1
Exhibit 10.62
INVESTMENT AGREEMENT
City of Moscow February 11, 1998
This Investment Agreement (hereinafter, "Agreement") is entered into by and
between:
AS EESTI FOREKSPANK, a credit institution organized under the laws of
Estonia (hereinafter, "Investor"), with its legal address at Narva
maantee 0X, Xxxxxxx, Xxxxxxx, represented by its Chairman of the
Board, Xxxx Xxxx, acting as a legal representative on the basis of
applicable law and its Charter; and
ZAO PIONEER BANK, a closed stock company organized under the laws of
the Russian Federation (hereinafter, "Bank"), with its legal address
at 2nd Krasnoprudny per., 7, Xxxxxx 000000, Russian Federation,
represented by Xxxxxxx Xxxxxxxxx, its Chairman, acting on the basis of
its Charter.
Investor and Bank are collectively referred to below as the "Parties", and each
of them is individually referred to below as a "Party".
RECITALS
The Parties hereby acknowledge that:
1. Investor wishes to subscribe for and purchase a new emission of the
common stock of Bank, equal to 35% of the total common stock of Bank
after the subscription;
2. Bank wishes to issue such new emission to Investor. Bank's General
Assembly of Shareholders has approved such emission and subscription
by Investor, and this Agreement, in Protocol No. 24, dated February 5,
1998; and
3. Prior to Investor's purchase of the shares, the Parties wish to
cooperate to obtain the necessary governmental and regulatory
approvals and complete certain legal procedures as described below.
NOW THEREFORE, the Parties have agreed as follows:
1. SUBJECT OF AGREEMENT
1.1 In accordance with this Agreement, Investor hereby agrees to subscribe for
and purchase from Bank, and Bank hereby agrees to issue and sell to
Investor, 80,769 common registered shares of Bank (the "Shares") in Bank's
sixth emission of shares,
2
which shall amount to 35% of the total number of common voting shares
issued by Bank after completion of such emission. Upon such purchase,
Investor shall own 35% of the total voting shares issued by Bank.
1.2 At the Closing (as defined in Article 3 below), the Parties shall execute a
separate Agreement on Purchase and Sale of Additional Shares (the
"Principal Contract") to document the issuance and sale of the Shares to
Investor.
1.3 The Principal Contract shall include the following terms, and such other
terms as may be required by law to implement the issuance and sale of the
Shares to Investor:
1.3.1 The number of Shares -- 80,769 shares.
1.3.2 The type of Shares -- common registered shares.
1.3.3 The form of Shares-- non-documentary.
1.3.4 The nominal value of a Share shall be one hundred (100) Russian
Rubles ("RUR"). (All Xxxxx amounts in this Agreement are set forth in
redenominated "new" Rubles. The Parties anticipate that Bank's
Charter will be amended accordingly.)
1.3.5 The price per share, and the aggregate price of all Shares to be sold
under the Principal Contract, shall be as stated in Article 1.4
below.
1.3.6 Settlements between the Parties shall be made in RUR in accordance
with the exchange rate established by the Central Bank of the Russian
Federation and effective on the date of payment.
1.4 The aggregate purchase price for the Shares shall be equal to the product
of 1.20 multiplied by the Final Adjusted Book Value (as defined below) per
common share of Bank, multiplied by the number of Shares purchased,
calculated in the manner and at the time hereinafter described (the
"Purchase Price").
1.4.1 The preliminary Purchase Price is US$5,085,862.39, based on the
adjusted book value of Bank as at November 30, 1997 ("Preliminary
Adjusted Book Value"), calculated in U.S. Dollars under United States
Generally Accepted Accounting Principles ("GAAP").
1.4.2 The final Purchase Price shall be calculated and agreed upon using
the Final Adjusted Book Value. "Final Adjusted Book Value" shall mean
Preliminary Adjusted Book Value adjusted for:
(a) changes during the period from November 30, 1997, through the
last day of the month immediately prior to the Closing (or such
other date as may be agreed by the Parties);
-2-
3
(b) resolution of any differences of opinion between the Parties
concerning any assets or liabilities of Bank; and
(c) any discrepancies due to technical differences between the
methodologies used by the Parties, Xxxxxx Xxxxxxxx and/or Price
Waterhouse pursuant to their activities under Article 1.4.3.
