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STRICTLY PRIVATE AND CONFIDENTIAL

 
 

CME MEDIA ENTERPRISES B.V.
 
CENTRAL EUROPEAN MEDIA ENTERPRISES LTD.
 
and
 
PPF (CYPRUS) Ltd.

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FRAMEWORK AGREEMENT
 

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December 13, 2004

DEWEY BALLANTINE
 
London
 

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CONTENTS
 

1
Definitions and Interpretation
6
 
1.1
Definitions
6
 
1.2
Interpretation
18
 
1.3
Annexes
20
 
1.4
Completion of Transaction Documents and Other Annexes
20
2
Sale and Purchase of the TV Nova Group
21
 
2.1
Outline of Transaction Structure and Steps
21
 
2.2
Effect on Purchase Price
22
3
Consideration
22
 
3.1
Purchase Price
22
 
3.2
TV Nova Value
23
 
3.3
Closing Audit Report
23
 
3.4
Determination of Closing Indebtedness, Closing CNTS Settlement Amount and Actual
Working Capital
23
 
3.5
Adjustments to the Purchase Price
24
 
3.6
Cash Payments
25
4
Warranties
26
 
4.1
Mutual Warranties
26
 
4.2
Additional Warranties by CME Ltd
27
 
4.3
Additional Warranties by PPF
27
 
4.4
Warranties by PPF Relating to the Ownership Interests and the Programming
Library
29
 
4.5
Warranties by PPF Relating to CET 21
32
 
4.6
Warranties by PPF Related to the TV Nova Group Companies and Other Entities
35
 
4.7
Warranties by PPF Related to Various Claims
53
 
4.8
Acknowledgement of Disclosure
55
 
4.9
Breach of Warranty
55
 
4.10
No Other Warranties
55
5
Pre-Closing Obligations
55
 
5.1
General Obligations of PPF
55
 
5.2
PPF Obligations Relating to the TV Nova Group
27
 
5.3
CME Parties' Obligations
59
6
Conditions to Closing
60
 
6.1
Conditions Precedent
60
 
6.2
Responsibility for Satisfaction
62
 
6.3
Satisfaction/Non-Satisfaction/Waiver
62
7
Closing
63
 
7.1
Time and Place of Closing
63
 
7.2
PPF's Closing Obligations
63
 
7.3
CME ME's Closing Obligations
65
8
Undertakings To Benefit The TV Nova Business
66
 
8.1
PPF's Undertakings
66
 
8.2
CME ME's Undertakings
67
 
8.3
Effect of Breach of Undertakings
68
 
8.4
Additional Undertaking by PPF
68
 
8.5
Additional Undertaking by CME ME and PPF
68
9
Termination
68

 

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9.1
Termination by Consent
68
 
9.2
Termination by the Parties Prior to Closing
68
 
9.3
Automatic Termination
69
 
9.4
Payments Upon Termination
69
 
9.5
Effects of Termination
70
10
Indemnity
70
 
10.1
Indemnity by PPF
70
 
10.2
Indemnity by CME
72
 
10.3
Threshold for Indemnification
72
 
10.4
Notice of Potential Indemnity Claims
73
 
10.5
Notice of Indemnity Claims
73
 
10.6
Defense of Third Party Claims
74
11
Limitation Of Liability
76
 
11.1
General
76
 
11.2
Time for Making Claims
77
 
11.3
Limitation on PPF's Liability
78
 
11.4
Allowances, Provisions and Reserves
78
 
11.5
Change in Law
78
 
11.6
Accounting Bases
78
 
11.7
Contingent and Non-quantifiable Liabilities
78
 
11.8
No Double Recovery
79
 
11.9
CME Parties' Approval
79
 
11.10
Status of Clause 11
79
 
11.11
Pre-1996 Event Facts and Circumstances
79
 
11.12
Limitation on CME Parties' Liability
79
12
Tax Issues
79
 
12.1
Tax Returns
79
 
12.2
Tax Credits
80
13
Security
80
 
13.1
Required Security
80
 
13.2
Substitute Security
80
 
13.3
Financial Condition of Guarantors and Mandatory Substitution
83
 
13.4
Costs and Expenses
85
 
13.5
Further Assurances Regarding Security
85
 
13.6
Duration of Security
85
14
Governing Law
85
15
Dispute Resolution
85
16
Non-Business Days
85
17
Amendments
86
18
Counterparts
86
19
Confidentiality and Announcements
86
 
19.1
Non-Disclosure
86
 
19.2
Duration of Restrictions
87
 
19.3
Public Support
87
20
Notices
87
 
20.1
Form of Notice
87
 
20.2
Addresses for Notices
87
21
Assignment
88
 
21.1
Successors
88
 
21.2
Restriction on Assignment
88
 
21.3
Substitute Performance
88
22
Rights of Third Parties
88

 

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22.1
General
88
 
22.2
Protected Parties
88
23
Entire Agreement
89
24
Waivers
89
25
Costs and Expenses
89
26
Severability
89
 
26.1
Effect of Invalidity
89
 
26.2
Cure
90
27
Legality
90
28
Further Assurance
90
Annex 1 Programming Library Transfer
92
Annex 2 PPF Group
94
Annex 3 Working Capital
95
Annex 4 Form of Transfer Agreement (CZ a.s. Entity)
96
Annex 5 Form of Transfer Agreement (CZ s.r.o. Entity)
97
Annex 6 Subscription Agreement
98
Annex 7 Registration Rights Agreement
99
Annex 8 TV Nova Group Agreement
100
Annex 9 Guarantee
101
Annex 10 Smejc Agreement
102
Annex 11 Amended Newco/Oldco Memorandum of Association
103
Annex 12 PPF Group Guarantee
104

 

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THIS FRAMEWORK AGREEMENT (this "Agreement") is made by way of a deed on December
13, 2004
 

BETWEEN:
 

(1)
CME MEDIA ENTERPRISES B.V., a company organized under the laws of the
Netherlands, and having its seat at 101706 Amsterdam Birkstraat 89, 3768 HD
Soest, the Netherlands ("CME ME");

(2)
CENTRAL EUROPEAN MEDIA ENTERPRISES LTD, a company organized under the laws of
Bermuda, and having its registered office at Clarendon House, Church Street,
Hamilton, HM CX Bermuda ("CME Ltd")

and

(3)
PPF (CYPRUS) LTD. a company organized under the laws of the Republic of Cyprus
with registered number HE 92433, and having its registered office at Arch.
Makeriou III, 2-4, Capital Center, 9th Floor, PC 1505, Nicosia, Cyprus ("PPF").

WHEREAS:

(A)
CET 21, spol. s r.o. ("CET 21") is a limited liability company organized and
existing under the laws of the Czech Republic and has a registered capital of
CZK 200,000 (the "CET 21 Registered Capital").

   

(B)
CET 21 is a holder of the license No. 001/1993 granted by the Council of the
Czech Republic for Radio and Television Broadcasting on February 9, 1993 and
valid through January 30, 2017 (the "TV Nova License") under which it operates
the Czech television broadcasting station called "TV Nova".

   

(C)
Vilja a.s. ("Vilja") is a joint stock company organized and existing under the
laws of the Czech Republic.

   

(D)
Vilja is the owner of a 52.075% Ownership Interest in CET 21, and exercises
control over CET 21 and the broadcasting of TV Nova.

   

(E)
TV NOVA HOLDINGS B.V. ("TVNH"), a company organized under the laws of the
Netherlands, owns a 100% Ownership Interest of Vilja and exercises control over
Vilja.

   

(F)
PPF directly or indirectly owns a 100% Ownership Interest in TVNH.

   

(G)
Česká Produkční 2000 a.s. ("CP 2000") is a joint stock company organized and
existing under the laws of the Czech Republic.

   

(H)
PPF owns and controls the disposition of a 100% Ownership Interest in CP 2000.

   

(I)
CP 2000 owns a 100% Ownership Interest of (1) MAG MEDIA 99, a.s. ("MAG MEDIA"),
a joint stock company organized and existing under the laws of the Czech
Republic, (2) NOVA-Consulting, a.s. ("Nova Consulting"), a joint stock company
organized and existing under the laws of the Czech Republic, and (3) Česká
produkční invest, a.s. ("CPI"), a joint stock company organized and existing
under the laws of the Czech Republic.

 

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(J)
CPI owns a 100% Ownership Interest of (1) Media Capitol, a.s. ("Media Capitol"),
a joint stock company organized and existing under the laws of the Czech
Republic, and (2) ERIKA a.s. ("ERIKA"), a joint stock company organized and
existing under the laws of the Czech Republic.

   

(K)
PPF directly or indirectly has the right to acquire, subject to regulatory
approvals, 66.67% of the Ownership Interest of Galaxie Sport, a licensed
television broadcaster in the Czech Republic, and to cause the 66.67% Galaxie
Sport Ownership Interest to become part of the TV Nova Group.

   

(L)
AQS a.s. ("AQS") is a joint stock company organized and existing under the laws
of the Czech Republic and has title to and control over the Programming Library
(as such term is defined below).

   

(M)
The broadcasting, advertising and programming operations, and certain ancillary
activities, of TV Nova consist of CET 21, Vilja, CP 2000, MAG MEDIA, Nova
Consulting, Media Capitol and ERIKA, as well as any contracts and services, and
trademarks, trade names or other intellectual property necessary or used in
respect of the TV Nova operations, and certain ancillary activities conducted by
certain subsidiaries of CP 2000 and for the purposes of this Agreement only, the
Programming Library (the "TV Nova Business").

   

(N)
The TV Nova Business shall be reorganized by PPF prior to the Closing so that
all relevant entities and assets necessary for the operation and control of, and
the enjoyment of the financial benefit of, the TV Nova Business are held,
directly or indirectly, in the TV Nova Group (as defined below) either by Vilja
(as to the licensed broadcasting operations and the Programming Library) or CP
2000 (as to all other aspects), and so that neither Vilja or CP 2000 have any
business operations or subsidiaries other than the TV Nova Business.

   

(O)
The Parties have agreed that at Closing, subject to the terms and conditions
provided herein:

 
(i)
CME ME shall acquire control over the TV Nova Business in a transaction whereby
PPF shall sell (or shall cause the parties under its control to sell) and CME ME
shall purchase (or shall cause the parties under its control to purchase) 85% of
the TV Nova Group in exchange for the Purchase Price;

 
(ii)
CME Ltd and the Designated Shareholders shall enter into the Subscription
Agreement and the Registration Rights Agreement, and CME Ltd shall cause the CME
Consideration Shares to be issued to the Designated Shareholders pursuant to the
Subscription Agreement;

 
(iii)
PPF and CME ME, or their respective affiliates as appropriate, shall enter into
the other Transaction Documents (as defined below); and

 

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(iv)
PPF and the CME Parties shall do and cause to be done such other things as are
necessary to complete the intended transaction, as provided in more detail in
this Agreement.

 
IT IS AGREED as follows:
 

1
Definitions and Interpretation

   

1.1
Definitions

 
In this Agreement:
 
"2005 TV Nova Budget"
means the budget for the TV Nova Group for calendar year 2005;
   
"Actual Working Capital"
means the amount of working capital as at the Closing Commencement Date, as
determined by using categories in respect of expected working capital of those
entities in the TV Nova Group as set forth in Annex 3 hereto and the amounts
specified in the Closing Audit Report;
   
"Additional Disclosed Documents Index"
means the index of documents provided to the CME Parties or their advisers by
PPF or its advisers and annexed to the Disclosure Letter;
   
"Adjustment Report"
means as specified in Clause 3.4.3;
   
"Agreement"
has the meaning specified in the heading hereof;
   
"AHVG"
means Prof. Josef Alan (born 1938), Dr. Peter Huncik (born 1951), Vlastimil
Venclik (born 1942), and Fedor Gal (born 1945), or any one or more of them;
   
"Amended Newco/Oldco Memorandum of Association"
means the memorandum of association of each of Newco and Oldco to be adopted and
effective as from the Closing Completion Date, substantially in the form
attached hereto as Annex 11;
   
"Antimonopoly Approval"
means (i) a final and effective decision of the Antimonopoly Office and/or the
Foreign Antimonopoly Office, approving the concentration of the Parties within
the meaning of the applicable laws, as proposed in the proceeding before the
Antimonopoly Office or the Foreign Antimonopoly Office, or (ii) a decision of
the Antimonopoly Office and/or the Foreign Antimonopoly Office that the
concentration of the Parties is not subject to the Antimonopoly Office's or the
Foreign Antimonopoly Office's approval, as the case may be;
   
"Antimonopoly Office"
means the Office for the Protection of Economic Competition of the Czech
Republic;

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"AQS"
means as defined in Recital (J);
   
"Auditors"
means KPMG Ceska Republika s.r.o., in their capacity as the auditors of the TV
Nova Business or such other auditors who are appointed as the auditors of the TV
Nova Business at any time after the Closing Completion Date;
   
