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EXHIBIT J
DATED MAY 30, 2001
ECO TELECOM LIMITED
and
OPEN JOINT STOCK COMPANY "VIMPEL-COMMUNICATIONS"
and
CITIBANK, N.A.
(acting through its London Branch)
as Escrow Agent
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ESCROW AGREEMENT
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CONTENTS
1. INTERPRETATION......................................................... 1
2. APPOINTMENT OF ESCROW AGENT............................................ 3
3. THE ESCROW ACCOUNT AND THE VIP DOLLAR ACCOUNT.......................... 3
4. ESCROW AMOUNT.......................................................... 3
5. OPERATING PROCEDURES................................................... 3
6. ESCROW AGENT........................................................... 6
7. REPLACEMENT OF ESCROW AGENT............................................ 7
8. FEES AND EXPENSES...................................................... 8
9. NOTICES................................................................ 9
10. GENERAL................................................................ 10
11. TERMINATION............................................................ 12
12. EFFECTIVE DATE......................................................... 12
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THIS AGREEMENT is dated May 30, 2001
BETWEEN:
1. ECO TELECOM LIMITED a company organized and existing under the laws of
Gibraltar (the "INVESTOR");
2. CITIBANK, N.A., a commercial bank organized and existing under the laws of
the United States of America acting through its London Branch (the "ESCROW
AGENT"); and
3. OPEN JOINT STOCK COMPANY "VIMPEL-COMMUNICATIONS", an open joint stock
company organized and existing under the laws of the Russian Federation
("VIP" and, together with the Investor, the "TRANSACTION PARTIES," and the
Transaction Parties, together with the Escrow Agent, being the "PARTIES").
WHEREAS:
(A) Concurrently with the execution and delivery of this Agreement, the
Transaction Parties are entering into a series of agreements, pursuant
to which the Investor intends, among other things, to invest in VIP
(the transactions contemplated by such agreements being, collectively,
the "TRANSACTION");
(B) The Investor is a party to a primary agreement dated on or about the
date of this Agreement (the "VIP PRIMARY AGREEMENT"), pursuant to which
VIP has agreed to issue and sell, and the Investor has agreed to
subscribe for and purchase, 5,150,000 shares of VIP common stock ("VIP
STOCK") on the terms and subject to the conditions set forth therein;
(C) As part of the Transaction, at the Closing under and as defined in the
VIP Primary Agreement, the Investor is to pay XXX XXXXXXX XXX XXXXX
XXXXXXX XXXXXX XXXXXX DOLLARS (US$103,000,000) for the VIP Stock, of
which FIFTY MILLION UNITED STATES DOLLARS (US$50,000,000) (the "INITIAL
DEPOSIT AMOUNT") is to be deposited in escrow with the Escrow Agent for
disbursement in accordance with this Agreement; and
(D) To facilitate the Transaction, the Transaction Parties have requested
the Escrow Agent to open and operate an escrow account in accordance
with the terms of this Agreement.
NOW IT IS HEREBY AGREED as follows:
1. INTERPRETATION
(1) The definitions of the terms listed on SCHEDULE 8 may be found
at the location specified therein. In addition, the following
terms shall have the meanings specified below:
"ACCOUNT BANK" shall mean Citibank T/O (OOO), a commercial bank
organized and existing under the laws of the Russian Federation.
"ACCOUNT BANK AGREEMENT" shall mean the account bank and overdraft
agreement dated on or about the date of this Agreement entered into
among the Account Bank, the Transaction Parties and Closed Joint-Stock
Company "VimpelCom-Region".
"AUTHORISED REPRESENTATIVES" shall mean the persons set out in SCHEDULE
4, PART A, as amended pursuant to CLAUSE 5(4).
"BUSINESS DAY" means a day other than a Saturday, a Sunday, or any day
on which banks in any of London, England, Moscow, Russia, New York, USA
and Oslo, Norway are authorized or obliged to close.
"CALLBACK CONTACT" means:
(a) any Authorised Representative; and
(b) the persons set out in SCHEDULE 4, PART B, as amended
from time to time, pursuant to CLAUSE 5(4).
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"CERTIFICATE AND PAYMENT INSTRUCTION" means a certification by VIP to
the Escrow Agent substantially in the form of SCHEDULE 1 with the dates
appropriately completed.
"CLOSING DATE" shall mean the date notified as such in the Preliminary
Closing Notice which date shall be no later than the Latest Closing
Date and at least 5 (five) Business Days after the receipt by the
Escrow Agent from VIP of such Preliminary Closing Notice.
"ESCROW AMOUNT" means the Principal Amount and any Interest Due Amount.
"EXECUTION DATE" means such date as the VIP Primary Agreement and all
Principal Agreements, as defined therein, are duly executed and
delivered by each of the parties thereto.
"FINAL CLOSING NOTICE" means a notice from the Investor and VIP to the
Escrow Agent substantially in the form of SCHEDULE 6 with the dates
appropriately completed.
"INTEREST DUE AMOUNT" means any interest accrued on the Principal
Amount in accordance with the terms of this Agreement and not yet added
to the Principal Amount.
"INVESTOR REFUND ACCOUNT" shall mean the account specified as such in
SCHEDULE 5.1 hereto, as amended from time to time pursuant to CLAUSE
5(8).
