ARTICLES OF ASSOCIATION
of the Joint Venture
TAKT
Paragraph Paragraph Title Page
1 Name and registered office 1
2 Object of the Joint Venture 2
3 Procedure 4
4 Legal principles 7
5 Participants 9
6 Principles of the economic activities of the Joint Venture 10
7 Business year 12
8 Articles of Association Fund 13
9 Financing 15
10 Disposal of shares 16
11 Inclusion of further participants 17
12 Branches 18
13 Reserve fund and further funds 19
14 Liability of the Joint Venture 20
15 Profit distribution and loss cover 21
16 Depreciation 22
17 Accounting and reporting 23
18 Chief Accountant 24
19 Annual Accounts 25
20 Auditing of the financial and economic activities 26
21 Organs of the Joint Venture 27
22 Managing Board 28
23 Board of Directors 32
24 Powers of the Managing Director of the First Deputy
Managing Director 36
25 Directors and Personnel 38
26 Cancellation and termination of the Joint Venture 39
27 Arbitration Court and applicable law 41
28 Amendments and addenda to the Articles of Association 42
29 Language of the Articles of Association 43
30 Validity Clause 44
31 Adjustment of the Articles of Association 45
32 Integral components of the Articles of Association 46
33 Signing of the Articles of Association 47
Paragraph 1
Name and Registered Office
of the Joint Venture
1.1. The name of the Joint Venture of the contractual participant shall be:
TAKT
1.2. The Registered Office of the company shall be at:
677005 Yakutsk
ul. Chalturina, 4/1
Yakut-Sacha Socialist Soviet Republic
USSR
Paragraph 2
Object of the Joint Venture
2.1. The participants do hereby form a Soviet-Austrian Joint Venture on the
basis of the contract governing the formation and activities of a Joint
Venture.
The object of this Joint Venture shall be
- especially thc completion of exploration works for the development of
hydrocarbons deposits in the area of the Yakut-Sacha Socialist Soviet
Republic on a risk basis, the development extraction and processing of
hydrocarbons, their transportation and sale both in the USSR and
abroad,
- likewise extraction, processing, transportation and sale of other
natural earth resources,
- the erection and operation of industrial and transportation systems as
well as the construction of communal dwellings, design, calculation,
erection and installation works as well as the commissioning and
erection especially of plant and equipment for the extraction and
processing of hydrocarbons,
- the exploitation of the timber of the Yakut-Sacha Socialist Soviet
Republic, the provision of timber, the production of sawn and other
timber products as well as the sale of these products both in the USSR
and abroad,
- the rendering of services for the economic and social development of
the collectives of the Soviet participant and the areas intended for
carrying on the activities.
- the organisation and completion of research and development works in
the area of the development, extraction and processing of raw
materials in the form of hydrocarbons and other natural earth
resources necessary for the fulfillment especially of the production
programme and the plans of the Joint Venture,
- the undertaking of publicity measures for the products produced and
services offered by the Joint Venture,
- the taking of measures in the field of marketing and the procurement
of foreign trade policy services in connection with exports and
imports,
- as well as other forms of activities not excluded by the legislation
of the USSR.
2.2. The Joint Venture is formed with the intention of making profits.
2.3. The Joint Venture shall conclude and undertake independently the export and
import transactions necessary for the setting up and operation of its
exploration, development, extraction, processing and transportation systems
and plants as well as for the sale of the hydrocarbons and its production
and take any other measures necessary for the object of the Joint Venture
as well as undertaking on its own the legal transactions necessary for its
activities.
2.4. The Joint Venture shall be entitled to exploit the deposits found and
developed by it and sell the hydrocarbons and products gained therefrom on
the market of the USSR or the world market at prices fused by it and
competitive on the world market. The jointly extracted natural earth
resources shall include amongst other things noble gases (i.e. Helium),
sulphur, carbon dioxide, nitrogen, lithium and strontium.
2.5. In order to achieve an economically meaningfu1 and most comprehensive
possible utilisation of the deposits found by it, the Joint Venture shall
also be entitled to sell the other natural resources also extracted from
these deposits when extracting hydrocarbons on the market of the USSR or on
the world market at prices determined by it and competitive on the world
market.
2.6. The Joint Venture shall be entitled, to sell consumer goods to the
personnel employed in the Joint Venture, the family members of the
personnel as well as to natives of the Yakut-Sacha Socialist Soviet
Republic and render services thereto free of charge.
Paragraph 3
Procedure
3.1. The Joint Venture shall materialise its object in the following three
phases:
1. Exploration:
The Joint Venture shall in the first instance undertake exploration
works in the two spatial sections, the position and extension of which
can be seen from the survey map attached to these Articles of
Association in Appendix 1 and the corresponding apportionment deed of
the State Organs empowered to do this, relating to these sections.
Section 1 covers the main part of the Kempendjaksker basin and the
adjacent areas of the Chebydinsk uplift and the Suntarsk saddle and
has the form of a rectangle with a surface area of 14,400 square
kilometres (map in Appendix 2).
Section 2 extends over the area of the Nepsk-Botuobinsk uplift and the
Predpatomsk basin in the form of a pentagon with a surface area of
6,900 square kilometres (map in Appendix 3).
In section 1 the Joint Venture has to fulfill above all the following
tasks in the first phase:
- Processing of the seismic data - 850 km;
- Valuation of the seismic information;
- Simulation and preparation of the geochemical and facies maps;
- Drilling of a test bore with breakdown of the subsalinary
reservoir.
In section 2 the Joint Venture must in the first phase catty out the
following tasks:
a) Verchenmurbaisk Area:
- processing of the seismic data - 820 km;
- valuation of the seismic information;
- technical and economic valuation of the area;
- in the event of proof of the economic nature of an
extraction- drilling works in a scope to be appropriately
stipulated.
b) Otradninsk area:
- Processing of the seismic data - 420 km;
- Valuation of the seismic information;
- Drilling of one or two test bores (including the bores
already being drilled).
The fulfillment of these tasks of the Exploration phase will probably
extend over a period of three to five years.
After conclusion of the aforementioned and where necessary any
additional works and after ensuring the economic nature of any
extraction taking into account the making of reasonable profits in
freely convertible currency, the details of the activities of the
Joint Venture shall be stipulated in the following phases by the
contractual participants.
2. When the economic nature of an extraction has been ensured the Joint
Venture shall within a further five years make preparations and take
measures for an economic extraction of the hydrocarbons found.
Further participants will where necessary also be taken up for this
purpose.
3. Extraction and sale of production:
This phase of economic extraction shall extend from the date of the
commercial commencement of extraction over the period of time
necessary for an exploitation of the deposits found in Sections 1 and
2.
3.2. In the event of economic extraction the Joint Venture may a1so take over
the processing, transportation and sale of its production and in so doing
if necessary also make use of the help of third parties.
