DATED     APRIL 4, 2013

CME Media Services Limited

- and -

Adrian Sarbu

 
AMENDED AND RESTATED CONTRACT OF EMPLOYMENT
 

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AMENDED AND RESTATED CONTRACT OF EMPLOYMENT AND STATEMENT OF PARTICULARS
PURSUANT TO SECTION 1 OF THE EMPLOYMENT RIGHTS ACT 1996 (the “Contract”)
Name and Address of Employer:
CME Media Services Limited, 5 Fleet Place, London EC4M 7RD, United Kingdom (the
“Company”)
Name and Address of Employee:
Adrian Sarbu, residing at [redacted]

1
TERM OF EMPLOYMENT

1.1
With effect from April 4, 2013, your contract of employment with the Company
dated July 27, 2009 shall be amended and restated in its entirety as set out in
this Contract. Your period of employment from July 27, 2009 shall count as
continuous employment hereunder. Subject to the provisions of clause 1.2, this
Contract and your employment shall terminate on December 31, 2016 (the “Term”).

1.2
Subject to clause 7, on or prior to June 30, 2016, the Company may in its sole
discretion offer to extend the Term for a period beyond December 31, 2016 by
delivering notice of the proposed terms of such extension to you. The parties
agree to negotiate in good faith in respect of such proposed extension. In the
event the parties agree the terms of such extension and enter into an agreement
in respect of such extension by September 30, 2016, the Term will be extended by
such period and on such terms as may be agreed.

1.3
You represent and warrant that you are not bound by or subject to any contract,
court order, agreement, arrangement or undertaking which in any way restricts or
prohibits you from entering into this Contract or performing your duties under
it.

2
JOB TITLE AND DUTIES

2.1
Your job title is President and Chief Executive Officer of the CME Group. For
purposes of this Contract, the “CME Group” shall mean Central European Media
Enterprises Ltd. (“CME Ltd.”) and/or any Associated Company (as defined below).

2.2
You shall use your best endeavours to promote and protect the interests of the
CME Group and shall not do anything that is harmful to those interests. You will
be based in the Company’s branch office in Prague, Czech Republic or at such
other place as the Company may from time to time reasonably require.

3
REMUNERATION

3.1
Your annual base salary is USD 1,800,000 per year (in words, one million eight
hundred thousand US Dollars), payable monthly in arrears by credit transfer into
your bank account after all necessary deductions for relevant taxes and social
security payments. Your salary shall be payable in Czech koruna (CZK) based on
the USD-CZK exchange rate in effect on the date of this Contract in respect of
the period through December 31, 2013 and on each January 1 in respect of each
year thereafter. In the event the amount of salary you would have been entitled
to receive in US Dollars in any calendar year, following conversion of such
amount using the average USD-CZK exchange rate for such calendar year, is
greater than the amount you did receive, the difference will be added to your
salary payable in the first month of the following calendar year. In the event
the amount of salary you would have been entitled to receive in US Dollars in
any calendar year, following conversion of such amount using the average USD-CZK
exchange rate for such calendar year, is less than the amount you did receive,
the difference will be withheld from your basic salary payable in the first
month of the following calendar year.

3.2
You shall be entitled to participate in the CME Management Compensation Policy
in effect from time to time (the “Policy”). The amount, if any, of any bonus
awarded pursuant to the Policy shall be determined by the Compensation Committee
of the Board of Directors of CME Ltd. (the “Compensation Committee”). Any bonus
awarded will be based on a target representing 100% of your gross annual salary.

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TOTAL COMPENSATION

4.1
Notwithstanding anything to the contrary stated herein, your total compensation
in respect of any relevant financial year of CME Ltd. (each a “Financial Year”)
during the Term (including, without limitation, your annual base salary, bonus
and any equity or other compensation, but excluding any Reimbursement Expenses
(as defined below)) shall not exceed the lesser of (i) 4% (four percent) of the
OIBDA reported by CME Ltd. for the corresponding Financial Year or (ii) USD
10,000,000, (in words, ten million US Dollars) in respect of each Financial
Year, the “Maximum Compensation”.

For the avoidance of doubt, no additional sums shall be due to you in the event
your actual total compensation in any Financial Year is less than the Maximum
Compensation amount for such Financial Year.