"Bank Guarantee"
means as defined in Clause 13.2.9(ii);
   
"Business Day"
means a day (other than Saturday or Sunday) on which commercial banks are open
for general business in Prague, New York and London (other than for services via
the Internet);
   
"CEDC"
means CEDC Management Services GmbH, a company organized under the laws of
Germany, with registered number HRB 33165 in Charlottenburg, and having its seat
at Bleibtreustrasse 6, 10623 Berlin, Germany, currently in the process of
liquidation by Erich Amsler, of the firm Amsler Czempiel Schreiber,
Bleibtreustrasse 6, 10623 Berlin;
"CET 21 Registered Capital"
means as defined in Recital (A);
   
"CET 21"
means as defined in Recital (A);
   
"Claim"
means any claims, rights, actions, proceedings of any nature, contingent or
actual, known or unknown, including any appeals in such proceedings, whether
asserted or not, which a person has against any person or any of its
subsidiaries and affiliates or current or former shareholders, relating in any
way to the assets, ownership structure or other affairs of such person or any of
its subsidiaries or current or former shareholders and affiliates, and where
used in the form "[Person] Claims" means Claims by or on behalf of the person so
indicated, and with respect to those [Person] Claims referred to in Clause 4.7.1
it means all such Claims as of the Execution Date, provided that from and after
the Closing Commencement Date, such term shall be understood to include all of
such person's Claims asserted on or before the Closing Commencement Date or
later Claims to the extent that such later Claims arise from facts and
circumstances existing on or before the Closing Commencement Date;
   
"Closing"
means the completion of the sale and purchase of the TV Nova Group as described
in Clause 7;
   
"Closing Audit Report"
means a report of the Auditors prepared in accordance with Clause 3.3 in which
the Auditors certify without qualifications the Combined Balance Sheet of CET
21, CP 2000 and MAG MEDIA as of the Closing Commencement Date (which report
shall include as attachments the audited balance sheets of CET 21, CP 2000 and
MAG MEDIA);

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"Closing Certificate"
means as defined in Clause 3.4.1
   
"Closing CNTS Settlement Amount"
means as defined in Clause 3.2.3;
   
"Closing Commencement Date"
means as defined in Clause 7.1;
   
"Closing Completion Date"
means as defined in Clause 7.1;
   
"Closing Indebtedness"
means as defined in Clause 3.2.2 ;
   
"Closing Management Report"
means a report of the management of the TV Nova Business in which the management
certify the Combined Balance Sheet of CET 21, CP 2000 and MAG MEDIA, prepared on
the basis of Czech accounting standards, as of the Closing Commencement Date
(which report shall include estimated Closing Indebtedness for the TV Nova
Group, the estimated Closing CNTS Settlement Amount and the estimated Actual
Working Capital, and shall further include as attachments the balance sheets of
any material entities in the TV Nova Group to the extent required by Czech
accounting standards);
   
"CME Consideration Shares"
means 3,500,000 unregistered CME Shares;
   
"CME Loan Agreement"
means a loan agreement between CME ME and Oldco, referred to in Clause 2.1 and
substantially as described in the Transaction Memorandum;
   
"CME Loan Note"
means a loan note issued by CME ME which is exchangeable for the CME
Consideration Shares, referred to in Clause 2.1 and substantially as described
in the Transaction Memorandum;
   
"CME Ltd"
means as specified on the first page of this Agreement;
   
"CME ME"
means as specified on the first page of this Agreement;
   
"CME Parties"
means CME ME and CME Ltd;
   
"CME Pledge"
means as specified in Clause 13.2.9(iv);
   
"CME Protected Parties"
means as specified in Clause 10;

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"CME Shares"
means Class A Common stock of CME Ltd. with a par value of US$ 0.08 per share;
   
"CNTS Lease"
means the two leases, dated September 10, 2004, and October 29, 2004, each
between CP 2000 and CNTS for use of space in a building at Vladislavova 20,
Prague, referred to on the Additional Disclosed Documents Index No. 34, document
numbers 3 and 4;
   
"CNTS Settlement"
means the Global Settlement Agreement between CET 21, CNTS and certain members
of the PPF Group dated December 19, 2003, pursuant to which CET 21 became
obligated to pay certain amounts to CNTS and certain members of the PPF Group,
and as referred to in the Data Room Index (document number 3.6.1.1.37);
   
"Combined Accounts"
means the Combined Balance Sheet and related income statements compiled on the
basis of the individual balance sheets and income statements of the specified
entities for the relevant financial year, in each case prepared in accordance
with the specified accounting standards, consistently applied;
   
"Combined Balance Sheet"
means the combined balance sheets for the corresponding year of any set of
Combined Accounts;
   
"Controlling Reports"
means the reports required to be prepared by the relevant statutory body of any
controlled company pursuant to Section 66a, paragraph 9 of the Commercial Code;
   
"CP 2000"
means as specified in Recital (F);
   
"CP 2000 Promissory Note"
means a promissory note issued by Vilja in the face amount of CZK 1,868,460,000
and held by CP 2000 on the Execution Date;
   
"CPI"
means as specified in Recital (I);
   
"CP Pledge"
means as specified in Clause 13.2.9(iii);
   
"CS"
means Ceska sporitelna, a.s., a joint stock company organized under the laws of
the Czech Republic, with its registered office at Olbrachtova 1929/62, Prague 4
140 00;
   
"CZK"
means Czech Crowns, the official currency for the time being of the Czech
Republic; provided, however, that if, while any of the Transaction Documents
remains in effect, the Czech Republic joins the third stage of the European
Economic and Monetary Union, adopts the Euro as its currency and CZK ceases to
be its lawful currency, all references herein to CZK shall be deemed to be
replaced by references to "Euro," "EUR" or "€" and the amounts of CZK shall be
deemed to be replaced by the equivalent amounts of Euro, calculated at the rate
of conversion of CZK (including compliance with rules relating to rounding in
accordance with the then applicable European Community regulations) into Euro
established by the Council of the European Union pursuant to Article 123 of the
treaty establishing the European Communities, as amended;

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"Data Room Index"
means the index of documents provided to the CME Parties or their advisers by
PPF or its advisers and annexed to the Disclosure Letter;
   
"Demand Amount"
has the meaning given in the Guarantee or the PPF Group Guarantee, as
applicable;
   
"Designated Shareholder(s)"
means those persons identified by PPF prior to the Closing Commencement Date as
the intended holders of the CME Consideration Shares, provided that there shall
be no more than two such persons, and each such person shall be (i) a member of
the PPF Group at the Closing Date, (ii) an "accredited investor" as defined in
the Subscription Agreement, and (iii) meet any other requirements of U.S.
federal and state securities laws or applicable laws of the jurisdiction of such
person's incorporation with respect to its holding of the CME Consideration
Shares;
   
"Disclosure Letter"
means the letter and its schedules to be dated as of the Execution Date in which
PPF discloses (i) information on liabilities, claims or facts and (ii) details
of other matters referred to in this Agreement, as delivered by PPF to the CME
Parties on the Execution Date;
   
"Dispute Notice"
means as defined in Clause 3.4.1;
   
"ERIKA"
means as specified in Recital (J);
   
"Escrow Account"
means an escrow account opened with an Escrow Bank for the purposes of PPF, the
Guarantor, or the PPF Group Guarantor paying funds into escrow pursuant to this
Agreement, the TV Nova Agreement, the Guarantee, the PPF Group Guarantee or any
relevant Substitute Security, and regulated by an Escrow Agreement;
   
"Escrow Agreement"
means an escrow agreement among the Escrow Bank, PPF, the Guarantor, the PPF
Group Guarantor and the CME Parties for the purposes of regulating payment of
funds into escrow and withdrawals from escrow pursuant to this Agreement, the TV
Nova Group Agreement, the Guarantee, the PPF Group Guarantee or any relevant
Substitute Security;

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"Escrow Bank"
means a bank in London (the identity and credit rating of which is reasonably
satisfactory to the CME Parties);
   
"Estimated Total Cash Consideration"
means the estimated Total Cash Consideration calculated in accordance with this
Agreement and based on the estimations set out in the Closing Management Report;
   
"Execution Date"
means the date hereof;
   
"Expiration of Time Limit"
means the lapse of the time-limit set forth in the applicable laws without the
Antimonopoly Office having issued a meritorious decision on a notification of
the concentration of the Parties, or without the Antimonopoly Office having
informed the parties to the proceeding that the proceeding shall continue, or an
analogous situation with respect to the Foreign Antimonopoly Office pursuant to
the applicable laws, as the case may be, in each case having the same material
effect as the Antimonopoly Approval;
   
"Foreign Antimonopoly Office"
means any relevant antimonopoly authority other than the Antimonopoly Office,
including the European Commission or its relevant bodies, as the case may be,
equivalent to the Antimonopoly Office having jurisdiction to approve the
concentration of the Parties hereunder;
   
"Fourth Installment"
means the amount, converted to CZK at the Closing Commencement Date, of the
Fourth Installment due on or before July 15, 2005 from PPF pursuant to the
Master Agreement dated October 8, 2003 among PPF, CME ME, CME Ltd and CME Czech
Republic B.V.;
   
"Galaxie Sport"
means a limited liability company organized and existing under the laws of the
Czech Republic, with a registered capital of CZK 105,000, that operates a sports
television broadcasting business pursuant to the Galaxie Sport License;
   
"Galaxie Sport License"
means license File No. Ru/72/02 granted by the Media Council on March 19, 2002
and valid for a period of 12 years from March 28, 2002, under which Galaxie
Sport operates the Czech television broadcasting station called "Galaxie sport";
   
"General Meeting"
means in respect of any entity incorporated by shares, a meeting of its
shareholders, and in respect of any other entity the functional equivalent of
such a shareholders' meeting;

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"Gerner"
Means Jan Gerner (born 1971);
   
"Guarantee"
means the guarantee by PPF a.s. in favor of the CME Parties to be given at the
Closing Commencement Date, in the form set out in Annex 9 hereto;
   
"Guarantor"
means PPF a.s., a company organised and existing under the laws of the Czech
Republic with its seat at Na Pankraci 121, 140 21 Prague;
   
"Guarantor Obligations"
means Obligations as such term is defined in the Guarantee;
   
"IFRS"
means the international financial reporting standards promulgated from time to
time by the International Accounting Standards Board;
   
"Indebtedness"
means any obligation (whether incurred as principal or surety) for the payment
or the repayment of money, whether present or future, actual or contingent,
including without limitation all notes, debentures, bonds, letters of credit,
bankers' acceptances and other instruments evidencing indebtedness (including
capital leases, guarantees and lines of credit) of the relevant person, and with
respect to CET 21 this term shall include the liability of CET 21 under the CNTS
Settlement;
   
"Indemnity Claim"
means any Claim by any Protected Party pursuant to the indemnities in Clause
10.1 and 10.2;
   
"Independent Accountant"
means as specified in Clause 3.4.3;
"Initial Security"
means as provided in the Guarantee;
   
"Komar"
Means Vladimir Komar (born 1972);
   
"Krsak"
means Peter Krsak (born 1949);
   
"Last Date for Closing"
means July 1, 2005, unless extended to October 1, 2005 as provided in Clause
6.3.7, or such other date as the Parties may agree in writing;
   
"LIBOR 3M"
means the interest rate determined by the British Bankers' Association (BBA) as
the London Interbank Offered Rate for US$ for a three month period (using the
methodology described by the BBA at www.bba.org.uk) at or about 11 a.m. (London
time) on the second London banking day of each month, as displayed on Moneyline
Telerate page 3750 (or such other page as may replace page 3750 on that service
or such other service as may be nominated by the BBA as its information vendor
for such purposes);

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"Losses"
means as provided in Clause 10.1.1;
   
"MAG MEDIA"
has the meaning specified in Recital (I);
   
"Material Adverse Effect"
means any effect that is or is reasonably likely to be materially adverse to the
assets, business, results of operations, financial condition or prospects of the
TV Nova Business considered as a whole;
   
"Media Act"
means Act No. 231/2001 Coll., as amended, On Radio and Television Broadcasting;
   
"Media Capitol"
means as specified in Recital (J);
   
"Media Council"
means the Council of the Czech Republic for Radio and Television Broadcasting
   
"Media Council Consent"
means any required approval of the Media Council including for a transfer of an
Ownership Interest in a licensee or such other matter as may be referred to
herein pursuant to the Media Act;
   
"MEF Media"
means the company referred to in Clause 4.6.13(A);
   
"Newco"
means a Czech limited liability company, to be organized and 100% owned and
controlled by CME ME on or before the Closing Commencement Date;
   
"Nova Consulting"
means as specified in Recital (J);
   
"Obligations"
has the meaning given in the Guarantee;
   
"Oldco"
means a Czech limited liability company, established prior to December 31, 2003,
to be acquired and 100% owned and controlled by CME ME on or before the Closing
Commencement Date;
   
