EXHIBIT 10.36
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THE ▇▇▇▇ ▇▇▇▇ EMPLOYEES TRUST AGREEMENT
DATED AS OF
NOVEMBER 29, 2000
BY AND BETWEEN
KHANTY MANSIYSK OIL CORPORATION,
AS GRANTOR,
AND
▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇
AND
▇▇▇▇ ▇. ▇▇▇▇▇▇,
AS TRUSTEES
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TABLE OF CONTENTS
PAGE
ARTICLE I CREATION OF TRUST; DEFINED TERMS.................1
ARTICLE II FAMILY MEMBERS...................................1
ARTICLE III TRUST FOR THE BENEFICIARY........................1
ARTICLE IV TRUST FOR SPOUSE.................................2
ARTICLE V TRUST FOR DESCENDANTS............................2
ARTICLE VI TRUSTS FOR PARENTS...............................3
ARTICLE VII REMOTE DISPOSITIONS..............................3
ARTICLE VIII DEFINITIONS; CONSTRUCTION OF TERMS...............3
ARTICLE IX ADMINISTRATION OF TRUST AGREEMENT................4
ARTICLE X FIDUCIARY POWERS.................................6
ARTICLE XI APPOINTMENT AND RESIGNATION OF TRUSTEES.........10
ARTICLE XII DEATH TAXES.....................................12
ARTICLE XIII IRREVOCABILITY; GOVERNING LAW...................12
ARTICLE XIV COUNTERPARTS....................................13
TRUST AGREEMENT made as of the 29th day of November, 2000, by and among
KHANTY MANSIYSK OIL CORPORATION, a Delaware corporation (hereinafter referred to
as the "Grantor"), and ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇, residing in the City, County and
State of New York, and ▇▇▇▇ ▇. ▇▇▇▇▇▇ residing in Queens County of New York City
in the State of New York (hereinafter, along with any other trustees serving
hereunder, referred to as the "Trustees").
ARTICLE I. CREATION OF TRUST; DEFINED TERMS
A. TRANSFER OF INITIAL CONTRIBUTION. The Grantor hereby creates a separate
trust for the benefit of each of the persons identified on Schedule A annexed
hereto, each of whom is currently employed by the Grantor or a subsidiary of the
Grantor, and may from time to time create a separate trust hereunder for other
employees in the future. Each employee, with respect to the trust for his or her
benefit and with respect to any trust hereunder for the benefit of his or her
spouse, parent, sibling or descendant, shall be referred to herein as the
"Beneficiary". The Grantor hereby transfers to the Trustees the Initial
Contribution with respect to the trusts for each of the employees named above
and may from time to time transfer in the future additional property to any one
or more of such trusts established hereunder as it shall determine in its sole
discretion. The Trustees accept and acknowledge receipt of the Initial
Contribution, and agree to hold the Initial Contribution and all additional
property transferred to them in trust, and to invest, manage and distribute such
property in accordance with the provisions of this trust agreement (this
"Agreement").
B. IDENTIFICATION OF TRUST AGREEMENT. This Agreement shall be known as
"THE 2000 KMOC EMPLOYEES TRUST AGREEMENT" and the trusts created under Article
III of this Agreement shall be known as "THE 2000 KMOC EMPLOYEES TRUST f/b/o"
followed by the name of the employee who is the Beneficiary thereof.
C. CAPITALIZED TERMS. Capitalized terms are defined in Article VIII unless
otherwise defined where they first appear.
ARTICLE II. FAMILY MEMBERS
A. REFERENCES TO CHILDREN. References to a Beneficiary's children shall
include any child of the Beneficiary who is living at the date of this Agreement
and any other child who may hereafter be born to or adopted by the Beneficiary.
B. REFERENCES TO SPOUSE. References to the Beneficiary's spouse shall be
to the person who is married to and living with the Beneficiary (disregarding
separations attributable to illness or reasons other than marital discord) at
the time such provision is applicable or at the death of the first of them to
die, as the case may be.
ARTICLE III. TRUST FOR THE BENEFICIARY
A. LIFETIME TRUST. During the life of the Beneficiary the Trustees shall
distribute to the Beneficiary so much of the net income and principal as the
Trustees in their sole discretion shall determine. This trust may be referred to
as the "Lifetime Trust."
B. DISPOSITION AT DEATH. Upon the death of the Beneficiary, the Lifetime
Trust shall terminate and the remaining principal shall be distributed to such
one or more of the Beneficiary's parents, spouse and descendants as the Trustees
in their sole discretion shall determine; provided, however, that any such
distributions shall be held in accordance with Articles IV, V or VI of this
Agreement, as the case may be. It is the
Grantor's desire, but not its direction, that any written instrument filed with
the Trustees setting forth the Beneficiary's wishes with respect to the
distribution of the remaining trust principal be given consideration by the
Trustees prior to making any distributions on termination of such trust, but
shall in no way be binding upon the Trustees in the exercise of their
discretion.
ARTICLE IV. TRUST FOR SPOUSE
All property distributed under this Agreement to the spouse of the
Beneficiary (the "Spouse") shall be held in trust upon the following terms:
A. DURING THE LIFE OF THE SPOUSE. During the life of the Spouse, the
Trustees shall distribute to the spouse of the Beneficiary so much of the net
income and principal as the Trustees in their sole discretion shall determine.
