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CEDC and Russian Standard Agree to Revised Transaction



            CEDC and Russian Standard Agree to Revised Transaction

CEDC Receives Access to up to $65 Million in Funding

Russian Standard to Assume Oversight Responsibility for CEDC Operations

CEDC to Appoint Chief Executive Officer

PR Newswire

MT. LAUREL, N.J., Dec. 28, 2012

MT. LAUREL, N.J., Dec. 28, 2012 /PRNewswire/ -- Central European Distribution
Corporation (NASDAQ: CEDC) announced today that it has agreed to a revised
transaction with Russian Standard (through its affiliate, Roust Trading Ltd.
("RTL")). This agreement represents a renewed commitment by Russian Standard
to a strategic alliance with CEDC and is an important vote of confidence in
the future success of CEDC's business. The agreement also addresses the
ongoing management of CEDC, with directors nominated by Russian Standard
taking responsibility for CEDC's operations through a newly-formed committee
of the CEDC Board of Directors. A special committee led by CEDC directors
unaffiliated with Russian Standard will retain control of any restructuring of
CEDC's capital structure. This amended transaction is intended to stabilize
CEDC's business and to pave the way for CEDC to address its balance sheet
issues in an orderly fashion. 

Under the revised terms, Russian Standard has:

  o released restrictions on $50 million in cash previously invested in CEDC,
    making such funds available for working capital and general corporate
    purposes,
  o agreed to provide a new $15 million revolving credit facility to CEDC, and
  o agreed to provide up to $107 million in new capital to CEDC (reduced by
    the commitment under the new revolving credit facility) subject to and
    conditional upon an overall restructuring of CEDC's capital structure that
    is acceptable to CEDC and Russian Standard.

In turn, CEDC has:

  o created an Operational Management Committee of the CEDC Board of Directors
    to be led by Mr. Tariko,
  o created a Restructuring Committee of the CEDC Board of Directors to be led
    by non-Russian Standard directors,
  o appointed Grant Winterton as Chief Executive Officer of CEDC, effective
    January 10, 2013. Mr. Winterton is the current General Manager of the
    Russian Alcohol Group - a CEDC subsidiary. Mr. Winterton has over 20 years
    of experience working in marketing, sales and general management positions
    for Campbells Soup (Australia), The Coca-Cola Company (Australia, Russia,
    Ukraine, China), Wimm Bill Dann (Russia) and Red Bull (Russia). Mr.
    Winterton has lived in Russia for over 10 years, working in the consumer
    goods industry, and has extensive working experience across the Russia,
    Ukraine, Belarus and CIS markets.  He joined CEDC as General Manager of
    the Russian Alcohol Group in April 2012.
  o agreed to call an annual shareholders' meeting as soon as practicable to
    vote on a slate of directors agreed between CEDC and Russian Standard and
    to decide if Russian Standard nominees will comprise a majority of the
    CEDC Board of Directors.

CEDC and Russian Standard are implementing these revised terms pursuant to a
binding term sheet signed today, which modifies the Amended and Restated
Securities Purchase Agreement and Amended and Restated Governance Agreement
between CEDC and RTL. These two agreements will terminate with automatic
effect on January 21, 2013, and, from today, CEDC will be permitted to have
restructuring discussions and negotiations with the holders of CEDC's
outstanding debt obligations. These revised terms also represent a settlement
of the issues between CEDC and Russian Standard stemming from, among other
things, the restatement of CEDC's financial statements for its 2010 and 2011
fiscal years in October of this year, with CEDC and RTL agreeing to mutually
release all claims and causes of action and not to bring any legal action
against the other under either agreement for matters arising prior to today.

CEDC and Russian Standard believe that these revised terms constitute a
mutually beneficial way of addressing CEDC's near-term funding and operational
issues while also committing CEDC and Russian Standard to work together to
address CEDC's long-term capital requirements, including a restructuring of
its current debt obligations. In that regard, CEDC and Russian Standard also
believe that the changes to CEDC's corporate governance comprise an
appropriate component of CEDC's strategy.