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4.2
Save as set forth herein, no additional pay or time off shall be permitted to
you in connection with your performance of the duties hereunder.

5.
OTHER BENEFITS

5.1
The Company undertakes either to (i) reimburse the costs of or (ii) to obtain
for your benefit and to maintain throughout the Term of this Contract:

5.1.1
travel insurance; and

5.1.2
medical and dental insurance

offered by an insurance provider reasonably selected by you.

5.2
Subject to the approval of the Compensation Committee, the Company shall use
commercially reasonable efforts to obtain life insurance and disability
insurance coverage for your benefit.

6.
EXPENSES

6.1
The Company shall reimburse you for all reasonable expenses incurred by you in
the proper performance of your duties under this Contract on production of
appropriate receipts in accordance with the CME Group Expense Policy and other
documentation reasonably requested by the Company in respect of the
Reimbursement Expenses (as defined below).

6.2
Notwithstanding clause 6.1, the Company shall reimburse you for expenses in
respect of business travel by you on chartered aircraft leased by you that is
integrally and directly related to the performance of your duties under this
Contract (“Reimbursement Expenses”) at a rate of USD 7,000 per hour up to a
maximum of 200 hours per Financial Year; provided, that no Reimbursement
Expenses shall be payable in respect of any transatlantic or intercontinental
travel without the prior approval of the Compensation Committee.

7.
TERMINATION OR NON-RENEWAL

7.1
You may terminate this Contract at any time on giving the Company twelve months’
notice in writing.

7.2
The Company may at any time and in its absolute discretion terminate this
Contract without cause by delivering you notice in writing in which the Company
elects either (i) to make a payment in lieu of notice pursuant to clause 7.4
(the “Payment Option”) or (ii) to appoint you as the head of CME Group
operations in Romania pursuant to clause 7.5 (the “Romania Option”). In
addition, in the event the parties have not entered into an agreement in respect
of an extension of the Contract pursuant to clause 1.2 on or prior to September
30, 2016, the Company shall deliver you notice in writing in which the Company
elects to exercise either (i) the Payment Option or (ii) the Romania Option. If
the Company has not delivered any such notice prior to December 31, 2016, it
will be deemed to have exercised the Payment Option as of such date.

7.3
In the event you give notice of termination pursuant to this clause, the Company
may elect to provide you with payment in lieu of notice. This payment will be
comprised solely of your annual base salary (at the rate payable when this
option is exercised) in respect of the portion of the notice period remaining at
the time the Company exercises this option and any earned but unpaid bonus
awarded in accordance with clause 3.2 hereof. All payments shall be subject to
deductions for income tax and social security contributions as appropriate. You
will not, under any circumstances, have any right to payment in lieu of notice
unless the Company has exercised its option to pay in lieu of notice.

7.4
In the event the Company exercises the Payment Option, the Contract and your
employment will terminate on the date specified in the notice (the “Termination
Date”) and the Company will make a payment to you as follows: (i) if the
Termination Date occurs on or prior to December 31, 2013, the payment will be in
an amount equal to USD 3,600,000 (in words, three million six hundred thousand
US Dollars) or (ii) if the Termination Date is on or after January 1, 2014, the
payment will be in an amount equal to the greater of (x) your base salary (at
the rate payable when this termination notice is delivered) for the period from
the Termination Date through the end of the Term or (y) USD 3,600,000 (in words,
three million six hundred thousand US Dollars). In addition, you are entitled to
any earned but unpaid bonus awarded in accordance with clause 3.2 hereof. You
are not entitled to any amounts in respect of the Romania Option if the Company
elects the Payment Option. All payments shall be subject to deductions for
income tax and social security contributions as appropriate. At the election of
the Company, such payments will be made at the times the Company would have made
payments to you had notice not been given.