3.3. In the event of the agreement of the participants and the receipt of the
approvals and licenses necessary for this the Managing Board may also
decide to extend the exploration, development and extraction to areas other
than those marked in Appendix 2 and 3. In this case the regulations of
this paragraph shall be applied appropriately as regards the procedure to
be followed.
Paragraph 4
Legal principles
4.1. The Joint Venture of the contractual participants shall have the legal form
of a Joint Venture in accordance with Decree No. 49 of the Council of
Ministers7 of the USSR of 13.01.1987, Decree No. 1074 of the ZK of the KPSU
and of the Council of Ministers of the USSR of 17.09.1987,theDecree of the
Council of Ministers of the USSR No. 1405 of 02.12.1988, the Decree of the
Council of Ministers of the USSR No. 203 of 07.03.1989 as well as the
regulation documents of the Russian Federalist Soviet Republic and the
Yakut-Sacha Socialist Soviet Republic leading directly to these Decrees of
the USSR.
4.2. The Joint Venture shall have the rights of a legal entity governed by
Soviet Law on the date of its registration at the Ministry for Finances of
the RFSFR.
4.3. The formation and activities of the Joint Venture shall be undertaken on
the basis of this contract and the appendices attached to it, especially
the Articles of Association of the Joint Venture (Appendix 4), whereby the
Articles of Association are an integral component of this contract. If any
conditions of the contract differ from the Rules of the Articles of
Association, then the conditions of this contract shall take precedence
over the rules of the Articles of Association.
4.4. The utilisation of the land and soil, the water, the forests, the natural
earth resources and other resources claimed for its activities, especially
in sections 1 and 2 sketched out in Paragraph 3 for the exploration and
extraction of hydrocarbons shall be effected on the basis of the
applicable deed of allocation issued by the competent Council of the
Peoples Deputies of the Yakut-Sacha Socialist Soviet Republic under
corresponding license for exploration and extraction as well as the
approvals and licenses of the USSR, thc RSFSR and the Yakut-Sacha
Socialist Soviet Republic for the exporting of hydrocarbons agreed with
the Ministry for Geology of the USSR and approved by the State Committee
of the RSFSR for Geology and Utilisation of energy fields and mineral oil
reserves, for the duration of the economic extraction and for the purpose
of the exclusive exploration, development, extraction, processing,
transportation and sale of hydrocarbons from the aforementioned sections.
These documents shall be attached after they have been issued to the
documents relating to the formation and activities of the Joint Venture.
4.5. The Joint Venture shall have a seal with its name and a logo, which will be
determined by the Managing Board.
4.6 The official languages of the Joint Venture shall be Russian and German.
Managing Board and Board of Directors documents shall be drafted in both
languages.
Paragraph 5
Participants
The participants of the Joint Venture are:
1. PGO LENANEFTEGASGEOLOGIJA
Lena-Geologie-und Produktionsvereinigung
fuer Erdoel-und Erdgasexploration
Yakutsk-20, 67781 GSP,
ul. Chalturina, 4/1
Yakutsk-Sacha Socialist Soviet Republic,
Union of Socialist Soviet Republics
2. OEMV (JAKUTIEN) Exploration Gesellschaft m.b.H.
A-1090 Vienna
Otto Wagner-Platz 5
Austria
Paragraph 6
Principles of the economic activities
of the Joint Venture
6.1. The economic activities of the Joint Venture shall be effected completely
on the basis of independent economic accounting, its own financial
liability and - after completion of the exploration and development
financed by the participants on a risk basis - on the generation of its
funds in Soviet Roubles and freely convertible currency in accordance with
its own operating and financing plans.
6.2. The operating and financing plans shall be prepared in advance in each case
by the 30th of each September for the following business year by the Board
of Directors, unless otherwise laid down by the Managing Board. The plans
must be approved by the Managing Board. In the Joint Venture budget plan
arising from these plans the receipts and expenditure to be expected shall
be listed separately for Soviet Roubles and freely convertible currency.
6.3. The Joint Venture shall itself bear the costs incurred for the exploration,
development, extractions, processing, transportation and sale of the
hydrocarbons. The credit lines and loans taken up for the financing of the
aforementioned activities shall be repaid from the proceeds occurring as a
result of its economic and financial activities.
6.4. The Joint Venture shall have the right, within the framework of carrying
out its tasks, to place orders with third parties, to use the
infrastructure which exists in the USSR and especially in the Yakut-Sacha
Socialist Soviet Republic and take part in the development of this
infrastructure especially through the setting up of medical projects and
various telecommunications systems.
6.5. The Joint Venture and the third parties instructed by it shall be entitled,
to import independently and where necessary export the machines and
equipment, materials, auxiliary items of equipment, food and other items
intended for the personal use of the personnel carrying out this work
necessary for the activities of the Joint Venture, including medical
equipment, drugs, consumer goods, te1ecommunications technology and the
like.
6.6. The Joint Venture shall be entitled within the framework of the licenses
issued to it by the Ministry for Foreign Trade Relations of the USSR as
well as any other competent State Committees, Ministries and authorities,
to import the goods it requires for materialising the object of the Joint
Venture and to export the raw materials and products it extracts.
6.7. Any proceeds from its economic activities, in whatever currency, shall
accrue solely to the Joint Venture, which will set up and conduct in the
USSR its own accounts for Soviet Roubles and freely convertible currency.
The Joint Venture shall be entitled where necessary within the framework of
what is permissible in accordance with Soviet legislation also to set up
and conduct accounts outside the USSR.
6.8. Thc Joint Venture shall ensure within the framework of its legal
obligations and what is economically tolerable:
- a complete geological survey and a rational and comprehensive
utilisation of the natural earth resources and the protection of
these;
- the carrying out of the works connected with the utilisation of the
natural earth resources which will be harmless to the employees of the
Joint Venture and local populations;
- the protection of air, earth, forests, waterways and other
environmental and natural features as well as buildings and structural
facilities against the possible harmful effects of the works connected
with the utilisation of the natural earth resources;
- the protection of natural parts, natural, historical and artistic
monuments against the possible damaging effects of the works connected
with the utilisation of the natural earth resources;
- the restoration of the plots of land used to a condition suitable for
further economic utilisation.
Paragraph 7
Business year
7.1. The business year of the Joint Venture shall be the calendar year.
Paragraph 8
Fund in accordance with the Articles of Association
8.1. The Articles of Association Fund of the Joint Venture shall total
US $20,000,000.00
(in words: two million United States Dollars)
8.2. The Articles of Association Fund shall be formed by the contractual
participants by cash payments in the form of inpayments to the current
account of the Joint Venture to be set up for Roubles and freely
convertible currency as follows:
1. Austrian Participant:
Cash inpayment totalling US $1,000,000.00:
2. Soviet Participant:
Cash payment totalling US $1,000,000.00:
payable in Soviet Roubles, converted at the official commercial rate
of exchange of the State Bank of the USSR and on the date of making
the payment.
