EXHIBIT 10.5
EMPLOYMENT AGREEMENT # GT11/02Moscow October 21, 2004
This Employment Agreement (hereinafter the “AGREEMENT”) is made and entered byand between GOLDEN TELESERVICES, INC., (hereinafter the “EMPLOYER” or“CORPORATION”), a Delaware corporation, located at 2831 29th St., N. W.,Washington, DC 20008, USA, having its accredited representative office in Russia(hereinafter the “REPRESENTATIVE OFFICE”), located at 1 Kozhevnichesky Proezd,2nd Floor, Moscow, Russia, 115114, in the person of Petr Aven, acting on thebasis of the Power of Attorney dated October 21, 2004,
and
VINOGRADOV ALEXANDER YAKOVLEVICH, a citizen of the Russian Federation, born in1953, residing at: Moscow, 6 2nd Kazachi Pereulok , Apt. 11, the passport # 4503 253010, issued by Donskoy OVD, in Moscow on June 26, 2002, (hereinafter the“EMPLOYEE”)
     WHEREAS, (i) by resolution of the Board of Directors of the Corporationdated December 15, 2001, the Employee was appointed to the position of Presidentand Chief Executive Officer of the Corporation, and (ii) by resolution of theBoard of Directors of the corporation Golden Telecom, Inc. dated November 6,2001, located at 2831 29th Street, N.W., Washington, D.C., 20008, the Employeewas appointed to the position of President and Chief Executive Officer of thecorporation Golden Telecom, Inc.;
     WHEREAS, the Employee is employed by the Corporation by agreement datedFebruary 1, 2002, such agreement which will expire on November 5, 2004;
     WHEREAS, the Corporation desires to continue to employ the Employee asPresident and Chief Executive Officer under the terms of this Agreement;
     WHEREAS, the Corporation is a member of a group (a holding company) ofcompanies owned by Golden Telecom, Inc. and is a wholly- owned subsidiary ofGolden Telecom, Inc. (“GTI”);
     WHEREAS, the Employee has substantial experience in telecommunicationsoperations;
     NOW THEREFORE, the Employer and Employee agreed as follows:
1.  SUBJECT OF THE AGREEMENT 1.1  The Corporation hereby employs the Employee, as PRESIDENT AND CHIEFEXECUTIVE OFFICER. The job responsibilities of the Employee are statedherein. The principal place of work of the Employee is the RepresentativeOffice. 1.2  This Agreement is the agreement on the principal place of employment. 1.3  The Employer and the Employee have agreed that the Board of Directors ofthe Corporation or the Board of Directors of GTI have the right to takedecisions to appoint the Employee to positions in executive bodies of theenterprises that are part of the GTI group. The parties have also agreedthat the performance of duties and exercise of authorities in suchexecutive bodies by the Employee are his employment responsibilities inaccordance with this
 

 

   Agreement. The Employee shall undertake to accept such appointments andperform such responsibilities. 2.  TERM 2.1  This Agreement has been concluded for a term of three (3) years fromNovember 6, 2004, such that the term of the Agreement shall expire onNovember 6, 2007. This Agreement has been concluded for the limited termin accordance with Para. 18 of Article 59 of the Labor Code as with thehead of an enterprise. 2.2  The Employee will commence his work under this Agreement on November 6,2004. 2.3  The last day of the Employee’s work (i.e. the termination day) shall bethe day of expiration of the Agreement indicated in section 2.1 herein.The Employer shall notify the Employee of the expiration of the term ofthe Agreement in writing with returned receipt not later than 90 daysbefore termination of this Agreement. 2.4  The provisions of this Agreement are applicable to the employmentrelationship between the parties from NOVEMBER 6, 2004 and continue to bein effect until the term of the Agreement is completed or the Agreement isterminated. 2.5  Where the Employer decides to enter into the Agreement for a new term, itwill notify the Employee in writing ninety (90) days before the term ofthe Agreement is terminated. 2.6  Where the Agreement terminates because of the expiration of its term, theEmployer shall pay the Employee compensation in accordance with theprovisions of this Agreement stated in Article 17.7. 2.7  Where the Employee is dismissed from his position in accordance withapplicable legislation, the Employer reserves the right within any periodof the notice period or dismissal period, to require the Employee not toattend the Employer’s premises or the premises of the Employer’s businessunit and also to provide the Employee with an alternative job of a similarnature to the job the Employee normally performs. The Employer has a rightto pay to the Employee the salary and other benefits, which the Employeeis entitled under this Agreement to, provided that the period of suchrestrictions by the Employer does not exceed six months. 3.  EMPLOYEE RESPONSIBILITIES 3.1  The Employee undertakes to perform the work in person and consciouslyperform his employment responsibilities provided for in this Agreement andstated in the EXHIBIT A hereto. 3.2  The main employment responsibility of the Employee is to manage thebusiness activity of the Corporation, the Representative Office and otherlegal entities and business units of the GTI group. The Employer andEmployee have agreed that Employee’s salary according to this Agreementincludes full and sufficient compensation for performance by the Employeeof the above employment responsibilities. 3.3  While managing the activity of the Representative Office, the Employee isentitled to the right of the first signature on bank documents, the rightto employ and dismiss other employees of the Corporation and theRepresentative Office, to award incentives and impose discipline penaltieson the employees of the Corporation and the Representative Office, subjectto the applicable internal policies of the Corporation.
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3.4  The Employee shall provide the employees of the Corporation and theRepresentative Office with job conditions which meet the requirements ofthe applicable law of Russia, including the requirements of labor safetyrules and others. 3.5  While performing his employment responsibilities under this Agreement, theEmployee shall be guided by the foundation documents of the Corporationand the Representative Office, resolutions, orders and instructions of themanagement bodies (the Shareholders’ Meeting, Board of Directors) of theCorporation and GTI. 3.6  The Employee shall devote all necessary business time and attention, andapply the Employee’s best efforts, towards the fulfillment and executionof all assigned duties, and also the accomplishment of defined annual,quarterly and/or longer-term goals. 3.7  The Employee shall comply with GTI’s Code of Conduct, and other localnormative acts of the Employer, provisions of applicable law, whichdirectly or indirectly relate to his job with the Employer, and shall alsomeet all the requirements of applicable legislation and perform all theEmployer’s instructions not contradicting the norms of the applicablelegislation. 3.8  The Employee shall observe labor discipline, perform the defined labornorms, and meet the requirements of labor protection and labor safetyprovision. 3.9  The Employee shall protect the property of the Employer and otheremployees, take all reasonable measures for the protection of the propertyand property interests of the Employer from thefts, damage and ruin andimmediately inform representatives of the Employer on any situationthreatening the life and health of people and safety of the property ofthe Employer. 3.10  The Employee shall undertake not to take any actions which may causematerial or other damage to the Employer and GTI or which may on any wayinjure the reputation of the Employer and GTI. 3.11  The Employee shall undertake during the term of the Agreement to observethe interests of the Employer so that all of the Employee’s actionsrelated to performance of his employment responsibilities under thisAgreement will be accomplished solely in the interests of the Employer andnot in his personal interests or in the interests of third persons. 3.12  The Employee is obliged to use his business time only for the purposes ofperforming his employment responsibilities under this Agreement and tofulfill his employment responsibilities consciously, responsibly and inaccordance with the provisions of this Agreement. 3.13  The Employee is subject to all other responsibilities imposed on him bythe Labor Code of the Russian Federation including those provided byArticle 21 of the Labor Code. 4.  EMPLOYER RESPONSIBILITIES 4.1  The Employer undertakes to provide the Employee with work in accordancewith the stipulated position conditioned by this Agreement. 4.2  The Employer shall provide the Employee with the equipment, technicaldocumentation and other means necessary for the Employee’s performance ofhis employment responsibilities under this Agreement. 4.3  The Employer shall pay to the Employee on a timely basis and in full theEmployee’s salary indicated in this Agreement and other payments. 4.4  The Employer is subject to all other responsibilities imposed on him bythe Labor Code of the Russian Federation including those provided byArticle 22 of the Labor Code.
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5.  BUSINESS TIME AND REST-TIME 5.1  The working day with non-fixed working hours shall be established for theEmployee. 5.2  In addition to days-off, the Employee is entitled to holidays establishedunder Russian law. 6.  VACATION 6.1  The Employee is entitled to annual principal paid vacation with reservedplace of work and average salary for the period of twenty-eight (28)calendar days for each year of employment by the Employer. The right touse vacation for the first year of employment arises after six (6) monthsof continuous employment by the Employer. 6.2  The Employee is entitled to additional annual paid vacation of three (3)calendar days per year in consideration of his non-fixed working hours. 6.3  At termination of employment the Employee shall be paid monetarycompensation for all the unused vacation days. Upon written application ofthe Employee, the unused vacations may be provided together withsubsequent dismissal (except for dismissals for cause). The last day ofvacation is deemed to be the day of dismissal. 7.  PAYMENT 7.1  The Employee’s salary shall be paid in accordance with the Employer’scustomary payroll practices and applicable currency control legislation ofthe Russian Federation. 7.2  The Employee shall be paid the base monthly the salary in the amount andstructure as set forth in EXHIBIT B hereto. 7.3  The Employee’s salary shall be paid semi-monthly in accordance with apayroll schedule set by the Rules of the Internal Labor Schedule. 7.4  The salary shall be paid to the Employee via bank transfer to a Russianbank account indicated in advance by the Employee in writing. 7.5  The Employer shall withhold income tax and other deductions from thesalary and other payments to the Employee in respect with this Agreementin accordance with applicable Russian legislation and transfer theindicated amount of money as appropriate. 7.6  The provision stated above in section 7.5 shall not exempt the Employeefrom obligations established under applicable legislation of the RussianFederation to pay taxes on income earned from sources other than theEmployer. 7.7  The Employer in the person of the Board of Directors of the Corporationshall review the salary of the Employee on an annual basis and shallconsider (based upon the Employee’s performance and the Corporation’sfinancial condition) potential increases to the Employee’s base salary asthe Employer shall, in its sole and absolute discretion, deem appropriate. 7.8  Vacation shall be paid not later than three days before it starts. 8.  BENEFITS 8.1  During the term of this Agreement, the Employee shall be entitled toreceive such benefits and also to participate in employee group benefitplans as are generally provided by the Employer and GTI to their employeesof comparable level and responsibility in accordance with the plans,practices and programs of the Employer and GTI.
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8.2  In addition, the Employee’s benefits shall include life and disabilityinsurance policies. The Corporation shall maintain a life insurance policyfor the Employee which shall have a value of US$ 1 million. In the eventthat the Employee elects to arrange his own life insurance policy, thenthe Corporation shall pay the Employee an annual amount of US$ 15,000(fifteen thousand dollars) for each year that the Employee maintains hisown life insurance policy during the Term of this Agreement. TheCorporation shall maintain the Employee’s disability insurance policy at alevel equal to 60 percent of the Employee’s salary. 8.3  For the purposes of this Agreement, the term “Benefits” shall not includethe Employee’s base salary, bonuses, incentive bonuses, or other specificremunerations, which the Employee may receive or for which the Employeemay be eligible during the term hereof. 8.4  In addition to the Benefits indicated in section 8.1, the Employer shallconclude a Travel Accident Insurance contract to provide accidentinsurance for the Employee during such time as the Employee performs hisduties on business trips as well as during his vacations. In the event ofthe Employee’s death, the insurance company shall pay the insuranceamounts to the Employee’s immediate relative provided that the insurancecompany obtains documents confirming the death of the Employee and therelationship of the Employee’s relative to the Employee. 8.5  The Employee will be provided with an automobile for Employee’s businessin line with the policy of the Employer. 8.6  The Employee is entitled to receive Benefits information from the Directorof Human Resources of the Employer, and the Employer is obliged to providesuch information to the Employee with receipt of written acknowledgement. 9.  EXPENSE REIMBURSEMENT 9.1  During the term of employment, the Employer shall reimburse the Employeefor all reasonable and necessary expenses incurred by the Employee inconnection with the performance of the Employee’s duties by the Agreement.Such reimbursements are subject to the submission to the Employer by theEmployee of appropriate documentation and/or vouchers in accordance withthe procedures of the Employer for business expense reimbursement andapplicable legislation. Such procedures of the Employer may be changedfrom time to time. The Employer in person of the Director of HumanResources shall inform the Employee on the procedures for businessexpenses reimbursement. 10.  OBLIGATORY SOCIAL INSURANCE 10.1  The Employee is subject to the obligatory social insurance (the obligatorymedical, social and pension insurance) by governmental non-budget funds atthe expense of the Employer in the manner provided by Russian legislation. 11.  TEMPORARY DISABILITY 11.1  In case of temporary disability (illness, accident etc.) the Employeeshall, to the extent possible, immediately inform the Director of HumanResources or another Employer’s authorized representative. 11.2  The Employee shall provide the sick leave paper confirming his temporarydisability (illness, accident etc.) not later than three (3) days after herestarts work. 11.3  The Employer shall pay to the Employee the temporary disability relief inaccordance with the applicable law.
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12.  CONFIDENTIAL INFORMATION 12.1  The list of confidential information, including the information consistingof commercial secrets of the Employer, is indicated in the EXHIBIT Chereto. 12.2  The Employee shall observe the procedure of confidentiality (secrecy) inrelation to the information stated in the EXHIBIT C hereto, not todisclose such information, including Employer’s commercial secrets, whichbecame known to the Employee in connection with his performance of hisemployment responsibilities under this Agreement, to the third persons andtake measures to prevent non-authorized disclosure of such information tothird persons. 12.3  Where the Employee discloses Employer’s commercial secrets, the Employeris entitled to dismiss the Employee in accordance with sub-section “B” ofsection 6 of Article 81 of the Labor Code of the Russian Federation. 12.4  Information constituting the Employer’s commercial secrets is the propertyof the Employer and remains its property in case of termination ofemployment relationship between the parties. 12.5  The Employee shall not bring out or carry from the premises of theEmployer’s enterprise any goods, documents, files, records etc. if this isnot related to his employment responsibility performance, and shallimmediately return them when the business necessity no longer exists. 12.6  The parties shall not spread in relation to each other any untrue andfalse information both during the term of employment relationship betweenthe Employee and Employer and after it terminates. The Employee shall notuse or publish any data or information being received by the Employeeduring the term of his employment under this Agreement. 12.7  The obligations stipulated for sections 12.2 and 12.6 above continue to bein effect after termination of this Agreement. 13.  INTELLECTUAL PROPERTY 13.1  All property rights to any intellectual property being the result of theEmployee’s job activity under this Agreement or in relation hereto, aswell as all the results of the Employee’s intellectual activity which hereceives by using the premises, information or other property of theEmployer, including know-how or any other official or commercial secret ofthe Employer, become the property of the Employer from the moment ofcreation of such objects. 13.2  The Employee shall immediately inform the Employer in writing about allthe objects of intellectual property under protection created by theEmployee in course of his job activity under this Agreement or relatedhereto, and also transfer to the Employer all the documents, copies andother documentation related to such objects. 13.3  The property rights to intellectual property objects indicated above areowned by the Employer in all the countries of the world. The Employeeshall take all legal measures and observe all official procedures, whichmay be required under the legislation of any country of the world tosecure (register) rights to such objects by the Employer. 13.4  The Employee hereby authorizes the Employer to act in its name in relationto all issues connected with security or registration by the Employer ofintellectual property rights to the objects indicated above. 13.5  The Employee and Employer hereby agree that the Employee’s salary includesfull and sufficient remuneration for all intellectual property objectscreated by the Employee, which are indicated above in section 13.1, exceptfor remuneration fixed by imperative norms of the applicable law of theRussian Federation.
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14.  PERSONAL DATA 14.1  The Employee shall provide appropriate processing (including storage andusage) and protection of personal data of the employees of the Corporationand Representative Office and of other enterprises under his control inaccordance with the Russian law. 15.  AMENDMENTS 15.1  All amendments and supplements to the Agreement shall be made in writingand signed by the parties. 15.2  At any time, the parties to this Agreement may amend this Agreement, inaccordance with Russian legislation. 16.  TERMINATION 16.1  The Agreement may be terminated at any time by the parties’ voluntaryagreement in accordance with section 1 of Article 77 of the Labor Code ofthe Russian Federation. 16.2  The Agreement is terminated on the term expiry date indicated in section2.1 hereof. This Agreement may be terminated early in accordance with theLabor Code of the Russian Federation and this Agreement. 16.3  Termination at the Employer’s Initiative for Cause.    In addition to those grounds provided for in the Labor Code of the RussianFederation, the Employer may terminate the Agreement with the Employeeupon Employee’s:
 (i)  breach of or failure to perform the Corporation’s or GTI Board ofDirectors’ instructions which do not contradict applicablelegislation, except for where such failure results from theEmployee’s disability and the Employee notifies the Employer asappropriate, and the Employer provides the Employee with areasonable period for elimination of such failure; in this case theEmployer is entitled to terminate the Agreement after such periodexpires if the failure has not been eliminated.  (ii)  fraud, embezzlement, or any other similar illegal act in connectionwith the Employee’s duties as an Executive of the Employer or anybusiness unit or affiliate or parent, direct or indirect, of theEmployer,  (iii)  conviction of any felony or crime involving moral turpitude whichcauses or may reasonably be expected to cause substantial losses orsubstantial injury to the reputation of the Corporation, GTI ortheir subsidiaries and affiliates;  (iv)  wilful or grossly negligent commission of any other act which causesor may reasonably be expected (as of the time of such occurrence) tocause substantial damage to or substantial injury to the reputationof the Employer, subsidiaries, affiliates or parent, direct orindirect, including GTI, of the Employer, including, withoutlimitation, any violation of the Foreign Corrupt Practices Act, asprovided for herein;
16.4  Termination for Reason of Total Disability.    Notwithstanding anything to the contrary in the provisions of thisAgreement, the Employer is entitled at all times to terminate thisAgreement immediately by delivering written notice to the Employee if theEmployee experiences a Total Disability. For the purpose of thisAgreement, the term “Total Disability” means any mental or physicalillness, condition,
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   disability or incapacity that:
 (i)  prevents the Employee from discharging substantial functions andemployment duties;  (ii)  shall be attested to in writing by a physician or a group ofphysicians acceptable to the Employer; and  (iii)  continues for a period of 90 days in any 12 (twelve) month period.
