Document:

exv10w6

 

EXHIBIT 10.6

GOLDEN TELECOM GROUP INC.

EMPLOYMENT AGREEMENT

     THIS AGREEMENT is made and entered into as of the first day of March,
2004, by and between Golden Telecom Group, Inc., a Delaware corporation (the
“Corporation”), and Mr. Michal Cupa, an adult citizen of the Czech Republic (the
“Employee”).

     WHEREAS, the Corporation is a wholly-owned subsidiary of Golden Telecom,
Inc. (“GTI”);

     WHEREAS, the Employee is has substantial experience in telecommunications
operations;

     WHEREAS, the Corporation desires to employ the Employee and the Employee
desires to be employed by the Corporation, subject to the terms and provisions
of this employment agreement (the “Agreement”);

     NOW THEREFORE, the Corporation and Employee mutually agree as follows:

1.  EMPLOYMENT.

     (a)  The Corporation hereby employs the Employee, and the Employee hereby
accepts employment, on the terms and conditions set forth herein.

     (c)  The Employee shall initially be given the position of Chief
Operating Officer and seconded to one or more of the Corporation’s affiliates,
based in Moscow, but may from time to time be given such title or be requested
to perform such duties and exercise such power and authority commensurate with
the Employee’s position as may be delegated to the Employee by the Employee’s
supervisors, the Chief Executive Officer or the Board of Directors of the
Corporation.

     (d)  The Employee shall devote all necessary business time and attention,
and employ Employee’s best efforts, toward the fulfillment and execution of all
assigned duties, and the satisfaction of defined annual and/or longer-term
performance criteria.

2.  TERM.

     (a)  The terms of this Agreement are effective as of the first day of
March, 2004, and shall continue unless terminated in accordance with section 9
herein.

     (b)  The Corporation reserves the right to pay the Employee in lieu of
any period of notice.

     (c)  Further, the Corporation reserves the right to require the Employee
not to attend the Corporation’s premises or the premises of the Employee’s
business unit or to provide the Employee with alternative work of a broadly
similar nature to the work the Employee normally performs, during any period of
suspension or whilst the Employee is under notice of termination (served either
by the Corporation or the Employee) provided that the Employee continues to be
paid the salary and benefits to which the Employee is entitled under this
Agreement and further provided that the period of any such requirement does not
exceed six months.

 

 

3. COMPENSATION.

     (a)  For the purposes of this Agreement, “Salary” shall mean all payments
by the Corporation to the Employee pursuant to this section 3.

     (b)  Commencing on the date hereof and continuing thereafter unless
adjusted as set forth herein, the Employee shall be paid an annual Salary of
Three Hundred Thousand United States dollars (US$300,000), payable in accordance
with the Corporation’s customary payroll practices for Employees.

     (c)  On an annual basis the Corporation shall review the salary of the
Employee and shall consider, based upon the Employee’s performance and the
Corporation’s financial position, potential increases to the Employee’s Salary
as the Corporation shall, in its sole and absolute discretion, deem appropriate.

     (d)  The Employee shall receive a one-time signing bonus in the amount of
Eight Thousand Seven Hundred and Fifty United States dollars (US$8,750).

4.  BONUS. Subject to the terms and conditions of the Golden Telecom Group,
Inc. Incentive Bonus Plan for Senior Management (“Bonus Plan”), attached hereto
as Annex A and forming an integral part hereof, the Corporation shall pay to the
Employee performance-based, incentive compensation (“Bonus”) in the amount of
One Hundred and Five Thousand United States dollars (US$105,000) per year.

5.  BENEFITS.

     (a)  During the Term of this Agreement, Employee shall be entitled to
receive such benefits and to participate in such employee group benefit plans,
including life, property, health and disability insurance, dental and medical
coverage policies as are generally provided by the Corporation to its employees
of comparable level and responsibility in accordance with the plans, practices
and programs of the Corporation (“Benefits”).

     (b)  During the Term of this Agreement, the Corporation shall pay the
reasonable school fees for the Employee’s eligible children in accordance with
the policies and practices of the Corporation.