7.5
In the event the Company exercises the Romania Option, the Company agrees to
appoint you as the head of CME Group operations in Romania for the period from
the termination date of the Contract until December 31, 2020, subject to your
entering into a new employment agreement with an Associated Company in form and
substance reasonably satisfactory to the parties. Such new employment agreement
shall provide that your annual base salary for such position shall be USD
900,000 (in words, nine hundred thousand US Dollars) per year and that in the
event such new employment agreement is terminated prior to December 31, 2020,
you shall be entitled to a payment equal to such annual base salary of USD
900,000 (in words, nine hundred thousand US Dollars) from the date such notice
of termination of such new employment agreement is delivered through December
31, 2020. You are not entitled to any amounts in respect of the Payment Option
if the Company exercises the Romania Option. However, in the event the new

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employment agreement is not entered into within 45 calendar days of the delivery
of notice by the Company of its election of the Romania Option pursuant to
clause 7.2, the Company shall be entitled to exercise the Payment Option. In
addition, you are entitled to any earned but unpaid bonus awarded in accordance
with clause 3.2 hereof following the exercise of the Romania Option. All
payments shall be subject to deductions for income tax and social security
contributions as appropriate.
7.6
The Company may terminate this Contract due to Termination for Cause without
notice, payment in lieu of notice or any other payment or obligation whatsoever.
“Termination for Cause” means your (i) conviction of a felony or entering a plea
of nolo contendere (or its equivalent) with respect to a charged felony; (ii)
gross negligence, recklessness, dishonesty, fraud, wilful malfeasance or wilful
misconduct in the performance of your duties under this Contract; (iii) wilful
misrepresentation to the shareholders or directors of CME Ltd. that is injurious
to CME Ltd.; (iv) wilful failure without reasonable justification to comply with
a reasonable written instruction or resolution of the Board of Directors of CME
Ltd.; or (v) a material breach of your duties or obligations under this
Contract. The Company may, in its reasonable judgment, suspend you on full pay
during any investigation that the Company may undertake into any fact or
circumstance which could lead to your Termination for Cause. Notwithstanding the
foregoing, a termination shall not be treated as Termination for Cause unless
the Company has delivered a written notice to you stating that it intends to
terminate your employment due to Termination for Cause and specifying the basis
for such termination.

7.7
Upon the termination by whatever means of this Contract you shall immediately
return to the Company all documents, computer media and hardware, credit cards,
mobile phones and communication devices, keys and all other property belonging
to or relating to the business of the Company which is in your possession or
under your power or control and you must not retain copies of any of the above.

7.8
Provided you continue to enjoy your full contractual benefits and receive your
pay in accordance with this Contract, the Company may in its absolute discretion
do all or any of the following during the notice period or any part of the
notice period, after you or the Company have given notice of termination to the
other, without breaching this Contract or incurring any liability or giving rise
to any claim against it:

7.8.1
exclude you from the premises of any company of the CME Group;

7.8.2
require you to carry out only specified duties (consistent with your status,
role and experience) or to carry out no duties;

7.8.3
announce to any of its employees, suppliers, customers and business partners
that you have been given notice of termination or have resigned (as the case may
be);

7.8.4
prohibit you from communicating in any way with any or all of the suppliers,
customers, business partners, employees, agents or representatives of the CME
Group until your employment has terminated except to the extent that you are
authorised by the General Counsel of CME Ltd. in writing; and

7.8.5
require you to comply with any other reasonable conditions imposed by the
Company.

7.9
You will continue to be bound by all obligations owed to the Company under this
Contract until termination of this Contract in accordance with this clause 7 or
such later date as provided herein.

8.
CONFIDENTIAL INFORMATION

8.1
You agree during and after the termination of your employment not to use or
disclose to any person (and shall use your best endeavours to prevent the use,
publication or disclosure of ) any confidential information:

8.1.1
concerning the business of the Company or any other member of the CME Group and
which comes to your knowledge during the course of or in connection with your
employment or your holding office with the Company; or

8.1.2
concerning the business of any client or person having dealings with the Company
or any other member of the CME Group and which is obtained directly or
indirectly in circumstances where the Company or any other member of the CME
Group is subject to a duty of confidentiality.

8.2
For the purposes of clause 8.1 above, information of a confidential or secret
nature includes but is not limited to information disclosed to you or known,
learned, created or observed by you as a consequence of or through your
employment with the Company, not generally known in the relevant trade or
industry about the business activities, services and processes of the Company or
any member of the CME Group, including but not limited to information concerning
advertising, sales promotion, publicity, sales data, research, programming and
plans for programming, finances, accounting, methods, processes, business plans
(including prospective or pending licence applications or investments in licence
holders or applicants), client or supplier lists and records, potential client
or supplier lists, and client or supplier billing.

