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Yukos Bankruptcy Court Ruling

Here are the Russian and English versions of the bankruptcy court’s ruling on Yukos.

ARBITRAZH COURT OF THE CITY OF MOSCOWRULINGMoscowIn the matter № A40-11836/06-88-35-БThe introductory part of the Ruling read out on 12th November, 2007The full text of the Ruling prepared on 15th November, 2007The Arbitrazh Court of the city of Moscow, including Presiding Judge P.Markov and Justices G.Bugayeva and O.Mishakov, with A.Safonova acting as Registrar,Having considered the matter of the bankruptcy of the Oil Company YUKOS OAO,With the participation of:The representativse of the Receiver, Yu.Romanov [follow passport and PoA details], E.Rebgun […], V.Bashmakov […], A.Chikunov […], I.Krylov […], S.Dogonin[…], Representative of Rosneft OAO – M.Datskevich […],Representative of Samaraneftegaz OAO R.Rozgalev […], Representative of the Tax Service of Russia A.Ustinov […], Representative of Tomskneft OAO R.Rogalev […], Chairman of the Creditors Committee A.Ustinov […], Attorney for Mr Tim Osborne, representing Yukos shareholders, N.Kamysheva […], the Receiver, E.Rebgun […],HAS RULED AS FOLLOWS:By the Moscow Arbitrazh Court Decision dated 04.08.2006, the Debtor, Oil Company Yukos OAO was recognized as bankrupt and receivership procedures were introduced, with E.K.Rebgun being appointed the Receiver.The Information regarding the bankruptcy was published in Rossiyskaya Gazette № 177 (4143) on 12.08.2006.By its Ruling dated 07.08.07, the Court extended the term of the receivership by three months.The purpose of the present hearing was for the Court to hear the Report submitted by the Receiver, Mr Rebgun, and his motion for the termination of the receivership with respect to the Debtor.The Court heard the Report of the Receiver, Mr Rebgun on the work accomplished between 04.08.2006 and 01.11.2007 and found as follows:In accordance with art. 126 of the Law on Insolvency (Bankruptcy), the Receiver advised the CEO of the Debtor that within three days, the financial and other documentation, as well as seals, stamps, material and other assets of the Debtor must be handed over to the Receiver (ref. YKU-1 of 08.08.2006).With a view to identifying the Debtor’s assets, the Receiver forwarded requests to the various registering authorities.The total Bankruptcy Estate credited to the company’s bank accounts throughout the term of the receivership, as of 01.11.2007, amounted to RUR 877 063 556 723.97, including:1. Operational revenue and receivables repaid – RUR 2 204 062 197.402. Sale of property – RUR 860 261 932 313.963. Dividends received and promissory notes redeemed – RUR 8 738 754 208.514. Loans repaid – RUR 67 830 8805. Bank interest – RUR 5 417 202 9156. Balance of bank accounts – RUR 373 774 209.02TOTAL – RUR 877 063 556 723.97With a view to beginning to manage the Debtor’s estate, located in more than 15 regions of Russia, the Receiver decided, under art 129.2 of the Law on Insolvency (Bankruptcy), to organize an open tender to select surveyors and valuers to be had recourse to for the purposes of the receivership.With a view to ensuring the safe-keeping of the Debtor’s property, the Receiver’s staff commenced the appraisal of the Debtor’s assets located in Moscow (Order № 3 of 15.06.2006).In August and September 2006, the bidding documentation was drafted and approved for tenders to appoint valuers and surveyors of Yukos assets, including the following:• Bidding procedures and standards / criteria that the winning bidder must meet• Instructions for the preparation of the bids• Requirements for the prospective bidders• Technical requirements for the works to be accomplished• List of assets to be valuedBy his Order № 5 dated 10.10.2006, the Receiver appointed the Bidding Committee which was assigned the task of identifying successful bidders.In accordance with the Notification of the bidding procedures published in the Vedomosti № 182 (1709) of 28.09.2006, the Receiver between 29.09 – 12.10.2006 organized the work for the filing of bids.Following the Bidding Committee’s meeting on 13.10.2006, the Committee members drew up and signed the following minutes and protocols:• Protocol 1 of the meeting of the Committee regarding the opening of the envelopes and the review of the bids• Protocol 2 regarding the results of the open tenderThe work was awarded to the consortium of bidders comprising ROSEKO ZAO, ENPI Consult ZAO, Rossiyskaya Otsenka ZAO, KO-INVEST OOO, and Otsenochnaya Firma BINOM OOO who had offered what the Committee judged to be the best terms.In pursuance of the Procedures governing the bidding, notifications were sent to the winner, as well as the