     (c)  On Termination of the Agreement under Sections 9 hereof the
Corporation shall provide the Employee with reimbursement (i) for the lesser of
the cost of a one-way business class airline ticket for the Employee and his
immediate family from his place of secondment to his place of relocation or his
domicile in the Czech Republic and (ii) for the lesser of moving the Employee’s
household goods from his place of secondment to his place of relocation or his
domicile in the Czech Republic.

     (d)  During the Term of this Agreement and for the tax reporting year
twelve months after the termination of this Agreement, the Corporation shall
provide, consistent with its internal policies applied throughout the Company,
professional accounting assistance in the preparation of the Employee’s tax
declarations in Russia and in the Employee’s country of citizenship, to the
extent required and requested by the Employee.

6.  EXPENSE REIMBURSEMENT. During the term of employment, the Corporation
shall reimburse the Employee for all reasonable and necessary expenses incurred
by the Employee in connection with the

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performance of Employee’s duties as an employee of the Corporation. Such
reimbursement is subject to the submission to the Corporation by the Employee of
appropriate documentation and/or vouchers in accordance with the customary
procedures of the Corporation for expense reimbursement, as such procedures may
be revised by the Corporation from time to time hereafter.

7.  VACATION. During each of the Corporation’s fiscal years during the term of
employment, Employee shall be entitled to vacation in accordance with the
Corporation’s practice, which currently totals four (4) weeks maximum,
calculated on the basis of one week for each three months of service. Vacation
days will be administered in accordance with company policy and will not
carry-over or accumulate from year to year without the prior written consent of
the Director, Human Resources.

8.  TAXATION POLICY The treatment of the Employee’s personal taxation by the
Corporation shall be governed by the Golden Telecom Group, Inc. Expatriate
Taxation Policy attached hereto as Annex B and forming an integral part hereof.

9.  TERMINATION.

     (a)  The Corporation shall have “Cause” to terminate Employee’s
employment hereunder upon Employee’s:

            (i)  failure to follow a legal order of the Employee’s supervisor,
Board or the Chief Executive Officer of the Corporation, other than any such
failure resulting from Employee’s disability, after notice and reasonable
opportunity for cure,

            (ii)  fraud, embezzlement, or any other similar illegal act
committed by the Employee in connection with the Employee’s duties as an
employee of the Corporation or any subsidiary or affiliate or parent, direct or
indirect, of the Corporation,

            (iii)  conviction of any felony or crime involving moral turpitude
which causes or may reasonably be expected to cause substantial economic injury
to or substantial injury to the reputation of the Corporation or any subsidiary
or affiliate or parent, direct or indirect, of the Corporation,

            (iv)  willful or grossly negligent commission of any other act which
causes or may reasonably be expected (as of the time of such occurrence) to
cause substantial economic injury to or substantial injury to the reputation of
the Corporation or any subsidiary or affiliate or parent, direct or indirect, of
the Corporation, including, without limitation, any material violation of the
Foreign Corrupt Practices Act, as described herein below.

     (b)  Termination by Reason of Total Disability. Notwithstanding anything
to the contrary in this Agreement, the Corporation shall at all times have the
right to terminate this Agreement and the employment of the Employee immediately
by delivering written notice to the Employee if the Employee experiences a Total
Disability. For the purpose of this Agreement, the term “Total Disability” means
any mental or physical illness, condition, disability or incapacity that:

            (i)  prevents the Employee from discharging essential job
responsibilities and employment duties;

            (ii)  shall be attested to in writing by a physician or a group of
physicians acceptable to the Corporation; and

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            (iii)  continues for period of 90 consecutive days in any twelve (12)
month period.

A Total Disability shall be deemed to have occurred on the last day of such
applicable 90-day period, and shall be determined in accordance with applicable
law relating to disability.

     (c)  Termination by Reason of Death. This Agreement shall terminate
immediately upon the death of the Employee.

     (d)  Voluntary Resignation. The Employee may terminate the Agreement at
any time by giving ninety (90) days’ prior written notice to the Corporation
(the “Employee’s Notice Period”). Upon receipt of such notice to the
Corporation, the Corporation, in its sole and absolute discretion, may either
continue to employ the Employee during all or part of the Employee’s Notice
Period, or may continue to pay the Employee’s Salary and continue Benefits
during the Employee’s Notice Period in lieu of continued employment.