"LATEST CLOSING DATE" means November 30, 2001 subject to (i) the Escrow
Agent not having received a Preliminary Closing Notice, Final Closing
Notice and Readiness Notice by the Latest Readiness Notice Time on such
date in accordance with the terms of this Agreement and (ii) the
Transaction Parties notifying the Escrow Agent in writing signed by the
Authorised Representatives of the Investor and VIP on November 30, 2001
promptly after the Latest Readiness Notice Time or at the latest by
4:00 p.m. (London time) on the first Business Day after November 30,
2001, that the Latest Closing Date shall be the sixth Business Day
after November 30, 2001, in which event the Latest Closing Date shall
be the sixth Business Day after November 30, 2001.
"LIBID" shall mean the rate certified by the Escrow Agent to be the
"Citibank Overnight LIBID Rate".
"MEETING DATE" means July 27, 2001.
"PRELIMINARY CLOSING NOTICE" means a notice from VIP to the Escrow
Agent substantially in the form of SCHEDULE 2 with the dates
appropriately completed.
"PRINCIPAL AMOUNT" means, at the date hereof, the Initial Deposit
Amount, and thereafter means the Initial Deposit Amount and any
interest capitalized and added to the Principal Amount, subject to any
payment thereof, in accordance with the terms of this Agreement.
"READINESS NOTICE" means a notice from the Account Bank to the Escrow
Agent substantially in the form of SCHEDULE 7 with the date
appropriately completed.
"RUBLES" means the lawful currency of the Russian Federation.
"TERMINATION NOTICE" means a notice from the Investor and VIP to the
Escrow Agent substantially in the form of SCHEDULE 3 with the date
appropriately completed.
"US$" means lawful currency of the United States of America.
"VIP DOLLAR ACCOUNT" shall mean the account specified as such in
SCHEDULE 5.2 hereto.
(2) Construction
The index to and headings in this Agreement are for convenience only
and should not be taken into account in construing this Agreement.
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2. APPOINTMENT OF ESCROW AGENT
The Transaction Parties hereby designate and appoint the Escrow Agent as
escrow agent and the Escrow Agent hereby accepts such designation and
appointment in accordance with the terms and conditions of this Agreement.
The term "Escrow Agent" shall include the Escrow Agent for the time being
and all its successors pursuant to the provisions of CLAUSE 7 (Replacement
of Escrow Agent).
3. THE ESCROW ACCOUNT AND THE VIP DOLLAR ACCOUNT
(1) The Investor has the following bank account in the name of and
for the benefit of the Investor with the Escrow Agent: Purchase
Account, designated account number 00000000 denominated in US$ (the
"ESCROW ACCOUNT").
(2) VIP has the VIP Dollar Account in the name of and for the
benefit of VIP with the Account Bank.
4. ESCROW AMOUNT
(1) The Escrow Agent hereby acknowledges and confirms to the
Transaction Parties that it has received cleared funds in the amount of
the Initial Deposit Amount from or for the benefit of the Investor and
that it has deposited such sum into the Escrow Account.
(2) The Principal Amount from time to time shall bear interest at
a per annum rate of interest of not less than LIBID minus 35 basis
points. Such interest shall begin to accrue on the date that cleared
funds representing the Initial Deposit Amount are received by the
Escrow Agent in connection herewith and shall accrue monthly, and such
interest shall be capitalized and added to the Principal Amount on the
first Business Day of the following calendar month or on such other
date determined in accordance with this Agreement, as applicable,
unless other terms are agreed to in accordance with CLAUSES 4(3) or
4(4).
(3) After the date hereof and until (but excluding) the Meeting
Date, the Investor may agree with the Escrow Agent to deposit the
Principal Amount into time deposit(s) with the Escrow Agent upon terms
agreed upon by the Investor and the Escrow Agent, provided that the end
of the term of such deposit(s) shall not occur after the day preceding
the Meeting Date.
(4) At any time after the Meeting Date, the Investor and VIP may
agree with the Escrow Agent to deposit the Principal Amount into time
deposit(s) with the Escrow Agent upon terms agreed upon by the
Investor, VIP and the Escrow Agent.
(5) Any interest rate agreed in accordance with CLAUSE 4(3) or
4(4) or determined in accordance with CLAUSE 4(2) (the "APPLICABLE
RATE") shall be net of all taxes due or withheld with respect thereto
and shall be calculated on the basis of a 360-day year, consisting of
12 months of 30 days each. All such accrued interest shall be credited
to the Escrow Account.
5. OPERATING PROCEDURES
(1) The Escrow Agent shall act as custodian of the Escrow Amount
and shall disburse the same in accordance with the terms of this
Agreement; provided, that notwithstanding anything to the contrary in
this Agreement, the Escrow Account may not go into overdraft.
(2) The Transaction Parties hereby instruct the Escrow Agent to
release the Escrow Amount or the relevant portion thereof from the
Escrow Account as follows:
(i) NO SHAREHOLDERS' APPROVAL. Subject to CLAUSE 5(3), if
the Escrow Agent shall not have received from VIP within five (5)
Business Days after the Meeting Date (the fifth Business Day after the
Meeting Date being the "LATEST APPROVAL NOTICE DATE"), a duly executed
Certificate and Payment Instruction substantially in the form of
SCHEDULE 1 hereto, signed by VIP, then the Escrow Agent is instructed
to pay to the Investor by wire transfer of immediately available funds
to the Investor Refund Account, (i) no later than the second Business
Day after the Latest Approval Notice Date, the Principal Amount and
(ii) no later than the fifth Business Day after the Latest Approval
Notice Date, the Interest Due Amount to but excluding the date of
payment of the Principal Amount.