other bidders.Contract KU 15/10/06 was executed on 23.10.2006 whereby the Consortium’s General Contractor, ROSEKO ZAO undertook to conduct all the work required in order to list and value all the Debtor’s property with a view to determining the fair market value and the liquidation value thereof.With a view to organizing valuation of the Debtor’s property and financial liabilities, an Order was signed [details of Order].In accordance with the Order, Commissions were set up to conduct valuation of the following types of property:• Receivables and Payables• General purpose and IT property (in Yukos’s structural units in Moscow)• Financial investments• Fixed assets, uninstalled equipment, funds invested into non-current assets, operational production, future liabilities (upstream, downstream and logistics). This Commission included sub-commissions on upstream, downstream operations, logistics, geological prospection, sales and distribution as well as a sub-commission to locate the assets leased out in various regions of Russia.The results of the work conducted by the Commission with respect to the assets located in Moscow were handed over to the General and IT valuation commission [details of Order].In accordance with Order № 8 of 27.10.2006, the valuation commissions commenced work on 30.10.2006.The documentation related to the compilation of lists and valuations, were drawn up in accordance with [details of the Ministry of Finance Order], including Minutes of commission meetings, valuation lists etc.As a result of the compilation of the lists of assets, the Receiver signed his Resolution № 2 of 27.03.2007 charging his various departments with the following tasks:• Identify any shortfalls• Make corrections to the financial reporting based on the decisions of the commissions compiling the lists of assets• File complaints/letters before action with various leaseholders who may have caused shortfalls• Draw up opinions regarding the possibility of suing delinquents for damages caused by the shortfalls• Draw up documentation to write off unusable equipment and other assets• Account for any surpluses• Carry out the registration of the various facilities in the Malanin, Sredne-Balyk and Priobskoye field where construction has been completed but no registration has been undertaken• List and register various assets where construction had not been completed• Mothball assets where construction work had been suspendedIt was determined that there does not appear to be any reasonable expectation of successful prosecution of the various individuals who were, pro forma, in charge of the safe-keeping of various assets that were found missing or where shortfalls had been identified.The Receiver set up a Commission (see Resolution to Conduct Internal Investigation of 18.06.2007) to look into the reasons for and the circumstances surrounding the shortfalls that had occurred with a view to making recommendations regarding possible prosecution of the individuals responsible for those shortfalls.The results of the Internal Investigation are contained in the Protocol approved by the Receiver on 19.09.2007.The Commission found as follows:The shortfalls in Yukos assets occurred between 1995-1005.The causes for the shortfalls were the failure on the part of various Company executives to comply with statutory and other legal requirement governing the safe-keeping and accounting for, various Yukos’s assets.The procedures for the proper acquisition and safe-keeping of assets, including equipment, were not complied with, equipment was handed over to various Company subsidiaries without executing relevant contracts and were not properly accounted for in the Company’s financial accounts. Those responsible for the safe-keeping of assets, including bailees, did not execute the legal documents required by law, no audit or investigations had been conducted to identify the reasons for the shortfall and no adjustments had been made to the Company accounts.The Commission did not identify any signs of criminal behaviour, including possible misappropriation or conversion.The Commission was unable to determine the identities of the persons guilty of the shortfalls by reason of having failed to file documents related to the commissioning, decommissioning or retirement of the various assets.The Commission determined that there was no prospect of successful prosecution or suing for damages those responsible for the shortfalls discovered in the course of the compilation of the lists of assets.In view of the above, the Commission recommended the following:Make the necessary adjustments to the accounts in connection with the claims filed with Rosneft OAO as per