     (e)  Termination Without Cause. The Corporation may terminate the
Employee’s employment at any time, for any reason, by providing Employee with
ninety (90) days prior written notice (the “Corporation’s Notice Period”) of
pending termination. Upon providing such notice to the Employee, the
Corporation, in its sole and absolute discretion, may either continue to employ
the Employee during all or part of the Corporation’s Notice Period, or may
continue to pay the Employee’s Salary and continue Benefits during the
Corporation’s Notice Period in lieu of continued employment.

10.  PAYMENTS UPON TERMINATION.

     (a)  Payment. Except as specifically set forth herein, all payments to be
made under the terms of this section may be made, in the Corporation’s sole and
absolute discretion, either in one payment at the beginning of the termination
period or in installments over the term of the period covered by the payments,
paid in accordance with the Corporation’s customary payroll practices.

     (b)  Termination For Cause. In the event that the Employee’s employment
under this Agreement is terminated for Cause, the Corporation shall have no
obligation to pay the Salary or provide any other compensation or Benefits
provided under this Agreement to, or for the benefit of, Employee for any period
after the date of such termination, or to pay any Bonus for the fiscal year in
which such termination occurs; provided, however, that the Corporation shall
promptly pay (i) all Salary earned by the Employee prior to the date of such
termination, (ii) any Benefits under any plans of the Corporation in which the
Employee is a participant to the full extent of the Employee’s rights under such
plans prior to termination, and (iii) reimbursement of any appropriate business
and/or entertainment expenses incurred by the Employee prior to termination and
properly submitted to the Corporation.

     (c)  Termination by Reason of Total Disability. In the event that the
Employee’s employment under this Agreement is terminated by reason of Total
Disability, the Corporation shall have no obligation to pay the Salary provided
under this Agreement to or for the benefit of the Employee for any period after
the date of such termination; provided, however, that the Corporation shall
promptly pay to the Employee (i) all Salary earned by the Employee prior to the
date of such termination, (ii) the pro rata share of any Bonus for the fiscal
year in which the total disability occurred, (iii) any Benefits under any plans
of the Corporation in which the Employee is a participant to the full extent of
the Employee’s rights under such plans, and (iv) reimbursement of appropriate
business and/or entertainment expenses incurred by the Employee prior to such
termination and properly submitted to the Corporation, each such

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item to be paid to the date of such termination with the exception of disability
benefits, which shall continue to be paid from the Corporation’s insured or
self-insured long-term disability plan, as the case may be, for the period
specified in such plan. In the event there is a period of time during which the
Employee is not being paid Salary and not receiving long-term disability
payments for any reason, and conditioned upon the Employee or Employee’s
representative immediately notifying the Corporation in writing, the
Compensation Committee shall make all necessary inquiries and shall decide in
its sole and absolute discretion whether the Corporation shall make interim
payments to the Employee until the commencement of payments under the long-term
disability plan.

     (d)  Termination by Reason of Death. If Employee dies during Employee’s
employment pursuant to this Agreement, the Corporation shall have no obligation
to pay the Salary provided under this Agreement to or for the benefit of the
Employee for any period after the date of the Employee’s death; provided,
however, that the Corporation shall promptly pay to the Employee’s designated
beneficiary, to the degree earned but not paid prior to the date of the
Employee’s death: (i) all Salary; (ii) the pro rata share of any Bonus for the
fiscal year in which the death occurred; (iii) any Benefits under any plans of
the Corporation in which the Employee is a participant to the full extent of the
Employee’s rights under such plans, and (iv) reimbursement of any appropriate
business and/or entertainment expenses incurred by the Employee and properly
submitted.