1.4.3 To determine Final Adjusted Book Value, prior to the Closing, Bank
shall cause its outside auditor, Xxxxxx Xxxxxxxx, to prepare an
analysis and calculate book value through the last day of the month
immediately prior to the Closing (or such other date as may be agreed
by the Parties) in U.S. Dollars under GAAP. Bank shall report the
results of such calculation to Investor, including the analysis of
Xxxxxx Xxxxxxxx, and any other data on which such results are based.
Such calculation shall be subject to review and reasonable approval
by Investor (who may be assisted for this purpose by Price
Waterhouse, which will conduct its review on the basis of
International Accounting Standards ("IAS")). If Investor does not
agree with Xxxxxx Xxxxxxxx'x calculation, then the Parties shall
discuss and endeavor in good faith to resolve any differences of
opinion.
1.5 In addition to paying the Purchase Price for the Shares, as a separate and
essential condition of the purchase, Investor shall be required to provide
certain license rights to software and management services to Bank, in a
manner to be agreed.
1.6 The other terms of such purchase, sale and issuance shall be as set forth
in this Agreement.
2. OBLIGATIONS OF THE PARTIES
2.1 Investor shall:
2.1.1 Subscribe for the Shares by executing the Principal Contract, and
such other documents as may be required by applicable Russian
legislation.
2.1.2 At the Closing, make payment for the Shares by paying the Purchase
Price to Bank in the manner required by applicable legislation.
2.1.3 Prior to the Closing, refrain from entertaining, soliciting, or
discussing with any prospective sellers, or agreeing to participate
in, any sale or offer to sell to Investor, directly or indirectly,
another Russian bank or any part thereof or interest therein.
-3-
4
2.2 Bank shall:
2.2.1 At the Closing, execute the Principal Contract, and in accordance
therewith issue and sell the Shares to Investor. Bank shall register
Investor in the share register of Bank as a shareholder, immediately
after Investor has duly paid the Purchase Price for the Shares. Bank
shall deliver to Investor an extract from the share register of Bank
immediately after the aforementioned registration, confirming the
transfer of ownership of and shareholder rights connected with the
Shares to Investor.
2.2.2 Prior to the Closing, refrain from:
(a) issuing any common or preferred shares, or securities convertible
into such shares, to any third party or parties, without the
prior written consent of Investor; or
(b) entertaining, soliciting, or discussing with any prospective
purchasers, or agreeing to participate in, any purchase or offer
to purchase, directly or indirectly, any shares of Bank.
2.2.3 Pay all Russian Federation taxes which may be assessed in connection
with Investor's purchase of the Shares under this Agreement,
including any securities taxes.
2.3 Both Parties shall:
2.3.1 Promptly upon execution of this Agreement, cooperate in good faith to
undertake all necessary steps to obtain the following approvals (the
"Approvals") for the transaction contemplated by this Agreement (the
"Transaction"):
(a) A decision of Investor's Supervisory Board of Directors,
approving this Agreement and Investor's performance of its
obligations hereunder;
(b) Approval of the State Anti-Monopoly Committee of the Russian
Federation;
(c) Approval of the Central Bank of Estonia;
(d) Approval of the Central Bank of the Russian Federation for
Investor's purchase of the Shares as contemplated by this
Agreement;
(e) Approval of the Central Bank of the Russian Federation for the
increase of share capital and adoption of a restated Charter of
Bank, as set forth in EXHIBIT 1 to this Agreement (with such
modifications to the text of the Charter as may be requested by
the Central Bank and agreed by the Parties); and
-4-
5
(f) Registration of an appropriate Emission Prospectus and the Shares
by the Central Bank of the Russian Federation.