"Oldco Promissory Note(s)"
means any promissory note issued by Oldco referred to in Clause 2.1 and
substantially as described in the Transaction Memorandum;
   
"Oldco Promissory Note Assignment Agreement(s)"
means any agreement to transfer the creditor's rights and title to any Oldco
Promissory Note, referred to in Clause 2.1 and substantially as described in the
Transaction Memorandum;
   
"Original TV Nova Combined Accounts"
means the audited Combined Accounts of CET 21, CP 2000 and MAG MEDIA for the
financial year ended 31 December 2003, prepared in accordance with IFRS;
   
"Ownership Interests"
means the shares, participation rights or other equity ownership interest of any
corporate person, and any reference to an [Entity] Ownership Interest refers to
the equity ownership of the relevant entity;

--------------------------------------------------------------------------------

"Party" or "Parties"
means the Party and Parties to this Agreement;
   
"Plejada"
means Plejáda a.s., a joint stock company organized under the laws of the Czech
Republic;
   
"PPF"
means as specified on the first page hereof;
   
"PPF Group"
means those persons listed in Annex 2 hereto;
   
"PPF Group Guarantee"
means the guarantee by PPF Group N.V. in favor of the CME Parties to be given at
the Closing Commencement Date, in the form set out in Annex 12;
   
"PPF Group Guarantor"
means PPF Group N.V., a company organized and existing under the laws of the
Netherlands with its seat at Herengracht 450-454, 1017CA Amsterdam, The
Netherlands;
   
"PPF Loan Agreement"
means a loan agreement between PPF and Oldco, referred to in Clause 2.1 and
substantially as described in the Transaction Memorandum;
   
"PPF Media"
means the company referred to in Clause 4.6.12(A);
   
"PPF Promissory Note"
means a Promissory Note issued by PPF with a face value equal to 15% of the
registered capital of Newco on the Closing Commencement Date, referred to in
Clause 2.1 and substantially as described in the Transaction Memorandum;
   
"PPF Protected Parties"
means as specified in Clause 10.2;
   
"Pre-contractual Statement"
means any draft, agreement, undertaking, representation, warranty, promise,
assurance or arrangement of any nature whatsoever, whether or not in writing,
relating to the subject matter of this Agreement made or given by any person at
any time prior to the Execution Date;
   
"Programming Library"
means all programming, production, dubbing and other rights held on behalf of or
licenses for use on TV Nova (including any commitments or options to acquire or
renew any such rights in the future) by AQS or otherwise, including any
receivables due from the sale or transfer of such rights as well as any current
payment obligations of CET 21 to AQS in respect of such rights but excluding any
existing liability for breach of any such right or the underlying contract or
any overdue payment obligation of AQS to any third party, as further described
in Clause 1.4.4;

--------------------------------------------------------------------------------

 
"Programming Library Pledge"
means the pledge created over part of the Programming Library in accordance with
the Agreement on Securing Assignment of Rights to Recordings, concluded by and
between eBanka, a.s. and AQS on September 1, 2004, as a collateral for the loan
provided to AQS by eBanka, a.s. pursuant to the Revolving Loan Agreement
concluded by and between eBanka, a.s. and AQS on September 1, 2004;
   
"Programming Library Transfer Agreement"
means the Programming Library Transfer Agreement between AQS and CET 21 to be
entered into on or before the Closing Commencement Date, as provided in Clause
1.4.4;
   
"Protected Party"
means a CME Protected Party or a PPF Protected Party;
   
"Purchase Price"
has the meaning set forth in Clause 3.1;
   
"Registration Rights Agreement"
means the Registration Rights Agreement between CME Ltd and the Designated
Shareholder(s) to be entered into on or before the Closing Commencement Date in
the form of Annex 7 hereto;
   
"Review Period"
means as provided in Clause 3.4.2;
   
"Security"
means the Guarantee and the PPF Group Guarantee, and following substitution, if
any, pursuant to Clause 13.2, means the Guarantee and such Substitute Security
as has replaced the PPF Group Guarantee;
   
"Shareholders Equity"
means the shareholders equity (excluding minority interests) as recorded on the
consolidated balance sheet of the PPF Group Guarantor, from time to time;
   
"Smejc"
means Jiri Smejc (born 1971);
   
"Smejc Agreement"
means an agreement among CME ME, PPF and Smejc, in the form set forth in Annex
10 hereto;
   
"Subscription Agreement"
means a subscription agreement to be entered into on or before the Closing
Commencement Date between CME Ltd and the Designated Shareholder(s), pursuant to
which the Designated Shareholder(s) shall subscribe for the CME Consideration
Shares, in the form set out in Annex 6 hereto;
   
"Subscription Price"
means US$ 129,990,000;
   
"Substitute Security"
means those forms of security specified in Clause 13.2.9;

--------------------------------------------------------------------------------

 
"Substitution Date"
means as provided in Clause 13.2.4(iii);
   
"Substitution Notice"
means a written notice from PPF to the CME Parties that PPF wishes to replace
any Security with Substitute Security;
   
"Tangible Net Worth"
means the sum of all paid up shareholder cash contributions to the share capital
account of the relevant person (or any other capital account of the relevant
person ascribed for such purposes) and any accumulated retained earnings less
any accumulated retained losses and intangible assets including, but not limited
to goodwill;
   
"Target Working Capital"
means the normalized working capital of the TV Nova Group as determined by using
categories in respect of those entities of the TV Nova Group and such amounts
designated as normalized as set forth in Annex 3 hereto;
   
"Tax" or "Taxes"
means any or all taxes, however denominated, including any interest, fines or
penalties payable in respect thereof, imposed by any governmental authority or
agency in any jurisdiction, which taxes shall include, without limiting the
generality of the foregoing, all income or profits taxes, payroll and employee
withholding taxes, social and health insurance contributions, sales and use
taxes, value added taxes, excise taxes, franchise taxes, business license taxes,
occupation taxes, real and personal property taxes, stamp taxes, environmental
taxes, withholding taxes, securing taxes, transfer taxes and other governmental
charges or obligations of the same or of a similar nature to any of the
foregoing which are required to be paid, withheld or collected, and shall
specifically include any Tax receivables recorded in the Working Capital
Certificate;
   
"Tax Authority"
means any person, organization or body entitled to enforce or collect Tax;
   
"Tax Laws"
means laws, decrees, ordinances, orders, regulations, instructions and other
normative acts made in accordance with such respective laws, as well as court
decisions or arbitral awards by which any relevant person, including a Tax
Authority, is bound, in respect of Taxes;
   
"Television Business"
means any business that is similar to the TV Nova Business or the principal
aspects thereof, including the purchase or sale of television advertising, the
purchase or sale of programming and related rights, the production or
distribution of television programming, broadcasting of television programs by
any platform (including without limitation, terrestrial broadcast, digital
terrestrial television, cablecast, DSL or other telephony network-based delivery
systems, satellite and pay-per-view), and the promotion or management of talent
and related rights;

--------------------------------------------------------------------------------

 
"Third Party Claim"
means any Claim against any Protected Party by any person other than a Party to
this Agreement;
   
"Total Assets"
means the total assets as recorded on the consolidated balance sheet of the PPF
Group Guarantor, from time to time;
   
"Total Cash Consideration"
means the amount equal to the Purchase Price minus (1) the Subscription Price
and minus (2) the amount of the Fourth Installment;
   
"Transaction Documents"
means this Agreement, the Transfer Agreements, the Subscription Agreement, the
Registration Rights Agreement, the TV Nova Group Agreement, the Guarantee, the
Amended Newco Memorandum of Association, the Amended Oldco Memorandum of
Association, the Oldco Promissory Note(s), the Oldco Promissory Note Assignment
Agreement(s), the CME Loan Note(s), the PPF Promissory Note, the CME Loan
Agreement, the PPF Loan Agreement, the Programming Library Transfer Agreement,
the Smejc Agreement, and the PPF Group Guarantee;
   
"Transaction Memorandum"
means the detailed description of the steps required to give effect to the
acquisition of the TV Nova Group by CME ME as contemplated herein, as delivered
by CME ME to PPF on the Execution Date;
   
"Transfer Agreements"
means (i) the Agreement on Transfer of Ownership Interest in Vilja between Newco
and TVNH, (ii) the Agreement on Transfer of Ownership Interest in CP 2000
between Oldco and PPF, (iii) the Agreement on Transfer of Ownership Interest in
Newco between CME ME and PPF, and (iv) the Agreement on Transfer of Ownership
Interest in Oldco between CME ME and PPF to be entered into on or before the
Closing Date, referred to in Clause 2.1 and as described in the Transaction
Memorandum, each substantially in the appropriate form set out in Annex 4 or
Annex 5 hereto;
   
"TV Global"
means TV Global a.s., a joint stock company organized and existing in accordance
with the laws of the Slovak Republic, registered in the Commercial Register of
the District Court in Kosice, file number 1118/V, identification number
36197009, with its seat at Geresakova 10, Kosice;

--------------------------------------------------------------------------------

 
"TV JOJ"
means the Slovak television broadcasting business operated under such name
pursuant to license T/39 issued on July 27, 1995 by the Council of the Slovak
Republic for Broadcasting and Re-transmission, and all programming and service
business related to such broadcasting business;
   
"TVNH"
means as specified in Recital (E);
   
"TV Nova"
means the Czech television broadcasting station operated by CET 21 under the TV
Nova License;
   
"TV Nova Business"
means as specified in Recital (M);
   
"TV Nova Combined Accounts"
means the audited Combined Accounts of the TV Nova Group (or if not for the
entire TV Nova Group for those entities in the TV Nova Group specified herein)
for the relevant period referred to herein, prepared in accordance with IFRS
consistently applied;
   
"TV Nova Group"
means Vilja, CET 21, Plejada, CP 2000, MAG MEDIA, Nova Consulting, Media
Capitol, ERIKA and the Programming Library;
   
"TV Nova Group Agreement"
means the TV Nova Group Agreement among CME ME, PPF, Newco and Oldco, to be
entered into on or before the Closing Commencement Date in the form set out in
Annex 8 hereto;
   
"TV Nova License"
means as specified in Recital (B);
   
"TV Nova Value"
means as specified in Clause 3.2;
   
"US Dollars" or "US$"
means the official currency for the time being of the United States of America;
   
"US GAAP"
means the financial reporting standards promulgated from time to time by the
Financial Accounting Standards Board;
   
"Vilja"
means as specified in Recital (C);
   
"Warranty"
means each statement set out in Clauses 4.1 to 4.7 (inclusive), and each
statement identified as a warranty in any other Transaction Document; and
   
"Zelezny"
means Vladimir Zelezny (born 1945).

 
1.2
Interpretation

 
In construing this Agreement, unless otherwise specified:
 

 
1.2.1
references to Clauses and Annexes are to clauses of, and annexes to, this
Agreement;

--------------------------------------------------------------------------------

 
1.2.2
references to a "person" shall be construed so as to include any physical or
legal person, firm, company or other body corporate, government, state or agency
of a state, local or municipal authority or government body or any joint
venture, association or partnership (whether or not having separate legal
personality);

     

 
1.2.3
reference to an "affiliate" of any person shall mean any "subsidiary" of that
person or a "holding company" of that person or any other subsidiary of that
holding company, as "subsidiary" and "holding company" are defined in Section
736 of the Companies Act 1985, provided that notwithstanding such definition,
each member of the PPF Group shall be deemed an affiliate of PPF for purposes of
the Transaction Documents;

 
1.2.4
a reference to any law, regulation, statute or statutory provision shall be
construed as a reference to the same as it may have been, or may from time to
time be, amended, modified or re-enacted;

     

 
1.2.5
any reference to a "day" (including within the phrase "Business Day") shall mean
a period of 24 hours running from midnight to midnight (except for the days of
time change lasting 25 or 23 hours which days shall be 25 or 23 hours
respectively);

     

 
1.2.6
references to time are to Central European Time;

     

 
1.2.7
a reference to any other document referred to in this Agreement is a reference
to that other document as amended, varied, novated or supplemented (other than
in breach of the provisions of this Agreement) at any time;

     

 
1.2.8
headings, recitals and titles are for convenience only and do not affect the
interpretation of this Agreement;

     

 
1.2.9
general words shall not be given a restrictive meaning by reason of the fact
that they are followed by particular examples intended to be embraced by the
general words;

     

 
1.2.10
references to a "Party", or the "Parties" shall be construed as to include and
each of its permitted successors and permitted assignees;

 
1.2.11
"control" means the power to direct the management and policies of the entity
whether through the ownership of share capital, by contract or otherwise;

 
1.2.12
"acting in concert" means acting together pursuant to an agreement or
understanding (whether formal or informal) or to be deemed to be acting in
concert under applicable law;

 
1.2.13
"related person" means, in respect of a legal person, an affiliate and in
respect of a physical person, any member of such individual's immediate family;
any person related by marriage to such individual or his immediate family as
well as members of their immediate families;

--------------------------------------------------------------------------------

 
1.2.14
the exchange rate to be used when calculating any amount in CZK which is based
on US$ (or the reverse) shall be determined based on the CZK/US$ exchange rate
derived from the European Central Bank rates for €/CZK and €/US$ fixed at 14:15
each Business Day and published on page ECB37 by Reuters and ECB3 by Bloomberg
on the relevant date for such determination, unless another exchange rate or
date is specified in a particular provision of this Agreement or any other
Transaction Document;

 
1.2.15
except as set forth to the contrary in a specific Warranty or other provision of
this Agreement or any other Transaction Document or in reference to a Material
Adverse Effect, the term "material" shall be interpreted to include any asset,
liability, claim, contingency or action (or series of related items) with a
value of US$ 400,000 or more; and

 
1.2.16
a liability, claim or fact shall be considered "disclosed" if information about
such liability, claim or fact was (i) disclosed to the CME Parties by placing
documentation of such item in the data room prior to the Execution Date and
including it on the Data Room Index or the Additional Disclosed Documents Data
Room Index, (ii) disclosed to the CME Parties in writing by any member of the
PPF Group prior to the Execution Date, or (iii) disclosed by PPF in the
Disclosure Letter or otherwise in writing to the CME Parties on or after the
Execution Date, but prior to the Closing Commencement Date.