     (e)  Voluntary Resignation. In the event that the Employee resigns
voluntarily from Employee’s employment with the Corporation, the Corporation
shall have no obligation to pay the Salary provided under this Agreement to or
for the benefit of the Employee for any period after the end of the expiration
of Employee’s Notice Period, or after the termination date if the Corporation
elects to terminate the employee and actually makes payments in lieu of
employment during the Employee’s Notice Period; provided, however, that the
Corporation shall promptly pay upon termination (i) all Salary earned by the
Employee prior to the expiration of the Employee’s Notice Period and (ii) the
pro rata share of all Bonuses for the fiscal year in which the resignation
occurred; and (iii) any Benefits under any plans of the Corporation in which the
Employee is a participant to the full extent of the Employee’s rights under such
plans prior to the expiration of the Employee’s Notice Period, provided,
however, that such Benefits shall cease upon Employee’s receipt of comparable
benefits under, or coverage under, any plans provided by a new employer; and
(iv) reimbursement of any appropriate business and/or entertainment expenses
incurred by the Employee through the end of said notice period and properly
submitted.

     (f)  Termination Without Cause. In the event the Corporation terminates
this Agreement and the Employee’s employment without Cause:

            (i)  the Corporation shall promptly pay or provide to the Employee,
to the extent earned prior to the date of such termination: (A) all Salary; (B)
the pro rata share of all Bonuses for the fiscal year in which the termination
occurred; (C) any Benefits under any plans of the Corporation in which the
Employee is a participant to the full extent of the Employee’s rights under such
plans prior to termination, except as noted in section 10(f)(ii)(B) below; and
(D) reimbursement of any appropriate business and/or entertainment expenses
incurred by the Employee prior to such termination and properly submitted to the
Corporation;

            (ii)  subject to the Corporation’s receipt from the employee of a
general release in its customary form, the Corporation shall also promptly pay
to the Employee:

                   (A)  an amount equal to the Employee’s Salary at its
then-current rate for a period

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equal to six (6) months, plus any amount to be paid to Employee as a cash payout
of Salary due to Employee for that portion of the Corporation’s Notice Period
that the Corporation shall elect to pay out pursuant to Section 10(e) hereof;

                   (B)  the cost of continuing all medical, dental, 401(k) plans
or retirement Benefits during the period determined in accordance with Section
10(f)(ii)(A) above; provided, however, that such Benefits shall cease upon
Employee’s receipt of comparable benefits under, or coverage under, any plans
provided by a new employer.

11.  COVENANTS OF THE EMPLOYEE. In order to induce the Corporation to enter
into this Agreement and employ the Employee, the Employee hereby covenants and
agrees as follows:

     (a)  During the term of this Agreement, and for a period equal to three
(3) months thereafter, the Employee shall not, without the prior written consent
of the Corporation, directly or indirectly through any other person or entity,
own, acquire in any manner any ownership interest in (except purely passive
investments amounting to no more than five percent (5%) of the voting equity),
or serve as a director, officer, employee, counsel or consultant of any person,
firm, partnership, corporation, consortium, association or other entity that
competes with the Corporation or any of its direct or indirect affiliates,
parents, or subsidiaries, in any geographic market in which the Corporation or
its direct or indirect affiliates, or subsidiaries, either (A) offers or
provides telecommunications services to customers; (B) operates or manages a
provider of telecommunications services; (C) has investments in a provider of
telecommunications services; or (D), to the Employee’s knowledge, has plans to
either operate a telecommunications carrier, offer a telecommunications service,
or invest in a telecommunications carrier within such three (3) month period;

     (b)  During the term of this Agreement, and for a period of twelve (12)
months thereafter, the Employee shall not, without the prior written consent of
the Corporation, directly or indirectly through any other person or entity:

            (i)  solicit, entice, persuade or induce any individual who is at
any time during the term of this Agreement, an officer, director or employee of
the Corporation, or any of its subsidiaries or affiliates or parents, direct or
indirect, to terminate or refrain from renewing or extending such person’s
employment with the Corporation or such subsidiary or affiliate or parent,
direct or indirect, or to become employed by, enter into contractual relations
with, or become consultant to any other individual or entity, and the Employee
shall not approach any such employee for any such purpose or authorize or
knowingly cooperate with the taking of any such actions by any other individual
or entity; or

            (ii)  except in accordance with the Employee’s duties on behalf of
the Corporation, solicit, entice, persuade, or induce any individual or entity
which currently is, or at any time during the term of this Agreement shall be, a
customer, consultant, vendor, supplier, lessor or lessee of the Corporation, or
any of its subsidiaries or affiliates or parents, direct or indirect, to
terminate or refrain from renewing or extending its contractual or other
relationship with the Corporation or such subsidiary or affiliate or parent,
direct or indirect, and the Employee shall not approach any such customer,
vendor, supplier, consultant, lessor or lessee for such purpose or authorize or
knowingly cooperate with the taking of any such actions by any other individual
or entity.