paragraph 3.1.1 of the Internal Investigation Report;Review the possibility, at the next Asset Valuation Commission meeting, of writing off the property found to be missing by virtue of failure to make entries regarding their commissioning, due to retirement, as well as those assets where shortfalls had been identified but no persons responsible for the shortfalls had been found (Sections 3.1.4-1.8, 3.2. and 3.3. of the Internal Investigation Report).Having regard to the conclusions contained in the Internal Investigation Report, the Commission resolved to make entries in the Company accounts as follows:• Reflect the shortfalls as per Section 1 of the Report of the Assets List Commission of 05.10.2007 where persons responsible were identified and where the Receiver by his Decision № 2 of 27.03.2007 decided to send claims or letters prior to initiation of proceedings to those responsible, or their successors and assigns;• Write off those shortfalls where no persons responsible were identified, as per Section 2 of the Report• Write off those shortfalls caused by failure to make entries in a timely fashion in the Company accounts where equipment had been commissioned, decommissioned, retired or assigned to third parties (Section 3 of the Report refers).Following the meeting of the Assets List Commission of 05.10.2007, the Receiver issued Resolution № 7 of 10.10.2007 whereby YUKOS FBTs was assigned the following tasks:• Make entries in the Company accounts to reflect the shortfalls for which persons responsible had been identified and duly notified as per the Receiver’s Resolution 2 of 27.03.2007, with the shortfall being written off;• Make entries in the Company accounts for the shortfalls for which the internal investigation had failed to identify those responsible, by writing them off;• Write off those shortfalls caused by failure to make entries in a timely fashion in the Company accounts where equipment had been commissioned, decommissioned, retired or assigned to third parties.The Receiver sent a number of claims to Rosneft OAO which were satisfied in full.In order to organize work related to the valuation of the Company’s assets, a Guiebook was drawn up containing a list of contact persons in the Company’s subsidiaries and affiliates with responsibility for making information available to the Valuation Consortium. A separate list was compiled of “problem assets” where no information was available regarding contact persons ( dormant companies, companies in liquidation etc).To ensure timely collection of data and information needed for the valuation and determination of the fair market value of Yukos’s long-term financial investments, the Receiver forwarded the following to the Company’s subsidiaries and affiliates:• Letters advising them of the institution of bankruptcy proceedings and the appointment of the Receiver, the compilation of Lists of assets and the valuation procedures as per art 13 Bankruptcy Act;• Questionnaires, separately for each type of company [ details of the Order]On 01.11.2006, the Consortium began sending out the questionnaires.Additionally, letters were sent to those companies where the Debtor held minority equity stakes, attaching lists of questions needed to conduct the valuation [details of governing statutes].This was due to the fact that some companies where Yukos held minority participations had refused to provide full details as per the valuer’s request.[Contract details] The Consortium drew up and submitted for approval to the Receiver the list of requirements for the valuation, as well as a model Valuer’s Report.[Contract details] The Consortium submitted its report N-01U/06 on 15.01.2007 entitled “Consultancy Services for the Compilation of Lists of Assets and the Valuation for the Purposes of Winding-up Yukos OAO, with a View to their Possible Sale or Other Disposition” which included the preliminary results of the valuation of Yukos subsidiaries and affiliates as of 19.01.2007.In view of the need for extending the term for the submission of the reports, the Receiver and the General Director of ROSEKO ZAO entered into a Supplementary Agreement on 19.01.2007 to the Valuation Contract [details of Contract].To amend and update the List of assets to be valued, a Supplementary agreement was executed to the Valuation Contract.In accordance with paragraph 2.1.4 of the Valuation Contract, and bearing in mind the Supplementary Agreement, the Consortium’s General Contractor submitted the following documents to the Receiver:• 184 reports on the fair market value of Yukos’s long-term financial investments pursuant to the List contained in the Attachment 1 to the Supplementary Agreement of 01.06.2007 