B. UPON THE DEATH OF THE SPOUSE. Upon the death of the Spouse, the trust
shall terminate and the Trustees shall distribute the remaining principal to
such one or more of the Beneficiary's parents and descendants as the Trustees in
their sole discretion shall determine; provided, however, that any such
distributions shall be held in accordance with Articles V or VI of this
Agreement, as the case may be. It is the Grantor's desire, but not its
direction, that any written instrument filed with the Trustees setting forth the
Beneficiary's wishes with respect to the distribution of the remaining trust
principal be given consideration by the Trustees prior to making any
distributions on termination of such trust, but shall in no way be binding upon
the Trustees in the exercise of their discretion.
ARTICLE V. TRUST FOR DESCENDANTS
All property distributed under this Agreement to a descendant of a
Beneficiary (the "Descendant") shall be held in trust upon the following terms:
A. DURING THE LIFE OF THE DESCENDANT. During the life of the Descendant,
the Trustees shall distribute to the Descendant so much of the net income and
principal as the Trustees in their sole discretion shall determine; provided,
however, that the Trustees shall have the discretion to distribute the entire
principal to the Descendant at any time after the Descendant attains the age of
twenty-one (21) years if the Trustees determine that such distribution would be
in the best interests of the Descendant.
B. UPON THE DEATH OF THE DESCENDANT. Upon the death of the Descendant, the
trust shall terminate and the Trustees shall distribute the remaining principal
to such one or more of the Beneficiary's parents, spouse and descendants as the
Trustees in their sole discretion shall determine; provided, however, that any
such distributions shall be held in accordance with Articles IV, V or VI of this
Agreement, as the case may be. It is the Grantor's desire, but not its
direction, that any written instrument filed with the Trustees setting forth the
Beneficiary's wishes with respect to the distribution of the remaining trust
principal be given consideration by the Trustees prior to making any
distributions on termination of such trust, but shall in no way be binding upon
the Trustees in the exercise of their discretion.
C. APPLICATION OF RULE AGAINST PERPETUITIES. Notwithstanding any contrary
provision of this Agreement:
(1) Each trust shall terminate no later than the expiration of the
longest period that property may be held in trust under the law of the
jurisdiction governing such trust (including any applicable term of years),
provided that if the jurisdiction has a rule against perpetuities that applies
only to certain types of property (such as, for example, real property), the
provisions of this Paragraph C shall apply only to such property. If under the
law of such jurisdiction the longest period that property may be held in trust
may be determined with reference
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to the death of the last survivor of a class of persons living at the date of
this Agreement, that class shall consist of the issue of all of the
Beneficiaries' parents who were living at the date of this Agreement.
(2) Upon termination of a trust pursuant to this Paragraph C, the
Trustees shall pay the remaining principal outright to the Descendant.
ARTICLE VI. TRUSTS FOR PARENTS
All property distributable to a parent of the Beneficiary (the "Parent")
shall be held in trust upon the following terms:
A. DURING THE LIFE OF THE PARENT. During the life of the Parent, the
Trustees shall distribute to the Parent so much of the net income and principal
as the Trustees in their sole discretion shall determine.
B. UPON THE DEATH OF THE PARENT OF A BENEFICIARY. Upon the death of the
Parent, the trust shall terminate and the Trustees shall distribute the
remaining principal to such one or more of the Beneficiary's spouse and
descendants as the Trustees in their sole discretion shall determine; provided,
however, that any such distributions shall be held in accordance with Articles
IV and V of this Agreement, as the case may be. It is the Grantor's desire, but
not its direction, that any written instrument filed with the Trustees setting
forth the Beneficiary's wishes with respect to the distribution of the remaining
trust principal be given consideration by the Trustees prior to making any
distributions on termination of such trust, but shall in no way be binding upon
the Trustees in the exercise of their discretion.
ARTICLE VII. REMOTE DISPOSITIONS
REMOTE DISPOSITION. Upon the death of any person for whom a trust is then
in existence, if the remaining principal of his or her trust is not effectively
disposed of under the other provisions of this Agreement (including if the
Trustees shall determine not to exercise their discretionary power to distribute
the property among such of the Beneficiary's spouse, parents, siblings and
descendants as are then living), such property shall be paid to such person or
persons who would have taken and in the amounts or proportions in which they
would have taken had the Beneficiary (for whom or for whose spouse, parent or
descendant such trust was established) then died interstate and a domiciliary of
the State of New York leaving such property and no other.
ARTICLE VIII. DEFINITIONS; CONSTRUCTION OF TERMS
A. DEFINED TERMS. Unless specifically provided otherwise, the following
definitions (with respect to both capitalized and non-capitalized terms) shall
apply for all purposes of this Agreement:
(1) "ARTICLE": the specified article of this Agreement.
(2) "CHILD," "CHILDREN," "DESCENDANTS" and "ISSUE" (and words of
similar import): persons who are descended from the designated ancestor
genetically or by legal adoption, provided that:
(a) a person legally adopted after attaining the age of eighteen
(18) years and such person's descendants (whether genetic or legally
adopted) shall be deemed not to be issue of the adoptive parent or
parents;
(b) a person legally adopted prior to attaining the age of
eighteen (18) years in a proceeding which terminated the parental rights
of a genetic parent shall be deemed not to be the issue of any such
genetic parent who consented to the adoption;
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(c) a person born out of wedlock and such person's descendants
(whether genetic or legally adopted) shall be deemed not to be issue of
such person's father unless such father has voluntarily acknowledged
paternity in a signed instrument filed with any court or governmental
agency or has otherwise openly and notoriously acknowledged the child as
his own; and
(d) a person born as a result of artificial insemination, in
vitro fertilization or other medical intervention shall be deemed to be a
genetic descendant of the woman (other than a woman who was contractually
serving as a surrogate mother) who gave birth to such person (the "birth
mother") and the husband of the birth mother at the time such person was
conceived or implanted, unless there is clear and convincing evidence that
the husband withheld consent to the medical intervention and did not
subsequently voluntarily acknowledge paternity.