     (c)  The Employee shall not at any time during or after the term of this
Agreement:

            (i)  other than when required in the ordinary course of business of
the Corporation,

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disclose, directly or indirectly, to any person, firm, corporation, partnership,
association or other entity, any trade secret, or confidential information
concerning the financial condition, suppliers, vendors, customers, lessors, or
lessees, sources or leads for, and methods of obtaining, new business, or the
methods generally of doing and operating the respective businesses of the
Corporation or its affiliates and subsidiaries and parents, direct or indirect,
to the degree such secret or information incorporates information that is
proprietary to, or was developed specifically by or for, the Corporation, except
such information that is a matter of public knowledge, was provided to the
Employee (without breach of any obligation of confidence owed to the
Corporation) by a third party that is not a subsidiary or affiliate or parent,
direct or indirect, of the Corporation, or is required to be disclosed by law or
judicial or administrative process; or

            (ii)  make any oral or written statement about the Corporation
and/or its financial status, business, compliance with laws, personnel,
directors, officers, consultants, services, business methods or otherwise, which
are intended or reasonably likely to disparage the Corporation or otherwise
degrade its reputation in the business or legal community in which it operates
or in the telecommunications industry.

     (d)  Employee hereby represents that (i) Employee is not restricted in
any material way from performing Employee’s duties hereunder as the result of
any contract, agreement or law; and (ii) Employee’s due performance of
Employee’s duties hereunder does not and will not violate the terms of any
Agreement to which Employee is bound.

12.  FOREIGN CORRUPT PRACTICES ACT. The Employee agrees to comply in all
material respects with the applicable provisions of the U.S. Foreign Corrupt
Practices Act of 1977 (“FCPA”), as amended, which provides generally that under
no circumstances will foreign officials, representatives, political parties or
holders of public offices be offered, promised or paid any money, remuneration,
things of value, or provided any other benefit, direct or indirect, in
connection with obtaining or maintaining contracts or orders hereunder. When any
representative, employee, agent, or other individual or organization associated
with Employee is required to perform any obligation related to or in connection
with this Agreement, the substance of this section shall be imposed upon such
person and included in any agreement between Employee and any such person.
Failure by the Employee to comply in all respects with the provisions of the
FCPA shall constitute a material breach of this Agreement and shall entitle the
Corporation to terminate this Agreement immediately upon such failure to comply.
Additionally, Employee hereby acknowledges that Employee has read the GTI
Business Practices Training Program,” a copy of which has been provided to
Employee. Employee also acknowledges that a condition precedent to the
effectiveness of this Agreement shall be the execution by Employee of the
“Employee FCPA Certification,” a copy of which has been provided to Employee.
Additionally, and as a condition for the Corporation to continue this Agreement,
Employee may be required from time to time at the request of the Corporation to
execute a certificate of Employee’s compliance with the aforementioned laws and
regulations.

13.  PURCHASES AND SALES OF THE CORPORATION’S SECURITIES. The Employee has
read, and agrees to comply in all respects, with GTI’s Legal Policy No. 1:
Policy and Procedures for Directors, Officers and Employees of Golden Telecom,
Inc. and its Affiliates on Insider Trading and Tipping and Legal Advisory
Memorandum No. 1A, as such policies may be amended from time to time.
Specifically, and without limitation, Employee agrees that Employee shall not
purchase or sell stock in GTI or any of its subsidiaries, affiliates or parents,
direct or indirect, at any time (i) that Employee possesses material non-public
information about GTI or any of its businesses; and (ii) during any “Trading
Blackout Period” as may be determined by GTI, as set forth in Legal Policy No. 1
and Legal Policy No. 1A from time to time.

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14.  NO DELEGATION. The Employee shall not delegate Employee’s employment
obligations under this Agreement to any other person.