 
1.3
Annexes

 
The annexes form an integral part of this Agreement and any reference to this
Agreement shall include the annexes.
 

1.4
Completion of Transaction Documents and Other Annexes

 
1.4.1
The Parties have agreed on the form and substance of certain other Transaction
Documents (other than this Agreement), as specified in the relevant Annex
attached to this Agreement as of the Execution Date.

 
1.4.2
The Parties shall negotiate in good faith and agree on any changes to the forms
of such other Transaction Documents that they agree may be appropriate taking
into account any changes to the final transaction structure.

 
1.4.3
As and when any amendment to any other Transaction Document is agreed as to form
and substance, the Parties will amend this Agreement by replacing the original
Annex with the agreed amended form of Transaction Document.

 

 
1.4.4
The Parties have agreed that promptly following the Execution Date, PPF shall
procure that CET 21 shall negotiate and finalize the Programming Library
Transfer Agreement with AQS (which shall be based on the principles outlined in
Annex 1, but in final form and substance satisfactory to CME ME and PPF) for
purposes of transferring the Programming Library to CET 21. The Parties
understanding of the contents of the Programming Library as of the Execution
Date are specified in document number 2a in the Additional Disclosed Documents
Index No. 34. On or prior to the Closing Commencement Date, the contents of the
Programming Library and the transfer thereof to CET 21 shall be agreed, as set
out in this Clause, and PPF shall procure that CET 21 and AQS enter into the
Programming Library Transfer Agreement and cause the Programming Library to be
transferred to CET 21 as contemplated therein on or before Closing.

 

--------------------------------------------------------------------------------

 
1.4.5
This Agreement, once signed, is intended by the Parties to form, together with
the other Transaction Documents, a legally binding agreement for the sale of 85%
of the TV Nova Group, subject to the provisions of this Agreement and
specifically to Clause 6. Neither Party shall argue or attempt to argue that
this Agreement is not legally binding on it as a result of being an "agreement
to agree".

 
2
Sale and Purchase of the TV Nova Group

 
Subject to the terms and conditions herein, including satisfaction of the
conditions set forth in Clause 6.1, CME ME shall purchase and PPF shall sell to
CME ME 85% of the TV Nova Group, as provided in this Clause 2.
 
2.1
Outline of Transaction Structure and Steps

 

 
2.1.1
CME ME and PPF shall cause the acquisition of the TV Nova Group to occur in
accordance with the steps set forth herein and in the Transaction Memorandum. 

 

 
2.1.2
CME ME shall form Newco, with a cash capitalization in an amount not less than
the purchase price in the Vilja Transfer Agreement.

 

 
2.1.3
Newco shall purchase 100% of the Vilja Ownership Interest from TVNH for cash
pursuant to the Vilja Transfer Agreement. At such time, the Amended Newco
Memorandum of Association shall be adopted.

 

 
2.1.4
Oldco, a wholly-owned subsidiary of CME ME, shall purchase 100% of the CP 2000
Ownership Interest from PPF for consideration represented by Oldco Promissory
Notes having an aggregate face value equal to the purchase price specified in
the CP 2000 Transfer Agreement. At such time, the Amended Oldco Memorandum of
Association shall be adopted.

 

 
2.1.5
CME ME shall acquire Oldco Promissory Notes in exchange for cash, the CME Loan
Note and such other consideration in the amount and of the type set forth in the
Oldco Promissory Note Assignment Agreement.

 

 
2.1.6
CME ME shall transfer a 15% Newco Ownership Interest to PPF in exchange for a
PPF Promissory Note.

 

--------------------------------------------------------------------------------

 
2.1.7
CME ME shall cancel the PPF Promissory Note in consideration of PPF canceling
Oldco Promissory Notes with an aggregate face value equal to the PPF Promissory
Note.

 

 
2.1.8
CME ME shall transfer a 15% Oldco Ownership Interest to PPF in exchange for cash
and other consideration corresponding to the nominal value of a 15% Oldco
Ownership Interest.

 

 
2.1.9
PPF shall cause the Designated Shareholder(s) to exchange the CME Loan Note for
the CME Consideration Shares, and CME Ltd shall issue the CME Consideration
Shares to the Designated Shareholder(s), at the Subscription Price pursuant to
the Subscription Agreement and subject to the Registration Rights Agreement.

 

 
2.1.10
Following all such transfers and transactions detailed in Clauses 2.1.1 to
2.1.9, PPF shall convert its remaining Oldco Promissory Notes, into a loan to
Oldco, pursuant to the PPF Loan Agreement, and CME ME shall convert its
remaining Oldco Promissory Notes, into a loan to Oldco, pursuant to the CME Loan
Agreement.

 
2.2
Effect on Purchase Price

 
Notwithstanding the structure outline and any financial terms specified in
Clause 2.1, the CME Parties shall not be obligated to pay any amount for the
purchase of 85% of the TV Nova Group other than as set forth in Clause 3.1.
 
3
Consideration

 
3.1
Purchase Price

 

 
3.1.1
The total consideration (the "Purchase Price") for the sale of 85% of the TV
Nova Group shall be US$ 670,000,000, adjusted as provided in Clause 3.5.

 

 
3.1.2
The Purchase Price shall be paid in the form of the CME Consideration Shares and
the Total Cash Consideration.

 

 
3.1.3
The Total Cash Consideration shall be paid in US$.

 

 
3.1.4
The Purchase Price shall be payable as set out below:

 

 
(i)
Subject to Closing, in the course of completion of such transfers and
transactions as are detailed in Clauses 2.1.1 to 2.1.9, CME Ltd shall cause the
CME Consideration Shares to be issued and delivered to the Designated
Shareholders;

 

 
(ii)
Subject to Closing, in the course of completion of such transfers and
transactions as are detailed in Clauses 2.1.1 to 2.1.9, CME ME shall pay or
procure the irrevocable payment of the Estimated Total Cash Consideration;

 

 
(iii)
Subject to Closing, in the course of completion of such transfers and
transactions as are detailed in Clauses 2.1.1 to 2.1.9, the Fourth Installment
shall be deemed paid in full; and

 

--------------------------------------------------------------------------------

 
(iv)
Following the preparation of the Closing Audit Report, any adjustments to the
Total Cash Consideration shall be paid in accordance with Clause 3.5.

 
3.2
TV Nova Value

 

 
3.2.1
The Parties' agreed valuation of 100% of the TV Nova Group will be determined as
of the Closing Commencement Date, and shall be the sum of (1) the amount of US$
833,333,333 minus (2) the amount of Closing Indebtedness of the TV Nova Group,
plus (3) the amount of the Closing CNTS Settlement Amount, plus or minus (4) an
amount equal to (whether positive or negative) the difference between the Actual
Working Capital and the Target Working Capital (in the aggregate, the "TV Nova
Value").

 

 
3.2.2
The Indebtedness of the TV Nova Group shall be estimated as at the Closing
Commencement Date as set out in the Closing Management Report (based on Czech
accounting standards), and finally determined as at the Closing Commencement
Date in the Closing Audit Report (the "Closing Indebtedness"), which for the
avoidance of doubt shall not include contingent liabilities as of the Closing
Commencement Date (the "Closing Indebtedness").

 

 
3.2.3
The unpaid amount of the CNTS Settlement shall be estimated as at the Closing
Commencement Date as set out in the Closing Management Report, and finally
determined as at the Closing Commencement Date in the Closing Audit Report (the
"Closing CNTS Settlement Amount").

 

 
3.2.4
The Actual Working Capital shall be estimated as at the Closing Commencement
Date as set out in the Closing Management Report, and finally determined as at
the Closing Commencement Date in the Closing Audit Report.

 

 
3.2.5
In making the determination of Closing Indebtedness and Actual Working Capital,
no liability amount included in the Actual Working Capital shall be counted also
as an amount of Closing Indebtedness.

 
3.3
Closing Audit Report

 

 
3.3.1
As soon as reasonably practicable after the Closing, CME ME and PPF shall cause
the Auditors to prepare the Closing Audit Report, including an audited Combined
Balance Sheet of CET 21, CP 2000 and MAG MEDIA in accordance with IFRS as of the
Closing Date, and the unqualified opinion of the Auditors thereon.

 

 
3.3.2
The cost of the preparation of the Closing Audit Report shall be borne by the
audited companies.

 
3.4
Determination of Closing Indebtedness, Closing CNTS Settlement Amount and Actual
Working Capital

 

--------------------------------------------------------------------------------

 
3.4.1
As soon as practicable and no later than 10 Business Days after the delivery of
the Closing Audit Report, PPF shall certify the Closing Indebtedness, the
Closing CNTS Settlement Amount and the Actual Working Capital in writing to CME
ME, based on the Closing Audit Report, and deliver to CME ME the working papers
for such determinations (the "Closing Certificate").

 

 
3.4.2
CME ME will have 30 Business Days from receipt to review the Closing Certificate
(the "Review Period"). If CME ME asserts that any item or amount shown or
reflected on the Closing Certificate is not correct, CME ME may, on or prior to
the last day of the Review Period, deliver a notice to PPF setting forth, in
reasonable detail, the basis for its disagreement together with supporting
calculations (the "Dispute Notice"). If no Dispute Notice is received by PPF on
or prior to the last day of the Review Period, the Closing Certificate shall be
deemed accepted by the Parties and the Closing Indebtedness, the Closing CNTS
Settlement Amount and the Actual Working Capital shall be the amounts set forth
therein.

 

 
3.4.3
Within 5 Business Days after delivery of the Dispute Notice, if CME ME and PPF
shall be unable, despite their reasonable efforts, to resolve the dispute set
forth in the Dispute Notice, CME ME and PPF shall jointly retain Ernst & Young
as independent public accountants (the "Independent Accountant"). CME ME and PPF
shall make available to the Independent Accountant all relevant documentation,
as soon as reasonably practical. The Independent Accountant shall review the
Closing Certificate and the Dispute Notice, and shall, as promptly as
practicable, and in no event later than 45 days following the date of their
engagement, deliver to CME ME and PPF a report (the "Adjustment Report") setting
forth in reasonable detail, their determination with respect to all of the
disputed items or amounts specified in the Dispute Notice, and the revisions, if
any, to be made to the Closing Certificate and the amount of Closing
Indebtedness, Closing CNTS Settlement Amount and Actual Working Capital, as
relevant, to reflect such determination, together with supporting calculations.
The Independent Accountant, if appointed, shall act as an expert and not as an
arbitrator, and its decisions on matters which shall be referred to it shall be,
absent manifest error, final and binding upon CME ME and PPF. CME ME shall pay
the fees and expenses of the Independent Accountant incurred in preparing and
delivering such Adjustment Report, unless the Independent Accountant determines
that revisions are to be made to the amounts set forth in the Closing
Certificate that would vary the amount presented in the Closing Certificate by
3% or more, in which case the PPF shall pay the fees and expenses of the
Independent Accountant incurred in preparing and delivering such Adjustment
Report.

 
3.5
Adjustments to the Purchase Price

 

 
3.5.1
PPF shall deliver the Closing Management Report to CME ME on the Closing
Commencement Date, which will include a draft of the Closing Certificate,
including its estimate of the Closing Indebtedness and the Closing CNTS
Settlement Amount, supported by appropriate working papers, and CME ME shall
adjust the Total Cash Consideration to be paid at Closing by (i) reducing the
Total Cash Consideration by an amount equal to 75% of the estimated Closing
Indebtedness and (ii) increasing the Total Cash Consideration by an amount equal
to 75% of the estimated Closing CNTS Settlement Amount.