8.3
This clause shall not apply to information which:

8.3.1
is used or disclosed in the proper performance of your duties or with the
consent of the Company;

8.3.2
is ordered to be disclosed by a court of competent jurisdiction or otherwise
required to be disclosed by law or pursuant to the rules of any applicable stock
exchange; or

8.3.3
is in or comes into the public domain (otherwise than due to a default by you).

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9.
INTELLECTUAL PROPERTY

9.1
The Company acknowledges that you may create intellectual property in the
performance of your duties that is used by the CME Group for its business. You
shall assign with full title your entire interest in any Intellectual Property
Right (as defined below) to the Company to hold as absolute owner.

9.2
You shall communicate to the Company full particulars of any Intellectual
Property Right in any work or thing created by you and you shall not use,
license, assign, purport to license or assign or disclose to any person or
exploit any Intellectual Property Right without the prior written consent of the
Company.

9.3
In addition to and without derogation of the covenants imposed by the Law of
Property (Miscellaneous Provisions) Act 1994, you shall prepare and execute such
instruments and do such other acts and things as may be necessary or desirable
(at the request and expense of the Company) to enable the Company (or its
nominee) to obtain protection of any Intellectual Property Right vested in the
Company in such parts of the world as may be specified by the Company (or its
nominee) and to enable the Company to exploit any Intellectual Property Right
vested in it to its best advantage.

9.4
You hereby irrevocably appoint the Company to be your attorney in your name and
on your behalf to sign, execute or do any instrument or thing and generally to
use your name for the purpose of giving to the Company (or its nominee) the full
benefit of the provisions of this clause and a certificate in writing signed by
any director or the secretary of the Company that any instrument or act relating
to such Intellectual Property Right falls within the authority conferred by this
clause shall be conclusive evidence that such is the case in favour of any third
party.

9.5
You hereby waive all of your moral rights (as defined in the Copyright, Designs
and Patents Act 1988) in respect of any act by the Company and any act of a
third party done with the Company’s authority in relation to any Intellectual
Property Right which is or becomes the property of the Company.

9.6
“Intellectual Property Right” means a copyright, know-how, trade secret and any
other intellectual property right of any nature whatsoever throughout the world
(whether registered or unregistered and including all applications and rights to
apply for the same) which:

9.6.1
relates to the business or any product or service of the Company; and

9.6.2
is invented, developed, created or acquired by you (whether alone or jointly
with any other person) during the period of your employment with the Company in
connection with the performance of your duties hereunder;

and for these purposes and for the purposes of the other provisions of this
clause 9, references to the Company shall be deemed to include references to any
Associated Company (as defined in clause 14.5 below). For the avoidance of
doubt, Intellectual Property Rights shall only include any of the foregoing
intellectual property rights that have been created by you in connection with
your performance of the services under this Contract.

10.
COLLECTIVE AGREEMENTS/WORKFORCE AGREEMENTS

There are no collective agreements or workforce agreements applicable to you or
which affect your terms of employment.

11.
DATA PROTECTION AND INFORMATION TECHNOLOGY

11.1
You acknowledge that the Company will hold personal data relating to you. Such
data will include your employment application, address, references, bank
details, performance appraisals, work, holiday and sickness records, next of
kin, salary reviews, remuneration details and other records (which may, where
necessary, include sensitive data relating to your health and data held for
equal opportunities purposes). The Company will hold such personal data for
personnel administration and management purposes and to comply with its
obligations regarding the retention of your records. Your right of access to
such data is as prescribed by law.

11.2
By signing this Contract, you agree that the Company may process personal data
relating to you for personnel administration and management purposes and may,
when necessary for those purposes, make such data available to its advisors, to
third parties providing products and/or services to the Company and as required
by law.

11.3
Subject to applicable law, the Company may review, audit, intercept, access and
disclose all information, messages or other data created from or sent over its
computer system for any purpose. By your signature to this Contract, you consent
to the foregoing.