Terms of the Revised Transaction

Effective immediately, RTL has released contractual restrictions on $50
million in cash previously invested in CEDC to allow CEDC to use this cash for
working capital and general corporate purposes, and committed to make
available a $15 million revolving credit facility to CEDC (drawable no earlier
than February 1, 2013), subject to definitive documentation and the provision
of reasonably satisfactory security by CEDC. Russian Standard has also
committed to provide CEDC with up to $107 million of new capital (reduced by
the amount of the commitment under the new revolving credit facility) subject
to and conditional upon an overall restructuring of CEDC's capital structure
that is acceptable to CEDC and Russian Standard.

In exchange, CEDC will provide guarantees and liens on assets of its
subsidiaries in respect of the debt currently evidenced by $50 million of
senior CEDC notes held by Russian Standard. In addition, CEDC has agreed to
certain corporate governance changes, including:

  o The creation of an Operational Management Committee to oversee all
    day-to-day business and operational management of CEDC with CEDC
    management to report directly to this committee. The Operational
    Management Committee will consist of Mr. Roustam Tariko, Mr. Scott Fine
    and another CEDC board member nominated by Russian Standard.
  o The creation of a Restructuring Committee with full responsibility for all
    matters related to any restructuring of CEDC's capital. The Restructuring
    Committee will consist of three non-Russian Standard directors and Mr.
    Roustam Tariko.
  o The appointment of Grant Winterton, the current Chief Executive Officer of
    the Russian Alcohol Group - a CEDC subsidiary, as Chief Executive Officer
    of CEDC effective January 10, 2013.

CEDC and Russian Standard have also reached agreement on the slate of
directors to be proposed at the next annual general meeting of CEDC
shareholders, which will be convened as soon as practicable. The slate of
directors will consist of three directors nominated by Russian Standard and
three directors nominated by non-Russian Standard directors. In addition,
shareholders will be given the opportunity to elect a seventh director from
among two candidates, one nominated by Russian Standard and one by the
non-Russian Standard directors.

Finally, CEDC and Russian Standard have agreed that the Amended and Restated
Securities Purchase Agreement and the Amended and Restated Governance
Agreement by and between CEDC and RTL will automatically terminate on January
21, 2013 and to mutually release all claims and causes of action (and not to
bring any legal action against the other) under either agreement for matters
arising prior to today.

About Central European Distribution Company

CEDC is one of the world's largest producers of vodka and Central and Eastern
Europe's largest integrated spirit beverage company. CEDC produces the Green
Mark, Absolwent, Zubrowka, Bols, Parliament, Zhuravli, Royal and Soplica
brands, among others.  CEDC exports its products to many markets around the
world, including the United States, England, France and Japan.

CEDC also is a leading importer of alcoholic beverages in Poland, Russia and
Hungary.  In Poland, CEDC imports many of the world's leading brands,
including Carlo Rossi Wines, Concha y Toro wines, Metaxa Liqueur, Remy Martin
Cognac, Sutter Home wines, Grant's Whisky, Jagermeister, E&J Gallo, Jim Beam
Bourbon, Sierra Tequila, Teacher's Whisky, Campari, Cinzano, and Old
Smuggler.  CEDC is also a leading importer of premium spirits and wines in
Russia with brands such as Concha y Toro, among others.

About Russian Standard Corporation

Russian Standard Corporation is one of Russia's most successful private
companies with business interests in premium vodka, spirits distribution,
banking and insurance. Russian Standard Vodka is the global leader in
authentic Russian premium vodka and the only Russian global brand with sales
in over 75 markets around the world. Its 2011 sales exceeded 2.6 million
9-liter cases. Roust Inc. is one of Russia's leading premium spirits
distributors, representing such well-known brands as Gancia, Remy Martin,
Metaxa, St Remy, Cointreau, Jagermeister, Molinari, Whyte & Mackay, and
Dalmore.  In 2011, Russian Standard acquired a 70% stake in Gancia SPA, the
legendary Italian wine-making company that created the first Italian sparkling
wine. With 2000 hectares of vineyards, 5 million kilograms of grapes vinified,
Gancia produces around 25 million bottles of sparkling wine, wines and
aperitifs each year. Russian Standard Bank is the largest privately owned
financial institution in Russia and is a leader in the Russian consumer
finance market, including consumer loans and credit cards. Since 1999 the Bank
has been setting new standards in consumer banking, with over 25 million
clients, over US$45 billion in loans granted and 35 million credit cards
issued. Russian Standard Bank is the exclusive issuer and service provider for
American Express and Diners Club International cards in Russia.