In the event of any question as to whether a birth mother's husband
withheld consent to a medical intervention for purposes of subparagraph (2)(d)
of this Paragraph A, or paternity has been voluntarily acknowledged for purposes
of subparagraphs (2)(c) or (2)(d) of this Paragraph A, the determination of the
Trustees (other than the birth mother or the putative father) shall be binding
on all persons interested in the trusts hereunder and on all persons claiming to
be so interested.
(3) "DEATH TAXES": all estate, inheritance, generation-skipping
transfer taxes, transfer, succession and other death taxes, together with any
interest and penalties thereon, imposed by any jurisdiction by reason of a
person's death.
(4) "EXECUTORS": the executors, personal representatives,
administrators of a person's Will or other legal representative of a person's
estate and successors thereto, whether domiciliary or ancillary, serving at any
time. References to a person's executors and any pronoun referring thereto shall
be construed in the singular or plural, as appropriate, and in the appropriate
gender.
(5) "INITIAL CONTRIBUTION": the property described on Schedule A
annexed hereto.
B. CONSTRUCTION OF TERMS. In construing this Agreement:
(1) If any beneficiary (other than a Beneficiary) dies within ninety
(90) days after the date on which he or she becomes entitled to any property
interest under this Agreement (whether outright or in trust), such beneficiary
shall be deemed to have died prior to such date.
(2) Property payable to a person's then living issue shall be paid
to such issue "PER stripes," that is, such property shall require primary
division into equal shares for the children of that individual (who are either
living or represented by living issue) whether or not there actually is a living
child of that individual.
(3) References to the Trustees and any pronoun referring thereto
shall be construed in the singular or plural, as appropriate, and in the
appropriate gender.
C. TITLES. Titles in this Agreement are solely for convenience of
reference and shall not affect the construction of any provision of this
Agreement.
ARTICLE IX. ADMINISTRATION OF TRUST AGREEMENT
A. GENERAL ADMINISTRATIVE PROVISIONS. In the administration of all trusts:
(1) Whenever the Trustees are directed or authorized to pay the
income or principal of any trust, the duty or power to pay the same to a
beneficiary shall include the power to apply the same for the benefit of the
beneficiary.
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(2) The Trustees may act primarily in the interests of the current
beneficiary (even to the extent of distributing the entire principal, thereby
terminating the trust) and without regard to the interests of subsequent
beneficiaries or remainder men or any rules of trust law which may require
impartiality as among such interests, and the interests of all subsequent
beneficiaries or remainder men are subordinate to the exercise of such powers.
The Trustees may, but shall not be required to, inquire into or take into
account the other income or resources of any beneficiary or the obligation of
any person to support any beneficiary.
(3) Any net income of any trust which is not distributed within
sixty-five (65) days after the close of the taxable year of the trust shall be
added to principal.
(4) In applying income or principal for a beneficiary under the
age of twenty-one (21) years, the Trustees may take into consideration that such
beneficiary may be a financial burden to his or her guardian or parent or the
person with whom he or she may be living, and accordingly, may pay from such
beneficiary's trust an appropriate share of the expenses of the guardian,
parent, or other person in maintaining the home in which the beneficiary and any
other persons reside and other related expenses.
(5) If the aggregate value of the principal and accrued and
undistributed income of any trust is at any time of such a modest amount that
the continued administration of the trust is not in the opinion of the Trustees
economically reasonable, the Trustees, in their discretion, may terminate such
trust and distribute the remaining principal and income to the current income
beneficiary.
(6) Notwithstanding any contrary provision of this Agreement, no
discretionary payments of income or principal shall be used to pay, defray or
reimburse any expense paid or payable by any governmental agency or charitable
institution for the support of any beneficiary, and the Trustees shall not be
compelled to pay, defray or reimburse any such expense. If, during the term of
the trust, the beneficiary is institutionalized in a facility operated by or
with or reimbursed by or with the funds of any governmental agency, or if public
funds are available for the care of or for payments and services to the
beneficiary, then no discretionary payments of income or principal shall be paid
or applied to or for the benefit of the beneficiary, except for those comforts
and luxuries not otherwise provided by any publicly funded program or from any
other source, public or private, and no court shall have the authority to direct
payments of income or principal to or for the benefit of the beneficiary.
(7) Whenever the Trustees pay the remaining principal upon
termination of any trust, such principal may be paid in cash or distributed in
kind and shall also include all accumulated, undistributed and accrued income
thereon.
(8) The Trustees may continue to exercise all the powers and
authority conferred by this Agreement with respect to any trust for a reasonable
period after the termination thereof and until completion of distribution of the
assets of the trust.
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B. DIVISION OF TRUSTS GENERALLY. If the Trustees so determine,
the Trustees shall hold any property immediately upon receipt in a separate
trust, or shall divide any property held in trust (including any terminating
trust) or directed to be held in trust (whether or not immediately upon receipt)
into two or more separate trusts of equal or unequal value, each of which shall
be held as a separate trust, provided that Trustees' commissions shall be
determined as if all property held in such separate trusts from time to time
constituted a single trust, and such commissions shall be allocated
proportionately among such separate trusts.
C. INTERESTS NOT TRANSFERABLE OR SUBJECT TO CREDITORS' CLAIMS. No
trust beneficiary shall have any right or power to anticipate, pledge, assign,
sell, transfer, alienate or in any other manner encumber his or her interest in
income or principal, nor shall any trust hereunder become liable for any
indebtedness of the beneficiary or be subject to any legal process, bankruptcy
proceeding or the claims, interference or control of the creditors of such
beneficiary.