 

--------------------------------------------------------------------------------

 

 
3.5.2
CME ME or PPF, as the case may be, shall within 10 Business Days following the
later of (1) the expiration of the Review Period, if no Dispute Notice shall
have been delivered as provided in Clause 3.4.2, or (2) if a Dispute Notice
shall have been delivered as provided in Clause 3.4.2, the delivery of the
Adjustment Report, and in compliance with the Adjustment Report, make the
relevant payments to the other Party as set forth below as adjustments to the
Purchase Price.

 

 
(i)
PPF shall pay to CME ME an amount equal to 75% of the amount by which the
Closing Indebtedness exceeds the estimated Closing Indebtedness.

 

 
(ii)
CME ME shall pay to PPF an amount equal to 75% of the amount by which the
Closing Indebtedness is less than the estimated Closing Indebtedness.

 

 
(iii)
CME ME shall pay to PPF an amount equal to 75% of the amount by which the
Closing CNTS Settlement Amount exceeds the estimated Closing CNTS Settlement
Amount.

 

 
(iv)
PPF shall pay to CME ME an amount equal to 75% of the amount by which the
Closing CNTS Settlement Amount is less than the estimated Closing CNTS
Settlement Amount.

 

 
(v)
If the Actual Working Capital exceeds the Target Working Capital, CME ME shall
pay to PPF an amount equal to 75% of the excess.

 

 
(vi)
If the Actual Working Capital is less than the Target Working Capital, PPF shall
pay to CME ME an amount equal to 75% of the deficiency.

 

 
3.5.3
The Parties shall cooperate in respect of such payments so that to the extent
possible one net payment shall be made by the relevant Party.

 
3.6
Cash Payments

 

 
3.6.1
All cash payments shall be made in immediately available funds to the account of
the relevant Party specified as provided below. The paying Party shall promptly
provide the receiving Party with all necessary information to confirm that such
payment has been made.

 

 
3.6.2
Each of PPF and the CME Parties shall provide to the other the bank account
details for payments in US$ and CZK. This information shall be provided in
writing not later than 30 days after the Execution Date.

 

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4
Warranties

4.1
Mutual Warranties

 
Each of the CME Parties, on the one hand, and PPF, on the other, warrants to the
other as at the Execution Date that each of the statements set forth below is
true, accurate and not misleading as at that date:
 

 
4.1.1
It is duly organized, validly existing and in good standing (if applicable)
under the laws of the jurisdiction of incorporation. It has all necessary power
and authority to carry on its business as currently conducted and as currently
contemplated to be conducted. It has the necessary power and authority to
execute, deliver and perform this Agreement and to consummate or to cause to be
consummated the transactions contemplated hereby to which it or one of its
affiliates is or may be a party.

 

 
4.1.2
The execution, delivery and performance of this Agreement has been duly and
validly authorized by all necessary corporate action. This Agreement has been
duly executed and delivered by it and constitutes the legally valid and binding
obligation of it, enforceable against it in accordance with its terms except as
such enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium and other similar laws and equitable principles relating to or
limiting creditors' rights generally.

 

 
4.1.3
The execution, delivery and performance of this Agreement and the other
Transaction Documents to which it or one of its affiliates is or may be a party
and the consummation by it or its affiliates, respectively, of the transactions
contemplated hereby:

 

 
(i)
will not breach any applicable provision of law, regulation, order or judgment
applicable to such Party or its affiliates or any provision of its or their
constitutive documents;

 

 
(ii)
will not require any consent of any governmental or regulatory authority under
any provision of law other than a Media Council Consent (as specifically
provided herein) and the Antimonopoly Approval; and

 

 
(iii)
will not result in the breach of or default under any obligation or agreement to
which it or its affiliates is a party or by which it or its affiliates is bound,
or by which any of its or their material assets is affected.

 

 
4.1.4
Other than as contemplated by this Agreement, no consents, approvals,
registrations, authorizations or permits are required to be obtained by it or
any of its affiliates in connection with the execution or performance of this
Agreement or any Transaction Document to which it or any of its affiliates is or
may be a party, the failure to make or obtain any of which would (a) prevent or
delay performance of this Agreement or any of the transactions contemplated in
the Transaction Documents or (b) subject it or any of its affiliates to any
material liability.

 

--------------------------------------------------------------------------------

4.2
Additional Warranties by CME Ltd

 
CME Ltd warrants to PPF as at the Execution Date that each of the statements set
forth below is true, accurate and not misleading as at that date:
 

 
4.2.1
CME Ltd owns 100% of Central European Media Enterprises N.V., a company
organized under the laws of the Netherlands Antilles.

 

 
4.2.2
Central European Media Enterprises N.V. owns 100% of CME ME.

 

 
4.2.3
The class A common stock of CME Ltd is currently listed on The Nasdaq National
Market.

 
4.3
Additional Warranties by PPF

 
PPF warrants to each of the CME Parties as at the Execution Date that each of
the statements set forth below is true, accurate and not misleading as at that
date:
 

 
4.3.1
PPF has the exclusive and unrestricted right, save for the requisite corporate
approvals set forth in Clause 7.2, to sell the TV Nova Group to CME ME on the
terms set out in this Agreement.

 

 
4.3.2
PPF's ownership interest in the TV Nova Group and each element thereof is free
from all pre-emption rights, rights of first refusal and other rights
exercisable by third parties, except as disclosed against this Warranty in the
relevant section of the Disclosure Letter.

 

 
4.3.3
There are no arrangements or agreements between any of the PPF Group and the
government of the Czech Republic with respect to TV Nova, CET 21 or the TV Nova
License.

 

 
4.3.4
There are no arrangements or agreements by or with any of the PPF Group to sell
the TV Nova Group or any material part or material assets thereof.

 

 
4.3.5
Except for the TV JOJ Ownership Interests and Kratky film Praha a.s. interest
disclosed against this Warranty in the relevant section of the Disclosure
Letter, no member of the PPF Group has any other direct or indirect ownership
interest or participation rights in any Television Business in the Czech
Republic or elsewhere other than its ownership interests in the TV Nova Group.

 

 
4.3.6
The Original TV Nova Combined Accounts were prepared in accordance with IFRS
consistently applied and fairly represent the financial condition and results of
operations and cash flows of the TV Nova Business as at 31 December 2003.

 

 
4.3.7
Since the date of the Original TV Nova Combined Accounts, no event or
circumstance has occurred that would constitute a Material Adverse Effect with
respect to the TV Nova Business, and no event exists or has occurred that will
or is likely to give rise to any such Material Adverse Effect.

 

--------------------------------------------------------------------------------

 
4.3.8
From September 5, 2003, until the Execution Date, PPF and its affiliates have
received 100% (save for immaterial amounts) of the cash flow distributed as
profit from the TV Nova Business.

 

 
4.3.9
Except as disclosed against this Warranty in the relevant section of the
Disclosure Letter, neither PPF nor any member of the PPF Group is aware of any
fact or circumstance that would materially modify the proportion of any
distributable cash flow to be received from the TV Nova Business after Closing.

 

 
4.3.10
Full and complete copies (subject only to deletion of schedules or annexes
thereto that PPF has determined are not relevant to the TV Nova Business as of
the Execution Date and that would not be of material interest or value to CME ME
in due diligence) of the documents listed on the Data Room Index and the
Additional Disclosed Documents Index attached as annexes to the Disclosure
Letter, have been or are provided in the data rooms established by PPF in (i) 12
St. James' Square, London, (ii) CityPoint, One Ropemaker Street, London, (iii)
Na Strzi 40, Prague 4, (iv) Krizeneckeho nam. 322/5, Prague, (v) Krizeneckeho
nam. 1078/5, Prague, and (vi) the Law Offices of Brzobohaty, Broz and Honsa,
Prague, or in certain instances delivered to CME ME's legal advisors in Prague.
The documents listed on the Data Room Index and the Additional Disclosed
Documents Index and provided in the data rooms are all documents existing within
each of the categories of documents identified in such indices, subject to the
disclosure thresholds set forth in such indices.

 

 
4.3.11
Neither this Agreement nor any of the Transaction Documents contains any untrue
statement of a material fact or omits to state a material fact necessary to make
the statements contained herein or therein, in light of the circumstances in
which they are made, not misleading; provided, however, that this Warranty by
PPF excludes any Warranty given by either of the CME Parties.

 

 
4.3.12
No schedule, annex, statement, document, certificate or other information (to
the extent that such documents or information relate to the period of time
during which PPF owned any Ownership Interest in the TV Nova Business) furnished
to either CME Party (i) by or on behalf of the PPF Group, (ii) by any of the
senior management of the TV NOVA Group (as such senior management are designated
in the 2003 Annual Report of PPF published on its website www.ppf.cz), or (iii)
to the best of PPF's knowledge and belief, by the Auditors, in connection with
this Agreement or any of the transactions contemplated hereby, contains any
untrue statement of a material fact or omits to state a material fact necessary
to make the statements contained herein or therein, in light of the
circumstances in which they are made, not misleading.

 

 
4.3.13
To the best of PPF's knowledge and belief, no schedule, annex, statement,
document, certificate or other information (to the extent that such information
relates to the period of time during which PPF had no Ownership Interest in the
TV Nova Business) furnished to either CME Party (i) by or on behalf of the PPF
Group or (ii) by any of the senior management of the TV NOVA Group (as such
senior management are designated in the 2003 Annual Report of PPF published on
its website www.ppf.cz), in connection with this Agreement or any of the
transactions contemplated hereby, contains any untrue statement of a material
fact or omits to state a material fact necessary to make the statements
contained herein or therein, in light of the circumstances in which they are
made, not misleading.

 

--------------------------------------------------------------------------------

 
4.3.14
The reported total operating revenues in the Combined Accounts of CET 21, CP
2000 and MAG MEDIA, prepared in accordance with Czech accounting standards, for
the first 10 months of 2004 are not less than CZK 4,035,670,000, profit from
operations (EBIT) for the same period was not less than CZK 1,954,169,000, and
profit before tax for the same period was not less than CZK 1,793,418,000. The
values for profit from operations and profit before tax each were affected by
the release of provisions in the amount of CZK 211,357,000.

 

 
4.3.15
The Total Assets of the PPF Group Guarantor as of December 31, 2003 were not
less than CZK 170 billion and the Shareholders Equity of the PPF Group Guarantor
as of December 31, 2003 was not less than CZK 9 billion, and since that date no
event or circumstance has occurred that would render the PPF Group Guarantor
unable to perform its obligations under the PPF Group Guarantee, and no event
exists to the knowledge of PPF that will or is likely to render the PPF Group
Guarantor unable to perform its obligations under the PPF Group Guarantee.

 
4.4
Warranties by PPF Relating to the Ownership Interests and the Programming
Library

 
PPF warrants to each of the CME Parties as at the Execution Date that each of
the statements set forth below is true, accurate and not misleading as at that
date:
 

 
4.4.1
The CP 2000 Ownership Interest owned by PPF is equal to 100%, and represents the
portion of the votes in the General Meeting equal to 100%.

 

 
4.4.2
Except as disclosed against this Warranty in the relevant section of the
Disclosure Letter, PPF's CP 2000 Ownership Interest is free from all liens,
charges, equities, encumbrances, pre-emption rights, rights of first refusal and
other rights exercisable by third parties.

 

 
4.4.3
The MAG MEDIA Ownership Interest owned by CP 2000 is equal to 100%, and
represents the portion of the votes in the General Meeting equal to 100%, and
such Ownership Interest is free from all liens, charges, equities, encumbrances,
pre-emption rights, rights of first refusal and other rights exercisable by
third parties.

 

--------------------------------------------------------------------------------

 
4.4.4
The Nova Consulting Ownership Interest owned by CP 2000 is equal to 100%, and
represents the portion of the votes in the General Meeting equal to 100%, and
such Ownership Interest is free from all liens, charges, equities, encumbrances,
pre-emption rights, rights of first refusal and other rights exercisable by
third parties.

 

 
4.4.5
The CPI Ownership Interest owned by CP 2000 is equal to 100%, and represents the
portion of the votes in the General Meeting equal to 100%, and such Ownership
Interest is free from all liens, charges, equities, encumbrances, pre-emption
rights, rights of first refusal and other rights exercisable by third parties.

 

 
4.4.6
The Media Capitol Ownership Interest owned by CPI is equal to 100%, and
represents the portion of the votes in the General Meeting equal to 100%, and
such Ownership Interest is free from all liens, charges, equities, encumbrances,
pre-emption rights, rights of first refusal and other rights exercisable by
third parties.

 

 
4.4.7
The ERIKA Ownership Interest owned by CPI is equal to 100%, and represents the
portion of the votes in the General Meeting equal to 100%, and such Ownership
Interest is free from all liens, charges, equities, encumbrances, pre-emption
rights, rights of first refusal and other rights exercisable by third parties.