Total value of the inpayments US $2,000,000.00.
8.3. The participants shall have the following shares in the Joint Venture in
accordance with the inpayments into the Articles of Association Fund:
Austrian Participant: 50 % of the shares
Soviet Participant: 50% of the shares
8.4. The cash payment shall become due thirty days after receiving the approvals
and licenses necessary for the activities of the Joint Venture in
accordance with Paragraph 4.4 of these Articles of Association.
8.5. The fund may be increased with the agreement of the participants in
response to a unanimous decision of the Managing Board of the Joint
Venture. The drawing right shal1 accrue to the participants according to
their shares. The drawing right is to be exercised within a deadline to be
set by the Managing Board, which must not be less than thirty days nor
exceed 180 days. A drawing right not exercised within this deadline shall
be offered by the Joint Venture to the other participant. If the latter
accepts the offer, then the shares in the Joint Venture shall change in
accordance with the new shares in the Articles of Association Fund. If the
latter does not accept the offer within the deadline set in the offer, then
the drawing right shall decay.
8.6. There is no obligation to put up any further capital.
Paragraph 9
Financing
9.1. In addition to the payments of the contractual participants into the
Articles of Association Fund the participants do hereby guarantee the
Joint Venture fixed agreed private loans for the first phase (exploration)
of its activities totalling
US $28,000,000.00
(in words: twenty eight million United States Dollars),
whereby each participant shall be responsible in accordance with the credit
and loan agreements (Appendices 4 and 5) attached to these Articles of
Association for
US $14,000,000.00
respectively, which in the case of the Soviet participant shall be paid in
Soviet Roubles, converted at the official commercial rate of exchange of
the State Bank of the USSR on the date of the remittance.
9.2. Expenditure above and beyond this amount may only tee effected by agreement
between the participants. For this purpose the Joint Venture may take up
in the necessary scope credit lines in Soviet Roubles and in freely
convertible currency.
9.3. Any investment and operating costs incurred at regular investment and
operating costs for exploration, development, extraction, processing,
transportation and sale shall be covered in the event of economic strikes
by the proceeds from the economic activities of the Joint Venture.
9.4. The amount set in the agreement between the participants (Appendix 6) the
transfer of the rights for the borehole already sunk by the Soviet
participant shall be offset with the private loan mentioned in Point 9.1 of
this paragraph of the Soviet participant.
Paragraph 10
Disposal of shares
10.1. Any disposal of shares in the Joint Venture or of parts of shares,
that is to say any transfer, abrogation, encumbering or change in content
of these shares, shall only be permitted in the event of the agreement of
the participants with a unanimous vote of the Managing Board.
10.2. A participant may only refuse his agreement for projectively justified
reasons.
10.3. In the event of the transfer of a share (sale, donation, contribution,
exchange) in the Joint Venture or a part of such a share by either of the
participants, the other participant shall have as right of preemption.
10.4. The selling participant must notify the content of the agreement
conclude with the buying new participant immediately in writing to the
party having right of preemption. The right of preemption may only be
exercised up to the expiry of a period sixty days from receipt of this
notice by written declaration to the disposing party.
Paragraph 11
Inclusion of further participants
11.1. The contractual participants do hereby agree, where necessary to
include further participants in the Joint Venture, in order to ensure the
materialisation of the aims and the object of the Joint Venture,
especially the financing of phases 2 and 3.
11.2. The contractual participants in so doing do hereby also agree, that
such participants must be selected and included from the point of view of
the optimum materialisation of the aims and object of the Joint Venture.
The decision on the inclusion of further participants in the Joint Venture
shall be taken amicably by the contractual participants. A unanimous
resolution of the Managing Board shall also be necessary.
Paragraph 12
Branches
12.1. The Joint Venture shall be entitled to set up branches and appoint
representatives as well as subsidiaries inside and outside the USSR.
12.2. The decision concerning the setting up of branches, subsidiaries and
the appointment of representatives shall be taken by the Managing Board.
Paragraph 13
Reserve fund and further funds
13.1. The Joint Venture shall form a reserve fund in the amount specified by
Soviet legislation from the gross profit remaining after deduction of any
expenses and the amounts written off for depreciation of its assets.
13.2. The Managing Board of the Joint Venture shall decide on the formation
of any further funds such as:
- a fund for the promotion of science and technology,
- a development fund in the event of the expansion of the commercial
activities of the Joint Venture,
- a fund for the repayment of long-term credit lines and their interest
amounts,
- a premium fund to pay for special services,
- a continuation fund for the training and further education of the
employees of the Joint Venture,
- a fund for social and cultural measures and for the building of
dwellings.
13.3. What portion of the gross profit is to be allocated annually to what
fund shall be decided by the Managing Board. The Board of Directors of
the Joint Venture shall decide on the withdrawals from the individual
funds with the exception of withdrawals from the Reserve Fund in
accordance with appropriate resolutions of the Managing Board within
the framework of its relevant jurisdiction and powers.
Paragraph 14
Liability of the Joint Venture
14.1. The Joint Venture shall be liable with all of its assets for its
commitments.
14.2. The Soviet State and the participants of the Joint Venture shall not
be liable for commitments of the Joint Venture, and the Joint Venture
shall not be liable for commitments of the Soviet State or its
participants.
Paragraph 15
Profit distribution and loss cover
15.1. The profit or loss of the Joint Venture shall be determined by the
Managing Board for each business year.
15.2. The profit which may be distributed shall the Balance Sheet profit
less the contributions to the Reserve Fund and any other apportionments to
further funds of the Joint Venture decided upon by the Managing Board in
accordance with paragraph 13, point 13.3 of these Articles of Association,
as well as less the payments of any tax commitments.
15.3. The profit available for distribution shall be distributed between the
Austrian and the Soviet participants in proportion to their shares in the
Articles of Association fund of the Joint Venture.
15.4. The profit share of the Austrian participant in the proceeds of the
Joint Venture in freely convertible currency shall be calculated fully in
freely convertible currency. In the event of the distribution of this
profit share the credit in freely convertible currency available in
accounts of the Joint Venture shall in the first place be used to satisfy
the profit payment claim of the Austrian participant.
15.5. In the event of a loss the Managing Board shall decide on whether and
how the loss is to be settled after listening to the Board of Directors.
In so doing it must be assumed that losses, arising from exploration and
development works, shall be covered first from the proceeds of extraction.
However as long as exploration and development works remain unsuccessful,
cumulative losses shall be earned forward to new account without any time
limit.
15.6. Losses not arising from the works mentioned in the foregoing paragraph
shall be covered from the Reserve Fund of the Joint Venture.
Paragraph 16
Amounts written off
16.1. The amount of the depreciation rates for the assets and property
rights of the Joint Venture shall be established annually by the Managing
Board in accordance with the financial needs of the Joint Venture.