2.3.2 Promptly upon execution of this Agreement, cooperate in good faith to
effect the re-registration of the Charter of Bank to permit the
issuance and sale of the Shares, and otherwise as needed to implement
the provisions of this Agreement.
3. CLOSING; CONDITIONS TO CLOSING
3.1 The funding of the purchase and sale of the Shares (the "Closing") shall
occur as follows.
3.2 Neither Party shall be obliged to complete the Closing until all of the
following conditions precedent have been satisfied (or waived by written
agreement, in the discretion of both Parties):
3.2.1 Both Parties shall have completed all due diligence regarding each
other and the Transaction, to their satisfaction, as described in
Article 4.
3.2.2 Both Parties shall have agreed on any adjustments to the Purchase
Price pursuant to Article 1.4.
3.2.3 All Approvals shall have been obtained and remain in effect.
3.2.4 There shall not have been a material, adverse change of circumstances
with respect to Bank and to which Investor objects; nor with respect
to Investor and to which Bank objects.
3.2.5 Investor shall have demonstrated to the satisfaction of Bank the
availability of funds necessary to pay the Purchase Price to Bank, in
a manner reasonably acceptable to Bank, not later than April 15,
1998.
3.2.6 Investor and Bank shall have agreed upon Bank's warranties pursuant
to Article 5.1 below, and any qualifications or modifications
thereto, or deletions therefrom.
3.3 At the Closing:
3.3.1 The Parties shall execute the Principal Contract as described in
Articles 2.1.1 and 2.2.1.
3.3.2 Investor shall pay the Purchase Price as described in Article 2.12.
3.3.3 Bank shall issue the Shares to Investor as described in
Article 2.2.1.
-5-
6
3.4 The Parties shall complete the Closing as promptly as possible, and in any
event within ten (10) business days after obtaining all of the Approvals.
3.5 If the Closing has not occurred by July 31, 1998, then this Agreement shall
terminate automatically pursuant to Article 6.2, unless the Parties have
first agreed in writing to extend such deadline.
4. DUE DILIGENCE
4.1 Each Party shall cooperate in good faith, and shall cause its respective
management, employees and key shareholders to cooperate in good faith, to
facilitate the other Party's due diligence efforts as described below.
4.2 Promptly upon obtaining all of the Approvals, each Party shall be
entitled to conduct due diligence regarding the other Party for the
following period of ten (10) business days. The purpose shall be for each
Party to determine whether there has been a material, adverse change of
circumstances with respect to the other Party (including, without
limitation, any legal proceedings or other events materially and adversely
affecting such Party's ability to perform its obligations under this
Agreement, or such Party's reputation) during the period between the date
of this Agreement and the date that all of the Approvals were obtained.
5. WARRANTIES OF PARTIES
5.1 Bank hereby makes the warranties set forth in Articles 5.1.1 through 5.1.11
below to Investor; SUBJECT, HOWEVER, to (a) information that Bank has
shared with Investor prior to the date of this Agreement, and (b) such
further qualifications, modifications and/or deletions regarding any matter
described in Articles 5.1.5 through 5.1.11 as Bank deems necessary and
shall have notified to Investor at least thirty (30) days prior to the
Closing.
5.1.1 Bank is a legal entity duly formed and legally existing under the
laws of the Russian Federation. Bank holds License No. 3108 for the
conduct of banking operations, issued by the Central Bank of the
Russian Federation on October 5, 1994.
5.1.2 The authorized capital stock of Bank consists of 610,000 shares of
common stock, 100 RUR par value; 150,000 of such shares are issued
and outstanding. There is no other capital stock authorized for
issuance, except as otherwise stated in this Agreement. No shares of
common stock are held in Bank treasury, and no shares are reserved
for issuance, nor are there outstanding any options, warrants,
convertible instruments or other rights, agreements or commitments
to acquire common stock of Bank, except for the rights of Investor
as set forth in this Agreement.