to the Valuation Contract;• 4 reports on the fair market value of Yukos’s long-term financial investments pursuant to the List contained in the Attachment 2 to the Supplementary Agreement of 01.06.2007 to the Valuation Contract.Under paras 4 and 5 of the Supplementary Agreement to the Contract of 01.06.2007, the Valuation Consortium conducted additional work and submitted reports to the Receiver on the following valuation reports:• Market value of Yukos’s assets located in the Malanin, Sredne-Balykm Vostochno-Salym, Vstrechny, Chupal, Kul-Yegansky, Severo-Pudinsjy, Ayavinsky, Jelindukonsky, Oskobinsky and Tersko-Kamovsky fields as of 01.04.2007;• Market and liquidation value of the ordinary shares in Commercial Bank Solidarnost OAO representing 4.78% of the issued and outstanding shares of the Bank as of 01.03.2007;• Market and liquidation value of the ordinary shares in Kubanskaya Energy Supply Company OAO , Kubanskaya Generating Company OAO and Territorial Generating Company № 4 OAO;• Market value of the immovable and movable property as well as intangible assets, including the Yukos Oil trademark, for a total of 3750 items, as of 01.04.2007 as per the list contained in Attachment 3 to the Supplementary Agreement of 01.06.2007 to the Valuation Contract• Market value of Yukos’s receivables under 428 contracts concluded between Yukos and other natural or juristic persons or joint venture contracts as of 01.05.2007 as per the list contained in Attachment 4 to the Supplementary Agreement of 01.06.2007 to the Valuation ContractAs per the Valuation Contract [details of contract] the market value was determined of Yukos’s share in the joint venture to build the Novokuibyshevsk Station.Information regarding the sales of the Debtor’s assets.Guidelines were drawn up governing the holding of open auctions to sell Yukos’s assets in the course of the receivership, which Guidelines were approved by the Creditors’ Committee meeting on 20.02.2007 (Minutes 4). Those Guidelines were published in Rossiyskaya Gazette № 37 (4300) of 21.02.2007, in the journal Bulletin Operativnoy Informatsii “Moslovskiye Torgi” № 16/2007/39 of 21.02.2007 and posted to the Debtor’s website on 20.02.2007.The Creditors Committee decided to instruct a specialised company to organize and carry out the auctions. On 21.02.2007, the Receiver signed Contract 17/325 with the Specialised State Establishment of the Russian Government “Russian Federal Property Fund” governing the procedures for the organisation and the holding of the auctions.During the period under review, the Receiver drew up and submitted to the Yukos Creditors’ Committee 20 proposals regarding the terms, procedures and modalities for the sale of Yukos assets [follows list of letters and other correspondence with dates and reference numbers].These proposals were approved by the Creditors Committee [follows list of auction lots and Committee minutes with dates and reference numbers].In pursuance of the Receiver’s instructions, the auctions organiser published the following information letters regarding the holding of auctions for the various lots:[follows list of information letters published in “Moskovskiye Torgi”, with individual lot numbers, from Lot 01 to Lot 20, newspaper issue numbers and dates].During the period under review, the auction organiser organised the holding of 20 auctions for the sale of Yukos’s assets, of which 17 have been recognised as effectively held and valid, including:[Follows list of auctions, including all the details of Minutes, dates etc, with the successful winners as follows:Lot 01 – RN Razvitiye OOOLot 02 – ENINeftegaz OOOLot 04 – Monte Valle OOOLot 05 – Neft Aktiv OOOLot 07 – VTB Bank Europa PlcLot 08 – JVP Invest OOOLot 09 – Auction held on 03.05.2007, winner was Promregion Holding ZAO, but the Antimonopoly Service refused to grant clearance, contract awarded to Neft Aktiv OOO for RUR 4 900 089 000Lot 10 – Neft Aktiv OOOLot 11 – Neft Aktiv OOOLot 12 – Unitex OOOLot 13 – Prana OOOLot 14 – Neft Aktiv OOOLot 15 – Tsentr Invest Trading OOOLot 17 – Rosneft Oil Company OAOThree auctions, i.e. lots 03, 06, and 16 were regarded as having been ineffective/invalid due to the absence of any bids ( 03 and 06) or because fewer than two bids had been received (16)]On 13.07.2007, the Creditors Committee (Minutes 16) approved the Terms and Conditions for the Holding of Open Auction to dispose (sell, assign) of Yukos’s receivanbles and Yukos’s shares in Yukos Finance B.V.On 08.08.2007, the auction organiser held an auction to sell Yukos’s assets included in Lot 18. The successful bidder was Rosneft Oil Company OAO (Minutes of 08.08.2007)On 15.08.2007, the auction organiser