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EXHIBIT 10.2
SHAREHOLDERS' AGREEMENT
THIS SHAREHOLDERS' AGREEMENT (this "Agreement") is made and
entered into as of __________, 1999, by and between Golden Telecom, Inc., a
Delaware corporation (the "Company"), and Global TeleSystems Group, Inc., a
Delaware corporation ("GTS").
RECITALS
A. In connection with the initial public offering of shares
of common stock by the Company, the Company issued to GTS 10,600,000 shares of
common stock of the Company (the "Shares").
B. The Company desires to grant to GTS pre-emptive rights for
any subsequent issuance of New Securities (as defined herein) by the Company.
C. The Company also desires that certain corporate governance
matters be agreed upon with GTS.
D. In consideration of the premises and the mutual agreements
contained herein, the parties hereby agree as follows:
AGREEMENT
1. Definitions
"Affiliates" shall mean, with respect to any Person, any
other Person or entity which directly or indirectly controls, is
controlled by, or is under common control with, such Person. A Person
shall be regarded as in control of another Person if its owns, or
directly or indirectly controls, at least 50% of the voting stock or
other ownership interest of the other Person, or if it directly or
indirectly possesses the power to direct or cause the direction of the
management and policies of the other Person by any means whatsoever.
"Independent Director" means a person other than an officer
or employee of the Company or its subsidiaries or any other individual
having a relationship which, in the opinion of the Company's board of
directors, would interfere with the exercise of independent judgment
in carrying out the responsibilities of a director.
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"Interested Transaction" means any transaction, or series of
similar transactions, to which the Company or any of its Affiliates is
a party, in which the aggregate amount involved exceeds US $1,000,000,
and in which GTS or any of its Affiliates will have a direct or
indirect material interest.
"New Securities" means any Shares or preferred shares of any
kind of the Company, whether now or hereafter authorized, and rights,
options, or warrants to purchase said Shares or preferred shares, and
securities of any type whatsoever that are, or may become, convertible
into, exercisable for, or exchangeable into said Shares or preferred
shares; provided, however, that "New Securities" shall not include
securities issued pursuant to an employee incentive share option plan
approved by the Company's board of directors.
"Person" shall mean an individual, corporation, partnership,
limited liability company, trust, business trust, association, joint
stock company, joint venture, pool, syndicate, sole proprietorship,
incorporated organization, governmental authority or any other form of
entity.
"Rights Notice" has the meaning as set forth in Section 2.
"Shares" has the meaning as set forth in the Recitals of this
Agreement.
2. Pre-emptive Rights. GTS shall have the right of first refusal to
purchase a pro rata portion of any issue of New Securities that the Company
may, from time to time, propose to sell and issue, provided that such pro rata
amount does not exceed the amount needed to maintain GTS's percentage ownership
in the Company immediately prior to the issuance of the New Securities.
(a) If the Company proposes to issue New Securities, it shall
give GTS written notice (the "Rights Notice") of its intention, describing the
New Securities, the price, the general terms upon which the Company proposes to
issue them, and the number of shares that GTS has the right to purchase. GTS
shall have thirty (30) days from delivery of the Rights Notice to agree to
purchase all or any part of its pro rata portion of the New Securities for the
price and upon the general terms specified in the Rights Notice, by giving
written notice to the Company setting forth the quantity of New Securities to
be purchased.
(b) The pre-emptive rights provided in this Section 2 shall
terminate when GTS owns less than 25% of the outstanding Common Stock of the
Company.
3. Interested Transactions. Any Interested Transaction between the
Company or any of its Affiliates, on the one hand, and GTS or any of its
Affiliates, on the other hand, shall be
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approved by a majority of the Independent Directors, unless such Interested
Transaction is described in a business plan or a budget that has previously
been separately approved by the Company=s Independent Directors.
4. Assignment. Neither party shall assign or transfer any of its
rights under this Agreement without the prior written consent of the other
party.
5. Notices. All notices, requests, demands and other communications
provided for by this Agreement shall be in writing (including telecopier or
similar writing) and shall be deemed to have been given at the time when mailed
in any general or branch office of the United States Postal Service, enclosed
in a registered or certified postpaid envelope, or sent by Federal Express or
other similar overnight courier service, addressed to the address of the
parties stated below or to such changed address as such party may have fixed by
notice, or if given by telecopier, when such telecopy is transmitted and the
appropriate answerback is received.
If to GTS, Inc.:
Global TeleSystems Group, Inc.
0000 Xxxxxxxx Xxxxx
Xxxxx Xxxxx, 00xx Xxxxx
XxXxxx, XX 00000
Attn: Chief Financial Officer
Copy to: General Counsel
If to the Company:
Golden Telecom, Inc.
00 Xxxxxxxxxxxxxxxxxx Xxx.
0xx Xxxxx
000000 Xxxxxx, Xxxxxx
Attn: Chief Financial Officer
Copy to: General Counsel
6. Further Assurances. GTS and the Company shall execute, acknowledge
and deliver or cause to be executed, acknowledged and delivered such
instruments and take such other action as may be necessary or advisable to
carry out their obligations under this Agreement and under any exhibit,
document or other instruments delivered pursuant hereto.
7. Governing Law. This Agreement shall be governed by the laws of the
State of New York.
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8. Entire Agreement. This Agreement constitutes the entire
understanding between the parties and supersedes all proposals, commitments,
writings, negotiations and understandings, oral and written, and all other
communications between the parties relating to the subject matter of this
Agreement. This Agreement may not be amended or otherwise modified except in
writing duly executed by all of the parties. A waiver by any party of any
breach or violation of this Agreement shall not be deemed or construed as a
waiver of any subsequent breach or violation thereof.
9. Counterparts. This Agreement may be executed in several
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same document.
10. Severability. Should any part, term or condition hereof be
declared illegal or unenforceable or in conflict with any other law, the
validity of the remaining portions or provisions of this Agreement shall not be
affected thereby, and the illegal or unenforceable portions of this Agreement
shall be and hereby are redrafted to conform with applicable law, while leaving
the remaining portions of this Agreement intact.
11. Force Majeure. No party shall be deemed to have breached this
Agreement or be held liable for any failure or delay in the performance of all
or any portion of its obligations under this Agreement if prevented from doing
so by a cause or causes beyond its control. Without limiting the generality of
the foregoing, such causes include acts of God or the public enemy, fires,
floods, storms, earthquakes, riots, strikes, lock-outs, wars and
war-operations, restraints of government power or communication line failure or
other circumstances beyond such party's control, or by reason of the judgment,
ruling or order of any court or agency of competent jurisdiction or change of
law or regulation subsequent to the execution of this Agreement.
12. Successors and Assigns. Subject to the provisions of Section 4,
this Agreement is solely for the benefit of the parties and their respective
successors and assigns. Nothing herein shall be construed to provide any rights
to any other entity or individual.
13. Headings. Section headings are for convenience only and do not
control or affect the meaning or interpretation of any terms or provisions of
this Agreement.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
GLOBAL TELESYSTEMS GROUP, INC.
By:
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Name:
Title:
GOLDEN TELECOM, INC.
By:
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Name:
Title:
