exv10w1



 







EXHIBIT 10.1




EMPLOYMENT AGREEMENT No. 81



This Employment Agreement (“Agreement”) is entered into on January 3, 2002 by and between EDN
Sovintel LLC (“Company”), with its registered address at 25 Dubovaya Roshcha St., Moscow 127427,
Russian Federation, and citizen Ilya Alexandrovich Smirnov, residing at 7 Pribrezhnyi Projezd Bldg.
1 Apt. 100, Moscow 125445, holder of the passport series XXIX-MIO No. 616362, issued by the 14th
Militia Precinct, Moscow, on July 12, 1983 (“Employee”).



The Parties hereto hereby agree as follows:




     1. Subject of the Agreement



     1.1 The Company hereby hires the Employee and the Employee hereby agrees to perform work in
the capacity of Director of the Legal Department of the Company’s Administrative Division, on the
terms and conditions and in compliance with the requirements set forth herein.



     1.2 As an employee of the Company the Employee shall perform the duties assigned to him and
shall be vested with the authorities and powers stipulated by this Agreement and designated from
time to time by the 1st Deputy General Director of the Company. During the period of his employment
the Employee shall report to the 1st Deputy General Director of the Company and the higher-level
executives..



     1.3 This Agreement is a agreement of full-time employment..



     1.4 The Employee’s place of work shall be the Company’s Moscow office in the Russian
Federation. Should the Employee be required to fulfill assignments for the Company outside Moscow,
the Employee hereby agrees to perform such assignments.



     2. Term of the Agreement



     This Agreement is concluded for an indefinite period of time.



     3. Payment Procedure



     3.1 On a regular basis, the Company shall pay the Employee his salary together with other
kinds of remuneration in accordance with the policies of the Company.



     3.2 The Employee’s salary, as determined in accordance with the staffing plan of the
Company and the Employee’s position, to an equivalent is equal to 4,600 US dollars per month. The
salary shall be paid to the Employee in accordance with the “Regulation on the Amounts, Systems and
Forms of Labor Remuneration of Staff Employees of EDN Sovintel LLC” and shall consist of a fixed
part (basic pay) and a variable part..



 









 





     3.3 As a rule, the salary shall be calculated for payment as of the last calendar date of the
current month. In some cases, provided by the labor laws, salary calculation may be shifted to an
earlier date of the current calendar month, as required for timely payment of the salary. In this
case, the salary calculation date shall be established by an internal regulation. The Company shall
withhold taxes from the aforementioned sum and from the other income paid by the Company, at the
rate and in the procedure established by the applicable Russian laws.



     3.3 This provision does not release the Employee from the responsibility established by the
applicable Russian laws for the payment of taxes on the income from all other sources which are not
connected with the labor relationships between the Company and the Employee.



     3.4 The salary and other remuneration stipulated by this Agreement shall be paid to the
Employee not later than the 10th day of the month which follows the month for which the payment is
to be made.



     4. Bonuses



     The Company may pay the Employee bonuses and other kinds of remuneration depending on the
results of his work and successful activity of the Company, subject to the “Regulation on the
Systems, Amounts and Forms of Bonuses Paid to Employees of the Commercial Division of EDN Sovintel
LLC.”



     5. Benefits and Allowances



     5.1 The Employee shall be entitled to additional benefits and allowances, both individual and
collective, established by the Company, including health insurance, life insurance and disability
insurance for the periods of business trips, in accordance with the general policies of the
Company.



     5.2 The Employee shall, in a timely manner, inform the Company of additional grounds for
receiving benefits, which are provided for by the applicable laws of the Russian Federation.



     5.3 The Employee shall be entitled to receive information about benefits and allowances from
the HR specialist of the Company.



     6. Payment of Expenses



     The Company shall compensate the Employee for all reasonably incurred actual expenses
incidental to the performance of his official duties, provided such expenses have been agreed upon
in advance with the 1st Deputy General Director of the Company. The expenses shall be paid if the
Employee presents proper confirming documents in the procedure established by the Company.



     7. Obligations of the Employee



     The Employee hereby assumes the following obligations:



 









 





     7.1 The Employee shall perform his duties and carry out the assignments of the Company
promptly and efficiently, using his skills and experience to the utmost. He shall always abide by
the instructions and the internal policies of the Company and shall use his best efforts to protect
the interests and reputation of the Company.



     7.2 The Employee shall handle with care the materials, office equipment, communication devices
and other tangible assets given to him by the Company. The Employee shall bear financial liability
both for direct real damages suffered by the Company though his fault and for damages suffered by
the Company because of the damages paid by the Employee to other persons.



     7.3 The Company shall, at all times, keep the Employee advised, and shall have him sign for
being advised, of the requirements of the Safety Engineering Instructions. The Employee shall, upon
the Company’s request, regularly undergo the instruction in this subject and shall not violate the
safety engineering instructions in force in the Company. For breaching the provisions of these
instructions the Employee shall bear responsibility under the applicable laws of the Russian
Federation.



     7.4 The Employee shall not, without a prior written consent of the Company, either directly or
through any third persons:




(i) during the term of this Agreement and for two years after its termination,
encourage or compel any person, who is an employee of the Company or of any of the
related companies, to terminate or refuse to prolong the employment agreement of this
person with the Company or any company related to the Company, or




(ii) during the term of this Agreement and for two years after its termination,
encourage or compel any natural person or legal entity, who/which is a customer or
supplier of the Company or of any of the related companies, to break off or refuse to
prolong his/its relations with the Company or its branch.



     7.5 If the nature of the Employee’s work is such that it is connected with the acceptance,
transfer, safekeeping and movement of tangible assets, the Employee agrees to sign a document
prepared by the administration of the Company, which establishes the full responsibility of the
Employee for the assets entrusted to him.



     7.6 Upon quitting his job the Employee shall not take away from the Company any materials or
any concepts developed while he was employed by the Company.



     7.7 The Employee shall promptly advise the Company of all items of intellectual property
created by him during the term of this Agreement. By signing this Agreement the Employee agrees
that all exclusive rights to the use of any inventions, useful models, industrial designs, domain
names, web pages and software in the source and object codes and in other forms, created in
connection with the performance by the Employee of the duties set forth in this Agreement (“Items
of



 









 







Intellectual Property”), and all related documentation shall be owned by the Company. The
Employee also agrees that the Company shall have exclusive rights to the use of the Items of
Intellectual Property and to their publication in any manner it sees fit. The Company shall have
the right to file, in its name, patent applications, applications for all inventions, useful models
and industrial designs created by the Employee in the course of the performance of his duties. The
Employee shall also assist the Company in the protection of the rights both when these rights are
infringed by third persons and when any claims or lawsuits are filed against the Company in
connection with the use by the Company of these rights.



     7.8 The Employee represents and warrants that Annex 2 to this Agreement is a full list of all
Items of Intellectual Property, patented by the Employee, all trademarks and domain names,
registered by the Employee, and all Items of Intellectual Property, trademarks and domain names,
for which applications for registration have been filed by the Employee. Annex 2 must also contain
the list of all copyrighted materials which are related to the sphere of the Company’s activity.



     8. Obligations of the Employer



     8.1 The Employer shall provide employment for the Employee in accordance with the labor
function stipulated by the Agreement.



     8.2 The Employer shall provide the Employee with the equipment, tools, technical
documentation and other means required by the Employee to perform his duties under this Agreement.



     8.3 The Employer shall ensure the working conditions complying with the requirements of the
applicable laws.



     8.4 The Employer shall, promptly and fully, pay the Employee the salary and other kinds of
remuneration stipulated by this Agreement.



     8.5 The Employer shall bear other obligations in accordance with the Labor Code of the Russian
Federation.



     9. Working Time and Leisure 



     9.1 The normal established duration of the working time is forty (40) hours per week, with a
five-day working week.



     9.2. The Employee shall be entitled to an annual leave twenty four (24) working days long as
calculated on the basis of a six-day working week. The Employee hereby agrees that the schedule of
leaves shall be agreed upon with the 1st Deputy General Director of the Company or with other
Company executives in accordance with the policies of the Company.



     9.3 The schedule of leaves of each division of the Company is approved by the General Director
of the Company or by the person who acts for him.



     10. Temporary Incapacity



 









 





     10.1 In the event of temporary incapacity (sickness, accident, etc.) the Employee shall, if
possible, immediately report this fact to his direct superior or the other authorized official of
the Employer.



     10.2 The Employee shall submit a document confirming his temporary incapacity (sickness,
accident, etc.) to the Employer within three (3) days of the date when the period of such temporary
incapacity ends.



     11. Non-Disclosure of Confidential Information



     During the term of this Agreement and for three years after its expiration, the Employee shall
not disclose, directly or indirectly, to any person, firm, corporation, partnership, association or
any other legal entity any confidential information about the financial position,
suppliers, customers, sources and methods of obtaining new orders or modus operandi of the Company,
the related and subsidiary companies, with the exception of the information which is in the public
domain or subject to disclosure under law.



     12. Real Compliance



     The Employee admits that his failure to comply with the provisions of Sections 11 and 13 of
this Agreement will harm the Company and, therefore, that the Company has the right to enforce real
compliance with these provisions through a court. This right supplements other rights of the
Company to the protection and to compensation for the damages caused by the Employee. The Company
reserves the right to claim damages and other economic compensation for the failure of the Employee
to comply with the obligations and provisions set forth in Sections 11 and 13.



     13. Delegation



     The Parties to this Agreement shall not delegate their obligations to any third persons. The
Company may transfer the Employee to another enterprise, organization or institution in accordance
with the rules established by the Labor Code of the Russian Federation.



     14. Notices



     All notices shall be addressed as follows:



if to the Company:

A.Ya. Vinogradov, General Director

25 Dubovaya Roshcha St., Moscow 127427

Tel.: 258 78 00;




if to the Employee:

I.A. Smirnov

7 Pribrezhnyi Projezd Bldg. 1 Apt. 100, Moscow 125445

Tel.: 283 50 37




 









 




The Parties shall advise each other in writing about changes in their addresses.




     15. Entire Agreement



     15.1 This Agreement and the Annexes hereto constitute the entire employment agreement between
the Parties and shall supersede all previous agreements, written or oral, between the Parties. All
modifications of the essential terms and conditions of this Agreement shall be in the form of
Addenda signed by the Parties.



     15.2 All amendments and modifications hereto shall form integral parts of the Agreement.



     16. Termination of the Agreement



     This Agreement may be terminated on the grounds stipulated by the Labor Code of the Russian
Federation.



     17. Payments Made Upon Termination of the Agreement



     17.1 When this Agreement is terminated by one of the Parties hereto the Company shall pay the
Employee the whole salary due to him up to the date of termination and the cash compensation for
all leaves that were not used by him..



     17.2 If the Company terminates the Agreement on the grounds stipulated by Paras. 3 and 6,
Article 29 and Paras. 2 and 6, Article 33 of the Labor Code of the Russian Federation, the Company
shall pay the Employee a severance pay in the amount of not less than an average two-week salary
and the cash compensation for all leaves that has not been used.



     17.3 If, during the term of this Agreement, the Employee has not used all or a part of the
sums to which he was entitled in accordance with the regulations on the benefits and allowances
(such as health insurance), the Employee shall not receive any compensation in the form of cash or
any other form when this Agreement is terminated.



     18. Binding Force of the Agreement



     This Agreement may be binding upon legal successors of the Parties if this is stipulated by
the Russian Federation laws..



     19. Choice of Law



     This Agreement shall be governed by the Russian Federation laws. In the cases which are not
regulated by this Agreement the Parties shall abide by the applicable laws of the Russian
Federation.