held an auction to sell Yukos’s assets included in Lot 19. The successful bidder was Promneftstroy OOO (Minutes of 16.08.07).On 15.08.2007, the auction organiser held an auction to sell Yukos’s receivables included in Lot 20. The successful bidder was Rosneft Oil Company OAO (Minutes of 15.08.2007).On 01.08.2007, the Receiver handed over the assets included in Lot 17 to Rosneft [details follow of the relevant contract provisions].On 31.08.2007, the Receiver handed over the assets included in Lot 18 to Rosneft [details follow of the relevant contract provisions].Following the receipt of funds by the Receiver from various debtors, which receivables had been sold in the course of the auction held on 06.09.2007, the Receiver and Rosneft entered into a Supplementary Agreement to the Assignment Contract of 20.08.2007 whereby the parties agreed on the surplus funds to be reimbursed to the successful bidder.On 06.09.2007, pursuant to para 2.1.1 of the Assignment Contract, the Receiver assigned to Rosneft all the rights flowing from that Contract and the Supplementary Agreement thereto.On 22.10.2007, pursuant to the valuation conducted by the independent valuer the Receiver executed a contract to pay a compensation for the share in the joint venture agreement in the amount of RUR 146 000 000.Therefore, as of 31.10.2007, the status was as follows:• Balance on the Debtor’s principal account – RUR – NIL• Current foreign currency account 40702840400000003814 with Gazprombank ZAO – USD – NIL• Current foreign currency account 40702840400000003814 with Gazprombank ZAO – Euro – NILInformation regarding the use and other disposition of the Debtor’s monetary funds is provided in the Receiver’s Report covering the period from 04.08.2006 through 01.11.2007.Over the period under review, a total of 208 letters of claim (letters before action) were sent out to various debtors requiring that they repay a total of RUR 23 069 674.80 thousand worth or receivables outstanding, of which:• Repayment of principal – RUR 18 041 803.74 thousand• Late penalties – RUR 5 027 871.06 thousandMr Eduard Rebgun was assigned the responsibility for keeping the payables register. In the course of the receivership, a register recording the Debtor’s outstanding payables was drawn up, including:Publication of the information bulletin regarding bankruptcy and the opening of the receivership – Rossiyskaya Gazette № 177 (4133) 0f 12.08.2006Creditors Register closed – 12.10.2006Total creditors claims reviewed – 99Total objections to creditors claims filed with arbitrazh courts by the Receiver – 34, of which:Court ruled to include 5 claimants in the RegisterCourt denied inclusion of 27 claimants in the RegisterCourt dismissed 2 claimsTotal creditors on the Register as of the Report date – noneInformation regarding the amounts claimed by various creditors, as per the Register:Creditors Amount claimed Percentage of DateClaims as per Register Claims satisfied claims satisfiedFirst no claims made, no payables identifiedCategorySecond RUR 1935660.3 RUR1935660.3 100% of second 02.04.07 Category category = 0.0002728%of total creditors claimsThird RUR 709526374778.87, RUR412873205891.53 100% of 27.06.07Cat. of which third category claims 29.06.07412873205891.53 principal (principal) 05.07.07= 58.1898% of 17.07.07total claims 26.10.0730.10.07RUR 296653168887.34 RUR 296653168887.34 100% of 26.10.07third category creditor third categoryclaims as per art 137.3 creditorsBankruptcy Act as per art 137.3Bankruptcy Act= 41.8099%of total claimsTOTAL: RUR 709528310439.17 RUR 709528310439.17Pursuant to the Moscow Arbitrazh Court’s Ruling and the Receiver’s Resolutions, 146 claims filed by 71 creditors were included in the Register.By its Ruling dated 28.05.2007 the Moscow Arbitrazh Court struck the second category creditors’ claims off the Yukos Oil Creditor Claims Register following full repayment of all outstanding debts related to those claims. Pursuant to that Ruling, the Receiver made respective tracking changes in the Register.Third category creditor claims (with respect to the principal amount of debt outstanding) and third category creditor claims for damages with respect to the compensation of profit forgone, loss of income, liquidated damages, fines, penalties and other charges or financial sanctions, including sanctions for failure to perform or incomplete performance of obligations under statutorily mandatory payments/disbursements have been repaid in full [Translator’s note: this convoluted language most probably refers to the payment of taxes and compulsory statutory contributions, such as social security contribs and the like]. For that reason, and in keeping with art 6 of