 

 
4.4.8
The MEF Media Ownership Interest owned by PPF is equal to or greater than
66.67%, and represents the portion of the votes in the General Meeting equal to
or greater than 66.67%, and the PPF Media Ownership Interest owned by PPF is
equal to or greater than 66.67%, and represents the portion of the votes in the
General Meeting equal to or greater than 66.67%, and in each case such Ownership
Interest is free from all liens, charges, equities, encumbrances, pre-emption
rights, rights of first refusal and other rights exercisable by third parties,
and in each case is sufficient for PPF to be able to cause MEF Media and PPF
Media to cause TVNH to transfer its Vilja Ownership Interest to Newco as
provided herein.

 

 
4.4.9
The aggregate TVNH Ownership Interest owned by MEF Media and PPF Media and is
equal to 100%, and collectively represents 100% of the votes in the General
Meeting, and such Ownership Interests are free from all liens, charges,
equities, encumbrances, pre-emption rights, rights of first refusal and other
rights exercisable by third parties.

 

 
4.4.10
TVNH owns the Vilja Ownership Interest which is equal to 100% and represents the
portion of the votes in the General Meeting of Vilja equal to 100%, and such
Ownership Interest is free from all liens, charges, equities, encumbrances,
pre-emption rights, rights of first refusal and other rights exercisable by
third parties.

 

 
4.4.11
Vilja owns the CET 21 Ownership Interest which is equal to 52.075% and
represents the portion of the votes in the General Meeting of CET 21 equal to at
least 52.075%, and except as disclosed against this Warranty in the relevant
section of the Disclosure Letter, such Ownership Interest is free from all
liens, charges, equities, encumbrances, pre-emption rights, rights of first
refusal and other rights exercisable by third parties. Vilja's CET 21 Ownership
Interest has been properly notified to CET 21.

 

--------------------------------------------------------------------------------

 
4.4.12
CET 21 owns 100% of the Plejada Ownership Interest, which represent the portion
of the votes in the General Meeting of Plejada equal to 100%, free from all
liens, charges, equities, encumbrances, pre-emption rights, rights of first
refusal and other rights exercisable by third parties, other than those arising
as a result of Plejada's liquidation proceedings.

 

 
4.4.13
Except as disclosed against this Warranty in the relevant section of the
Disclosure Letter, PPF has agreed to acquire a 1.25% Ownership Interest in CET
21 from CEDC, conditional on Media Council Consent, pursuant to an Agreement on
Transfer of Ownership Interest between PPF and CEDC dated October 23, 2003. PPF
has made a full and complete application to the Media Council for approval of
the transfer of this 1.25% CET 21 Ownership Interest.

 

 
4.4.14
Except as disclosed against this Warranty in the relevant section of the
Disclosure Letter, Vilja has agreed to acquire a 1.25% Ownership Interest in CET
21 from CS, conditional on Media Council Consent, pursuant to an Agreement on
transfer of Ownership Interest between CS and Vilja dated April 2, 2003. Vilja
has made a full and complete application to the Media Council for approval of
the transfer of this 1.25% CET 21 Ownership Interest.

 

 
4.4.15
Except as disclosed against this Warranty in the relevant section of the
Disclosure Letter, CET 21 owns 28.755% of the CET 21 Registered Capital in the
form of a treasury interest.

 

 
4.4.16
Except as disclosed against this Warranty in the relevant section of the
Disclosure Letter and except for the Programming Library Pledge, the Programming
Library is free from all liens, charges, equities, encumbrances, pre-emption
rights, rights of first refusal and other rights exercisable by persons other
than the TV Nova Group or AQS, other than those in favor of the relevant
licensors.

 

 
4.4.17
Except as disclosed against this Warranty in the relevant section of the
Disclosure Letter, AQS has full title to, leases for, or other valid rights to
use the Programming Library for the benefit of TV Nova, and in those disclosed
circumstances where AQS may not have full title to, leases for, or other valid
rights to use the Programming Library for the benefit of TV Nova, there have
been no claims asserted or threatened by the relevant licensor or any third
party that are likely to adversely affect the rights of AQS or TV Nova to use
the Programming Library. Except as disclosed against this Warranty in the
relevant section of the Disclosure Letter, TV Nova is the sole and exclusive
licensee of all programming held in the Programming Library and has received
valid consent to use the rights under any programming license agreement or
similar arrangement entered into on behalf of or for the benefit of TV Nova
whether by AQS or otherwise.

 

--------------------------------------------------------------------------------

 
4.4.18
No dispute (whether pursuant to court or arbitration proceedings or otherwise)
regarding any programming license agreements entered into by or on behalf of TV
Nova are pending or threatened. The TV Nova Group has duly acquired all
intellectual property rights for broadcasting all of its programs and there have
not been any claims that the broadcasting of such programs violates any
intellectual property rights of any third party.

 

 
4.4.19
Document number 1 referred to in the Additional Disclosed Documents Index No. 33
provides a list and brief description of all contracts or other transactions
which are in force on the Execution Date between the TV Nova Group and any
officer, director or employee or other related person of any of the PPF Group
and such list is true, accurate and complete in all material respects as at the
Execution Date.

 

 
4.4.20
No officer, director or employee or other related person of any of the PPF Group
is presently party to any material non-arm's length transactions with any other
person involved in the TV Nova Business.

 
4.5
Warranties by PPF Relating to CET 21

 
PPF warrants to each of the CME Parties as at the Execution Date that each of
the statements set forth below is true, accurate and not misleading as at that
date:
 

 
4.5.1
Except as disclosed against this Warranty in the relevant section of the
Disclosure Letter, CET 21 is a limited liability company duly organized and
validly existing in accordance with the laws of the Czech Republic, registered
in the Commercial Register kept by the City Court in Prague, the Czech Republic,
file number C 10581, identification number 45800456, with its seat at
Kříženeckého nám. 322/5, Prague 5, the Czech Republic.

 

 
4.5.2
Except as disclosed against this Warranty in the relevant section of the
Disclosure Letter, a true and complete copy of CET 21's Memorandum of
Association, which to the best of PPF's knowledge and belief is valid for
purposes of the corporate governance of CET 21 is document 3.2 on the Data Room
Index, provided, however, that as disclosed against this Warranty in the
relevant section of the Disclosure Letter there are certain challenges pending
with respect to CET 21's Memorandum of Association.

 

 
4.5.3
CET 21 has all licenses (including the TV Nova License), permits or other
approvals necessary to enable it to conduct the TV Nova Business as currently
conducted, including all requisite regulatory approvals and authorizations to
carry on the business as a broadcaster and each such license, permit or other
approval is valid, and no person in the PPF Group is aware of any reason arising
since August 30, 1996 that would form the basis for any such license, permit or
other approval to be withdrawn, not renewed in due course, or materially
modified.

 

--------------------------------------------------------------------------------

 
4.5.4
Except as disclosed against this Warranty in the relevant section of the
Disclosure Letter, CET 21 is in compliance with all applicable laws, regulatory
rules, licenses, permits and approvals, and has not received any notice which,
after receipt or lapse of time or both, would constitute non-compliance with any
applicable law, regulatory rule, license, permit or approval.

 

 
4.5.5
CET 21 has not at any time engaged in any business or owned any business or
entity other than business related directly to TV Nova other than in relation to
TV JOJ.

 

 
4.5.6
CET 21 has full title to, leases for, or other valid rights to use all material
assets used for the operation of the TV Nova Business as of the date hereof;
provided, however, that as disclosed against this Warranty in the relevant
section of the Disclosure Letter certain persons have claimed that they are the
executive directors of CET 21, and in such capacity may have attempted to affect
CET 21's title to its material assets, but to the best knowledge of PPF, after
due inquiry, there have been no legal acts made or purported to be made by any
of such persons that would make this Warranty incorrect.

 

 
4.5.7
CET 21 is not and has not been subject to any bankruptcy proceedings.

 

 
4.5.8
All material contracts of CET 21 have been disclosed to CME ME, and all such
material contracts are in full force and effect, and, to the knowledge of PPF,
without any material breach, threatened termination or other similar
circumstance; provided, however, that as disclosed against this Warranty in the
relevant section of the Disclosure Letter certain persons have claimed that they
are the executive directors of CET 21, and in such capacity may have attempted
to cause CET 21 to enter into contracts, but to the best knowledge of PPF, after
due inquiry, there have been no legal acts made or purported to be made by any
of such persons that would make this Warranty incorrect.

 

 
4.5.9
CET 21 has, in accordance with prevailing Tax Laws of the relevant Tax
Authority, (i) timely filed Tax returns that are in all material respects true,
correct and complete and timely paid all Taxes that are due and payable with
respect to its operations and assets, except for Taxes that are contested in
good faith by appropriate proceedings and for which adequate reserves have been
established, and all such Tax returns have been audited by the relevant Tax
Authority or are closed by the applicable statute of limitations for all taxable
years, (ii) established reserves that are adequate for the payment of Taxes not
yet due and payable but which relate to the carrying out of business of CET 21
prior to the date hereof, (iii) carried out all transactions with related
persons at fair market price and on an arm's length basis, (iv) properly
recorded in its accounting records, financial statements and Tax or other
official returns, the creation and release of reserves and provisions, all
transactions with securities and derivatives and properly calculated all
material non-deductible expenses and tax-exempt income, and (v) has no
outstanding Tax or similar fiscal liabilities.

--------------------------------------------------------------------------------

 
4.5.10
The audited financial statements and balance sheet of CET 21 dated as of
December 31, 2003 have been disclosed to CME ME and fairly reflect the financial
condition and results of operations of CET 21 as of that date, and there has
been in aggregate no material negative change to such condition and results of
operations as of the date hereof, except for such changes as have been disclosed
to CME ME.

 

 
4.5.11
CET 21's accounts make full and proper provision for (or, if appropriate,
disclose by way of notes) all liabilities (whether actual, contingent,
quantified or disputed) of CET 21 as at or on the date of such accounts, to the
extent required by the accounting standards applicable to such accounts, and
there are no other liabilities of CET 21 as at or on the date of such accounts.

 

 
4.5.12
Other than pursuant to or in connection with the CNTS Settlement and the CNTS
Lease, there is no other business or other relationship or pending or threatened
claims between (a) CNTS and (b) CET 21 or any other person involved in the TV
Nova Business, whether current or contemplated.

 

 
4.5.13
The unpaid amount of the CNTS Settlement, including interest, determined by
application of IFRS, was CZK 1,274,736,000 as of November 30, 2004, in relation
to the agreed amount and, to the best knowledge of PPF, not more than CZK
9,212,000 in relation to the undecided intellectual property claims.

 

 
4.5.14
Except as disclosed against this Warranty in the relevant section of the
Disclosure Letter, there are no material Claims pending or, to the knowledge of
PPF, threatened, before any court, arbitration panel, public administrative
authority, institution or other person against or adversely affecting CET 21.

 

 
4.5.15
CET 21 has full title to all trade marks and any other intellectual property
related to TV Nova that are registered in favor of CET 21 by the relevant
authorities in the Czech Republic or elsewhere.

 

 
4.5.16
CET 21 has no subsidiaries other than Plejada.

 

 
4.5.17
There are no unpaid or unsatisfied liabilities or other obligations of CET 21
(other than those incurred in the ordinary course of business), or causes of
action of any nature (vested or contingent) from or against, any of the PPF
Group or any person controlled by any of the PPF Group, and there are no unpaid
or unsatisfied liabilities or other obligations of any of the PPF Group or any
person controlled by any of the PPF Group to CET 21 (other than those incurred
in the ordinary course of business), and no member of the PPF Group has assigned
or transferred or purported to assign or transfer to any person outside of the
PPF Group any liabilities or other obligations of CET 21 or causes of action of
any nature (vested or contingent) in respect of the TV Nova Business.

 

--------------------------------------------------------------------------------

 
4.5.18
Except as disclosed against this Warranty in the relevant section of the
Disclosure Letter, there are no past or currently pending, or, to the knowledge
of PPF, threatened actions, proceedings or investigations, whether civil or
criminal, against CET 21 or the presently incumbent directors or managers of CET
21 or the present employees of CET 21 (in connection with their employment with
the company).

 

 
4.5.19
Other than the single instance disclosed against this Warranty in the relevant
section of the Disclosure Letter, there have been no other fines, penalties or
other sanctions imposed on CET 21 by the Media Council pursuant to Section 32(1)
of the Media Act or any other provision of the Media Act within the last
twenty-four months prior to the Execution Date, and PPF is not aware of any
facts or circumstances occurring during such period that could form the basis
for the Media Council to impose a fine, penalty or other sanction pursuant to
Section 32(1) of the Media Act or that could form the basis for the Media
Council to revoke the TV Nova License pursuant to Section 63 of the Media Act.

 
4.6
Warranties by PPF Related to the TV Nova Group Companies and Other Entities

 
PPF warrants to each of the CME Parties as at the Execution Date that each of
the statements set forth below is true, accurate and not misleading as at that
date:
 

 
4.6.1
CP 2000

 

 
(A)
CP 2000 is a joint stock company duly organized and validly existing in
accordance with the laws of the Czech Republic, registered in the Commercial
Register of the City Court in Prague, file number B 5264, identification number
25653431, with its seat at Prague 5, Hlubocepy, Krizeneckeho nam. 322/5.