   A Total Disability shall be deemed to have occurred on the last day ofsuch applicable 90-day period, and shall be determined in accordance withapplicable medical law relating to disability. 16.5  Voluntary Resignation.    The Employee may terminate this Agreement at any time by giving a writtennotice to the Employer one month prior to the assumed resignation date(the “Employee’s Notice Period”). The Employee shall notify the Employerno later than ninety (90) days prior to the date of resignation. Uponreceipt of such notice, the Employer, in its sole discretion, may eithercontinue to employ the Employee during all or part of the Employee’sNotice Period, or may continue to pay the Employee’s salary and continuegrant Benefits during the Employee’s Notice Period in lieu of continuedemployment. 16.6  Termination by the Corporation’s Management Body’s Resolution.    The Employer is entitled to terminate this Agreement and end theemployment relationship with the Employee at any time by resolution of theShareholders’ Meeting or Board of Directors of the Corporation. 17.  PAYMENTS UPON TERMINATION 17.1  Payment.    Except as specifically set forth herein, all payments to be made under theterms of this section may be made by the Employer in its sole and absolutediscretion, either in one lump-sum payment at the beginning of thetermination period or in installments over the term of the period coveredby the payment in accordance with the Employer’s customary payrollpractices. 17.2  Termination on the Employer’s Initiative by Additional Reasons    In the event that this Agreement is terminated by the Employer for Cause(section 16.3 herein), the Employer shall have no obligation to pay thesalary to the Employee or provide any other remuneration or Benefits underthis Agreement for any period after the date of such termination(dismissal), or to pay an Employee Bonus for the fiscal year in which suchtermination occurs.    However, the Employer shall as appropriate (i) pay to the Employee allsalary earned by Employee prior to the date of termination, (ii) grant anyBenefits under any program of the Employer, in which the Employee is aparticipant to the full extent of the Employee’s rights under such plansprior to termination, and (iii) reimburse any appropriate businessexpenses incurred by the Employee prior to termination and properlyconfirmed by the Employee. 17.3  Termination by Reason of Total Disability (section 16.4 hereof).    In the event that the Employee’s employment under this Agreement isterminated by reason of
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   Total Disability, the Employee shall have no obligation to pay the salaryor to grant the Benefit provided under this Agreement for any period afterthe date of such termination.    In such case the Employer shall properly (i) pay to the Employee allsalary earned by the Employee prior to the date of such termination, (ii)pay to the Employee the pro rata share of the Employee Bonus for thefiscal year in which the Total Disability occurred, (iii) grant anyBenefits under any plans of the Employer in which the Employee is aparticipant to the full extent of the Employee’s rights under such plansprior to the date of such termination, (iv) reimburse respective expensesincurred by the Employee prior to such termination and properlyconfirmation by the Employee, (v) pay to the Employee the severancepayment in the amount of average month salary for the period of two weeks.Each such payment is to be made on the date of the termination with theexception of total disability relief, which shall continue to be paid inaccordance with the total disability insurance plan.    In the event there is a period of time during which the Employee is notbeing paid salary for any reason and not receiving total disabilitypayments by insurance plan, and conditioned upon the Employee orEmployee’s representative immediately notifying the Employer in writing,the Compensation Committee of the Board of Directors of GTI (“CompensationCommittee”) shall require all necessary information and shall discusswhether the Employer shall make interim payments to the Employee until thecommencement of insurance payments under the total disability plan. 17.4  Termination by Reason of Death.    If the Employee dies during the term of this Agreement, the Employer shallproperly pay to the members of the Employee’s family or to the personsbeing his dependants on the day of his death, to the degree earned but notpaid prior to the date of the Employee’s death: (i) all salary; (ii) thepro rata share of the Employee’s Bonus for the fiscal year in which thedeath occurred; (iii) any Benefits under any plans of the Employer inwhich the Employee is a participant to the full extent under such plansand (iv) reimburse properly confirmed business expenses incurred by theEmployee which were not paid on the date of his death. 17.5  Voluntary Resignation (section 16.5 hereof).    In the event that the Employee resigns voluntarily from Employee’semployment with the Employer (declares the agreement terminated), theEmployer shall have no obligation to pay the salary provided under thisAgreement to the Employee for any period after the end of the expirationof Employee’s Notice Period.    Prior to the expiration of Employee’s Notice Period the Employer shallpromptly: (i) pay the salary earned by the Employee prior to theexpiration of the Employee’s Notice Period; (ii) grant the Benefits underany plans of the Employer in which the Employee is a participant to thefull extent of the Employee’s rights under such plans prior to theexpiration of the Employee’s Notice Period, provided, however, that suchBenefits shall cease upon Employee’s receipt of comparable benefits orcoverage under any plans provided by a new employer and (iii) reimburseany appropriate business expenses incurred by the Employee before theexpiration of said Employee’s Notice Period and properly confirmed by theEmployee. 17.6  Termination by Resolution of the Management Body (section 16.6 hereof).    In the event that the Employer terminates this Agreement by resolution ofthe Shareholders’ Meeting or the Board of Directors of the Corporation:
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 (i)  the Employer shall properly pay to the Employee: (A) all salary tothe extent earned prior to the separation date; (B) the pro ratashare of the Employee Bonuses for the fiscal year in which thetermination occurred; (C) Benefits under any insurance plans of theEmployer in which the Employee is a participant to the full extentof the Employee’s rights under such plans prior to termination (D)reimburse appropriate expenses incurred by the Employee prior to thedate of such termination and properly submitted to the Employer;  (ii)  subject to the Employer’s receipt from the Employee of a notarizeddeclaration stating that the Employee does not have any claim to theEmployer, the Employer shall also pay to the Employee in accordancewith its payroll schedule an amount equal to the Employee’s salaryon the separation date for the period of nine (9) months;  (iii)  the Employer shall extend for nine (9) months the period of validityof the benefits under the medical insurance plan in which theEmployee is a participant, provided that such benefits shall ceaseupon the Employee’s receipt of comparable benefits under, any plansprovided by a new employer.