ARTICLE X. FIDUCIARY POWERS
A. GENERAL POWERS OF TRUSTEES. The Trustees shall have all powers
and discretion conferred generally upon trustees under the laws of the State of
New York. Without limiting the foregoing, the Trustees are also authorized, in
their discretion:
(1) To retain for such period of time as they deem advisable
any property in the form received by them and successive interests received on
account thereof, including the stock of any corporate fiduciary acting
hereunder, without liability for decrease in value; and to acquire by purchase,
by exercise of options, or otherwise, and to retain for so long as they deem
advisable any kind of realty and personalty, including balances in savings
accounts, stock of any class, bonds or unsecured obligations (producing taxable
or tax-exempt income), options, interests in investment trusts and discretionary
common trust funds, and limited liability and limited partnership interests, and
metals, precious and semi-precious stones, coins, stamps, fine arts, and term
interests, life estates, remainder interests and other similar types of limited
interests, all without diversification as to kind or amount and without being
restricted by any statute or rule of law concerning fiduciary investments and
even though such investment is non-income producing or of a wasting asset
nature, and even though any trust may be invested entirely or primarily in one
investment or one type of investment;
(2) To manage, maintain, insure, repair, alter, improve,
develop, subdivide, partition or otherwise deal in or with or abandon any real
or personal property or any interest therein;
(3) To sell (at public or private sale), mortgage, exchange,
grant options to purchase, lease or otherwise dispose of any real or other
property or any interest therein, at such times, in such manner and upon such
terms and conditions (including, without limitation, for cash or on credit or
both, and for a term, whether or not such term extends beyond the anticipated
period of administration of any trust or any period fixed by law) as the
Trustees determine;
(4) To consent to the subordination, modification, renewal
or extension of any note, bond, mortgage, open account indebtedness or other
obligation, whether or not secured or evidenced by any writing; and to foreclose
or otherwise deal with mortgages or to continue mortgage investments and to use
other assets to protect any investment in any property, whether represented by
note, bond, mortgage, other obligation or otherwise;
(5) To vote by discretionary proxy or otherwise, and to
become parties to any voting trust agreement whether or not extending beyond the
anticipated period of administration of any trust or any term fixed by law, and
to assent to, participate in or oppose any type of reorganization, readjustment,
re-capitalization, consolidation, merger, dissolution of or other action in
connection with any corporation or other entity (including, without limitation,
delegating discretionary powers to and depositing property with any committee
and paying any assessments or other expenses);
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(6) To borrow money without personal liability therefore
from one or more of themselves or others for any and all purposes of any trust,
and to pay all expenses incurred in connection with any borrowing, and to secure
payment (including payment to one or more of themselves) by bond or mortgage,
pledge or hypothecation, all upon such terms and conditions as they determine,
including, without limitation, in the case of a borrowing from themselves in
their individual capacities, at then prevailing rates of interest and with such
security as shall conform with then prevailing commercial practice;
(7) To lend money upon such terms as they deem advisable or
appropriate in the overall best interests of the current beneficiary to the
income beneficiary of any trust or to others, at rates of interest and with such
security as conform with the then prevailing commercial practice, provided that
the Trustees shall not lend money to one or more of themselves in their
individual capacities, to any entity in which any one of them is an interested
party, or to the spouse or issue of any Trustee;
(8) To exercise any of their powers under this Agreement
with any one or more of themselves or others acting with respect to any other
trust hereunder;
(9) To employ and consult with investment and legal counsel,
brokers, depositories, accountants, custodians and such other agents as they
deem advisable (irrespective of whether any such person or entity shall be
affiliated with the Trustee, and even if the Trustee shall be a partner,
stockholder, officer, director, or corporate affiliate of or shall have any
interest in such entity), and to charge the compensation of all such agents, as
well as other expenses and charges, against the principal (or, if appropriate,
income) of any trust or trusts, and to apportion such compensation, expenses and
charges among such trusts without reducing the commissions otherwise payable to
them as Trustees; and, to the extent permitted by law, to delegate discretionary
powers to and rely on information or advice furnished by any such investment or
legal counsel, accountants or custodians;
(10) To register any property in the name of their nominee,
including the nominee of any corporate fiduciary, or to hold the same
unregistered or in such other form that title passes by delivery;
(11) To hold the principal and income of any trusts or shares
hereunder in a consolidated fund, invested IN SOLID, in which the separate and
distinct trusts and shares shall have undivided interests;
(12) To divide property into shares and to distribute
property in kind, or partly in cash and partly in kind, and to effect such
division and distribution in whole or in part by allocating to each share or
distribution an undivided interest in any asset held, or by allocating certain
assets to certain shares or distributions, and other assets to other shares or
distributions, on a non-pro rata or disproportionate basis or otherwise,
irrespective of the amount of unrealized appreciation or depreciation for
capital gain or loss purposes of each asset thus sold, exchanged or allocated,
without adjustment in the amount of any share or distribution by reason of any
difference in the income tax bases of the assets thus allocated to such shares
or distributions, and to elect or not to elect to recognize gain on any such
distribution, and such divisions, allocations, distributions and elections shall
be binding and conclusive on all persons interested in the trusts hereunder;
(13) To determine the time and circumstances, if any, for the
payment of any estimated income tax with respect to the income of any trust and,
in the discretion of the Trustees, to determine to elect or not to elect to
treat any portion of such estimated payment as a payment made by the
beneficiaries of such trust;
(14) To pay any and all expenses, costs, fees or other proper
charges of any trust; and the right of any beneficiary to income or principal
shall be subject to the deductions that the Trustees may make against the same;
(15) To make payments or distributions on account of the
dispositions hereunder, subject to adjustment and on the basis of estimates,
pending the final determination of the taxes due at or imposed by reason of a
beneficiary's death;
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(16) To compromise, contest, prosecute or abandon any claim
of whatever nature, whether asserted against the trust or trust assets or held
by the Trustees; and
(17) Generally, to exercise for the benefit of any trust and
any property constituting a part thereof all rights, powers and privileges of
every nature that may be exercised by one owning such property absolutely and in
his or her own right and without being limited in any way by the rights, powers
and privileges specifically granted in this Agreement; and in connection with
the exercise of any such rights, powers and privileges, whether or not the same
be specifically mentioned herein, to enter into such contracts, to execute such
written instruments, and to include therein such covenants, terms and conditions
as they determine and to do any and all such other acts as they determine to
effectuate all rights, powers and privileges conferred upon them.