 

 
(B)
A true and complete copy of CP 2000's Articles of Association as in effect on
the Execution Date and an excerpt from the Commercial Register of CP 2000 with
current information as of the Execution Date have been disclosed to CME ME.

 

 
(C)
The entire registered capital of CP 2000 amounts to CZK 625,000,000.

 

 
(D)
CP 2000 is in compliance with all applicable laws, regulatory rules, licenses,
permits and approvals, and has not received any notice which, after receipt or
lapse of time or both, would constitute non-compliance with any applicable law,
regulatory rule, license, permit or approval, except as disclosed against this
Warranty in the relevant section of the Disclosure Letter.

 

 
(E)
CP 2000 has not at any time engaged in any business or owned any business or
entity other than business related directly to the TV Nova Business or TV JOJ.

 

--------------------------------------------------------------------------------

 
(F)
CP 2000 has full title to, leases for, or other valid rights to use all assets
used for the operation of its business as of the date hereof.

 

 
(G)
CP 2000 is not and has not been subject to any bankruptcy, insolvency, or
liquidation proceedings.

 

 
(H)
CP 2000 has no subsidiaries other than MAG MEDIA, Nova Consulting, CPI and MEF
Media, a.s., and CP 2000 has a 50% Ownership Interest in Mag Media a.s. and
Slovenska Produckna a.s. MEF Media a.s., Mag Media a.s. and Slovenska Produckna
a.s. are not parties to any material contracts related to the TV Nova Business.

 

 
(I)
CP 2000 owns 100% of all outstanding shares in MEF Media a.s., which represent
the portion of the votes in the General Meeting of each such subsidiary equal to
100%, free from all liens, charges, equities, encumbrances, pre-emption rights,
rights of first refusal and other rights exercisable by third parties.

 

 
(J)
All material contracts of CP 2000 have been disclosed to CME ME, and all such
material contracts are in full force and effect, and, to the knowledge of PPF
after due inquiry, without any material breach, threatened termination or other
similar circumstance.

 

 
(K)
CP 2000 has, in accordance with prevailing Tax Laws of the relevant Tax
Authority, (i) timely filed Tax returns that are in all material respects true,
correct and complete and timely paid all Taxes that are due and payable with
respect to its operations and assets, except for Taxes that are contested in
good faith by appropriate proceedings and for which adequate reserves have been
established, and all such Tax returns have been audited by the relevant Tax
Authority or are closed by the applicable statute of limitations for all taxable
years, (ii) established reserves that are adequate for the payment of Taxes not
yet due and payable but which relate to the carrying out of its business prior
to the date hereof, (iii) carried out all transactions with related persons at
fair market price and on an arm's length basis, (iv) properly recorded in its
accounting records, financial statements and Tax or other official returns, the
creation and release of reserves and provisions, all transactions with
securities and derivatives, and properly calculated all material non-deductible
expenses and tax-exempt income, and (v) has no outstanding Tax or similar fiscal
liabilities.

 

 
(L)
The audited financial statements and balance sheet of CP 2000 dated as of
December 31, 2003 have been disclosed to CME ME and fairly reflect the financial
condition and results of operations of CP 2000 as of that date, and there has
been in aggregate no material negative change to such condition or results of
operations as of the date hereof, except for such changes as have been disclosed
in the relevant section of the Disclosure Letter.

 

 
(M)
CP 2000's accounts make full and proper provision for (or, if appropriate,
disclose by way of notes) all liabilities (whether actual, contingent,
quantified or disputed) of CP 2000 as at or on the date of such accounts, to the
extent required by the accounting standards applicable to such accounts, and
there are no other liabilities of CP 2000.

 

--------------------------------------------------------------------------------

 
(N)
Except as disclosed against this Warranty in the relevant section of the
Disclosure Letter, there are no material Claims pending or, to the knowledge of
PPF, threatened, before any court, arbitration panel, public administrative
authority, institution or other person against or adversely affecting CP 2000.

 

 
(O)
CP 2000 has full title to all trade marks and any other intellectual property
related to TV Nova that are registered in favor of CP 2000 by the relevant
authorities in the Czech Republic or elsewhere.

 

 
(P)
Except as disclosed against this Warranty in the relevant section of the
Disclosure Letter, there are no unpaid or unsatisfied liabilities or other
obligations of CP 2000 (other than those incurred in the ordinary course of
business) to, or causes of action of any nature (vested or contingent) from or
against, any of the PPF Group or any person controlled by any of the PPF Group,
and there are no unpaid or unsatisfied liabilities or other obligations of any
of the PPF Group or any person controlled by any of the PPF Group to CP 2000
(other than those incurred in the ordinary course of business), and no member of
the PPF Group has assigned or transferred or purported to assign or transfer to
any person outside the PPF Group any liabilities or other obligations of CP 2000
or causes of action of any nature (vested or contingent) in respect of the TV
Nova Business.

 

 
(Q)
Except as disclosed against this Warranty in the relevant section of the
Disclosure Letter, there are no past or currently pending, or, to the knowledge
of PPF, threatened actions proceedings or investigations, whether civil or
criminal, against CP 2000 or the presently incumbent directors or managers of CP
2000 or the present employees of CP 2000 (in connection with their employment
with the company).

 

 
4.6.2
MAG MEDIA

 

 
(A)
MAG MEDIA is a joint stock company duly organized and validly existing in
accordance with the laws of the Czech Republic, registered in the Commercial
Register of the City Court in Prague, file number B 6065, identification number
25788124, with its seat at Prague 1, Lazarska 5.

 

 
(B)
A true and complete copy of MAG MEDIA's Articles of Association as in effect on
the Execution Date and an excerpt from the Commercial Register of MAG MEDIA with
current information as of the Execution Date have been disclosed to CME ME.

 

 
(C)
The entire registered capital of MAG MEDIA amounts to CZK 210,000,000, of which
CZK 63,700,000 has been paid in accordance with applicable law.

 

--------------------------------------------------------------------------------

 
(D)
MAG MEDIA is in compliance with all applicable laws, regulatory rules, licenses,
permits and approvals, and has not received any notice which, after receipt or
lapse of time or both, would constitute non-compliance with any applicable law,
regulatory rule, license, permit or approval.

 

 
(E)
MAG MEDIA has not at any time engaged in any business or owned any business or
entity other than business related directly to TV Nova.

 

 
(F)
MAG MEDIA has full title to, leases for, or other valid rights to use all assets
used for the operation of its business as of the date hereof.

 

 
(G)
MAG MEDIA is not and has not been subject to any bankruptcy, insolvency, or
liquidation proceedings.

 
(H)
MAG MEDIA has no subsidiaries.

 

 
(I)
All material contracts of MAG MEDIA have been disclosed to CME ME, and except as
disclosed against this Warranty in the relevant section of the Disclosure Letter
all such material contracts are in full force and effect, and, to the knowledge
of PPF after due inquiry, without any material breach, threatened termination or
other similar circumstance.

 

 
(J)
MAG MEDIA has, in accordance with prevailing Tax Laws of the relevant Tax
Authority, (i) timely filed Tax returns that are in all material respects true,
correct and complete and timely paid all Taxes that are due and payable with
respect to its operations and assets, except for Taxes that are contested in
good faith by appropriate proceedings and for which adequate reserves have been
established, and all such Tax returns have been audited by the relevant Tax
Authority or are closed by the applicable statute of limitations for all taxable
years, (ii) established reserves that are adequate for the payment of Taxes not
yet due and payable but which relate to the carrying out of its business prior
to the date hereof, (iii) carried out all transactions with related persons at
fair market price and on an arm's length basis, (iv) properly recorded in its
accounting records, financial statements and Tax or other official returns, the
creation and release of reserves and provisions, all transactions with
securities and derivatives, and properly calculated all material non-deductible
expenses and tax-exempt income, and (v) has no outstanding Tax or similar fiscal
liabilities.

 

 
(K)
The audited financial statements and balance sheet of MAG MEDIA dated as of
December 31, 2003, has been disclosed to CME ME and fairly reflect the financial
condition and results of operations of MAG MEDIA as of that date, and there has
been in aggregate no material negative change to such condition or results of
operations as of the date hereof, except for such changes as have been disclosed
to CME ME.

 

 
(L)
MAG MEDIA's accounts make full and proper provision for (or, if appropriate,
disclose by way of notes) all liabilities (whether actual, contingent,
quantified or disputed) of MAG MEDIA as at or on the date of such accounts, to
the extent required by the accounting standards applicable to such accounts, and
there are no other liabilities of MAG MEDIA.

--------------------------------------------------------------------------------

 
(M)
There are no material Claims pending or, to the knowledge of PPF, threatened,
before any court, arbitration panel, public administrative authority,
institution or other person against or adversely affecting MAG MEDIA.

 

 
(N)
MAG MEDIA has full title to all trade marks and any other intellectual property
related to TV Nova that are registered in favor of MAG MEDIA by the relevant
authorities in the Czech Republic or elsewhere.

 

 
(O)
There are no unpaid or unsatisfied liabilities or other obligations of MAG MEDIA
(other than those incurred in the ordinary course of business) to, or causes of
action of any nature (vested or contingent) from or against, any of the PPF
Group or any person controlled by any of the PPF Group, and there are no unpaid
or unsatisfied liabilities or other obligations of any of the PPF Group or any
person controlled by any of the PPF Group to MAG MEDIA (other than those
incurred in the ordinary course of business), and no member of the PPF Group has
assigned or transferred or purported to assign or transfer to any person outside
the PPF Group any liabilities or other obligations of MAG MEDIA or causes of
action of any nature (vested or contingent) in respect of the TV Nova Business.

 

 
(P)
There are no past or currently pending, or, to the knowledge of PPF, threatened
actions proceedings or investigations, whether civil or criminal, against MAG
MEDIA or the presently incumbent directors or managers of MAG MEDIA or the
present employees of MAG MEDIA (in connection with their employment with the
company).

 

 
4.6.3
Nova Consulting

 

 
(A)
Nova Consulting is a joint stock company duly organized and validly existing in
accordance with the laws of the Czech Republic, registered in the Commercial
Register of the City Court in Prague, file number B 4268, identification number
25084500, with its seat at Prague 1, Jungmannova 17.

 

 
(B)
A true and complete copy of Nova Consulting's Articles of Association as in
effect on the Execution Date and an excerpt from the Commercial Register of Nova
Consulting with current information as of the Execution Date have been disclosed
to CME ME.

 

 
(C)
The entire registered capital of Nova Consulting amounts to CZK 1,000,000.

 

 
(D)
Nova Consulting is in compliance with all applicable laws, regulatory rules,
licenses, permits and approvals, and has not received any notice which, after
receipt or lapse of time or both, would constitute non-compliance with any
applicable law, regulatory rule, license, permit or approval.

 

--------------------------------------------------------------------------------

 
(E)
Nova Consulting has not at any time engaged in any business or owned any
business or entity other than business related directly to TV Nova.

 

 
(F)
Nova Consulting has full title to, leases for, or other valid rights to use all
assets used for the operation of its business as of the date hereof.

 

 
(G)
Nova Consulting is not and has not been subject to any bankruptcy, insolvency,
or liquidation proceedings.

 

 
(H)
Nova Consulting has no subsidiaries.

 

 
(I)
All material contracts of Nova Consulting have been disclosed to CME ME, and all
such material contracts are in full force and effect, and, to the knowledge of
PPF after due inquiry, without any material breach, threatened termination or
other similar circumstance.

 

 
(J)
Nova Consulting has, in accordance with prevailing Tax Laws of the relevant Tax
Authority, (i) timely filed Tax returns that are in all material respects true,
correct and complete and timely paid all Taxes that are due and payable with
respect to its operations and assets, except for Taxes that are contested in
good faith by appropriate proceedings and for which adequate reserves have been
established, and all such Tax returns have been audited by the relevant Tax
Authority or are closed by the applicable statute of limitations for all taxable
years, (ii) established reserves that are adequate for the payment of Taxes not
yet due and payable but which relate to the carrying out of its business prior
to the date hereof, (iii) carried out all transactions with related persons at
fair market price and on an arm's length basis, (iv) properly recorded in its
accounting records, financial statements and Tax or other official returns, the
creation and release of reserves and provisions, all transactions with
securities and derivatives, and properly calculated all material non-deductible
expenses and tax-exempt income, and (v) has no outstanding Tax or similar fiscal
liabilities.

 

 
(K)
The audited financial statements and balance sheet of Nova Consulting dated as
of December 31, 2003 has been disclosed to CME ME and fairly reflect the
financial condition and results of operations of Nova Consulting as of that
date, and there has been in aggregate no material negative change to such
condition or results of operations as of the date hereof, except for such
changes as have been disclosed to CME ME.