     20. Labor Disputes



 









 





     20.1 The Parties shall settle all disputes or lawsuits connected with this Agreement by means
of negotiation. If the dispute is initiated by the Employee, the negotiations shall be held with
the head of the division and the CEO or the acting CEO of the Company, with the participation of
the HR and legal services of the Company.



     20.2 If the Parties fail to come to terms, the dispute shall be resolved in accordance with
the applicable laws of the Russian Federation.



     21. Miscellaneous



     If the Employee or any member of his family becomes associated with any government structure
or institution, the Employee shall immediately advise the Company of this fact.



     IN WITNESS WHEREOF, the Parties have executed this Agreement in two counterparts as of the
date first referenced above.



	 	 	 
	On behalf of the Company:

	 	Employee:
	 
	 	 
	(Signature)

	 	(Signature)
	 
	 	 
	A.Ya. Vinogradov
	 	 
	General Director

	 	I.A. Smirnov






 









 






Annex 1

to Employment Agreement Dated January 3, 2002



The Parties hereby confirm that the documents listed below form an integral part of this Agreement:



1. “Regulation on the Amounts, Systems and Forms of Labor Remuneration of Staff Employees of EDN
Sovintel LLC.”



2. “Regulation on the Systems, Amounts and Forms of Bonuses Paid to Employees of the Commercial
Division of EDN Sovintel LLC.”




	 	 	 
	On behalf of the Company:

	 	Employee:
	 
	(Signature)

	 	(Signature)
	 
	A.Ya. Vinogradov
	 	 
	General Director

	 	I.A. Smirnov






 









 






Annex 2

to Employment Agreement Dated January 3, 2002




List of Items of Intellectual Property Owned by the Employee




 









 








AMENDMENT

TO EMPLOYMENT AGREEMENT NO.81 DATED 03.01.02




The city of Moscow

     25.07.2006



The present Amendment (hereinafter referred to as the Amendment) to Employment Agreement No.81
dated 03.01.02 was entered into by and between the limited liability company EDN SOVINTEL
(hereinafter referred to as the Employer) in the person of O.E.Novikova, Head of the Personnel
Department, acting on the basis of letter of attorney No.M213/09/05 dated 20.09.05 located at the
address: Russian Federation, 115114, 1 Kozhevnichevsky proezd, on the one hand, and citizen Ilya
Alexandrovich Smirnov, passport of series 45 04, number 545115, issued by the militia precinct
Ramenki, the city of Moscow, on December 3, 2002 residing at the address: 117607, Moscow,
29/1/apt.108 Michurinsky prospect, on the other hand (referred to collectively as the Parties and
individually as the Party).



The Parties agreed as follows:





1. The clause of the Agreement with relation to the Employee’s salary shall be worded as
follows:




‘The Employer shall pay the Employee a monthly official salary in the amount equivalent to the
sum of 10,000.00 (ten thousand dollars 00 cents) US in rubles at the rate of the Central Bank
of the Russian Federation as of the date of calculation.’


The date of salary calculation is, as a rule, the last calendar date of the current month. In
some cases the date of calculation may be transferred to an earlier date of the current
calendar month necessary for the timely payment of the salary. In this case the date of salary
calculation is set by an internal normative act. From the above amount and from other proceeds
paid or transferred in another form to the Employee by the Employer the Employer shall withhold
and pay taxes in the amount and in the procedure established by the effective Russian
legislation.’




2. Other articles of the Agreement remain unchanged.




3. The present Agreement becomes effective on 01.07.2006.




4. The present Agreement is made in 2 (two) counterparts with one for each of the
Parties.



	 	 	 
	On behalf of the Employer (signature)

	 	On behalf of the Employee (signature)
	Head of Personnel Department, EDN

	 	I.A.Smirnov
	SOVINTEL

	 	Residential address: Moscow 117607,
	 

	 	29/1/apt 108 Michurinsky prospect;
	 

	 	tel.683-50-37
	Moscow, 115114, 1 Kozhevnichevsky
	 	 
	proezd, tel.258-78-00