B. EXTRAORDINARY POWERS. Within the broad scope of investment
powers conferred upon the Trustees under Paragraph A of this Article, the
Trustees shall have the following investment powers, authority and discretion:
(1) To engage in transactions involving so-called "short
sales" and to purchase securities on margin and to maintain margin accounts for
such purposes, which margin accounts may be with one or more individuals, firms,
associations, banks, stock brokerage firms or corporations, and to conduct such
transactions in such accounts and to pledge or hypothecate all or any portion of
the principal of the trusts as security for the payment of the debit balances in
such accounts, on such terms and conditions as the Trustees, in their
discretion, determine;
(2) To hold, purchase, sell and trade, without limitation,
futures, options on futures, exchange listed and over-the-counter put and call
options on securities, equity indices, commodities and currencies and to enter
into such contracts whether or not the securities, commodities, equity indices,
currencies or other instruments underlying such contracts are owned by the trust
at the time of such purchase or sale or, in the case of options, at any time
during the option exercise period, for such duration and upon such other terms
as the Trustees, in their discretion, determine, and, in the case of options, to
exercise any such option at such time or times, or to refrain from exercising
any such option even if such action will result in the entire loss of the
premium paid for such option, as the Trustees, in their discretion, determine.
Any premium received by the Trustees with respect to any option granted by them
shall be income of the trust; and
(3) To enter into contracts with one or more individuals,
stock brokerage firms, associations or corporations in such form as the
Trustees, in their discretion, determine, including, but not limited to,
contracts for the furnishing of investment advisory services and contracts for
opening discretionary accounts, granting to such individuals, firms,
associations or corporations the authority to purchase, sell and otherwise deal
in securities and commodities and to pay the regular commissions or other
compensation of such individuals, firms, associations or corporations for such
investment advisory services and brokerage services out of the income or
principal of the trusts as the Trustees, in their discretion, determine, all
without affecting the Trustees' primary responsibility for investments.
C. DISTRIBUTIONS OF PROPERTY. As to all distributions under this
Agreement:
(1) When property is payable to a person under the age of
twenty-one (21) years or under another legal disability, the Trustees are
authorized, in their discretion, to pay the same to such person (notwithstanding
his or her age or legal disability), or to the guardian of his or her person or
property, or his or her committee, conservator or other like fiduciary, wherever
appointed, or without the intervention of such fiduciary, to any adult with whom
such person resides, but for such person's sole benefit, or to a custodian
(selected by the Trustees) for such person under the Uniform Transfers to Minors
Act or other comparable law of any jurisdiction (until the maximum age permitted
under applicable law) (provided that no custodian shall make any payment out of
such property that satisfies any portion of such custodian's individual legal
obligation of support, and any custodian having such an obligation shall agree
to this provision before receiving any property).
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(2) The written receipt of any person to whom property is paid
pursuant to any provision of this Agreement or the cancelled check or other
evidence of the application of any amount by the Trustees for the benefit of any
beneficiary shall be a full discharge to the Trustees for any amount so paid or
applied and from further accountability therefore and the Trustees shall not be
required to see to the use or application thereof by any beneficiary or
recipient.
(3) Anything herein to the contrary notwithstanding, the Trustees
in their sole discretion shall have the power to distribute any part or all of
any trust held hereunder to any charitable organization, as they shall select.
D. RESTRICTIONS OF FIDUCIARY POWERS. Notwithstanding any contrary
provision of this Agreement, no Trustee shall exercise any discretion:
(1) To pay income or principal of a trust of which such Trustee is
a beneficiary to himself or herself;
(2) To pay income or principal to any other beneficiary of a trust
of which such Trustee is a current or successor income beneficiary or a
presumptive remainder man; or
(3) To pay or loan income or principal of any trust in discharge
of any of such Trustee's individual legal obligations, including obligations of
support.
E. MISCELLANEOUS PROVISIONS CONCERNING TRUSTEES. The following
additional provisions shall apply to the Trustees:
(1) Each Trustee (whether or not originally appointed hereunder)
shall have the same rights, powers, duties and privileges, whether or not
discretionary, except as to any right, power, duty or privilege expressly
withheld from any such Trustee by law, by any provision of this Agreement or by
any instrument appointing such Trustee, and except as to any right, power, duty
or privilege expressly conferred upon a designated class of Trustees by any
provision of this Agreement, which right, power, duty or privilege shall not be
exercisable by a Trustee not within the class.
(2) No Trustee, whether named herein or otherwise designated or
appointed, shall be required to give any bond or security in any court or
jurisdiction.
(3) Whenever the Grantor confers any discretion upon the Trustees
without mandating that they act, the Trustees' determination as to the extent to
which such discretion is exercised shall be conclusive on all persons interested
in the trusts.