Paragraph 17
Accountancy and reporting
17.1. The Joint Venture shall trade on the basis of complete economic
accounting and cost coverage as well as by internal and external financing
and shall carry on its activities in accordance with the annual plans
confirmed by the Managing Board of the Joint Venture.
17.2. The Joint Venture shall for this purpose conduct an operational,
bookkeeping and statistical system of accounting and form of invoicing as
specified for Joint Ventures in the USSR. It will conduct its accounting
system on the principle of double-entry bookkeeping.
If for the purposes of the accounting system freely convertible currency
is to be converted into Soviet Roubles, this must be effected at the
commercial rate of exchange of the State Bank of the USSR applicable
on the date of the remittance.
17.3. Additionally the Joint Venture shall conduct its bookkeeping and
accounting for submission to the financial authorities competent for the
participants in accordance with the conditions of proper bookkeeping and
drafting of Balance Sheets in accordance with the Accounting Law of 1990
of the Republic of Austria (BGB1. No. 475 of 31.07.1990) in the currency
applicable version in German and in United States Dollars.
Paragraph 18
Chief Accountant
18.1. The Chief Accountant of the Joint Venture shall be appointed by the
Board of Directors. The prior consent of the Managing Board must be
obtained for that appointment.
Paragraph 19
Annual Accounts
19.1. At the latest three months after the end of the business year the
Balance Sheets together with Profit and Loss Accounts of the Joint Venture
for the business year which has elapsed must be drawn up by the Board of
Directors in accordance with Paragraph 17, points 17.2 and 17.3.
19.2. With regard to the profit made, the Board of Directors must submit a
proposal for its utilisation to the Managing Board within the same time
limit.
Paragraph 20
Auditing of the financial and economic activities
20.1. Bookkeeping, invoicing and Annual Accounts shall be audited at the
expense of the Joint Venture by an independent auditing company, to be
selected by the Managing Board and which will have unrestricted access to
all the ledgers and other records and vouchers of the Joint Venture.
Paragraph 21
Organs of the Joint Venture
21.1. The organs of the Joint Venture are:
- a Managing Board,
- the Board of Directors.
21.2. Their composition and relevant powers and jurisdictions are set out
and regulated in the following paragraphs.
Paragraph 22
Managing Board
22.1. The top organ of the Joint Venture shall be the Managing Board. It
will determine especially the basic outlines of the commercial activities
of the Joint Venture in accordance with these Articles of Association as
well as its integral component and will be responsible for any specially
highlighted tasks, above and beyond the course of day to day business
activities.
The course of day to day business activities shall however be the task of
the Board of Directors.
22.2. The Managing Board shall consist of four people. Of these both
participants shall in each case appoint two people. The Chairman of the
Managing Board shall be a representative of the Austrian, and the Deputy
Chairman shall be a representative of the Soviet participant.
Additionally both participants shall in each case appoint a replacement
member.
22.3. The members of the Board shall be appointed for a period of four
years. The appointment may be revoked prematurely at the discretion of
that participant of the Joint Venture which has appointed a Managing Board
member.
The appointment several times of a member of the Board for in each case a
further period of office shall be allowed. The participants shall inform
each other and the Board of Directors of the joint company in writing of
the appointment or revocation of a member of the Managing Board. The
appointment or dismissal shall become effective on the thirtieth day after
receipt of the notice.
22.4. If necessary in response to a proposal from the Managing Board the
Participants of the Joint Venture may appoint additional Managing Board
members. In this case to safeguard the share ratios in the Articles of
Association Fund the appointment may be made in accordance with the shares
subscribed by the participants.
22.5. The Managing Board meeting shall be convened in writing by the
Chairman of the Managing Board or - in his absence - by his deputy.
22.6. The notice must state the date, place and agenda of the Managing Board
meeting.
The participants and the Joint Venture must have received the notice at
least 45 days before the date set for the meeting.
22.7. In the event of being prevented from personally attending a Managing
Board meeting, a Managing Board member may have himself represented with a
deciding vote at the meeting on the basis of a Power of Attorney issued in
writing thereby, by another Managing Board member, a replacement member or
by a third parry who is not a member of the Managing Board.
22.8. Managing Board meetings shall be convened as required, but at least
twice a year. The annual results shall be discussed by the Managing Board
no later than three months after the end of the relevant business year.
22.9. The participants, each Managing Board member, the Managing Director
and the First Deputy Managing Director of the Joint Venture may demand the
convening of a meeting by written application stating reasons. The
participant may also convene the Managing Board meeting themselves subject
to the convening notice, if there is no reply to their request to convene
a meeting within thirty days.
22.10.The right to submit questions for decision to the Managing Board shall
be held by the participants of the Joint Venture, the Managing Board
members, the Managing Director and the First Deputy Managing Director.
22.11.Minutes of the Managing Board meeting shall be prepared. The Chairman
of the Managing Board shall submit the corresponding minutes thirty days
after the meeting for the members of the Managing Board who attended the
meeting for signature.
22.12.The Managing Board shall be able to take resolutions, inform the
Managing Board members who are personally present at the meeting or if
they are properly represented in accordance with point 22.7. If the
meeting is unable to take resolutions, then a fresh meeting must be
convened within six weeks, which shall in every case be able to take
resolutions on the same agenda.
22.13.The Managing Board shall take its resolutions basically with a simple
majority of the votes of the Managing Board members attending. If the
votes are equal, then the Chairman of the Managing Board shal1 have the
casting vote. Managing Board members properly represented in accordance
with point 22.7 shall be deemed to be attending.
22.14.The decision on the following important and fundamental questions of
commercial policy and the general commercial activities of the Joint
Venture shall however require unanimity:
1) Amendments to the Articles of Association of the Joint Venture;
2) Stipulation of the fundamental aims of the activities of the Joint
Venture;
3) The inclusion of further participants;
4) Disposal of shares in accordance with Paragraph 10 of these Articles
of Association.
5) The making of investments not included in the plans;
6) The granting of securities for third parties, especially the
acceptance of warranties, guarantees and similar promises;
7) The protection and utilisation of industrial protection rights of the
Joint Venture;
8) The conclusion, amendment and cancellation of know-how, license and
fundamental cooperation agreements;
9) The buying and selling of property;
10) The setting up and formation of funds additional to those listed in
Paragraph 12;
11) The entering into service agreements with a duration of more than
three years;
12) The appointment and dismissal of the Managing Director and his Deputy
proposed by the Soviet participant;
13) Liquidation of the Joint Venture, the appointment of a Liquidation
Committee and confirmation of the 1iquidation Balance Sheet.