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The Escrow Agent shall confirm in writing to the Investor and VIP that
it has effected the transfers to be made in accordance with this CLAUSE
5(2)(i) promptly after having executed each such transfer.
(ii) SHAREHOLDERS' APPROVAL. Subject to CLAUSE 5(3), if,
on or before the close of business on August 3, 2001, the Escrow Agent
shall have received a duly executed Certificate and Payment Instruction
substantially in the form of SCHEDULE 1 hereto, signed by VIP, then the
Escrow Agent is instructed to pay to the Investor by wire transfer of
immediately available funds to the Investor Refund Account, no later
than the fifth Business Day after receipt of such notice, the amount
representing interest accrued on the Principal Amount at the Applicable
Rate from the date cleared funds in the amount of the Initial Deposit
Amount are credited to the Escrow Account to (but excluding) the
Meeting Date. The Escrow Agent shall confirm in writing to the Investor
and VIP that it has effected the transfer to be made in accordance with
this CLAUSE 5(2)(II) promptly after having executed such transfer.
(iii) CLOSING. Subject to CLAUSES 5(3), 5(5) and 5(6), upon
receipt by the Escrow Agent of all of the following:
(a) no later than the fifth Business Day prior to the
Latest Closing Date, a duly executed Preliminary
Closing Notice substantially in the form of SCHEDULE
2 signed by VIP;
(b) no later than the Latest Closing Date, a duly
executed Final Closing Notice substantially in the
form of SCHEDULE 6 signed by VIP and the Investor;
and
(c) no later than the Latest Closing Date, a duly
executed Readiness Notice substantially in the form
of SCHEDULE 7 signed by the Account Bank;
the Escrow Agent is instructed to:
(aa) transfer on the Closing Date from the Escrow
Account to the VIP Dollar Account with details of
payment as specified in the Preliminary Closing
Notice, by wire transfer of immediately available
funds, the Initial Deposit Amount;
(bb) transfer on the Closing Date from the Escrow
Account to the Investor Refund Account, by wire
transfer of immediately available funds, the amount
representing the difference between the Principal
Amount on the Closing Date and the Initial Deposit
Amount; and
(cc) transfer from the Escrow Account to the Investor
no later than the fifth Business Day after the
Closing Date, by wire transfer of immediately
available funds to the Investor Refund Account the
Interest Due Amount to but excluding the Closing
Date.
The Escrow Agent shall (x) by the close of business (London time) on
the Business Day preceding the Closing Date, notify the Account Bank
and the Transaction Parties that, subject to receipt of a Final Closing
Notice and a Readiness Notice, the transfer of the Initial Deposit
Amount to the VIP Dollar Account will be effected by the Escrow Agent
on the Closing Date (such notice being an "ESCROW AGENT FUNDING
NOTICE"), and (y) subject to the other provisions of this CLAUSE
5(2)(III), promptly confirm in writing to VIP and the Investor on the
Closing Date that the Escrow Agent has effected the transfers to be
made in accordance with this CLAUSE 5(2)(III) promptly after having
executed each such transfer.
(iv) TERMINATION (AGREEMENT OF THE PARTIES). Subject to
CLAUSE 5(3), upon the receipt by the Escrow Agent of a duly executed
Termination Notice substantially in the form of SCHEDULE 3 hereto
signed by VIP and the Investor (the date of such receipt being the
"TERMINATION DATE"), the Escrow Agent is instructed to transfer to the
Investor by wire transfer of immediately available funds to the
Investor Refund Account (i) no later than the second Business Day
immediately following the Termination Date, the Principal Amount and
(ii) no later than the fifth Business Day immediately following such
payment of the Principal Amount, the Interest Due Amount to but
excluding the date of such payment of the Principal Amount. The Escrow
Agent shall confirm in writing to the Investor and VIP that it has
effected each transfer to be made in accordance with this CLAUSE
5(2)(iv) promptly after having executed each such transfer.
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(v) TERMINATION (LATEST CLOSING DATE). Subject to CLAUSE
5(2)(ii) and CLAUSE 5(3), if immediately after the Latest Readiness
Notice Time (as defined below), the Escrow Agent has not received a
duly executed Preliminary Closing Notice, Final Closing Notice and
Readiness Notice in each case signed by the relevant party or parties,
then the Escrow Agent is instructed to transfer to the Investor by wire
transfer of immediately available funds to the Investor Refund Account
(i) on and not before the fifth Business Day immediately following the
Latest Closing Date, the Principal Amount and (ii) no later than the
fifth Business Day immediately following such payment of the Principal
Amount, the Interest Due Amount to but excluding the date of such
payment of the Principal Amount. The Escrow Agent shall confirm in
writing to the Investor and VIP that it has effected each transfer to
be made in accordance with this CLAUSE 5(2)(V) promptly after having
executed each such transfer.
(3)
(i) Upon the Escrow Agent's receipt in accordance with
CLAUSE 9 of a notice from any Transaction Party, executed by a
person purporting to be an executive officer or director of
such Transaction Party, that any dispute, controversy or claim
in connection with the transactions contemplated by this
Agreement has been submitted to arbitration in accordance with
CLAUSE 10(5) of this Agreement (an "ARBITRATION NOTICE"), the
Escrow Agent shall continue to hold any sums in the Escrow
Account (and shall continue to credit interest to the Escrow
Account in accordance with CLAUSE 4 of this Agreement) until
authorized to release such funds in accordance with this
CLAUSE 5(3).