-6-
7
5.1.3 This Agreement has been duly and validly executed and delivered by
Bank and constitutes a valid and binding Agreement of Bank
enforceable in accordance with its terms. Bank's General Assembly of
Shareholders has approved the Transaction contemplated by this
Agreement in Protocol No. 24, dated February 5, 1998. Bank has all
requisite corporate power and authority to enter into this Agreement
and to carry out the Transaction contemplated hereby, and its doing
so has been duly and sufficiently authorized, subject only to the
Approvals.
5.1.4 The execution, delivery and performance of this Agreement, and the
performance by Bank of its obligations hereunder do not (1) conflict
with or result in a breach of any of the provisions of the Charter of
Bank; (2) contravene any law, ordinance, rule or regulation of the
Russian Federation or any order, writ, judgment, injunction, decree,
determination, or award of any court or other authority having
jurisdiction, or cause the suspension or revocation of any
authorization, consent, approval, or license, presently in effect,
which affects or binds, Bank, and will not have a material adverse
effect on the validity of this Agreement; (3) conflict with or result
in a material breach of or default under any material indenture or
loan or credit agreement or any other material agreement or
instrument to which Bank is a party; or (4) constitute grounds for
the loss or suspension of any material permits, licenses or other
authorizations used in the business of Bank.
5.1.5 Bank has no liabilities which are not adequately reflected or
reserved against on Bank's most recent balance sheet furnished to
Investor, except liabilities incurred since the date of such balance
sheet in the ordinary course of business. Without limiting the
foregoing, (a) there are no material unpaid leasehold improvements at
any of Bank's facilities or locations for which Bank is or will be
responsible, and Co) there are no material deferred rents due to
lessors at or with respect to any of such facilities or locations.
5.1.6 Since the date of Bank's most recent balance sheet furnished to
Investor, except in the ordinary course of business there has not
been (a) any material adverse change in the business, condition
(financial or otherwise), operations, or prospects of Bank; (b) any
material damage, destruction, or loss, whether covered by insurance
or not, having a material adverse effect on the business, condition
(financial or otherwise), operations, or prospects of Bank; (c) any
entry into or termination of any material commitment, contract,
agreement, or transaction (including, without limitation, any
material borrowing or capital expenditure or sale or other
disposition of any material asset or assets) of or involving Bank
other than this Agreement; (d) any redemption, repurchase, or other
acquisition for value of its capital stock by Bank, or any issuance
of capital stock of Bank or of securities convertible into or rights
to acquire any such capital stock or any dividend or distribution
declared, set aside, or paid on capital stock of Bank; (e) any
transfer of or right granted under any material lease, license,
agreement, patent, trademark, trade name, or copyright of Bank;
(f) any sale or other disposition of any material asset of Bank, or
any mortgage,
-7-
8
pledge, or imposition of any material lien or other encumbrance on
any asset of Bank, or any agreement relating to any of the
foregoing; or (g) any default or breach by Bank in any material
respect under any material contract, license or permit. Since the
date of such balance sheet, Bank has conducted its business in the
ordinary and usual course, and, without limiting the foregoing, no
material changes have been made in (a) executive compensation
levels, (b) the manner in which other employees of Bank are
compensated, or (c) supplemental benefits provided to any such
executives or other employees.
5.1.7 Bank has properly filed or caused to be filed all federal, local,
and foreign income and other tax returns, material reports and
declarations that are required by applicable law to be filed by it,
and has paid, or made full and adequate provision for the payment
of, all federal, local, and foreign income and other taxes properly
and finally due.
5.1.8 To the best knowledge of Bank, no material investigation or review
by any governmental entity with respect to Bank is pending or
threatened, nor has any governmental entity indicated in writing to
Bank an intention to conduct the same, and there is no material
action, suit, or proceeding pending or, to the best of the knowledge
of Bank, threatened against Bank.
5.1.9 There are no collective bargaining, bonus, profit sharing, special
compensation, or other trusts, funds, or special arrangements
maintained by Bank for the benefit of its directors, officers, or
employees, except for normal salary adjustments and bonuses
determined in the ordinary course of business.