the General Regulations Governing the Keeping of Creditor Claims Register by the Receiver [follow details of Govt approval] the Receiver struck those claims off the Register.Over the period under review, nine creditor claims were struck off the Register by virtue of the Resolution of the Ninth Arbitrazh Court of Appeal.The List of Creditor Claims to be satisfied subject and subsequent to the full repayment of Register Creditors’ claims included 13 claims for a total of RUR 239 463 847 076.61.On 26th and 29th October 2007, 68.30115% of the claims filed by the creditors included in the List of Creditor Claims to be satisfied subject and subsequent to the full repayment of Register Creditors’ claims were satisfied.The Receiver identified and closed all the Debtor’s bank accounts. On 30th October 2007, there was RUR nil balance on the Debtor’s principal account (Gazprombank OAO). Following the Receiver’s request [follow details of request] the principal account was closed on 30.10.2007.The expenses related to the receivership amounted to• RUR 2 250 334 578.72 Yukos operational activities• RUR 1 728 359 275.05 cost of receivership• Paid to creditors RUR 873 084 862 870.20In those instances where there were insufficient funds to satisfy creditor claims, no third party secondary liability was engaged.In the course of the receivership the Receiver sent out letters revoking Powers of Attorney previously issued [follow details of the PoAs revoked and correspondence exchanged with holders of PoAs].Yukos licenses.Following the compilation of the list of licenses, it was determined on 20.09.2006 that Yukos held 11 subsoil licenses / leases in the Samara Oblast, Khanty-Mansiisk Autonomous Region, the Tomsk Oblast and the Evenki Autonomous Region and one underground water license for operational needs. Yukos had entered into relevant contracts to realise its rights under the licenses.The subsoil use was performed by means of entering into:• Agency agreements with Yukos subsidiaries which then proceeded to carry out the operations either themselves or by outsourcing to subcontractors;• Works and Services Contracts, both with its subsidiaries and specialised organisationsIn the course of the receivership, all Yukos’s equipment used to carry out work at the license plots was sold.As of the report date the licenses have been assigned and all necessary registration of the rights to the equipment employed to do work in the plots had been carried out.In the course of the receivership, receivables totalling RUR 98 546 732.10 thousand were identified, owed to Yukos by 502 debtors under 818 contracts for a total of RUR 98 546 732 .10 thousand, including various outstanding invoices, claims, promissory notes etc.In the course of the review of those, it was determined as follows:• Debts owed by 44 debtors under 73 items in the amount of RUR 4 389 073.7 thousand were erroneously booked due to errors on the part of Yukos’s accountants (outsourced)• Debts in the amount of RUR 89 777.1 thousand owed by 65 debtors under 78 items were misstated due to earlier failure to book primary records in the Company’s accounts. Documents were subsequently retrieved by the Receiver from the various counterparties and handed over to the accountants (outsourced)• Yukos accounts listed a RUR 79 125 011.9 thousand worth of outstanding receivables subject to being written off as time-barred, including the RUR 67 085 504.4 thousand worth of receivables due from scheme organizations [the Russian term used here is totally incomprehensible, my best guess is that perhaps what they mean is some companies involved in various (tax saving?) “schemes”, see also the Note below – Translator’s Note], entities wound-up or liquidated and struck off the register of legal entities prior to Yukos going into bankruptcy, as well as unidentified or hopeless debts.The data related to third party receivables, together with the results of the review conducted thereof are contained in the general Table entitled “List of Yukos Receivables” and contained in 477 reference materials in Volumes 1824-1832 of the Case File.Following the work conducted in the course of the receivership:• Debtors repaid a total of RUR 797 530.3 thousand worth of current debts outstanding, with or without institution of court proceedings• RUR 14 145 561.1 thousand worth of the Debtor’s receivables was assigned for a cash consideration of RUR 11 553 340 thousand• RUR 12 039 507.5 thousand worth of the Debtor’s receivables was written off as per para 77 of the Accounting Guidelines, including time-barred and / or hopeless receivables,• RUR 67 085 504.4 thousand worth of the Debtor’s receivables was written off in compliance