17.7  Termination by Expiration (section 16.2 hereof).    In case of termination due to expiration of the agreement the Employershall:
 (i)  pay to the Employee in accordance with its payroll schedule anamount equal to the Employee’s salary on the separation date for theperiod of nine (9) months;  (ii)  the Employer shall extend for nine (9) months the period of validityof the benefits under the medical insurance plan in which theEmployee is a participant, provided that such benefits shall ceaseupon the Employee’s receipt of comparable benefits under, any plansprovided by a new employer.
18  CHANGE OF CONTROL    In the event that there is a Change of Control, then the Corporation shallpay the Employee a lump sum amount equal to two times the Employee’sannual base salary. For the purposes of this Agreement, “Change ofControl” shall mean:
 (i)  a sale of all or substantially all of the assets of GTI to anothercorporation (other than a parent, subsidiary or affiliated companyof GTI), or  (ii)  any transaction (including, without limitation, a merger orreorganization in which GTI is the surviving corporation) whichresults in any person or entity (other than a parent, subsidiary oraffiliated company of GTI) owning more than 50% of the combinedvoting power of all classes of stock of GTI, provided, however, anysuch transaction under this section 18 by any of Alfa TelecomLimited, Nye Telenor East Invest AS, OAO Rostelecom or theirrespective affiliated companies shall not be considered a Change ofControl for the purposes of this section 18.
19.  REPRESENTATION    Employee hereby represents that: (i) the Employee is not restricted in anymaterial way from performing Employee’s duties hereunder as the result ofany contract, agreement or law and (ii) Employee’s due performance ofEmployee’s duties hereunder does not and will not violate the terms of anyagreement to which the Employee is bound.
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20.  FOREIGN CORRUPT PRACTICES ACT 20.1  As the President of the Corporation registered and having businessactivity in the U.S., the Employee agrees to comply in all materialrespects with the applicable provisions of the U.S. Foreign CorruptPractices Act of 1977 (“FCPA”), as amended, which provides that under nocircumstances will foreign officials, representatives of political partiesor holders of public offices be offered, promised or paid any money,remuneration, things of value, or provided any other benefits, direct orindirect, in connection with obtaining or maintaining contracts or ordershereunder. When any representative, executive, agent, or other individualor organization associated with the Employee is required to perform anyobligation related to or in connection with this Agreement, the substanceof this Article shall be imposed upon such person and included in anyagreement between the Employee and any such person. Failure by theEmployee to comply in all respects with the provisions of the FCPA shallconstitute a material breach of this Agreement and shall entitle theEmployer to terminate this Agreement immediately upon such failure tocomply. Additionally, the Employee hereby acknowledges that the Employeehas read “An Explanation of the Foreign Corrupt Practices Act” and “GoldenTelecom, Inc. Policy on Foreign Transactions,” copies of which have beenprovided to the Employee. The Employee also acknowledges that a conditionprecedent to the effectiveness of this Agreement shall be the execution bythe Employee of the “Addendum to the Golden Telecom, Inc. Policy onForeign Transaction,” a copy of which has been provided to the Employee.Additionally, and as a condition for the Employer to continue thisAgreement, the Employee may be required from time to time at the requestof the Employer to execute a certificate of Executive’s compliance withthe aforementioned laws and regulations. 21.  RESTRICTIONS ON OPERATIONS WITH GTI SECURITIES 21.1  As an Employee of the Corporation registered and acting in the U.S., theEmployee agrees to comply with restrictions on operations with GTIsecurities fixed for the officers of the Corporation and some other itsemployees and stated in the “Policy and Procedures for Directors, Officersand Employees of GTI and its Affiliates on Insider Trading and Tipping”.The Employee hereby acknowledges that he has read the “Policy andProcedures for Directors, Officers and Employees of GTI and its Affiliateson Insider Trading and Tipping” the copy of which has been provided to theEmployee. 22.  NON-COMPETITION 22.1  As the Employee of the Corporation, registered and acting in the U.S.,during the term of this Agreement, and for a period equal to nine (9)months thereafter, the Employee agrees (i) directly or indirectly throughany other person or entity not to acquire in any manner any            shares/ownership interest in entities that compete with the Corporation orother entities and business units of the GTI group (except purely passiveinvestments amounting to no more than five percent (5%) of the votingequity), and (ii) not to be employed with entities which compete with theCorporation or other entities and business units of the GTI group as wellas not to provide such entities with consultancy services. 