22.15.Decisions on the following matters shall come especially within the
jurisdiction of the Managing Board:
1) Confirmation of the Annual Balance Sheet and Annual Report of the
Board of Directors of the Joint Venture;
2) Distribution of the profit of the Joint Venture;
3) Preparation of the method of covering losses;
4) Resolutions concerning the taking up of credit lines;
5) Confirmation of the programmes of the foreign trade activities of the
Joint Venture as well as reports on their implementation;
6) Confirmation of the production and finance plans as well as reports on
their implementation;
7) Stipulation of the funds of the Joint Venture. Determination of their
scope, sources, from which they are formed, and the way in which they
are used;
8) Formation of the organs of the Joint Venture, determination of their
powers as well as the termination of their activities;
9) The setting up of branches and appointment of representatives as well
as determination of their activities;
10) Stipulation of the rules of the internal Working Order,
11) Stipulation and amendment of the job plan;
12) Stipulation of the qualifications and number of Austrian technical
people as well as the contractual conditions for their activities in
the Joint Venture;
13) Confirmation of the training plan and measures for the training of the
personnel of the Joint Venture;
14) The appointment and dismissal of the Deputy of the Managing Director
to be proposed by the Austrian participant.
22.16.Resolutions of the Managing Board may also be taken in writing. If
all the Board members agree to this form of resolution, then a Managing
Board meeting need not be convened.
22.17.The activities of the Managing Board shall be effected basically on an
honorary basis, however the expenditure for travel and accommodation of
the Joint Venture incurred by the Managing Board members through taking
part in Managing Board meetings shall be repaid thereto. In addition the
participants shall pay the remuneration of their Managing Board members
themselves and for their own account.
22.18.The Order of Business to be drafted by the Managing Board shall
regulate anything else.
Paragraph 23
Board of Directors
23.1. The Board of Directors shall manage the day to day activities of the
Joint Venture.
It shall report to the Managing Board of the Joint Venture, implement the
instructions and resolutions of the latter and shall be liable to the
Board for complying with and executing the said instructions and
resolutions.
23.2. The Board of Directors shall consist of the Managing Director and the
First Deputy Managing Director, who will be appointed and dismissed by the
Managing Board of the Joint Venture. The Managing Director shall be
appointed in response to a proposal from the Soviet participant, and the
First Deputy Managing Director in response to a proposal from the Austrian
participant.
23.3. The Managing Director and First Deputy Managing Director shall be
appointed for a period of three years. Their appointment may be revoked
by a resolution of the Managing Board or in response to a proposal from
the Soviet participant concerning the Managing Director or a proposal of
the Austrian participant concerning the First Deputy Managing Director.
On revocation of the appointment the employment relationship of the
affected parry with the Joint Venture is to be cancelled immediately.
An appointment several times in each case for a further period of office
shall be allowed.
23.4. If necessary the Board of Directors may be supplemented by resolution
of the Managing Board by the appointment of further Deputy Managing
Directors as well as being reduced by dismissal thereof.
23.5. Two members of the Board of Directors appointed by different
participants shall be entitled to represent the Joint Venture outwardly.
They shall in each case have only jointly unrestricted powers to act and
sign, provided this is not expressly restricted in this contract or in the
Articles of Association of the Joint Venture.
23.6. The Managing Director and First Deputy Managing Director shall take
part in meetings of the Management Board with a consultative vote.
23.7. The activities of the Board of Directors shall be effected in
accordance with the conditions of this contract and the Articles of
Association of the Joint Venture in accordance with the principle of
unanimity. If there is no unanimity, each member of thc Board of
Directors shall be entitled, to approach the Managing Board to bring
about a binding decision.
23.8. Applications to the Managing Board are to be made basically by the
Board of Directors as an organ. If it is impossible for its members to
reach agreement, then each member of the Board of Directors shall make
applications independently.
23.9. The Board of Directors must obtain the prior written consent of the
Managing Board for the following transactions:
1) The acquisition, sale or encumbering of plots of land or rights equal
to plots of land;
2) The erection of production plants at new locations;
3) The acquisition of third party companies or participation therein;
4) The granting of credit outside the usual commercial operations;
5) The appointment of special proxies or authorised agents;
6) The acceptance of warranties and guarantees (with the exception of the
acceptance of guarantees in normal goods traffic);
7) The taking up of long-term bank credit lines or loans;
8) Entering into commitments on bills of exchange;
9) The making of investments and placing of orders with an initial or
production value of more than US $500,000.00 or a corresponding value
in Soviet Roubles, converted at the official commercial rate of
exchange of the State Bank of the USSR;
10) The conducting of active proceedings with a value at dispute of more
than US $50,000.00;
11) The conclusion of agreements, which as regards their financial effects
are of special significance to the future development of the Joint
Venture, especially if such agreements are to bind the Joint Venture
for longer than two years;
12) Obligations as regards basic rates of remuneration, social security
contributions and pensions.
23.10.The Managing Board may give its consent to certain transactions in
advance as well as amending limits of amounts for the transactions
mentioned under point 17.9.
23.11.The commercial activities of the Joint Venture shall take place in
accordance with the Directives and at prices, proposed by the Board of
Directors and which must be approved by the Managing Board when confirming
the finance plan.
23.12.The placing of orders with third parties must be effected subject to
the prerequisite of financial and technical competitiveness (price,
technical execution, delivery times and the like) so that the participants
of the Joint Venture will receive the order in preference on equal offer
conditions. If offers of the Soviet participant and the Austrian
participant are equa1, then the Soviet participant shall be given
preference. In the Business Order of the Board of Directors conditions
must be included concerning the methods of tender competitions and the
allocation of orders.
23.13.The Board of Directors shall be liable to the Managing Board in
respect of the following items,
1) The execution of the resolutions of the Managing Board and the
provision of reports relating thereto;
2) The drafting of Annual investment and finance plans;
3) The provision at the latest 45 days after the end of each month of a
monthly Profit and Loss Account, a list of the sums of the bills
receivable for goods and services as well as a list of the cash flow
and the positions of the Bank accounts including the current stage of
the obligations of the Joint Venture, to be produced and forwarded
directly to the participants;
4) to draft reports on those transactions, which may be of considerable
significance to the profitability or liquidity of the Joint Venture in
good enough time so that the Board can comment on them;
5) to submit no later than three months after the end of the business
year the Annual Accounts, the Profit and Loss Account and the
situation report and report on the profitability of the Joint Venture,
especially the profitability of the ordinary capital;
6) at the request of the Board to report at any time on basic or
fundamental matters of the Joint Venture.
23.14.The activities of the Board of Directors shall also be regulated by
the Order of Business to be drafted by it and approved by the Managing
Board.