with court decisions and pursuant to the Letter of the Federal Tax Service № 14-3-05/2613 of 12.10.2007 as receivables artificially generated by Yukos as a result of the tax evasion schemes [ See Note above – it is possible that these are the same“schemes”which were mentioned previously – Translator’s Note].Therefore, a total of RUR 12 350 870.3 thousand was credited to the bankruptcy estate as a result of the repayment of receivables and debt assignment.In the course of the period under review, representatives of the Receiver took part in 493 court proceedings in Russia involving Yukos or its subsidiaries and affiliates.Representatives of the Receiver participated in 7 proceedings at various arbitrazh court levels in Ukraine to appeal the striking off of Yukos from the shareholders register of KAFA ZAO.Representatives of the Receiver also took part in various court hearings with respect to seven cases heard by the District and Appellate Courts of Amsterdam. They issued proceedings in the Bankruptcy Court for the Southern District of New York, in the London Court of International Arbitration involving Yukos and the Polish oil company PKN Orlen (for USD 5 million) and in the London Court of International Arbitration involving Yukos and the former shareholders of Sibneft OAO (for an amount in excess of USD 18.3 billion).The Receiver brought civil actions within the framework of the two criminal cases instituted against former Yukos executives, and was admitted as civil complainant for RUR 74 million and RUR 342 million, respectively.During the course of the receivership, the Receiver brought 39 actions seeking to invalidate various transactions and recover debts owed by Yukos debtors. The courts ordered recovery of debts for a total of RUR 173 684 711.14, including RUR 15 873 951.6 from the Investment Bank TRUST. In 6 cases the Receiver’s claims were dismissed by the courts.Two actions were brought to invalidate resolutions passed by general shareholders meetings of Yukos subsidiaries and affiliates. The resolution passed by YuT-Oil ZAO was invalidated by the court. The action seeking to invalidate a resolution passed by the meeting of shareholders of Samaraneftegeofizika OAO was dismissed.13 debt recovery orders were obtained.In the actions previously brought by Yukos to invalidate the auction of Yuganskneftegaz OAO’s shares, to invalidate the contract for oil transhipment with Tangra Oil OOO and to recover RUR 2 521 327 932 from Investment Bank TRUST, the Receiver supported the Debtor’s position.Based on newly discovered evidence, a cassation appeal was filed from the Moscow Arbitrazh Court’s ruling of 19.02.1007 and the Ninth Arbitrazh Court of Appeal’s Ruling of 28.04.2007 dismissing the appeals from the trial court’s decision regarding the recovery from Yukos of USD 13 710 740 in favour of Tangra Oil OOO. The appeal was allowed in full by the Federal Arbitrazh Court for the Moscow District.On 19.10.2007, the Receiver invoked procedural succession with respect to the action brought previously against the Investment Bank TRUST OAO, in connection with the assignment of claim to Rosneft OAO. The court allowed the application for procedural succession and substituted Rosneft OAO for Yukos.In connection with the proceedings brought against Vostochnaya Literatura Editions and the three proceedings brought against the National Bank TRUST OAO the Receiver withdrew the actions following an out of court settlement and subsequent repayment of debt.A data base was maintained with respect to all the litigation conducted on behalf of Yukos. The data base was constantly updated to allow for search and tracking capabilities.The Receiver made arrangements to seek and recover primary records and documents lost with a view to prosecuting debtors.Negotiations were initiated to reach settlements out of court and recover debts outstanding.A register of promissory notes issued by the Debtor was compiled, broken down by location and maturity. The blanks of promissory notes were identified and taken into safe-keeping.Third party promissory notes issued in favour of Yukos were handed over to the Receiver on 21.08.2006, 28.11.2006 and 30.11.2006.56 shareholder questionnaires and application forms were filled out and sent to various depositaries and registrars.68 requests were sent to various depositaries and registrars with a view to obtaining excerpts from share registers. 145 excerpts were received with respect to shares in depositary and share register accounts.A promissory note issued by Sibirskaya Geofizicheskaya Kompaniya OOO for RUR 47 397 313.59 was fully repaid on 13.03.2007.