22.2  As a Employee of the Corporation registered and acting in the U.S., theEmployee agrees during the term of the Agreement and for nine (9) monthsupon the termination to refrain from inducing (direct or indirect)officers of the Corporation and of other entities and business units ofGTI with the purpose (i) to terminate or refrain from renewing orextending such persons’s employment with the Corporation or another entityof the GTI group or (ii) to induce such persons to become employed orbecome consultant to any person not being a
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   member of the GTI group. 22.3  As an Employee of the Corporation registered and acting in the U.S., theEmployee agrees during the term of the Agreement and for nine (9) monthsupon the termination to refrain from inducing (direct or indirect) anycontractors of the Corporation or other entities and business units of theGTI group with the purpose to terminate or refrain from extending suchpersons’ s contractual or other relations with the Corporation or anotherentity of the GTI group. 23.  INDEMNIFICATION 23.1  As an Employee of the Corporation registered and acting in the U.S., theEmployee shall be entitled to indemnification set forth in the Employer’sCertificate of Incorporation to the maximum extent allowed under the lawsof the Commonwealth of Virginia and the State of Delaware CorporationsAct. 24.  DIRECTORS’ AND OFFICERS’ INSURANCE 24.1  The Employer shall identify, acquire and maintain in force at all timesduring the term of this Agreement Directors, Officers and CorporateLiability Insurance policies in relation to the Employee as President ofthe Corporation registered and acting in the U.S.. 25.  NOTICES 25.1  Any written notice required by this Agreement will be deemed delivered tothe intended recipient when (i) delivered in person by hand; or (ii) threedays after being sent via certified mail, return receipt requested; or(iii) the day after being sent via by overnight courier, in each case whensuch notice is properly addressed to the following address and with allfees having been paid properly:         If to the Employer: Moscow Representative Office of the Corporation    Golden TeleServices, Inc.    Russia, 115114, Moscow    1 Kozhevnichesky Proezd, 2nd Floor   Attn: Jeffrey A. Riddell     Senior Vice-President     General Counsel        If to the Employee: Mr. Alexander Vinogradov    Moscow, 6 2nd Kazachi Pereulok , Apt. 11
Either party may change the address to which notices, requests, demands andother communications to such party shall be delivered by giving notice to theother party in the manner described above.
26.  ENTIRE AGREEMENT 26.1  This Agreement constitutes the entire agreement between the parties withrespect to the subject matter described in this Agreement and supersedesall prior agreements, both oral and written, between the parties. ThisAgreement may not be modified, amended, or rescinded in any manner, exceptby written instrument signed by both of the parties hereto.
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27.  SEVERABILITY 27.1  In case any one or more of the provisions of this Agreement shall be heldby any court of competent jurisdiction or another body to be illegal,invalid or unenforceable, such provision shall have no force and effect,but such holding shall not affect the legality, validity or enforceabilityof any other provision of this Agreement. 28.  DISPUTE RESOLUTION 28.1  In the event that any dispute arises between the Employer and the Employeeregarding or relating to this Agreement and/or any aspect of theEmployee’s employment, such disputes are subject to be resolved bynegotiations. Where such disputes cannot be resolved through negotiations,they shall be submitted to the court. 29.  FORCE MAJEURE 29.1  Neither Employer nor Employee shall be liable for any delay or failure inperformance of any part of this Agreement to the extent that such delay orfailure is caused by an event beyond its reasonable control including, butnot be limited to, fire, flood, explosion, war, strike, embargo,government requirement, acts of civil or military authority, and acts ofGod not resulting from the negligence of the claiming party. 30.  MISCELLANEOUS 30.1  All the exhibits to this Agreement are its integral parts and to be signedby the Employer and the Employee. 30.2  This Agreement shall be governed by the legislation of the RussianFederation. The content of Articles 19, 20 and 21 hereof are subject tointerpretation, and the obligations determined by the above articles shallbe regulated in accordance with the law/legislation applicable to theCorporation’s activity and relationship between the Corporation and theEmployee.