Paragraph 24
Powers of the Managing Director
and the First Deputy Managing Director
24.1. The Managing Director of the Joint Venture shall within the framework
of the powers accruing to him in accordance with this contract and the
Articles of Association of the Joint Venture fu1fill the following
functions:
The Managing Director
1) shall manage the activities of the Joint Venture in accordance with
the programmes of the Joint Venture;
2) dispose of the assets of the Joint Venture including its cash funds
within the framework laid down in Paragraph 17, Point 17.9;
3) submit to the Managing Board of the Joint Venture the drafts of the
programmes and plans as well as the reports on the implementation of
these programmes and plans for confirmation; no later than three
months after the end of the business year he will submit the Annual
Balance Sheet, and Annual Report and the Report on the implementation
of the Finance Plan;
4) shall act without Power of Attorney in the name of the Joint Venture,
represent it with respect to authorities, companies and organisations
both in the USSR and abroad;
5) undertake transactions of any kind and legal transactions, provided
that this contract does not contain any restrictions, he shall issue
Powers of Attorney and in agreement with the First Deputy Managing
Director open current and other accounts of the Joint Venture at
Banks;
6) shall be liable for the drafting of the rules of the internal Working
Order, submit them to the Managing Board of the Joint Venture for
confirmation and ensure that these rules are complied with;
7) in accordance with the precepts of the Order of Business of the Board
of Directors he will determine the structural breakdown of the Joint
Venture and the job plans of the employees of the Joint Venture;
8) shall decide and issue instructions concerning operational matters
relating to the internal activities of the Joint Venture;
9) prepare proposals concerning the plans and measures for the training
of the personnel of the Joint Venture and submit them to the Managing
Board for confirmation;
10) prepare any further necessary materials and proposals, which must be
submitted to the Managing Board of the Joint Venture for examination,
and shall ensure the implementation of the decisions taken by the
Managing Board.
24.2. Decisions, the financial consequences of which go above US $10,000.00
shall require the agreement of the Managing Director and the First Deputy
Managing Director to be effective.
In addition any documents to be submitted to the Managing Board for
decision, as well as the hiring and firing of personnel shall require
agreement.
24.3. The First Deputy Managing Director shall take over the tasks and
powers of the Managing Director in the event of his illness or absence.
Moreover his powers shall be regulated in the Order of Business of the
Board of Directors.
24.4. The Managing Director and First Deputy Managing Director shall
regularly inform each other comprehensively of the progress of the
economic activities of the Joint Venture, but at least once a week.
24.5. The specific division of labour and method of operation of the Board
of Directors shall be laid down in the Order of Business to be approved by
the Managing Board. Regardless of the total liability of the Board of
Directors the competence and liability of the Directors for their business
area shall bc clear from this Order of Business.
Paragraph 25
Directors and Personnel
25.1. The personnel of the Joint Venture shall consist largely of Soviet
citizens, but also of foreign citizens, for which the Austrian Participant
shall have a right of proposal.
25.2. Questions of the conditions for the appointment and dismissal of
employees, wages and salaries and additional material incentives, the
working hours and holidays, industrial protection and social support of
the employees shall be regulated by the Joint Venture by way of deviation
from any other valid labour legislation of thc USSR and the RSFSR
independently by its Managing Board.
25.3. The Directors and personnel of the Joint Venture and its branches or
representatives shall therefore receive in response to a decision of the
Managing Board remunerations and Social Security payments, which shall not
be less than those for comparable activities in the company, which has the
right of proposal for the Director or employee.
25.4. Moreover the obligations and rights of the foreign Directors and
foreign personnel shall be governed by the agreements concluded
individually therewith. The technical requirements and qualifications of
the individual employees shall in each case by stipulated separately by
the Joint Venture.
25.5. Without the consent of the Managing Board only service agreements with
a duration of at most three years may be concluded by the Board of
Directors with Soviet and foreign employees of the Joint Venture.
25.6. The Board of Directors of the Joint Venture is obliged, to conclude
collective agreement with the union organisation which is to be formed
within the Joint Venture. Before commencement of negotiations with the
collective detail framework conditions for the collective agreement must
be submitted by the Board of Directors to the Managing Board for approval.
If the framework conditions are exceeded this will again require approval
by the Managing Board.
25.7. Each employee of the Joint Venture shall be entitled to also approach
individual Managing Board members, if he feels that his rights have been
violated.
Paragraph 26
Cancellation and termination of the Joint Venture
26.1. The Joint Venture is formed for an unspecified duration.
It will end on the expiry of the commercial extraction and completion of
the processing, transport and sale of hydrocarbons in accordance with
Paragraph 3 of these Articles of Association.
26.2. In the event of cancellation by a participant the Joint Venture shall
not be ended. If the cancellation becomes legally effective, then the
rights and obligations arising out of the credit and loan agreement
between the Joint Venture and the cancelling participant shall become
ineffective. The other participant shall in this case be entitled to take
over the share of the cancelling participant.
26.3. The cancelling participant shall receive his share of the assets at
the value, to be determined appropriately in the event of the liquidation
of the Joint Venture. The conditions stipulated in this paragraph for
this case shall be applied similarly.
An auditing of the established value by an international auditing company
shall in this case only be undertaken in response to a request from the
participant, who will also pay the costs of the audit.
26.4. Cancellation by a participant may be effected at the earliest after
complete granting of the loan by the said participant as mentioned in
Paragraph 9, Point 9.1 of these Articles of Association.
26.5. In the event of the official establishment of the inability to pay of
a participant by competent organs, involving the winding up of the said
participant, or if a participant voluntarily causes the loss of his legal
status, then the rights and obligations of this participant shall be
treated by the Joint Venture as if he had cancelled.
26.6. The Joint Venture shall be prematurely terminated:
- if the Managing Board of the Joint Venture takes an appropriate
unanimous resolution;
- in those cases, in which the regulation documents applicable to the
Joint Venture (paragraph 4 of the contract relating to the formation
and activities of the Joint Venture) provide for his liquidation.
26.7. The participants do hereby agree that the exploration on a risk basis will
mean initially a fairly long loss period which will therefore not lead to
premature winding up of the Joint Venture.
26.8. In the event of the termination of the Joint Venture the Managing
Board shall appoint a liquidation committee, which will consist of three
people.
the liquidation committee shall issue a liquidation balance sheet, which
will be submitted to the Managing Board for approval. The valuation of
the assets shall be effected by the liquidation committee in accordance
with the recommendations for the procedure of Auditors when valuing whole
companies of the U.E.C. committee for technical matters and research (KFF)
from the year 1980.
The liquidation balance sheet shall require an audit by an international
auditing company for its acceptance.
26.9. The residual assets shall after payment of the debts and redemption of
the commitments of the Joint Venture be paid out in accordance with the
approved liquidation balance sheet to the participants in proportion to
their shares in the Articles of Association Fund. Freely available and
transferable currency of the Joint Venture shall first be used for
payments to the Austrian participant.
If there is no freely available and transferable currency in the scope
necessary to satisfy the Austrian participant, the Joint Venture must
acquire freely convertible and transferable currency for the remaining
share of the Austrian participant.
26.10.On liquidation of the Joint Venture or on the departure of a
participant from the Joint Venture the outpayment of the relevant shares
in the Joint Venture between the participants shall be effected in the
form of cash or goods at the residual value of the share on the date
of liquidation or departure determined in accordance with this paragraph.