12.
CONTRACTS (RIGHTS OF THIRD PARTIES) ACT 1999

Unless the right of enforcement is expressly granted, it is not intended that a
third party should have the right to enforce the provisions of this Contract
pursuant to the Contracts (Rights of Third Parties) Act 1999.

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13.
INDEMNITY

13.1
The Company will indemnify you and pay on your behalf all Expenses (as defined
below) incurred by you in any Proceeding (as defined below), whether the
Proceeding which gave rise to the right of indemnification pursuant to this
Contract occurred prior to or after the Term of this Contract provided that you
shall promptly notify the Company of such Proceeding and the Company shall be
entitled to participate in such Proceeding and, to the extent that it wishes,
jointly with you, assume the defence thereof with counsel of its choice. This
indemnification shall not apply if it is determined by a court of competent
jurisdiction in a Proceeding that any losses, claims, damages or liabilities
arose primarily out of your gross negligence, wilful misconduct or bad faith.

13.2
The term “Proceeding” shall include any threatened, pending or completed action,
suit or proceeding, or any inquiry or investigation, whether brought in the name
of the Company or otherwise and whether of a civil, criminal, administrative or
investigative nature, including, but not limited to, actions, suits or
proceedings brought under or predicated upon any securities laws, in which you
may be or may have been involved as a party or otherwise, and any threatened,
pending or completed action, suit or proceeding or any inquiry or investigation
that you in good faith believe might lead to the institution of any such action,
suit or proceeding or any such inquiry or investigation, in each case by reason
of the fact that you are or were serving at the request of the Company as a
director, officer or manager of any other Associated Company, whether or not you
are serving in such capacity at the time any liability or expense is incurred
for which indemnification or reimbursement can be provided under this Contract.

13.3
The term "Expenses” shall include, without limitation thereto, expenses
(including, without limitation, attorneys fees and expenses) of investigations,
judicial or administrative proceedings or appeals, damages, judgments, fines,
penalties or amounts paid in settlement by or on behalf of you and any expenses
of establishing a right to indemnification under this Contract.

13.4
The Expenses incurred by you in any Proceeding shall be paid by the Company as
incurred and in advance of the final disposition of the Proceeding at your
written request. You hereby agree and undertake to repay such amounts if it
shall ultimately be decided in a Proceeding that you are not entitled to be
indemnified by the Company pursuant to this Contract or otherwise.

13.5
The indemnification and advancement of Expenses provided by this Contract shall
not be deemed exclusive of any other rights to which you may be entitled under
the Company’s Articles of Association or the constituent documents of any other
Associated Company for which you are serving as a director, officer or manager
at the request of the Company, the laws under which the Company was formed, or
otherwise, and may be exercised in any order you elect and prior to,
concurrently with or following the exercise of any other such rights to which
you may be entitled, including pursuant to directors and officers insurance
maintained by the Company, both as to action in official capacity and as to
action in another capacity while holding such office, and the exercise of such
rights shall not be deemed a waiver of any of the provisions of this Contract.
To the extent that a change in law (whether by statute or judicial decision)
permits greater indemnification by agreement than would be afforded under this
Contract, it is the intent of the parties hereto that you shall enjoy by this
Contract the greater benefit so afforded by such change. The provisions of this
clause shall survive the expiration or termination, for any reason, of this
Contract and shall be separately enforceable.

14.
POST-EMPLOYMENT RESTRICTIONS AND CORPORATE OPPORTUNITIES

14.1
For the duration of your employment with the Company and for a period of twelve
(12) months after the termination thereof for any cause, you shall not:

14.1.1
either on your own account or on behalf of any other person, firm or company,
directly or indirectly, carry on or be engaged, concerned or interested in any
business the same as that of the CME Group or which is competitive with any
business in which the CME Group is engaged (including, without limitation,
securing broadcasting licenses, operating television stations and other
broadcasting, the production of programming and other content, other programming
services or distribution services) and with which you were actively involved at
any time in the twelve months preceding the termination of your employment
within the territories in which the CME Group operates or is considering to
operate (the “Territory”) and in which you were actively involved at any time in
the twelve months preceding the termination of your employment (excluding any
film production not funded by the CME Group that is undertaken pursuant to the
Framework Agreement (“Framework Agreement”) dated July 27, 2009 among CME
Production B.V., CME Romania B.V., Media Pro Management S.A., Media Pro B.V. and
you, as amended and any of the activities of the Media Pro Entertainment
Business (as defined in the Framework Agreement));