Russian Standard Corporation has over 19,000 employees working in offices in
Moscow, St Petersburg, New York, Paris, London and Kiev. The total assets of
Russian Standard Corporation exceed US$5 billion.

Cautionary Statement about Forward-Looking Information

This press release contains forward looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995 including, without
limitation, statements about the expected effects of the CEDC management
changes announced and statements about the terms of the revised agreement with
RTL, including the availability of the new revolving credit facility and the
additional capital to be provided, statements about our ability to meet our
near-term funding requirements and statements about our revised governance
arrangement with RTL and the operational effects thereof on our business.
Forward looking statements are based on our knowledge of facts as of the date
hereof and involve known and unknown risks and uncertainties that may cause
the actual results, performance or achievements of CEDC to be materially
different from any future results, performance or achievements expressed or
implied by our forward looking statements.  Such risks include, among others,
meeting the relevant conditions to the availability of the new revolving
credit facility and implementing the requested security and guarantee
arrangements, our ability to agree an overall restructuring of CEDC's capital
structure, our ability to access our existing lines of credit, and our ability
to effectively implement and maintain the revised corporate governance
arrangement with RTL.

Investors are cautioned that forward looking statements are not guarantees of
future performance and that undue reliance should not be placed on such
statements.  CEDC undertakes no obligation to publicly update or revise any
forward looking statements or to make any other forward looking statements,
whether as a result of new information, future events or otherwise, unless
required to do so by securities laws.  Investors are referred to the full
discussion of risks and uncertainties included in CEDC's Form 10-K for the
fiscal year ended December 31, 2011, including statements made under the
captions "Item 1A. Risks Relating to Our Business" and in other documents
filed by CEDC with the United States Securities and Exchange Commission (the
"SEC").

Additional Information

CEDC will file copies of the term sheet with the SEC on a Form 8-K to which
investors should refer for additional information on the terms of the revised
transaction.

In connection with its proposed annual general meeting, CEDC will prepare a
proxy statement to be filed with the SEC. When completed, a definitive proxy
statement and a form of proxy will be mailed to stockholders of CEDC. CEDC
STOCKHOLDERS ARE URGED TO READ THE PROXY STATEMENT BECAUSE IT WILL CONTAIN
IMPORTANT INFORMATION ABOUT THE ANNUAL GENERAL MEETING AND RELATED MATTERS.
CEDC stockholders will be able to obtain, without charge, a copy of the proxy
statement (when available) and other relevant documents filed with the SEC
from the SEC's website at http://www.sec.gov. In addition, documents filed by
CEDC are available at the SEC's public reference room located at 100F Street,
N.E. Washington, D.C. 20594. CEDC stockholders will also be able to obtain,
without charge, a copy of the proxy statement and other relevant documents
(when available) by directing a request to Brian Morrissey, US General
Counsel, at 3000 Atrium Way, suite 265, Mt. Laurel, NJ 08054, telephone (856)
273-6980 or from CEDC's website, www.cedc.com.  

CEDC and certain of its respective directors and executive officers and Roust
Trading Ltd. and certain of its respective directors and executive officers
may be deemed to be participants in the solicitation of proxies from
shareholders in connection with the annual general meeting under the rules of
the SEC. Information about the directors and executive officers of CEDC is
included in the definitive proxy statement relating to its 2011 Annual Meeting
of Shareholders filed with the SEC on March 26, 2011 and subsequent current
reports on Form 8-K filed with the SEC. Shareholders may obtain additional
information regarding the interests of CEDC and its directors and executive
officers in the matters to be considered at the annual general meeting, which
may be different than those of CEDC shareholders generally, by reading the
proxy statement and other relevant documents regarding the annual general
meeting, when filed with the SEC.

Contact

David Bailey
Interim Chief Executive Officer
Central European Distribution Corporation
48-22-456-6106

Anna Załuska
Corporate PR Manager
Central European Distribution Corporation
48-22-456-6061

Oleg Yegorov
Russian Standard Corporation
7-495-967-0990

SOURCE Central European Distribution Corporation

Website: http://www.cedc.com
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