5.1.10 Bank has good title, or effective and continuing leasehold rights in
the case of leased property, to all real property and all personal
property owned or leased by it or used by it in the conduct of its
business in such a manner as to create the appearance or reasonable
expectation that the same is owned or leased by it, free and clear
of all material liens, claims, encumbrances and charges which could
materially impair the use thereof.
5.1.11 Bank is in substantial compliance with all, and has received no
written notice of any substantial violation of any, laws or
regulations applicable to its operations.
5.2 Investor hereby warrants to Bank that:
5.2.1 Investor is a legal entity duly formed and legally existing under the
laws of Estonia.
5.2.2 This Agreement has been duly and validly executed and delivered by
Investor and constitutes a valid and binding agreement of Investor
enforceable in accordance with its terms. Investor's Supervisory
Board has authorized Investor to enter into the Transaction and this
Agreement by Resolution No. 4/97 on November 17, 1997. Investor has
all requisite corporate power and authority to enter into this
Agreement and to carry out the Transaction
-8-
9
contemplated hereby, and its doing so has been duly and sufficiently
authorized, subject only to the Approvals.
5.2.3 The execution, delivery and performance of this Agreement, and the
performance by Investor of its obligations hereunder do not, (1)
conflict with or result in a breach of any of the provisions of the
Articles of Association of Investor; (2) contravene any law,
ordinance, rule or regulation of Estonia or any order, writ,
judgment, injunction, decree, determination, or award of any court or
other authority having jurisdiction, or cause the suspension or
revocation of any authorization, consent, approval, or license,
presently in effect, which affects or binds, Investor, and will not
have a material adverse effect on the validity of this Agreement; (3)
conflict with or result in a material breach of or default under any
material indenture or loan or credit agreement or any other material
agreement or instrument to which Investor is a party; or (4)
constitute grounds for the loss or suspension of any material
permits, licenses or other authorizations used in the business of
Investor.
5.2.4 There is no ongoing, pending or threatened legal action or proceeding
before any court, governmental agency or arbitrator, which may
materially and adversely affect Bank's rights under this Agreement or
Investor's performance of its obligations under this Agreement.
5.2.5 Investor has complied with all applicable laws and regulations in
entering into this Agreement and acquiring the Shares.
5.2.6 Prior to the Closing, Investor shall have obtained sufficient funds
necessary for payment of the Purchase Price.
5.3 Each Party shall bear civil liability to the other Party for any errors or
inaccuracies in its warranties as set forth above, and shall indemnify the
other Party for any damages or losses caused by such errors or
inaccuracies, including due to any failure to complete the Transaction or
the Closing directly caused thereby.
6. TERM AND TERMINATION
6.1 The term of this Agreement shall commence on the date hereof and shall
expire upon the full performance by the Parties of their obligations
hereunder.
6.2 Notwithstanding Article 6.1 above:
6.2.1 This Agreement shall terminate automatically as described in
Article 3.5 above.
6.2.2 This Agreement may be terminated by a Party as described in
Article 8.2 below.
6.2.3 At the option of Investor, this Agreement may be terminated if the
Parties are
-9-
10
unable to agree on Bank's qualifications, modifications and/or
deletions to its warranties in Article 5. l, within thirty (30) days
after notice thereof as described in Article 5.l(b).
6.2.4 At the option of Investor, this Agreement may be terminated if
Investor has duly paid the Purchase Price for the Shares as described
in this Agreement and the Principal Contract, but within 180 days
thereafter the Central Bank of the Russian Federation has failed to
register the Shares or the Report on the Results of the Emission, and
as a result of such failure the emission of the Shares is deemed
invalid under Russian law; PROVIDED, that prior to such termination,
Bank shall have an additional 180 days after notice from Investor in
which to cure any such failure.
In case of any early termination as listed above, neither Party shall have
any liability to the other in respect of this Agreement or such
termination; PROVIDED, that in the case of termination under Article 6.2.4,
promptly after termination Investor shall return the Shares to Bank, and
Bank shall refund the Purchase Price to Investor.
6.3 The obligations of the Parties under Articles 6.2, 7, 9 and 10 shall
survive the expiration or earlier termination of this Agreement.