[Follows list of Handover Certificates for the Yukos assets sold in the course of various auctions, broken down by Lots][Follows list of documents and archive records handed over to the specialised archive and records management company, Expo Archive OOO, a total of 30 308 “records units”. A further contract was concluded with Archive Services OOO to systematise and file Yukos’s records and archives – follows list of steps undertaken to file the records]In accordance with applicable tax laws, during the period under review the Receiver file VAT and other tax returns [follows list of tax returns, including Subsoil Use tax, social contributions, etc], and on 01.11.2007 the liquidation balance sheet was filed.[Follows list of documents filed with the State Statistics Agency]59 requests for information from the Chairman of the Creditors Committee were received and processed by the Receiver and 241 letters were sent to the Creditors Committee with attachments totalling 274 222 pages. In addition, 14 monthly reports were submitted with attachments on 33 698 pages.A liquidation balance sheet was drawn up as of 31.10.07 reflecting the end result of the receivership, i.e. outstanding creditor claims and losses totalling RUR 227 112 298 thousand.Therefore, in the course of the receivership, the Receiver1. Published the information regarding Yukos bankruptcy and receivership in Rossiyskaya Gazette;2. Compiled the register of Yukos creditor claims, with a separate list containing creditor claims filed after the closing of the creditor claims register with a view to satisfying those claims after all the creditor claim from the main register had been satisfied (subject to sufficiency of Debtor’s funds);3. List of Debtor’s assets was drawn up and the assets therein were valued by an independent valuer;4. Employment of Debtor staff was terminated;5. The Debtor’s financial status was reviewed;6. Outstanding receivables owed by third parties were submitted for recovery (both in and out of court)7. The Debtor’s investment portfolio (securities and equity participations) was analysed with a view to their disposition as appropriate;8. The Debtor’s assets were sold off at public auctions;9. Bankruptcy estate was formed, totalling RUR 877 063 556 723.97;10. The Debtor’s accounts with various financial institutions were closed;11. Out of the Bankruptcy Estate:• Current liabilities arising after the institution of bankruptcy were repaid• 100% of second category creditors’ claims was repaid in the amount of RUR 1 935 669.3;• 100% of third category creditors’ claims was repaid in the amount of RUR 709 526 374 778.87;• 68.30115% of claims of the creditors whose [subordinated] claims were to be satisfied subject to the prior repayment of claims of Register Creditors was satisfied in the amount of RUR 163 556 552 431.0312. The Debtor’s principal bank account was closed;13. Yukos’s liquidation balance sheet was filed;14. The Debtor’s records were handed over to GlavArchive [the Moscow Records Management Agency].The documents confirming the contents of the Receiver’s Report covering 04.08.06 through 20.07.07 are to be found in the Moscow Arbitrazh Court’s files, Case № A40-11836/06-88-35Б, volumes 1487 to 1844.The Receiver has thus demonstrated to have accomplished the duties he had been assigned pursuant to the Bankruptcy Act.Having reviewed the case file and the Receiver’s Report, the Court hereby rules that the receivership with respect to the Debtor is terminate.Pursuant to art 149 Bankruptcy Act the liquidation of the Debtor shall be completed, the Debtor shall be considered liquidated and the Receiver’s responsibilities shall terminate as of the date of the inclusion in the Unified State Register of Legal Entities of an entry regarding the liquidation of the Debtor.Based on the foregoing, and in accordance with arts. 32, 147, and 149 of the Bankruptcy Act, as well as arts. 184 and 223 Code of Arbitrazh ProcedureTHE COURT HEREBY RESOLVESto complete the receivership of Yukos Oil OAO.Creditors’ claims which have not been satisfied due to insufficiency of Debtor’s funds shall be considered expired. The claims brought by creditors who were not recognised by the Receiver shall also be considered expired to the extent that the creditors concerned had not applied to court, or had applied but failed.The Receiver is hereby ordered to transmit this Ruling to the state agency responsible for the registration of legal entities with a view to making a relevant entry in the Unified State Register of Legal Entities and provide proof thereof to the Moscow Arbitrazh Court.This Ruling may be appealed until such time as the liquidation entry has been made.Presiding Judge P.A.MarkovJustices G.M. BugaevaO.G.Mishakov