(ii) Notwithstanding anything to the contrary in this
Agreement, forthwith upon receipt by the Escrow Agent of an
order, judgment, award or decree ordering the release of the
Escrow Amount, the sum on deposit in the Escrow Account, or
any portion of either thereof (a "RELEASE ORDER"), accompanied
by a legal opinion satisfactory to the Escrow Agent given by
counsel for the party requesting such release (a "LEGAL
OPINION," and, together with the Release Order, a "FINAL
ADJUDICATION NOTICE") to the effect that such order, judgment
or decree represents a final adjudication of the rights of the
Parties by a court or arbitral tribunal of competent
jurisdiction, and that the time for appeal from such order,
judgment, award or decree has expired without an appeal having
been made, the Escrow Agent shall release the Escrow Amount in
accordance with the Release Order.
(4) Each of the Transaction Parties undertakes to give the Escrow
Agent five (5) Business Days' notice in writing of any amendment to its
Authorised Representatives or Callback Contacts, as specified in
SCHEDULE 4, PART A or PART B, as applicable. Any amendment of the
Authorised Representatives or Callback Contacts of any Transaction
Party shall take effect upon the expiry of such five (5) Business Days'
notice.
(5) Any Preliminary Closing Notice delivered to the Escrow Agent
pursuant to CLAUSE 5(2)(iii) shall be void and without effect and this
Agreement shall remain in effect and the Escrow Agent shall continue to
hold and disburse the Escrow Amount in accordance with this Agreement
as if such Preliminary Closing Notice had not been so delivered to the
Escrow Agent, unless, on or before the Latest Readiness Notice Time,
the Escrow Agent shall have received (i) a duly executed Final Closing
Notice signed by the Investor and VIP and (ii) a duly executed
Readiness Notice signed by the Account Bank. As used in this Agreement,
"LATEST READINESS NOTICE TIME" means 7:00 a.m. (London time) on the
Closing Date or such later time, not later than 7:45 a.m. (London time)
on the Closing Date, as the Account Bank may, in its sole discretion,
have determined in accordance with the Account Bank Agreement that it
is willing to accept a duly executed Final Closing Notice, the Account
Bank in such case shall have consulted with and informed the Escrow
Agent of such decision before 7:00 a.m. (London time) on the Closing
Date, such determination to be conclusively evidenced by the delivery
by the Account Bank to the Escrow Agent by 7:45 a.m. (London time) on
the Closing Date of a duly executed Readiness Notice. For the avoidance
of doubt, the Escrow Agent shall be fully protected and indemnified in
accordance with the terms of this Agreement, in transferring the
Initial Deposit Amount to the VIP Dollar Account and transferring the
amount representing the difference between the Principal Amount on the
Closing Date and the Initial Deposit Amount to the Investor Refund
Account on the Closing Date upon receipt by the Latest Readiness Notice
Time of a duly executed Final Closing Notice signed by the Investor and
VIP and a duly executed Readiness Notice signed by the Account Bank
and, subject to CLAUSE 5(3), in transferring the Interest Due Amount to
but excluding the Closing Date to the Investor Refund Account no later
than the fifth Business Day after the Closing Date.
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(6) The Escrow Agent shall not initiate the transfer of funds from
the Escrow Account as stipulated in CLAUSE 5(2)(iii) unless it has
received:
(i) the Preliminary Closing Notice;
(ii) the Final Closing Notice; and
(iii) the Readiness Notice.
(7) If, after the Escrow Agent transfers the Initial Deposit
Amount to the Account Bank in accordance with CLAUSES 5(2)(iii) and
5(6), the Account Bank returns the Initial Deposit Amount to the Escrow
Agent and notifies the Escrow Agent that such sum is being returned
because of a "Completion Difficulty" in accordance with the Account
Bank Agreement, then the Escrow Agent shall deposit such sum in the
Escrow Account and this Agreement shall remain in effect and the Escrow
Agent shall hold and disburse the Escrow Amount in accordance with this
Agreement as if any Preliminary Closing Notice, Final Closing Notice
and Readiness Notice delivered to the Escrow Agent in accordance with
this Agreement had not been so delivered to the Escrow Agent.
(8) The Investor may amend SCHEDULE 5.1 hereto from time to time
by delivering an amended SCHEDULE 5.1 to the other Parties in
accordance with CLAUSE 9, which amendment shall state expressly that
such amended SCHEDULE 5.1 is to replace the SCHEDULE 5.1 hereto (or any
prior amendment to SCHEDULE 5.1 delivered in accordance with this
CLAUSE 5(8)) and shall be signed by an Authorised Representative of the
Investor. No such amendment will take effect until five (5) Business
Days after the amended SCHEDULE 5.1 is received by the Parties in
accordance with this CLAUSE 5(8).