7. CONFIDENTIALITY; DISCLOSURES
7.1 The Parties agree that their due diligence activities under Article 4,
negotiation and execution of this Agreement and completion of the Closing
as described herein may involve the exchange of oral or written information
between the Parties that is deemed confidential and proprietary by the
disclosing Party ("confidential information"), including (for example)
written materials that are clearly marked as confidential. Any Party who
receives such confidential information will refrain from disclosing it to
any third party without the advance written consent of the Party who
disclosed such information; PROVIDED, that each Party may share such
information with its professional advisors (upon written agreement by such
advisors, in form reasonably acceptable to the other Party, to comply with
the provisions of this Article).
7.2 Each Party that receives confidential information will use it for the sole
purpose of pursuing the due diligence activities, negotiation and execution
of Agreements, and completion of the Closing and the Transaction as
described herein.
7.3 Each Party will also cause its employees, agents, representatives and
professional advisors to comply with the provisions of this Article.
7.4 Upon the earlier of (a) termination of this Agreement, or (b) the Closing,
each Party shall destroy or return to the other Party all documents or
tangible materials containing confidential information of the other Party
which is covered by this Article, and shall retain no copies thereof.
-10-
11
7.5 In its discretion, a disclosing Party may elect to disclose certain
information under this Article by allowing the receiving Party to review
such information in a secure location on the disclosing Party's premises.
The receiving Party may make notes regarding such information, but shall
not make or retain any copies thereof.
7.6 If disclosure of any confidential information obtained by a receiving Party
is sought by any governmental authority, then such receiving Party shall
promptly notify the disclosing Party, and shall use its best efforts to
cooperate fully with the disclosing party's pursuit of any or all available
legal remedies that may be selected by the disclosing Party to maintain the
confidentiality of the information, prior to any disclosure to such
governmental authority. However, notwithstanding the foregoing, after
reasonable consultation with the disclosing Party, the receiving Party
shall be entitled to undertake any disclosure to a governmental authority
that is mandatory under applicable law.
7.7 The preceding paragraphs of this Article 7 are not applicable to any
information that:
7.7.1 Was already known to a receiving Party at the time of receipt, and
such Party can provide written confirmation that this information was
at its disposal on the date of receipt;
7.7.2 Is or becomes public not through any act or failure to act of the
Party who received it; or
7.7.3 Later is disclosed without restriction to the receiving Party by a
third party fully authorized to do so.
7.8 Neither Party shall make any public announcements or statements regarding
this Agreement, the Transaction or any matters relating directly thereto
without the prior, written consent of the other, which shall not be
unreasonably withheld where a Party has a legal obligation to make such
announcement or statement under its national securities or banking laws or
the regulations of any applicable public stock exchange (subject to
necessary precautions being taken to protect confidential information as
described under Article 7.6 and otherwise above). All such announcements,
statements, press releases or the like shall be discussed and their texts
agreed upon by both Parties, in advance.
8. FORCE MAJEURE
8.1 In the event of any occurrence of Force Majeure circumstances making it
impossible for a Party to perform completely or in material part its
obligations under this Agreement, including, without limitation: fire,
natural calamity, military actions, decrees of state power or other
unforeseen circumstances, which do not depend on the action of the Parties,
then the required time for performance of such Party's obligations under
this Agreement shall be postponed for the period during which such
circumstances continue.
-11-
12
8.2 In the event that such circumstances continue for a period of time
exceeding six (6) months, then each of the Parties shall be entitled to
terminate this Agreement by written notice to the other. In such case,
neither Party shall be held liable to the other Party for any damage
inflicted as a result of the occurrence of the Force Majeure circumstances.
8.3 A Party that by virtue of any Force Majeure circumstances becomes unable to
fulfill obligations as described above, shall promptly notify the other
Party in writing about the occurrence of such circumstances.
9. FINAL PROVISIONS
9.1 This Agreement may be amended or modified only upon written consent of the
Parties.