15.  NOTICES. Any written notice required by this Agreement will be deemed
provided and delivered to the intended recipient when (i) delivered in person by
hand; or (ii) three days after being sent via U.S. certified mail, return
receipt requested; or (iii) the day after being sent via by overnight courier,
in each case when such notice is properly addressed to the following address and
with all postage and similar fees having been paid in advance:

	 	 	 
	If to the Corporation:

	 	Golden Telecom Group, Inc.
	

	 	c/o Golden Telecom, Inc.
	

	 	Attn: Director Human Resources
	 
	 	 
	Copy:

	 	General Counsel
	

	 	4400 MacArthur Boulevard, N.W., Suite 200
	

	 	Washington, D.C. 20007
	 
	 	 
	If to the Employee:

	 	Michal Cupa
	

	 	c/o Golden TeleServices Inc.
	

	 	1 Kozhevnichesky proezd 2nd Floor
	

	 	Moscow 115114
	

	 	Russian Federation

     Either party may change the address to which notices, requests, demands
and other communications to such party shall be delivered personally or mailed
by giving written notice to the other party in the manner described above.

16.  BINDING EFFECT. This Agreement shall be for the benefit of and binding
upon the parties hereto and their respective heirs, personal representatives,
legal representatives, successors and, where applicable, assigns.

17.  ENTIRE AGREEMENT. This Agreement constitutes the entire agreement between
the listed parties with respect to the subject matter described in this
Agreement and supersedes all prior agreements, understandings and arrangements,
both oral and written, between the parties with respect to such subject matter.
This Agreement may not be modified, amended, altered or rescinded in any manner,
except by written instrument signed by both of the parties hereto; provided,
however, that the waiver by either party of a breach or compliance with any
provision of this Agreement shall not operate nor be construed as a waiver of
any subsequent breach or compliance.

18.  SEVERABILITY. In case any one or more of the provisions of this Agreement
shall be held by any court of competent jurisdiction or any arbitrator selected
in accordance with the terms hereof to be illegal, invalid or unenforceable in
any respect, such provision shall have no force and effect, but such holding
shall not affect the legality, validity or enforceability of any other provision
of this Agreement provided that the provisions held illegal, invalid or
unenforceable do not reflect or manifest a fundamental benefit bargained for by
a party hereto.

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19.  DISPUTE RESOLUTION AND ARBITRATION. In the event that any dispute arises
between the Corporation and the Employee regarding or relating to this Agreement
and/or any aspect of Employee’s employment relationship with the Corporation,
AND IN LIEU OF LITIGATION AND A TRIAL BY JURY, the parties consent to resolve
such dispute through mandatory arbitration under the Commercial Rules of the
American Arbitration Association (“AAA”), before a single arbitrator in
Arlington, Virginia or other location mutually acceptable to the Executive and
the Corporation. The parties hereby consent to the entry of judgment upon award
rendered by the arbitrator in any court of competent jurisdiction.
Notwithstanding the foregoing, however, should adequate grounds exist for
seeking immediate injunctive or immediate equitable relief, any party may seek
and obtain such relief; provided that, upon obtaining such relief, such
injunctive or equitable action shall be stayed pending the resolution of the
arbitration proceedings called for herein. The parties hereby consent to the
exclusive jurisdiction in the state and Federal courts of or in the Commonwealth
of Virginia for purposes of seeking such injunctive or equitable relief as set
forth above.

20.  CHOICE OF LAW. The Employee and the Corporation intend and hereby
acknowledge that jurisdiction over disputes with regard to this Agreement, and
over all aspects of the relationship between the parties hereto, shall be
governed by the laws of the Commonwealth of Virginia without giving effect to
its rules for resolving conflicts of laws.

21.  SECTION HEADINGS. The section headings contained in this Agreement are for
reference purposes only and shall not affect in any manner the meaning or
interpretation of this Agreement.

22.  COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which taken
together shall constitute one and the same instrument.

23.  FORCE MAJEURE. Neither Corporation nor Employee shall be liable for any
delay or failure in performance of any part of this Agreement to the extent that
such delay or failure is caused by an event beyond its reasonable control
including, but not be limited to, fire, flood, explosion, war, strike, embargo,
government requirement, acts of civil or military authority, and acts of God not
resulting from the negligence of the claiming party.