6. ESCROW AGENT
It is further agreed that:
(1) the Escrow Agent shall be obliged to exercise the same degree
of care with respect to the Escrow Amount that it exercises with
respect to its own property;
(2) this Agreement expressly sets forth all the duties and
obligations of the Escrow Agent. The Escrow Agent shall not be bound by
the provisions of any other agreement between or among any of the
Transaction Parties except this Agreement and the instructions
delivered in accordance herewith and no implied duties or obligations
of the Escrow Agent shall be read into this Agreement;
(3) the Escrow Agent shall not be liable to any person or entity
for any loss, liability, claim, action, damages or expenses arising out
of or in connection with its performance of or its failure to perform
any of its obligations under this Agreement, provided the Escrow Agent
has exercised the standard of care described in CLAUSE 6(1) above, and
provided, however, that notwithstanding any other provision in this
Agreement, the Escrow Agent shall be liable for its own gross
negligence or wilful misconduct (except for consequential losses or
special damages of any kind whatsoever, in each case however caused and
whether or not foreseen). The liability of the Escrow Agent hereunder
shall be limited to an amount equal to the Escrow Amount;
(4) except with respect to Pre-Signing Legal Fees, for which VIP
is solely responsible pursuant to CLAUSE 8.1, the Transaction Parties
shall jointly and severally indemnify and hold harmless the Escrow
Agent from and against any and all losses, liabilities, claims,
actions, damages and expenses (including but not limited to reasonable
lawyers' fees and disbursements) arising out of or in connection with
this Agreement, save as are caused by its own gross negligence or
wilful misconduct (all sums payable pursuant to this CLAUSE 6(4) being
"REIMBURSABLE ITEMS");
(5) the Escrow Agent shall not be obliged to make any payment or
otherwise to act on any Certificate and Payment Instruction,
Preliminary Closing Notice, Final Closing Notice, Termination Notice,
or other request or instruction notified to it under this Agreement if
it is unable:
(i) to verify any signature on the notice, request, or
instruction against the specimen signature provided
for the relevant Authorised Representative hereunder;
and
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(ii) (in the case of any such notice received by fax) to
validate the authenticity of the request by
telephoning a Callback Contact for the relevant
Party.
(6) the Escrow Agent shall be entitled to rely upon any order,
judgment, certification, demand, notice, or other written instrument
delivered to it hereunder without being required to determine the
authenticity or the correctness of any fact stated therein or validity
or the service thereof. The Escrow Agent may act in reliance upon any
instrument or signature believed by it to be genuine and may assume
that any person purporting to give receipt or advice or make any
statement or execute any document in connection with the provisions
hereof has been duly authorised to do so;
(7) the Escrow Agent may consult lawyers over any question as to
the provisions of this Agreement or its duties hereunder. The Escrow
Agent may act pursuant to the advice of lawyers or other professional
advisers with respect to any matter relating to this Agreement and
shall not be liable for any action taken or omitted in accordance with
such advice;
(8) the Escrow Agent does not have any interest in the Escrow
Amount deposited hereunder but is serving as custodian only. Without
limiting the generality of the foregoing sentence of this CLAUSE 6(8),
none of the sums on deposit in the Escrow Account shall be used by, or
available to the Escrow Agent to set off any obligations of the
Investor or any of the other Transaction Parties owing to the Escrow
Agent in any capacity. The Escrow Amount shall not be subject to any
lien or attachment by any creditor of any party (other than those
arising by operation of law) and the Escrow Amount shall be used solely
for the purpose set forth in this Agreement. The obligation of the
Escrow Agent to disburse the Escrow Amount in accordance with the terms
of this Agreement constitutes an independent and separate obligation of
the Escrow Agent, and the Escrow Agent shall not under any
circumstances whatsoever deduct from or otherwise offset against such
amounts any amounts owed, or alleged to be owed, by a Transaction Party
to the Escrow Agent or any other party under or in connection with this
Agreement or any other agreement, or any claim, obligation or other
liability of any nature whatsoever incurred or alleged to have been
incurred by a Transaction Party under or in connection with any such
agreement or any other matter whatsoever. This CLAUSE 6(8), CLAUSE 6(3)
and CLAUSE 6(4), above, shall survive notwithstanding any termination
of this Agreement or the resignation or replacement of the Escrow
Agent;
(9) the Escrow Agent shall have no responsibility for the contents
of any ruling of the arbitrators or any third party contemplated in any
other document between or among any of the Transaction Parties as a
means to resolve disputes and may rely without any liability upon the
contents thereof;
(10) in the event of any disagreement between or among the
Transaction Parties resulting in an Arbitration Notice being delivered
to the Escrow Agent in accordance with CLAUSE 5(3), or in the event
that the Escrow Agent in good faith is in doubt as to its duties and
rights hereunder, the Escrow Agent shall be entitled to refrain from
taking any action in that instance and its sole obligation, in addition
to those duties hereunder as to which there is no such uncertainty
(including the crediting of accrued interest to the Escrow Account in
accordance with CLAUSE 4(2) hereto), shall be to safely keep all
property held in the Escrow Account until it shall be required to
release it in accordance with CLAUSE 5(3) or as directed in writing
jointly by the Transaction Parties; and
(11) The Escrow Agent shall not be required to make any
disbursement under this Agreement to the extent that the funds
available for such purpose under this Agreement are insufficient.
7. REPLACEMENT OF ESCROW AGENT
(1) The Transaction Parties, acting together, may at any time
replace the Escrow Agent by delivering to the Escrow Agent written
notice signed by each Transaction Party to such effect; such notice to
include the removal date and the details of a successor escrow agent.
Within thirty (30) calendar days of receipt of such notice and details,
the Escrow Agent shall execute and deliver such documents and take such
action as may be reasonably necessary, in its opinion, to transfer to
the successor escrow agent the Escrow Amount together with such records
maintained by the Escrow Agent in connection with its duties hereunder
and other information with respect to the Escrow Amount as such
successor may reasonably request (provided such information is not of a
commercially sensitive nature). The successor escrow agent named in the
notice and details shall be an internationally recognized bank which is
not affiliated with any Transaction Party.
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(2) The Escrow Agent may at any time and for any reason resign by
giving written notice to such effect to the Transaction Parties.
