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EXHIBIT 10.4
AMENDMENT TO PROJECT COMPLETION AGREEMENT
AMENDMENT (the "Amendment"), dated as of June 3, 1999, among CLOSED
JOINT- STOCK COMPANY "FOREST-STARMA", a joint stock company of the closed type,
organized and existing under the legislation of the Russian Federation (the
"Company"), THE PIONEER GROUP, INC., a corporation organized and existing under
the laws of the state of Delaware (the "U.S. Sponsor"), PIONEER FOREST, INC., a
corporation organized and existing under the laws of the state of Delaware and a
wholly owned subsidiary of the U.S. Sponsor (the "U.S. Subsidiary Sponsor"),
INTERNATIONAL JOINT-STOCK COMPANY "STARMA HOLDING", a closed joint stock
company, organized and existing under the legislation of the Russian Federation
(the "Russian Sponsor") and OVERSEAS PRIVATE INVESTMENT CORPORATION, an agency
of the United States of America ("OPIC").
WITNESSETH:
WHEREAS, the Company, the U.S. Sponsor, the Russian Sponsor and OPIC
are parties to a Project Completion Agreement dated as December 21, 1995 (the
"Project Completion Agreement");
WHEREAS, all capitalized terms used herein and not otherwise defined
herein shall have their respective meanings set forth in the Finance Agreement
dated December 21, 1995, as amended, between the Company and OPIC or in the
Project Completion Agreement;
WHEREAS, as a result of the Recapitalization, the U.S. Subsidiary
Sponsor now owns 97% of the shares of capital stock of the Company and the
Russian Sponsor no longer holds any capital stock of the Company; and
WHEREAS, the parties wish to substitute the U.S. Subsidiary Sponsor for
the Russian Sponsor, as a party to and under the terms of, the Project
Completion Agreement.
NOW, THEREFORE, the parties agree as follows:
1. AMENDMENTS.
(a) The U.S. Subsidiary Sponsor is hereby substituted for
the Russian Sponsor as a party to the Project Completion
Agreement and the words "U.S.Subsidiary Sponsor" are
hereby subsituted for the words "Russian Sponsor" in
each instance in the definition of Sponsors in Section
1(b) of the Project Completion Agreement. The U.S.
Sponsor shall remain a party to the Project Completion
Agreement and its obligations thereunder shall not be
affected by such substitution.
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(b) Section 24 of the Project Completion Agreement is hereby
amended by the addition of the following paragraph:
"Notwithstanding the foregoing, the U.S. Sponsor
hereby indemnifies and holds harmless the
Indemnified Persons from and against any and all
losses, liabilities, obligations, damages,
penalties, actions, judgments, suits, costs,
expenses, or disbursements of any kind or nature
whatsoever (Losses) that may be imposed on,
incurred by, or asserted against any Indemnified
Person in any way relating to the Contract of
Pledge of Shares between the U.S. Subsidiary
Sponsor and OPIC on the Recapitalization, if such
Losses would not have occurred had the U.S. Sponsor
and the Russian Sponsor not transferred their
shares of the Company, directly or indirectly, to
the U.S. Subsidiary Sponsor in connection with the
Recapitalization. In particular, but without
limitation, this indemnity extends to any Losses
incurred by an Indemnified Person as a result of
the bankruptcy of the U.S. Subsidiary Sponsor or
due to the existence of any contract for pledge of
shares in the Company which the U.S. Subsidiary
Sponsor may have entered into, and having priority
to, the contract for the Pledge of Shares with
OPIC."
2. REPRESENTATIONS AND WARRANTIES.
(a) Each of the Company, the U.S. Sponsor, the U.S.
Subsidiary Sponsor and the Russian Sponsor represents
and warrants to OPIC that this Amendment consititutes a
legal, valid and binding obligation of it, enforceable
against it in accordance with its terms. (b) Each of the
U.S. Sponsor and the U.S. Subsidiary Sponsor represents
and warrants to OPIC, jointly and severally that: (i) As
of the effective date hereof the U.S. Subsidiary Sponsor
owns of record and beneficially, and the U.S. Sponsor
owns beneficially, 97% of the issued and outstanding
shares of capital stock of the Company, and the U.S.
Sponsor owns of record and beneficially all of the
issued and outstanding shares of capital stock of the
U.S. Subsidiary Sponsor; (ii) As of the date hereof each
of the representation and warranties of the Sponsors in
paragraphs (b) through (j) of Section 8.A of the Project
Completion Agreement are true and accurate.
3. UNDERTAKING OF U.S. SUBSIDIARY SPONSOR. The U.S. Subsidiary
Sponsor hereby agrees to be bound by the terms of Project
Completion Agreement as amended by this Amendment and to
appoint an agent for service of process satisfactory to OPIC
in compliance with Section 14(b) of the Project Completion
Agreement and give written notice thereof to OPIC within 30
days after the date hereof. Notices to the U.S. Subsidiary
Sponsor pursuant to
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Section 18 of the Project Completion Agreement may be given
to it at the following address:
00 Xxxxx Xxxxxx
Xxxxxx, XX 00000
Tel: 000-000-0000
Fax: 000-000-0000
4. RATIFICATION AND CONFIRMATION. As amended hereby, all the
terms and provisions of the Project Completion Agreement are
hereby ratified and confirmed and shall apply in full force
and effect.
5. EFFECTIVE DATE. This Amendment shall be effective as of the
date hereof.
6. COUNTERPARTS. This Amendment may be executed in counterparts,
each of which when so executed and delivered shall be deemed
an original and all of which shall constitute one and the same
instrument.
IN WITNESS whereof, the parties hereto have caused this Amendment to be
executed by their authorized representatives as of the day and year first
above written.
CLOSED JOINT-STOCK COMPANY "FOREST-STARMA"
By: /s/ Xxxxxx X. Xxxxxx
Its: Authorized Officer
By: /s/ Xxxxxxxxx X. Xxxxxxx
Its: Authorized Officer
By: /s/ Xxxx Xxxxxxx
Its: Chief Accountant
THE PIONEER GROUP, INC.
By: /s/ Xxxx X. Xxxxxxx
Its: Executive Vice President, CFO and Treasurer
PIONEER FOREST, INC.
By: /s/ Xxxxxxx X. Xxxxxx
Its: President
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INTERNATIONAL JOINT-STOCK COMPANY "STARMA HOLDING"
By: /s/ Xxxxxx X. Xxxxxx
Its: Authorized Officer
By: /s/ Xxxx Xxxxxxx
Its: Chief Accountant
OVERSEAS PRIVATE INVESTMENT CORPORATION
By: /s/ Xxxxxx X. Xxxxx
Its: Investment Officer