(4) The rights, powers and privileges conferred upon the Trustees
are in addition to and not by way of limitation of the rights, powers and
privileges conferred by law and may be exercised without the authorization of
any court.
(5) Any individual Trustee may delegate any or all of his or her
rights, powers, duties and privileges, whether or not discretionary, to the
other then acting Trustee or Trustees (except as to matters involving any right,
power, duty or privilege withheld from or not conferred upon such other Trustee
by law, by any provision of this Agreement or by any instrument appointing such
Trustee) by delivering an instrument, signed and acknowledged, to the
appropriate effect to such other Trustees, provided that any such instrument
shall be revocable at any time.
(6) Each individual Trustee shall be deemed not to have special
investment skills, whether or not such Trustee has such skills, unless the
instrument appointing such Trustee specifically provides to the contrary.
9
(7) If the Trustees disagree as to any matter when more than two
of them are authorized to act, a decision shall be made by the majority of the
Trustees who are not precluded by law or by this Agreement from acting.
Notwithstanding the foregoing, ministerial duties and decisions of the Trustees,
if more than one is serving (including, but not limited to, the signing of
checks, the execution of brokerage agreements relating to securities, and
similar transactions), may be executed by any one Trustee.
(8) A dissenting Trustee (or a Trustee who is prohibited by law or
by the provisions of this Agreement from participating in a particular action or
decision of the Trustees) shall not be liable or accountable for the actions or
decisions of the Trustees, even if the dissenting (or prohibited, as the case
may be) Trustee is required to perform ministerial acts in order to carry out a
decision of the other Trustees.
F. PERSONS DEALING WITH TRUSTEES. With respect to persons dealing with
the Trustees:
(1) Anyone may rely upon a copy of this Agreement and of any other
document required by this Agreement to be in writing, which is certified by any
Trustee to be a full and complete copy of this Agreement or of such document, to
the same effect as if such copy were the original. Anyone may rely upon any
statement of fact certified by any Trustee.
(2) No person or corporation dealing with the Trustees in any
transaction affecting any trust hereunder shall be required to inquire or
investigate into the Trustees' authority for entering into such transaction or
to see to the application made by the Trustees of the proceeds of any such
transaction.
G. EXONERATION OF TRUSTEES. So long as they have acted in good faith
and with reasonable care, diligence and prudence, the Trustees are hereby
exonerated from any individual responsibility or liability to any person
interested in the trusts hereunder for any loss or lack of benefit that may
occur to any property passing under this Agreement or otherwise, or result by
reason of the Trustees having exercised or not exercised the powers, discretion
and authority granted under this Agreement or conferred by law.
H. NOTICE OF EVENT AFFECTING PAYMENT OR DISTRIBUTION. Until the
Trustees receive written notice of any birth, marriage, death or other event
upon which the right to payment or distribution may depend, the Trustees shall
incur no liability to any person whose interest may have been affected by that
event for any payment or distribution in good faith made or not made.
I. INDEMNIFICATION. The Grantor hereby agrees to indemnify the Trustees
for, and to hold them harmless against, any loss, liability, tax or expense
incurred, arising out of or in connection with their entering into this
Agreement and carrying out the duties as Trustees hereunder. The indemnity
provided hereunder shall survive the termination of this Agreement and any trust
established hereunder.
ARTICLE XI. APPOINTMENT AND RESIGNATION OF TRUSTEES
A. APPOINTMENT OF SUCCESSOR TRUSTEES.
(1) The Trustees at any time acting hereunder are authorized, in
their discretion:
(a) to appoint one or more individuals or a bank or trust
company (incorporated under the laws of any jurisdiction) as additional or
successor Trustees to serve with or after any Trustee upon any contingency. This
shall be a continuing power in any such person at any time acting hereunder; and
(b) to establish the order of succession and to revoke any
such appointment until, by its terms, it is effective, whether or not he, she or
they made any such appointment.
10
(2) Any appointment or revocation pursuant to this Paragraph
A shall be made by a written instrument, duly signed and acknowledged, and filed
with the records of the trust to which such appointment or revocation relates.
B. REMOVAL OF TRUSTEES. From time to time and with or without cause,
the Grantor, acting by resolution of its board of directors, may remove any
Trustee of a specified trust and appoint a successor Trustee who is not then a
descendant of the parents of the Beneficiary.
C. QUALIFICATION OF SUCCESSOR TRUSTEES. Any successor Trustee shall
qualify to act when his, her or its appointment becomes effective by an
instrument ("Acceptance of Trust") duly signed and acknowledged, and filed with
the records of the trust. No successor Trustee shall be required to investigate
or audit the accounts or acts of the prior Trustees or to take any action with
respect thereto before qualifying or acting.
D. RESIGNATION OF TRUSTEES. Any Trustee may resign at any time without
court application or consent by delivering an instrument ("Resignation of
Trustee"), signed and acknowledged, to a co-Trustee, if any, and to any
successor, and by filing a copy of such instrument with the records of the
trust, provided that the resignation of any Trustee acting alone shall be
effective only upon the appointment and qualification of a successor Trustee.
E. DELIVERY OF DOCUMENTS. A copy of any Acceptance of Trust or
Resignation of Trustee shall be delivered to the current beneficiaries of the
trust and to the legal representative or parent of any such beneficiary who is
under a legal disability.
(1) Delivery of any document under this Agreement may be made
either by personal delivery or by depositing the same in the mails, postage
prepaid, either registered or certified mail, return receipt requested, to the
address that such person from time to time has specified in writing to the party
effecting the delivery or, if none, to the person's last known address.