At the time of liquidation before any outpayment of shares the
commitments of each participant must be settled in respect to the other
participant and third parties.
Paragraph 27
Court of Arbitration and
Applicable Law
27.1. Any differences of opinion between the contractual participants, which
cannot be settled amicably, shall be settled subject to the exclusion of
the ordinary Courts by a Court of Arbitration of the Zurich Chamber of
Trade to the exclusion of Swiss Collision Law ruling in accordance with
material Swiss Law and binding on the participants, unless other legal
principles are applicable in accordance with Paragraph 4 of the contract
concerning the formation and activities of the Joint Venture.
27.2. The Court of Arbitration shall proceed in accordance with the
applicable conciliation and Arbitration Decree of the Zurich Chamber of
Trade and shall consist of the normal three Arbitrators. One each may be
appointed by each contractual participant. The proceedings of the Court
of Arbitration shall be conducted in German.
27.3. The decision of the Court of Arbitration shall be final.
Paragraph 28
Amendments and addenda
to the Articles of Association
28.1. Any amendments and addenda to these Articles of Association must be in
writing in Russian and German and may only be included with the agreement
of the representatives of the contractual participants given Powers of
Attorney for this purpose.
Paragraph 29
Language of the Articles of Association
29.1. The Russian and German versions of these Articles of Association shall
be equally binding.
29.2. In the event of problems of interpretation caused by translation each
contractual participant shall appoint an independent expert instructed to
prepare a proposal to solve thc problems satisfying the financial aims and
object of the Joint Venture.
Paragraph 30
Validity clause
30.1. Should individual paragraphs of these Articles of Association or parts
thereof be ineffective or become ineffective, this shall not affect the
effectiveness of the other paragraphs and the whole Articles of
Association.
30.2. The contractual participant shall in such a case be obliged, to
replace the ineffective paragraph or its ineffective parts with a
paragraph or parts thereof, which come the closest to the economic
and financial sense of the ineffective paragraph or parts thereof.
Paragraph 31
Adjustment of the Articles of Association
31.1. In the event of relevant regulation documents of the USSR, the RSFSR
or the Yakut-Sacha Socialist Soviet Republic becoming effective,
especially with regard to Company, Corporation or Trade Law including
Balance Sheet Law, the law of ownership of the land, the natural earth
resources and movable items, or other areas affecting the activities
of the Joint Venture, the contractual participants shall be entitled,
to adapt the conditions of these Articles of Association to the sense
and purpose of these regulation documents.
31.2. The adaptation of these Articles of Association or individual
conditions thereof requested in writing with reasons by a contractual
participant may only be refused by the other contractual participant for
objectively justified reasons.
Paragraph 32
Integral components of the Articles of Association
32.1. The following items shall form integral components of these Articles
of Association and the business principle for the formation and activities
of the Joint Venture:
1. Survey map of the exploration areas;
2. Survey map for section 1;
3. Survey map for section 2;
4. Credit and loan agreement between PGO LENANEFTEGASGEOLOGIJA and the
Joint Venture;
5. Credit and loan agreement between OEMV (JAKUTIEN) Exploration
Gesellschaft m.b.H. and the Joint Venture;
6. Agreement between OEMV (JAKUTIEN) Exploration Gesellschaft m.b.H. and
PGO LENANEFTEGASGEOLOGIJA;
7. Service agreement between PGO LENANEFTEGASGEOLOGIJA and the Joint
Venture;
8. Service agreement between OEMV (JAKUTIEN) Exploration Gesellschaft
m.b.H. and the Joint Venture.
Paragraph 33
Signing of the Articles of Association
33.1. These Articles of Association were signed
on 7th June 1991 in Vienna
in four copies in Russian and in German, the two language versions being
equally binding.
33.2. These Articles of Association become effective the moment they are
signed.
In the name and on the instructions of
PGO LENANEFTEGASGEOLOGIJA
(signature)
Selenski, V.V.
(Signature)
Jachenko, V.M.
In the name and on the instructions of the Company
OEMV (JAKUTIEN) Exploration Gesellschaft m.b.H.
(Signature)
Helmut Langanger
Amendment of the
CONTRACT
relating to the formation and activities
of the Joint VentureTAKT
between
The State Committee of the Republic of Sacha for
Privatisation, Antimonopoly Policy and
Support for Enterprise
67022 Yakutsk
Ulica Kirova No. 11
Republic of Sacha (Yakut)
Russian Federation
- hereinafter called the "Yakut Participant" -
represented by
Mr. R. Burnashov
and
the OEMV (JAKUTIEN) Exploration Gesellschaft m.b.H.
A-1090 Vienna
Otto-Wagner-Platz 5
Austria
a legal entity governed by Austrian Law,
- hereinafter called the "Austrian Participant" -,
represented by the
Director,Dipl. Ing. Helmut Langanger
PREAMBLE
PGO Lenaneftegasgeologia and OEMV (JAKUTIEN) Exploration Gesellschaft m.b.H.
signed the incorporation documents for thc TAKT Joint Venture on 7th June 1991;
The TAKT joint venture was registered with effect from 18th June 1991 in the
Soviet City of Yakutsk and on 18th August 1991 at the Ministry of Finance of the
Russian Federation;
In consideration of Decree No. 477 of 23.9.1991 of the Council of Ministers of
the Republic of Sacha the Managing Board of TAKT decided on 2nd October 1991 to
include GosKomnedra, of the Republic of Sacha (Yakut) as a further member of
TAKT;
By decision of the Council of Ministers of the Republic of Sacha of 23rd
September 1991 GosKomnedra Republic Sacha (Yakut) was liquidated.
The legal successor of GosKomnedra Republic Sacha (Yakut) is the Ministry for
the Energy and Fuel Industry of the Republic of Sacha;
By decision of the Council of Ministers of the Republic of Sacha of 19.1.1992,
No. 27, the raw materials industry of the Republic of Sacha was freshly
organized.
The Government of the Republic of Sacha (Yakut) stipulated the changing of the
founders of TAKT on the Yakut side on 29.5.92 in Decree No. 346/8.
The Managing Board of TAKT agreed on 29th September 1992 to the departure of
Lenaneftegasgeologia and of GosKomnedra from TAKT and the inclusion of the
Ministry for the energy and fuel industry as well as Jakutburneftegas as a new
participant in TAKT.
By decree of 14th October 1992 No. 848-r the Government of the Republic of Sacha
transferred all the shares of the State Administration organs in Joint Ventures
to the State Committee of the Republic of Sacha for Privatisation, Antimonopoly
Policy and Support for Enterprise.
The Managing Board of TAKT on 22nd February 1993 agreed to the transfer of the
shares in the TAKT joint venture from the Ministry for the Energy and Fuel
Industry and from Jakutburneftegas to the State Committee of the Republic of
Sacha for Privatisation, Antimonopoly Policy and Support for Enterprise.