[SIGNATURE PAGE FOLLOWS]

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     IN WITNESS WHEREOF, the parties to this Agreement have executed and
delivered this Agreement.

GOLDEN TELECOM GROUP, INC.

	 	 	 
	By:
	 	 
	 
	 	

	Name:
	 	Alexander Vinogradov
	Title:
	 	Chief Executive Officer

EMPLOYEE

	 	 	 
	

	Name:
	 	Michal Cupa
	Date:
	 	April 15, 2004

10exv10w7

 

EXHIBIT 10.7

Derek Bloom

Derek Bloom is employed by the Company as Senior Vice President, General Counsel
and Corporate Secretary, however, his employment agreement is currently being
negotiated. By offer letter (the “Bloom Offer Letter”), Mr. Bloom was offered an
annual base salary of $300,000 and an annual target bonus of $105,000. Mr. Bloom
is eligible to participate in the Company’s Long Term Incentive Bonus Plan
(“LTIBP”), the details of which are currently being developed, however, under
the Bloom Offer Letter, Mr. Bloom has been offered 5,500 restricted shares of
the Company’s stock, with a three-year vesting period.

Under the terms of the Bloom Offer Letter, Mr. Bloom is entitled to life
insurance with a value up to $1 million and disability insurance with a value up
to 60% of his annual base salary. The Company will match up to 50% of Mr.
Bloom’s maximum allowed contribution under the US Internal Revenue Code in a
Company sponsored 401(k) plan. Upon termination of Mr. Bloom’s employment, he is
entitled to reasonable relocation costs to his place of residence in the US.

The Bloom Offer Letter also states that Mr. Bloom’s employment agreement shall
include a change of control clause such that in the event of a change of control
in the Company, Mr. Bloom shall receive a payment equal to two times his annual
salary.

During his employment with the Company, the Company will reimburse Mr. Bloom for
all Russian tax obligations to which he may be subject. Further, Mr. Bloom will
retain the actual and economic benefit of the Foreign Earned Income Exclusion
(currently $80,000), and the Company will reimburse the difference representing
the amount of Russian tax that he will not be able to credit or deduct for US
tax purposes.

Brian Rich

Brian Rich is employed by the Company as Senior Vice President and Chief
Financial Officer, however, his employment agreement is currently being
negotiated. By offer letter (the “Rich Offer Letter”), Mr. Rich was offered an
annual base salary of $300,000, which has been increased to $318,000, and an
annual target bonus of $105,000. Mr. Rich is eligible to participate in the
LTIBP, the details of which are currently being developed, however, under the
Rich Offer Letter, Mr. Rich has been offered 5,500 restricted shares of the
Company’s stock, with a three-year vesting period.

Under the terms of the Rich Offer Letter, Mr. Rich is entitled to life insurance
with a value up to $1 million and disability insurance with a value up to 60% of
his annual base salary. The Company will match up to 50% of Mr. Rich’s maximum
allowed contribution under the US Internal Revenue Code in a Company sponsored
401(k) plan. Mr. Rich was also offered reimbursement of certain costs, including
brokerage fees and closing documentation associated with the sale of his house
in the US, up to a maximum value of $55,000. Upon termination of Mr. Rich’s
employment, he is entitled to reasonable relocation costs to his place of
residence in the US.

 

 

The Rich Offer Letter also states that Mr. Rich’s employment agreement shall
include a change of control clause such that in the event of a change of control
in the Company, Mr. Rich shall receive a payment equal to two times his annual
salary.

During his employment with the Company, the Company will reimburse Mr. Rich for
all Russian tax obligations to which he may be subject. Further, Mr. Rich will
retain the actual and economic benefit of the Foreign Earned Income Exclusion
(currently $80,000), and the Company will reimburse the difference representing
the amount of Russian tax that he will not be able to credit or deduct for US
tax purposes.

Oleg Malis

Mr. Malis is employed by the Company as Senior Vice President and Director of
Mergers and Acquisitions. Mr. Malis is paid an annual salary of $230,000 and
has an annual target bonus of $83,000.

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00079-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00079-of-00352.parquet"}]]