(3) Such resignation or removal of the Escrow Agent will take
effect on the earlier of:
(a) the appointment of a successor escrow agent
designated by the Transaction Parties in writing pursuant to
this CLAUSE 7 or by order of a court or arbitral tribunal of
competent jurisdiction and the acceptance of such successor of
such appointment; or
(b) if no successor escrow agent shall have been
appointed and/or the successor escrow agent shall not have
accepted such appointment (i) in the case of resignation,
thirty (30) calendar days after the date of delivery of the
Escrow Agent's written notice of resignation to the
Transaction Parties, or (ii) in the case of removal, upon
confirmation by the Transaction Parties to the Escrow Agent of
the appointment of an internationally recognised bank which is
not affiliated with any Transaction Party to be the successor
escrow agent, the acceptance by such bank of such appointment,
and confirmation by the Account Bank in accordance with CLAUSE
7(5).
If 30 days after (i) in the case of resignation, delivery of
the notice of resignation of the Escrow Agent or (ii) in the
case of removal, the date designated for the Escrow Agent's
removal, a successor escrow agent has not been appointed in
accordance with the terms hereof, the Escrow Agent's sole
responsibility shall be to safekeep the Escrow Amount until
receipt of (w) notice of such an appointment, (x) a
Certificate and Payment Instruction, Preliminary Closing
Notice, Final Closing Notice and Readiness Notice or (y) a
Termination Notice in accordance with the terms hereunder or
(z) a Final Adjudication Notice in accordance with CLAUSE 5(3)
hereof.
(4) Notwithstanding the foregoing, no resignation or removal of
the Escrow Agent shall be effective until a successor escrow agent has
acknowledged its appointment as such is provided in this CLAUSE 7
hereof.
(5) The Transaction Parties shall ensure that the appointment of a
successor escrow agent is made on the terms of this Agreement and the
Transaction Parties shall ensure such appointment shall be binding on
all of the Parties. The appointment of a successor escrow agent shall
be subject to confirmation by the Account Bank that such appointment
will not prevent timely performance by the Account Bank of its
obligations under the Account Bank Agreement or any amendment thereto.
(6) Upon written acknowledgement by a successor escrow agent
appointed in accordance with this CLAUSE 7 of its agreement to serve as
escrow agent hereunder and the receipt of property then comprising the
Escrow Amount, the Escrow Agent shall be fully released and relieved of
all duties, responsibilities and obligations under this Agreement,
subject to such liability as the Escrow Agent may have under CLAUSE
6(3) for any gross negligence or wilful misconduct prior thereto, and
such successor escrow agent shall for all purposes hereof be the Escrow
Agent.
8. FEES AND EXPENSES
(1) In consideration of the performance of its role under this
Agreement, VIP shall pay to the Escrow Agent:
(i) an acceptance fee of US$5,000 (the "ACCEPTANCE FEE");
(ii) an administration fee of US$10,000 (the
"ADMINISTRATION FEE"); and
(iii) legal fees and all out of pocket expenses incurred by
the Escrow Agent in connection with the negotiation and
preparation of this Agreement (the "PRE-SIGNING LEGAL FEES");
in each case, payable on the date of this Agreement and otherwise in
accordance with the letter agreement dated as of 22 March 2001 between
the Escrow Agent and VIP, without regard to the "Assumptions" set forth
therein.
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(2) As between the Transaction Parties and without prejudice to
CLAUSE 8(1), the Investor shall reimburse VIP for one-half of the
Acceptance Fee and one-half of the Administration Fee on the date of
this Agreement, but shall have no liability for any Pre-Signing Legal
Fees.
(3) All amounts of whatever nature payable to, and recoverable by,
the Escrow Agent pursuant to the terms of this Agreement shall be
payable, without set-off or counterclaim, by the Transaction Parties,
as applicable, on the earlier of the date specified in this Agreement
and thirty (30) Business Days following the receipt of any invoice from
the Escrow Agent, which invoice shall be delivered to VIP and the
Investor in accordance with CLAUSE 9 hereof.
(4) Without prejudice to CLAUSE 6(4), the Transaction Parties
agree among themselves that any liability for Reimbursable Items shall
be allocated between themselves as follows:
(i) if a Reimbursable Item is not incurred in connection with an
arbitration proceeding or other claim under this Agreement
which results in an arbitrators' award or final judgment, then
the Transaction Parties shall share liability for such
Reimbursable Item equally;
(ii) if a Reimbursable Item is incurred in connection with an
arbitration proceeding or other claim under this Agreement
which results in an arbitrators' award or final judgment, then
liability for such Reimbursable Item shall be allocated
between the Transaction Parties (a) in accordance with such
arbitrators' award or final judgment, if liability for the
Reimbursable Item is expressly addressed therein, (b) pro-rata
in accordance with the liability assessed against the
respective Transaction Parties, if liability for the
Reimbursable Item is not expressly addressed therein and
either or both of the Transaction Parties is held to have any
liability for any matter thereunder, or (c) evenly if neither
Transaction Party is held to have any liability; provided,
that notwithstanding the preceding clauses (a), (b) and (c),
to the extent that the Reimbursable Item consists of
reimbursing the Escrow Agent for damages payable to a
Transaction Party (the "DAMAGED TRANSACTION PARTY") as a
consequence of the Escrow Agent making a disbursement of funds
to the other Transaction Party, such other Transaction Party
shall be liable for such Reimbursable Item; and
(iii) to the extent that either Transaction Party (the "OVERPAYING
TRANSACTION PARTY") has paid more than its share of a
Reimbursable Item to the Escrow Agent in accordance with
CLAUSE 6(4), the other Transaction Party shall, so long as the
liability under CLAUSE 6(4) has been fully and finally
discharged, forthwith on demand of the Overpaying Transaction
Party, reimburse the Overpaying Transaction Party such amount
as shall be necessary for each of the Transaction Parties to
have borne the cost of such Reimbursable Item in accordance
with their liability, as between the Transaction Parties,
determined in accordance with this CLAUSE 8.4.