Article 1
The Yakut member and the Austrian member do hereby agree, that on the basis of
thc contract relating to the formation and activities of a joint venture
including any appendices mentioned there of 7th June 1991 (Annex 1) as well as
the addenda and amendments in accordance with subsequent Article 2 the Yakut
participant is freshly included as a participant in the TAKT Joint Venture. The
Yakut participant takes over the rights and obligations under the aforementioned
contract as they have so far existed for the Yakut Russian participant.
Article 2
2.1. The contract relating to the formation and activities of the TAKT Joint
Venture is hereby amended as follows:
a) Preamble
The first paragraph is amended as follows:
"The State Committee of the Republic of Sacha for Privatisation,
Antimonopoly Policy and Support for Enterprise, which in accordance with
the decree of the Government of the Republic of Sacha of 14th October 1992
No. 848-r has to take over all the shares in joint ventures from the State
Administration organs."
b) Paragraph 7 point 2 is amended as follows:
"The funds as laid down in the Articles of Association shall be formed as
follows by the parties to the contract by cash inpayments in the form of
inpayments to the current accounts to be formed of the joint venture for
Roubles and for freely convertible currency or by non-cash capital
contributions, to be approved by the Managing Board:
1. Austrian Participant
Cash inpayment or
Non-cash capital contribution
Totalling US $1,000,000
2. Yakut participant
Cash inpayment or
Non-cash capital contribution
Totalling US $1,000,000
payable in US$ or Russian Roubles, converted at the officially
published rate of exchange of the State Bank of the Russian Federation
on the date of inpayment or provision of the non-cash capital
contribution.
Total value of the inpayments US $2,000,000."
c) Paragraph 7 point 4 is amended as follows:
"The cash inpayments or non-cash capital contributions shall become due for
payment at the latest thirty days after receipt of all the necessary
approvals for the licenses in accordance with Paragraph 4.4 and the
exploration and production splitting contract."
d) Paragraph 8 point 1 is amended as follows:
"In addition to the inpayments of the parties to the contract to the funds
in accordance with the Articles of Association the participants do hereby
grant to the Joint Venture for the first phase (Exploration) of his
activities fixed agreed private loans totalling
US $28,000,000
(in words: Twenty eight million US Dollars),
whereby each participant shall be responsible in accordance with the credit
and loan agreements attached to this contract (Appendices 5 and 6) for
US $14,000,000.
(in words: Fourteen million US Dollars), payable in US$ or Russian
Roubles, converted at the officially published rate of exchange of the
State Bank of the Russian Federation on the date of inpayment or provision
of the non-cash capital contribution."
e) Paragraph 8 Point 4 is deleted and not replaced.
f) Paragraph 28 Point 1, 1st paragraph is amended as follows:
"-It will make available to the Joint Venture free of charge all
geological, geophysical and other technical data relating to the sections
mentioned in Appendices 2 and 3 of this contract, which are in the
possession of companies, which are subordinate to the Yakut participant
directly or indirectly."
g) Paragraph 31. Point 5 is supplemented at the end with a new subparagraph
"The rights and obligations of the two participants arising out of
Paragraph 31 Point 5 also apply equally to companies, which are subordinate
to one of the two participants, directly or indirectly."
h) Paragraph 43 Point 1 Figure 5 and Figure 8 are amended as follows:
"Credit and loan agreement between the State Committee of the Republic of
Sacha for Privatisation, Antimonopoly Policy and Support for Enterprise and
the Joint Venture".
Figure 8 is deleted and not replaced.
2.2. The Articles of Association of the joint venture TAKT are amended as
follows:
a) Paragraph 5 point 1 is amended as follows:
"State Committee of the Republic of Sacha for Privatisation, Antimonopoly
Policy and Support for Enterprise"
b) Paragraph 8 Point 2 is amended as follows:
"1) The funds in accordance with the Articles of Association shall be
formed as set out hereinafter by the parties to the contract by cash
inpayments in the form of inpayments to the current accounts of the
joint venture to be set up for Roubles and for freely convertible
currency or by non-cash capital contributions, to be approved by the
Managing Board:
1. Austrian participant:
Cash inpayment or non-cash
capital contribution
totalling US $1,000,000
2. Yakut participant:
Cash inpayment or non-cash
capital contribution
totalling US $1,000,000
payable in US$ or Russian Roubles, converted at
the officially published rate of exchange of the State Bank of the
Russian Federation on the date of inpayment or non-cash capital
contribution.
Total value of the inpayments US $2,000,000.
c) Paragraph 8 Point 4 is amended as follows:
"The cash inpayments or non-cash capital contributions shall become due at
the latest thirty days after receipt of all the necessary approvals for the
licenses in accordance with Paragraph 4.4 and the exploration and
production splitting contract."
d) Paragraph 9 point 1 is amended as follows:
"In addition to the inpayments of the parties to the contract into the
funds in accordance with Articles of Association the participants do
guarantee to the joint venture for the first phase (exploration) of its
activities fixed agreed private loans totalling
US $28,000,000.
(in words: Twenty eight million US Dollars),
each participant being responsible in accordance with the credit and loan
agreements (Appendices 4 and 5) attached to this contract for
US $14,000,000.
(in words: Fourteen million US Dollars),
payable in US$ or Russian Roubles, converted at the officially published
rate of exchange of the State Bank of the Russian Federation on the date of
inpayment or the non-cash capital contribution."
e) Paragraph 9 point 4 is deleted and not replaced.
f) Paragraph 32 point 1 Figure 4 and Figure 7 are amended as follows:
Figure 4
"Credit and loan agreement between the State Committee of the Republic of
Sacha for Privatisation, Antimonopoly Policy and Support for Enterprise and
the Joint Venture"
Figure 7 is deleted and not replaced.
2.3 The State Committee of the Republic of Sacha for Privatisation,
Antimonopoly Policy and Support for Environment will enter with the TAKT
joint venture into a credit and loan agreement in accordance with Appendix
2. The credit and loan agreement shall be included as an integral
component and commercial principle of the contract governing the formation
and activities of the Joint Venture as Paragraph 43.1 Point 5 and as
Paragraph 32.1 Point 4 of the Articles of Association.
Article 3
All other paragraphs and appendices of the Contract relating to the formation
and activities of the joint venture as well as the Articles of Association
remain in force unchanged.
In the name and on the instructions of (Stamp and signature
THE STATE COMMITTEE OF THE REPUBLIC dated 21.04.93 of the
OF SACHA FOR State Committee of
PRIVATISATION, ANTIMONOPOLY POLICY AND Sacha)
SUPPORT FOR ENTERPRISE
(Signature of Helmut Langanger)
In the name and on the instructions of
OEMV (JAKUTIEN) Exploration Gesellschaft m.b.H.
Last part - Contract