This Agreement has been signed in four (4) counterparts, two (2) of which are inRussian and two (2) in English. Each party shall receive one (1) counterpart inRussian and one (1) counterpart in English. If there is any discrepancy betweenthe English and Russian texts, then the Russian text shall prevail.   EMPLOYER: EMPLOYEE:    Petr Aven Alexander Yakovlevich VinogradovBy Power of Attorney  [Employer’s Stamp]  
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EXHIBIT A
TO THE EMPLOYMENT AGREEMENT # GT 11/02 DATED OCTOBER 21, 2004
JOB RESPONSIBILITIES OF THE EMPLOYEE
Job Responsibilities of the Employee:
The Employee shall:
-     conduct general and active management and control of the businessand affairs of the Corporation and Representative Office and, in case ofhis appointment to positions in the executive bodies of other entitiesbeing members of the GTI group, of the business and affairs of suchentities;
-     make sure that all orders and resolutions of the management bodies(the Shareholders’ Meeting, Board of Directors) of the Corporation and GTIare carried into effect;
-     perform all duties incident to the office of President and fixed bythe foundation documents of the Corporation and Representative Officeand/or orders and resolutions of the management bodies of the Corporationand GTI, and all such other duties as may from time to time be assigned bythe Board of Directors   EMPLOYER: EMPLOYEE:    Petr Aven Alexander Yakovlevich VinogradovBy Power of Attorney  [Employer’s Stamp]  
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EXHIBIT B
TO THE EMPLOYMENT AGREEMENT # GT 11/02 DATED OCTOBER 21, 2004
COMPENSATION
   Compensation of the Employee includes the base salary, bonuses and otherincentive payments indicated below. 1.  EMPLOYEE BASE SALARY 1.1  The Employee shall be paid the base salary per month in an amountequivalent to US$ 33,333.33 (thirty three thousand three hundred thirtythree dollars and thirty three cents) before taxes in accordance with theapplicable law of the Russian Federation, and the base salary shall bepaid in Ruble equivalent by the rate of the Central Bank of the RussianFederation on the day of payroll accrual. The above base salary shall bepaid to the Employee beginning from the date when this Agreement enteredinto effect and continuing thereafter unless revised in accordance withthe provisions hereof. 2.  EMPLOYEE BONUS    In addition to the Employee’ base salary in accordance with the resolutionof the Board of Directors of the Corporation and GTI the Employer may payto the Employee the Employee’s performance-based incentive bonus (the“EMPLOYEE BONUS”) in an amount equivalent to US$ 140,000 (one hundred andforty thousand dollars). The bonus shall be paid annually. The actualamount of the annual payment will depend on the results of overallperformance of GTI, the performance of the Employee’s business unit and onthe achievement of personal objectives. 3.  OTHER INCENTIVE PAYMENTS 3.1  GTI has adopted the Long Term Incentive Bonus Program (the “PROGRAM”) forits employees and the employees of its business units, including theCorporation. Subject to the provisions of the Program the Corporation willallocate long term incentive amounts to the Employee in accordance withthe terms of the Program. 3.2  In the event that the Agreement is terminated under sections 16.2 (expiryof term), 16.4 (Disability for Reasons of Total Disability), 16.6(Termination by the Corporation’s Management Body’s Resolution) or 16.7(Termination Due to Change of Control), then any incentive under theProgram which has been allocated to the Employee but which has not vestedshall fully vest as of the termination date of the Agreement.
(_____)____________ 2004   EMPLOYER: EMPLOYEE:    Petr Aven Alexander Yakovlevich VinogradovBy Power of Attorney  [Employer’s Stamp]  
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EXHIBIT C
TO THE EMPLOYMENT AGREEMENT # GT 11/02 DATED OCTOBER 21, 2004
LIST OF CONFIDENTIAL INFORMATION
1.  Information related to the Employer’s business activity, its employees,partners or affiliates or related to their business activity conditions,information on their contractors, any financial information, includingforecasted financial results, information on employees, amount of theirsalaries and other remunerations to be paid, and also any informationknown, disclosed or available to the Employee in respect with theEmployer, its employees, partners, contractors or affiliates.
2.  All the correspondence, letters, facsimile messages, lists of employeesand contractors, any documentation, translations, any information onelectronic and magnetic medias, and also other documents and materials(including, but not limited with those created by the Employee in courseof his employment activity with the Employer), related to the businessactivity of the Employer, its employees, partners, contractors andaffiliates.
(_____)____________ 2004   EMPLOYER: EMPLOYEE:    Petr Aven Alexander Yakovlevich VinogradovBy Power of Attorney  [Employer’s Stamp]  
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