(2) Any document required to be delivered to the Trustees shall be
deemed delivered if delivered to any Trustee. Failure to deliver a copy of any
instrument (which copy is intended to provide information and is not of
substantive import) shall not affect or negate the effectiveness of such
instrument, the original of which is appropriately delivered or disposed of, for
its intended purpose.
ARTICLE XII. COMPENSATION OF TRUSTEES; ACCOUNTING; SERVICE OF PROCESS
A. COMPENSATION OF TRUSTEES. Each Trustee shall be entitled to
reimbursement from the trust for his or her reasonable out-of-pocket expenses
incurred in connection with his or her services in such capacity.
(1) The Trustees shall be compensated as follows:
(a) Any individual Trustee shall not be entitled to
compensation for his or her services in such capacity; and
(b) Any corporate Trustee shall be entitled to compensation
for its services as prescribed in its published rates, as from time to
time in effect, unless different compensation has been provided for by
written agreement between such corporate Trustee and the person appointing
such Trustee or all trust beneficiaries who are not under a legal
disability and the legal representative or parent of any such beneficiary
under a legal disability.
B. ACCOUNTING. Each Trustee is excused from the duty of rendering
annual or other periodic accounts to any court, regardless of whether such duty
is required by the laws of any jurisdiction affecting the trust. No Trustee
shall be required to account in any court in the absence of a breach of trust.
Notwithstanding the foregoing, the Trustees may have their account judicially
settled at any time if they deem it advisable to do so. The
11
Trustees may also choose to effect a non-judicial settlement of their account by
agreement. The written approval of all beneficiaries not under a legal
disability (or of the legal representative of such of them as are under a legal
disability) as to any matter relating to or arising in the course of the
administration of any trust hereunder, whether such matter relates to an
accounting or any action taken or omitted or proposed to be taken or omitted by
the Trustees, shall be conclusive on all persons interested in the trusts
hereunder, including those who are as yet unborn at the time of such written
approval. For purposes of this Paragraph B, the term "Trustees" shall include
any former Trustee or his, her or its legal representative or the executor of
the estate of any deceased Trustee.
C. SERVICE OF PROCESS. In any proceeding in which all persons
interested in any trust are required to be served with process, where a person
having an interest in the trust is under a disability and a party to the
proceeding has the same interest as the person under a disability, it shall not
be necessary to serve the person under a disability, unless, notwithstanding
this provision, such service is required under local law.
ARTICLE XIII. DEATH TAXES
A. TAX APPORTIONMENT. If any Death Taxes are imposed on the estate of
any beneficiary of a trust hereunder by reason of property held in a trust
hereunder, the Trustees shall pay from such trust its proportionate share of
such Death Taxes, as determined under the law of the jurisdiction imposing such
Death Tax.
B. RELIANCE UPON BENEFICIARY'S EXECUTORS. The Trustees may rely on the
determination of a beneficiary's executors as to the actual amount of any
payment described in this Article and shall have no duty or responsibility to
make any further inquiry or to take part in the determination of such taxes, and
upon making such payments shall have no further liability or accountability to
any person interested in the trusts hereunder.
ARTICLE XIV. IRREVOCABILITY; GOVERNING LAW
A. TRUSTS IRREVOCABLE. This Agreement and the trusts hereunder shall be
irrevocable. No one shall have the right or power in any capacity, whether alone
or in conjunction with others, to alter, amend, revoke or terminate any trust or
any terms of this Agreement, in whole or in part. Notwithstanding the foregoing,
the Grantor shall have the power, by written instrument, which has been signed
and acknowledged, to create a separate trust for the benefit of an employee for
whom a trust has not previously been established hereunder. Upon written
acceptance of the then acting Trustees, a trust for such employee shall be held
pursuant to the terms of this Agreement.
B. GOVERNING LAW. This Agreement and the trusts hereunder shall be
construed, regulated and governed in all respects, not only as to administration
but also as to validity and effect, by the laws of the State of New York.
C. CHANGE OF SITUS.
(1) The Trustees, at any time and from time to time, in their
discretion:
(a) May remove all or part of the assets to and hold and
administer the same in any other jurisdiction;
(b) May change the situs of administration of any trust from
one jurisdiction to another jurisdiction; and
(c) May elect that the law of such other jurisdiction shall
thereafter govern the trust to such extent as may be necessary and
appropriate, whereupon the courts of such other jurisdiction shall
have the power to effectuate the purposes of this Agreement to such
extent.
▇▇
▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇ )
: ss.:
COUNTY OF NEW YORK )
On this 29th day of November, 2000, before me personally appeared ▇▇▇▇ ▇
▇▇▇▇▇▇▇▇▇▇▇, who being by me duly sworn, did depose and say: that he is the
President and Chief Executive Officer of KHANTY MANSIYSK OIL CORPORATION, the
corporation mentioned and described in and which executed the foregoing
instrument; that he knows the corporate seal of said corporation; that the seal
affixed to the foregoing instrument is such corporate seal and that it was so
affixed by order of the Board of Directors or other governing body of said
corporation; and that he signed his name thereto by like order.
------------------------------
Notary Public
(SEAL)
STATE OF NEW YORK )
: ss.:
COUNTY OF NEW YORK )
On this 29th day of November, 2000, before me personally appeared ▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇▇▇, personally known to me or proved to me on the basis of satisfactory
evidence to be the individual whose name is subscribed to the within instrument
and acknowledged to me that he executed the same in his capacity, and that by
his signature on the instrument, the individual, or the person upon behalf of
which the individual acted, executed the instrument.