9. NOTICES
All communications required pursuant to this Agreement shall be
addressed to the respective party as follows:
(1) If to the Investor, to:
Eco Telecom Limited
Xxxxx 0, 0 Xxxxx Xxxxx
Xxxxxxxxx
Xxxxxxxxx: Xxxxx Xxxx
Facsimile: x000-00000
with a copy to:
OOO Alfa-Eco
21, Novy Arbat
121019 Moscow
Russian Federation
Attention: Stanislav Shekshnya
Fax: x0 000 000 0000
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and a copy to:
Xxxxxxx Xxxxx CIS Legal Services
00, Xxxxxxxxxxxx Xxxxxxxx
000000 Xxxxxx
Russian Federation
Attention: Xxxxxxxx Xxxxxxx
Fax: x0 000 000 0000
(2) If to the Escrow Agent, to:
Citibank, N.A.
Xxxxxxx Xxxxxx
Xxx'x Xxxx
Xxxxxx XX0 0XX
Attention: Xxxx Xxxxxx/Xxxx X'Xxxx
Fax: (x00 00) 0000 0000/2931
(3) If to VIP, to:
OJSC "Vimpel-Communications"
10 Xxxxxx 0-Xxxxx, Xxxxxxxx 00
Xxxxxx, Xxxxxxx Xxxxxxxxxx 000000
Attention: Xx Xxxxxx
Fax: x0 000 000 0000
with a copy to:
Akin, Gump, Strauss, Xxxxx & Xxxx, L.L.P.
0 Xxxxxxx Xxxxxx, Xxxxx Xxxxx XX
Xxxxxx 000000, Russian Federation
Attention: Xxxxxxx X. Xxxxxxxx
Fax: x0 000 000 0000
(4) If to the Account Bank, to:
Citbank T/O (OOO)
0-00 Xxxxxxx Xx.
000000 Xxxxxx, Russian Federation
Attention: Xxxxxx Xxxxxx
Fax: x0 000 000 0000
All such notices, requests and other communications will (a) if
delivered personally to the address provided in this CLAUSE 9, be
deemed given upon delivery, (b) if delivered by facsimile transmission
to the facsimile number provided in this Clause 9, be deemed given upon
printed electronic confirmation of receipt, and (c) if delivered by
courier to the address provided in this CLAUSE 9, be deemed given upon
receipt (in each case regardless of whether such notice, request or
other communication is received by any other person to whom a copy of
such notice is to be delivered pursuant to this CLAUSE 9). Any Party
from time to time may change its address, facsimile number or other
information for the purpose of notices hereunder by giving notice of
such change to the other Parties.
10. GENERAL
(1) This Agreement shall be binding upon and inure solely for the
benefit of the Parties and their respective successors and assigns.
Unless otherwise expressly permitted by this Agreement, no Party
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may assign or otherwise transfer any of its rights, interests or
obligations under this Agreement without the prior written consent of
the other Parties.
(2) No Party shall be bound by any amendment or modification of
this Agreement, including the transfer of any interest hereunder,
unless such amendment or modification is in writing and signed by or on
behalf of each Party; provided, however, that the Parties shall be
bound by any amendment to SCHEDULE 4 or SCHEDULE 5.1 hereto effected in
accordance with the provisions of this Agreement.
(3) Terms of this Agreement may only be waived by written consent
signed by or on behalf of each Party. The waiver by any Party of a
breach of any provision of this Agreement shall not operate or be
construed as a waiver of any other provision and any extension of time
for the performance of any obligation shall not be deemed to be an
extension of time for the performance of any other obligation.
(4) This Agreement and any dispute, controversy or claim arising
out of or relating to this Agreement shall be construed in accordance
with and governed by English law, without giving effect to any
conflicts of laws principles thereof which would result in the
application of laws of another jurisdiction.
(5) Arbitration; Consent to Jurisdiction; Service of Process;
Waiver of Sovereign Immunity
(a) Any and all disputes and controversies arising under,
relating to or in connection with this Agreement shall be
settled by arbitration by a panel of three (3) arbitrators
under the United Nations Commission on International Trade Law
(UNCITRAL) Arbitration Rules then in force (the "UNCITRAL
Rules") in accordance with the following terms and conditions:
(i) In the event of any conflict between the
UNCITRAL Rules and the provisions of this Agreement,
the provisions of this Agreement shall prevail.
(ii) The place of the arbitration shall be
Geneva, Switzerland.
(iii) Where there is only one claimant party and
one respondent party, each shall appoint one
arbitrator in accordance with the UNCITRAL Rules, and
the two arbitrators so appointed shall appoint the
third (and presiding) arbitrator in accordance with
the UNCITRAL Rules within thirty (30) days from the
appointment of the second arbitrator. In the event of
an inability to agree on a third arbitrator, the
appointing authority shall be the International Court
of Arbitration of the International Chamber of
Commerce, acting in accordance with such rules as it
may adopt for this purpose. Where there is more than
one claimant party, or more than one respondent
party, all claimants and/or all respondents shall
attempt to agree on their respective appointment(s).