14.1.2
seek to do business and/or do business, perform any services or supply any goods
or seek to do so, in competition with any company of the CME Group with any
person, firm or company who at any time during the twelve months preceding the
termination of your employment was a client, customer or supplier of any company
of the CME Group and with whom during that period you or another person on your
behalf had contact or dealings in the ordinary course of business or were aware
of in the course of your employment;

14.1.3
interfere or seek to interfere or take such steps as may or are calculated to
interfere with the continuance of supplies (whether services or goods) or any
rights of purchase, sale, import, distribution or agency enjoyed by or supplied
to any company of the CME Group, or the terms on which they are so supplied or
enjoyed, from any person, firm or company supplying or offering rights to any
company of the CME Group at any time during the period of twelve months prior to
such termination;

14.1.4
solicit, entice or procure or endeavour to solicit, entice or procure any
employee of the CME Group to breach his contract of employment or any person to
breach his contract for services with the Company or any Associated Company;

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14.1.5
in relation to a business the same as or competitive with the CME Group in the
Territory, solicit, employ, engage or offer or cause to be employed or engaged,
whether directly or indirectly, any employee, director or consultant of any
company of the CME Group engaged or employed at the date of termination of your
employment or at any time during the twelve months preceding such termination
who has knowledge of confidential aspects of the business of the CME Group, and
with whom, at any time during the period of twelve months prior to such
termination, you had material dealings; and/or

14.1.6
you shall not at any time falsely represent yourself as being connected with or
interested in the Company or any Associated Company or in the business of the
CME Group.

14.2
For the duration of your employment with the Company, you shall not accept or
invest in, whether directly or indirectly, any opportunity (a “Corporate
Opportunity”) (i) which is in the line of business of any company of the CME
Group (other than any existing investment in a company of the CME Group), (ii)
which arises or becomes known to you as a result of your employment by the
Company, or (iii) in which the CME Group has an interest or expectancy unless
(a) you have presented the Corporate Opportunity to the Board of Directors of
CME Ltd. in reasonable detail and (b) the Board of Directors has decide not to
pursue such Corporate Opportunity after such presentation by you. The Company
acknowledges that Corporate Opportunities shall not include your investments in
the companies listed in Annex 1 hereto; provided, that the activities such
companies engage in continue to be substantially the same as of the date hereof.

14.3
Each of the restrictions in this clause shall be enforceable independently of
each other and its validity shall not be affected if any of the others is
invalid. If any of the restrictions is void but would be valid if some part of
the restriction were deleted, the restriction in question shall apply with such
modification as may be necessary to make it valid.

14.4
The restrictions set forth in this clause 14 shall not apply if the Company is
in breach of this Contract.

14.5
For the purposes of this Contract, “Associated Company” shall mean a subsidiary
(as defined by the Companies Act 1985 as amended) and any other company which is
for the time being a holding company (as defined by the Companies Act 1985 as
amended) of the Company or another subsidiary of such holding company.

15.
GENERAL

15.1
You hereby authorise the Company to deduct from any salary or other amounts
payable to you under this Contract any sums owing by you to the Company.

15.2
Your Incentive Compensation Recoupment Policy Acknowledgement dated February 22,
2012 is incorporated herein by reference.

15.3
This Contract shall be governed by and construed in accordance with English law.
The parties agree to submit to the non-exclusive jurisdiction of the English
courts in respect of any dispute hereunder.

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The Company and Adrian Sarbu agree to the terms set out above.

Signed as a Deed by CME Media Services Limited acting by:
 
Jon Mortimer, Director
  /s/ Jon Mortimer
David Sturgeon, Director
 /s/ David Sturgeon

Signed as a Deed by Adrian Sarbu

 /s/ Adrian Sarbu
in the presence of:
Witness signature:

 /s/ Kamila Novosadova
Name:
 Kamila Novosadova
Address:
 [redacted]
 

Occupation:
 Legal Team Assistant

 

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