------------------------------
Notary Public
(SEAL)
STATE OF NEW YORK )
: ss.:
COUNTY OF NEW YORK )
On this 29th day of November, 2000, before me personally appeared ▇▇▇▇ ▇.
▇▇▇▇▇▇, personally known to me or proved to me on the basis of satisfactory
evidence to be the individual whose name is subscribed to the within instrument
and acknowledged to me that he executed the same in his capacity, and that by
his signature on the instrument, the individual, or the person upon behalf of
which the individual acted, executed the instrument.
------------------------------
Notary Public
(SEAL)
14
SCHEDULE A
TO
THE ▇▇▇▇ ▇▇▇▇ EMPLOYEES TRUST AGREEMENT
--------------------------------------------------------------------------------------
EMPLOYEE INITIAL CONTRIBUTION
--------------------------------------------------------------------------------------
▇▇▇▇▇▇, ▇▇▇▇ Option to purchase 350 shares of common
stock in Khanty Mansiysk Oil Corporation,
subject to the terms of the applicable option
agreement pursuant to which each such option was
granted.
7 shares of common stock in Khanty Mansiysk Oil
Corporation subject to the terms of the
agreement pursuant to which such shares were
transferred to or acquired by the Trust.
--------------------------------------------------------------------------------------
▇▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ Option to purchase 350 shares of common
stock in Khanty Mansiysk Oil Corporation,
subject to the terms of the applicable option
agreement pursuant to which each such option was
granted.
4 shares of common stock in Khanty Mansiysk Oil
Corporation subject to the terms of the
agreement pursuant to which such shares were
transferred to or acquired by the Trust.
--------------------------------------------------------------------------------------
Khamidullina, Rima 20 shares of common stock in Khanty
Mansiysk Oil Corporation subject to the terms of
the agreement pursuant to which such shares were
transferred to or acquired by the Trust.
--------------------------------------------------------------------------------------
Khanutin, Gleb 10 shares of common stock in Khanty
Mansiysk Oil Corporation subject to the terms of
the agreement pursuant to which such shares were
transferred to or acquired by the Trust.
--------------------------------------------------------------------------------------
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ 10 shares of common stock in Khanty
Mansiysk Oil Corporation subject to the terms of
the agreement pursuant to which such shares were
transferred to or acquired by the Trust.
--------------------------------------------------------------------------------------
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ Option to purchase 425 shares of common
stock in Khanty Mansiysk Oil Corporation,
subject to the terms of the applicable option
agreement pursuant to which each such option was
granted.
--------------------------------------------------------------------------------------
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ Option to purchase 885 shares of common
stock in Khanty Mansiysk Oil Corporation,
subject to the terms of the applicable option
agreement pursuant to which each such option was
granted.
--------------------------------------------------------------------------------------
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ Option to purchase 750 shares of common
stock in Khanty Mansiysk Oil Corporation,
subject to the terms of the applicable option
agreement pursuant to which each such option was
granted.
--------------------------------------------------------------------------------------
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ 10 shares of common stock in Khanty
Mansiysk Oil Corporation subject to the terms of
the agreement pursuant to which such shares were
transferred to or acquired by the Trust.
--------------------------------------------------------------------------------------
Markov, Rinat 20 shares of common stock in Khanty
Mansiysk Oil Corporation subject to the terms of
the agreement pursuant to which such shares were
transferred to or acquired by the Trust.
--------------------------------------------------------------------------------------
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ Option to purchase 1,991 shares of
common stock in Khanty Mansiysk Oil Corporation,
subject to the terms of the applicable option
agreement pursuant to which each such option was
granted.
--------------------------------------------------------------------------------------
15
--------------------------------------------------------------------------------------
▇▇▇▇▇▇▇, ▇▇▇▇▇ Option to purchase 250 shares of common
stock in Khanty Mansiysk Oil Corporation,
subject to the terms of the applicable option
agreement pursuant to which each such option was
granted.
6 shares of common stock in Khanty Mansiysk Oil
Corporation subject to the terms of the
agreement pursuant to which such shares were
transferred to or acquired by the Trust.
--------------------------------------------------------------------------------------
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇ Option to purchase 1,528 shares of common
stock in Khanty Mansiysk Oil Corporation,
subject to the terms of the applicable option
agreement pursuant to which each such option was
granted.
20 shares of common stock in Khanty Mansiysk Oil
Corporation subject to the terms of the
agreement pursuant to which such shares were
transferred to or acquired by the Trust.
--------------------------------------------------------------------------------------
Tnalin, Alibek Option to purchase 250 shares of common
stock in Khanty Mansiysk Oil Corporation,
subject to the terms of the applicable option
agreement pursuant to which each such option was
granted.
62 shares of common stock in Khanty Mansiysk Oil
Corporation subject to the terms of the
agreement pursuant to which such shares were
transferred to or acquired by the Trust.
--------------------------------------------------------------------------------------
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ Option to purchase 350 shares of
common stock in Khanty Mansiysk Oil Corporation,
subject to the terms of the applicable option
agreement pursuant to which each such option was
granted.
--------------------------------------------------------------------------------------
Varaksin, Viktor 7 shares of common stock in Khanty
Mansiysk Oil Corporation subject to the terms of
the agreement pursuant to which such shares were
transferred to or acquired by the Trust.
--------------------------------------------------------------------------------------
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ Option to purchase 95 shares of common
stock in Khanty Mansiysk Oil Corporation,
subject to the terms of the applicable option
agreement pursuant to which each such option was
granted.
5 shares of common stock in Khanty Mansiysk Oil
Corporation subject to the terms of the
agreement pursuant to which such shares were
transferred to or acquired by the Trust.
--------------------------------------------------------------------------------------
16