9.2 Each Party shall pay its own fees and expenses incurred in connection with
this Agreement and the Transaction. Each Party shall bear the cost of any
brokers, advisors or finders retained by it in connection with the
Transaction.
9.3 For purposes of coordination between the Parties in performing their
obligations hereunder, the authorized representative of Investor shall be
Xxxxx Xxxx, and the authorized representative of Bank shall be Xxxx
Xxxxxxx. A Party may change such designated person by written notice to the
other Party.
9.4 Notices or responses required by this Agreement shall be given in writing,
and shall be deemed delivered upon the earlier of (a) the date actually
received, or (b) the date ten (10) days after dispatch by overnight courier
(DHL or Federal Express). Notices or responses shall be addressed and sent
by personal delivery, registered mail or fax (with a copy by registered
airmail) to the address of the intended recipient set forth below. The
addresses and bank accounts of the Parties are:
To Investor: AS Eesti Forekspank
Narva maantee 00
Xxxxxxx, XX0000
Xxxxxxx
Attn: Xx. Xxxx Xxxx, Chairman of the Board
Facsimile: x000-000-0000
Bank Account: Mezhcombank, Moscow
Account No.: 40805810100000000025
Corr. Account No. :30101810100000000143
with a copy to: ZAO Pioneer Bank
2nd Krasnoprudny per., 7
Xxxxxx 000000
Russian Federation
Attn: Mr. Xxxxx Xxxx
Facsimile: x0 (000) 000-0000
-12-
13
To Bank: ZAO Pioneer Bank
2nd Krasnoprudny per., 7
Xxxxxx 000000
Russian Federation
Attn: Xx. Xxxxxxx Xxxxxxxxx, Chairman
Facsimile: x0 (000) 000-0000
Bank Account: Corr. Account No.: 30101810400000000231
BIC 044579231
OKPO 29307376
OKONH 96120
with a copy to: Pioneer First Investment Group
Gazetny 5, Room 255
Moscow 103918
Russian Federation
Attn: Xx. Xxxx X. Xxxxxxx
Facsimile: x0 (000) 000-0000
9.5 This Agreement sets forth the entire agreement between the Parties relating
to the subject matter contained herein and replaces all other prior
agreements or understandings, whether written or oral (including without
limitation the Term Sheet dated December 5, 1997).
10. ARBITRATION AND APPLICABLE LAW
10.1 The Parties will use their best efforts to resolve any disputes or
controversies arising out of this Agreement by negotiations in good faith.
10.2 If such a dispute or controversy has not been settled by negotiations
within thirty (30) days, then the Parties hereby agree to resolve the
dispute by binding arbitration, under the auspices of and pursuant to the
Rules of Conciliation and Arbitration of the International Chamber of
Commerce. The arbitration proceedings will be conducted in London, England.
The language of the arbitration will be English. The arbitration tribunal
will consist of three (3) arbitrators. Investor will be entitled to
appoint one arbitrator and Bank will be entitled to appoint one arbitrator.
The two arbitrators so appointed will choose the third arbitrator. The
decision and award of the arbitrators may, in their discretion, require the
losing Party to pay the legal fees and expenses of the prevailing Party.
The decisions of such arbitral tribunal will be final and binding on both
Parties, and enforceable by all courts with jurisdiction.
10.3 This Agreement shall be construed in accordance with the laws of the
Russian Federation.
-13-
14
This Agreement has been signed on February 11, 1998, in the City of Moscow, in
four(4) originals, two (2) in English and two (2) in Russian, each equally
binding and valid, with both language versions intended to be identical in
meaning.
ON BEHALF OF BANK ON BEHALF OF INVESTOR
/s/ Xxxxxxx Xxxxxxxxx /s/ Xxxx Xxxx
----------------------------- -------------------------------
Xxxxxxx Xxxxxxxxx Xxxx Xxxx
Chairman Chairman of the Board
Pioneer Bank AS Eesti Forekspank
[SEAL] [SEAL]
-14-
15
EXHIBIT 1
RESTATED CHARTER
[to follow]
-15-