In the event that all claimants and all respondents
cannot agree upon their respective appointment(s)
within thirty (30) Business Days of the date of the
notice of arbitration, all appointments shall be made
by the International Court of Arbitration of the
International Chamber of Commerce.
(iv) The English language shall be used as the
written and spoken language for the arbitration and
all matters connected to the arbitration.
(v) The arbitrators shall have the power to
grant any remedy or relief that they deem just and
equitable and that is in accordance with the terms of
this Agreement, including specific performance, and
including, but not limited to injunctive relief,
whether interim or final, and any such relief and any
interim, provisional or conservatory measure ordered
by the arbitrators may be specifically enforced by
any court of competent jurisdiction. Each Party
retains the right to seek interim, provisional or
conservatory measures from judicial authorities and
any such request shall not be deemed incompatible
with the agreement to arbitrate or a waiver of the
right to arbitrate.
(vi) The award of the arbitrators shall be final
and binding on the Parties .
(vii) The award of the arbitrators may be enforced
by any court of competent jurisdiction and may be
executed against the person and assets of the losing
party in any competent jurisdiction.
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(b) Except for arbitration proceedings pursuant to CLAUSE
10(5), no action, lawsuit or other proceeding (other than the
enforcement of an arbitration decision, an action to compel
arbitration or an application for interim, provisional or
conservatory measures in connection with the arbitration in
accordance with Clause 10(5)(a)(v)) shall be brought by or
between the Parties and/or any of their affiliates in
connection with any matter arising out of or in connection
with this Agreement.
(c) Each Transaction Party irrevocably appoints Law
Debenture Corporation, located on the date hereof at 0xx
Xxxxx, 000 Xxxx Xxxxxx, Xxxxxx, Xxxxxxx XX0X 0XX, as its true
and lawful agent and attorney to accept and acknowledge
service of any and all process against it in any action, suit
or proceeding permitted by CLAUSE 10(5), with the same effect
as if such Party were a resident of England and had been
lawfully served with such process in such jurisdiction, and
waives all claims of error by reason of such service, provided
that the Party effecting such service shall also deliver a
copy thereof to the other Parties at their addresses specified
in CLAUSE 9 hereof. Each Transaction Party will enter into
such agreements with such agent as may be necessary to
constitute and continue the appointment of such agent
hereunder. In the event that any such agent and attorney
resigns or otherwise becomes incapable of acting, the affected
Transaction Party will appoint a successor agent and attorney
in London reasonably satisfactory to each other Party, with
like powers.
(d) Each Party hereto hereby represents and acknowledges
that it is acting solely in its commercial capacity in
executing and delivering this Agreement and in performing its
obligations hereunder, and each such Party hereby irrevocably
waives with respect to all disputes, claims, controversies and
all other matters of any nature whatsoever that may arise
under or in connection with this Agreement and any other
document or instrument contemplated hereby, all immunity it
may otherwise have as a sovereign, quasi-sovereign or
state-owned entity (or similar entity) from any and all
proceedings (whether legal, equitable, arbitral,
administrative or otherwise), attachment of assets, and
enforceability of judicial or arbitral awards.
(6) If any provision in this Agreement or any other document
executed in connection herewith is or shall become invalid, illegal or
unenforceable in any jurisdiction, the invalidity, illegality or
unenforceability of such provision in such jurisdiction shall not
affect or impair the validity, legality or enforceability of (i) any
other provision of this Agreement or any such other document in such
jurisdiction or (ii) such provision or any other provision of this
Agreement or any such other document in any other jurisdiction.
(7) This Agreement may be executed in any number of counterparts,
each having the same effect as if the signatures on the counterparts
were on a single copy of this Agreement.
(8) A person who is not party to this Agreement may not enforce
its terms under the Contracts (Rights of Third Parties) Xxx 0000.
(9) Each of the Transaction Parties shall provide to the Escrow
Agent all instruments and documents within their respective powers to
provide that are necessary for the Escrow Agent to perform its duties
and responsibilities hereunder.
(10) Unless otherwise agreed in writing by the Transaction Parties,
the Escrow Agent shall not be entitled to appoint any sub-agents for
performance of any rights or obligations under this Agreement.
11. TERMINATION
This Agreement shall terminate and the Escrow Agent shall be discharged
from all duties and liabilities hereunder, only upon such date as the
Escrow Agent shall have distributed all of the Escrow Amount and all
sums on deposit in the Escrow Account in accordance with this
Agreement, without prejudice to the rights of the Parties accruing
hereunder during the term of this Agreement. CLAUSES 6, 8 and 10 of
this Agreement shall survive the termination of this Agreement.
12. EFFECTIVE DATE
This Agreement shall come into effect upon signing thereof.
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IN WITNESSETH WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first written above and shall be effective on the
Execution Date.
THE INVESTOR
ECO TELECOM LIMITED
By: /s/ Serge Barychkov
----------------------------------
Name: Serge Barychkov
Title: Attorney-in-Fact
VIP
OPEN JOINT STOCK COMPANY
"VIMPEL-COMMUNICATIONS"
By: /s/ Xxxxxx X. Xxxxx
----------------------------------
Name: Xxxxxx X. Xxxxx
Title: President
By: /s/ Xxxxxxxx X. Bychenkov
----------------------------------
Name: Xxxxxxxx X. Bychenkov
Title: Chief Accountant
THE ESCROW AGENT
CITIBANK, N.A.
ACTING THROUGH ITS LONDON BRANCH
By: /s/ Xxxx X'Xxxx
----------------------------------
Name: Xxxx X'Xxxx
Title: Assistant Vice President
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