 

 
(L)
Nova Consulting's accounts make full and proper provision for (or, if
appropriate, disclose by way of notes) all liabilities (whether actual,
contingent, quantified or disputed) of Nova Consulting as at or on the date of
such accounts, to the extent required by the accounting standards applicable to
such accounts, and there are no other liabilities of Nova Consulting.

 

--------------------------------------------------------------------------------

 
(M)
There are no material Claims pending or, to the knowledge of PPF, threatened,
before any court, arbitration panel, public administrative authority,
institution or other person against or adversely affecting Nova Consulting.

 

 
(N)
Nova Consulting has no trade marks or any other intellectual property rights
related to TV Nova that are registered in favor of Nova Consulting by the
relevant authorities in the Czech Republic or elsewhere.

 

 
(O)
There are no unpaid or unsatisfied liabilities or other obligations of Nova
Consulting (other than those incurred in the ordinary course of business) to, or
causes of action of any nature (vested or contingent) from or against, any of
the PPF Group or any person controlled by any of the PPF Group, and there are no
unpaid or unsatisfied liabilities or other obligations of any of the PPF Group
or any person controlled by any of the PPF Group to Nova Consulting (other than
those incurred in the ordinary course of business), and no member of the PPF
Group has assigned or transferred or purported to assign or transfer to any
person outside the PPF Group any liabilities or other obligations of Nova
Consulting or causes of action of any nature (vested or contingent) in respect
of the TV Nova Business.

 

 
(P)
There are no past or currently pending, or, to the knowledge of PPF, threatened
actions proceedings or investigations, whether civil or criminal, against Nova
Consulting or the presently incumbent directors or managers of Nova Consulting
or the present employees of Nova Consulting (in connection with their employment
with the company).

 

 
4.6.4
CPI

 

 
(A)
CPI is a joint stock company duly organized and validly existing in accordance
with the laws of the Czech Republic, registered in the Commercial Register of
the City Court in Prague, file number B 7123, identification number 26438615,
with its seat at Prague 1, Na Prikope 12/853.

 

 
(B)
A true and complete copy of CPI's Articles of Association as in effect on the
Execution Date and an excerpt from the Commercial Register of CPI with current
information as of the Execution Date have been disclosed to CME ME.

 

 
(C)
The entire registered capital of CPI amounts to CZK 150,000,000.

 
(D)
Except as disclosed against this Warranty in the relevant section of the
Disclosure Letter, CPI is in compliance with all applicable laws, regulatory
rules, licenses, permits and approvals, and has not received any notice which,
after receipt or lapse of time or both, would constitute non-compliance with any
applicable law, regulatory rule, license, permit or approval.

 

--------------------------------------------------------------------------------

 
(E)
CPI has not at any time engaged in any business or owned any business or entity
other than business related directly to the TV Nova Business or TV JOJ.

 

 
(F)
CPI has full title to, leases for, or other valid rights to use all assets used
for the operation of its business as of the date hereof.

 

 
(G)
CPI is not and has not been subject to any bankruptcy, insolvency, or
liquidation proceedings.

 

 
(H)
CPI has no subsidiaries other than ERIKA and Media Capitol, but CPI has a 49.18%
Ownership Interest in MAC TV, a Slovak limited liability company that holds part
of the PPF Group's interest in TV JOJ, as disclosed in the relevant section of
the Disclosure Letter.

 

 
(I)
All material contracts of CPI have been disclosed to CME ME, and all such
material contracts are in full force and effect, and, to the knowledge of PPF
after due inquiry, without any material breach, threatened termination or other
similar circumstance.

 

 
(J)
CPI has, in accordance with prevailing Tax Laws of the relevant Tax Authority,
(i) timely filed Tax returns that are in all material respects true, correct and
complete and timely paid all Taxes that are due and payable with respect to its
operations and assets, except for Taxes that are contested in good faith by
appropriate proceedings and for which adequate reserves have been established,
and all such Tax returns have been audited by the relevant Tax Authority or are
closed by the applicable statute of limitations for all taxable years, (ii)
established reserves that are adequate for the payment of Taxes not yet due and
payable but which relate to the carrying out of its business prior to the date
hereof, (iii) carried out all transactions with related persons at fair market
price and on an arm's length basis, (iv) properly recorded in its accounting
records, financial statements and Tax or other official returns, the creation
and release of reserves and provisions, all transactions with securities and
derivatives, and properly calculated all material non-deductible expenses and
tax-exempt income, and (v) has no outstanding Tax or similar fiscal liabilities.

 

 
(K)
The audited financial statements and balance sheet of CPI dated as of December
31, 2003, has been disclosed to CME ME and fairly reflect the financial
condition and results of operations of CPI as of that date, and there has been
in aggregate no material negative change to such condition or results of
operations as of the date hereof, except for such changes as have been disclosed
to CME ME.

 

 
(L)
CPI's accounts make full and proper provision for (or, if appropriate, disclose
by way of notes) all liabilities (whether actual, contingent, quantified or
disputed) of CPI as at or on the date of such accounts, to the extent required
by the accounting standards applicable to such accounts, and there are no other
liabilities of CPI.

 

 
(M)
Except as disclosed in the relevant section of the Disclosure Letter, there are
no material Claims pending or, to the knowledge of PPF, threatened, before any
court, arbitration panel, public administrative authority, institution or other
person against or adversely affecting CPI.

 

--------------------------------------------------------------------------------

 
(N)
CPI has full title to all trade marks and any other intellectual property
related to TV Nova that are registered in favor of CPI by the relevant
authorities in the Czech Republic or elsewhere.

 

 
(O)
There are no unpaid or unsatisfied liabilities or other obligations of CPI
(other than those incurred in the ordinary course of business) to, or causes of
action of any nature (vested or contingent) from or against, any of the PPF
Group or any person controlled by any of the PPF Group, and there are no unpaid
or unsatisfied liabilities or other obligations of any of the PPF Group or any
person controlled by any of the PPF Group to CPI (other than those incurred in
the ordinary course of business), and no member of the PPF Group has assigned or
transferred or purported to assign or transfer to any person outside the PPF
Group any liabilities or other obligations of CPI or causes of action of any
nature (vested or contingent) in respect of the TV Nova Business.

 

 
(P)
There are no past or currently pending, or, to the knowledge of PPF, threatened
actions proceedings or investigations, whether civil or criminal, against CPI or
the presently incumbent directors or managers of CPI or the present employees of
CPI (in connection with their employment with the company).

 

 
4.6.5
Media Capitol

 

 
(A)
Media Capitol is a joint stock company duly organized and validly existing in
accordance with the laws of the Czech Republic, registered in the Commercial
Register of the City Court in Prague, file number B 7399, identification number
26237580, with its seat at Prague 5, Krizeneckeho nam. 5/322.

 

 
(B)
A true and complete copy of Media Capitol's Articles of Association as in effect
on the Execution Date and an excerpt from the Commercial Register of Media
Capitol with current information as of the Execution Date have been disclosed to
CME ME.

 

 
(C)
The entire registered capital of Media Capitol amounts to CZK 1,000,000.

 

 
(D)
Media Capitol is in compliance with all applicable laws, regulatory rules,
licenses, permits and approvals, and has not received any notice which, after
receipt or lapse of time or both, would constitute non-compliance with any
applicable law, regulatory rule, license, permit or approval.

 

 
(E)
Media Capitol has not at any time engaged in any material business or owned any
business or entity other than business related directly to TV Nova.

 

--------------------------------------------------------------------------------

 
(F)
Media Capitol has full title to, leases for, or other valid rights to use all
assets used for the operation of its business as of the date hereof.

 

 
(G)
Media Capitol is not and has not been subject to any bankruptcy, insolvency, or
liquidation proceedings.

 

 
(H)
Media Capitol has no subsidiaries.

 

 
(I)
Media Capitol is not party to any material contracts.

 

 
(J)
Media Capitol has, in accordance with prevailing Tax Laws of the relevant Tax
Authority, (i) timely filed Tax returns that are in all material respects true,
correct and complete and timely paid all Taxes that are due and payable with
respect to its operations and assets, except for Taxes that are contested in
good faith by appropriate proceedings and for which adequate reserves have been
established, and all such Tax returns have been audited by the relevant Tax
Authority or are closed by the applicable statute of limitations for all taxable
years, (ii) established reserves that are adequate for the payment of Taxes not
yet due and payable but which relate to the carrying out of its business prior
to the date hereof, (iii) carried out all transactions with related persons at
fair market price and on an arm's length basis, (iv) properly recorded in its
accounting records, financial statements and Tax or other official returns, the
creation and release of reserves and provisions, all transactions with
securities and derivatives, and properly calculated all material non-deductible
expenses and tax-exempt income, and (v) has no outstanding Tax or similar fiscal
liabilities.

 

 
(K)
The audited financial statements and balance sheet of Media Capitol dated as of
December 31, 2003 has been disclosed to CME ME and fairly reflect the financial
condition and results of operations of Media Capitol as of that date, and there
has been in aggregate no material negative change to such condition or results
of operations as of the date hereof, except for such changes as have been
disclosed to CME ME.

 

 
(L)
Media Capitol's accounts make full and proper provision for (or, if appropriate,
disclose by way of notes) all liabilities (whether actual, contingent,
quantified or disputed) of Media Capitol as at or on the date of such accounts,
to the extent required by the accounting standards applicable to such accounts,
and there are no other liabilities of Media Capitol.

 

 
(M)
There are no material Claims pending or, to the knowledge of PPF, threatened,
before any court, arbitration panel, public administrative authority,
institution or other person against or adversely affecting Media Capitol.

 

 
(N)
Media Capitol has full title to all trade marks and any other intellectual
property related to TV Nova that are registered in favor of Media Capitol by the
relevant authorities in the Czech Republic or elsewhere.

 

--------------------------------------------------------------------------------

 
(O)
There are no unpaid or unsatisfied liabilities or other obligations of Media
Capitol (other than those incurred in the ordinary course of business)to, or
causes of action of any nature (vested or contingent) from or against, any of
the PPF Group or any person controlled by any of the PPF Group, and there are no
unpaid or unsatisfied liabilities or other obligations of any of the PPF Group
or any person controlled by any of the PPF Group to Media Capitol (other than
those incurred in the ordinary course of business), and no member of the PPF
Group has assigned or transferred or purported to assign or transfer to any
person outside the PPF Group any liabilities or other obligations of Media
Capitol or causes of action of any nature (vested or contingent) in respect of
the TV Nova Business.

 

 
(P)
There are no past or currently pending, or, to the knowledge of PPF, threatened
actions proceedings or investigations, whether civil or criminal, against Media
Capitol or the presently incumbent directors or managers of Media Capitol or the
present employees of Media Capitol (in connection with their employment with the
company).

 

 
4.6.6
ERIKA

 

 
(A)
ERIKA is a joint stock company duly organized and validly existing in accordance
with the laws of the Czech Republic, registered in the Commercial Register of
the City Court in Prague, file number B 4489, identification number 25098900,
with its seat at Prague 1, Skolska 3.

 

 
(B)
A true and complete copy of ERIKA's Articles of Association as in effect on the
Execution Date and an excerpt from the Commercial Register of ERIKA with current
information as of the Execution Date have been disclosed to CME ME.

 

 
(C)
The entire registered capital of ERIKA amounts to CZK 102,000,000.

 

 
(D)
ERIKA is in compliance with all applicable laws, regulatory rules, licenses,
permits and approvals, and has not received any notice which, after receipt or
lapse of time or both, would constitute non-compliance with any applicable law,
regulatory rule, license, permit or approval.

 

 
(E)
ERIKA has not at any time engaged in any material business or owned any business
or entity other than business related directly to TV Nova. ERIKA has not
operated any business in respect of gaming other than a number lottery on TV
Nova for a period of approximately one month.

 

 
(F)
ERIKA has full title to, leases for, or other valid rights to use all assets
used for the operation of its business as of the date hereof.

 

 
(G)
ERIKA is not and has not been subject to any bankruptcy, insolvency, or
liquidation proceedings.

 

 
(H)
ERIKA has no subsidiaries.

 

 
(I)
All material contracts of ERIKA have been disclosed to CME ME, and all such
material contracts are in full force and effect, and, to the knowledge of PPF
after due inquiry, without any material breach, threatened termination or other
similar circumstance.

 

--------------------------------------------------------------------------------

 
(J)
ERIKA has, in accordance with prevailing Tax Laws of the relevant Tax Authority,
(i) timely filed Tax returns that are in all material respects true, correct and
complete and timely paid all Taxes that are due and payable with respect to its
operations and assets, except for Taxes that are contested in good faith by
appropriate proceedings and for which adequate reserves have been established,
and all such Tax returns have been audited by the relevant Tax Authority or are
closed by the applicable statute of limitations for all taxable years, (ii)
established reserves that are adequate for the payment of Taxes not yet due and
payable but which relate to the carrying out of its business prior to the date
hereof, (iii) carried out all transactions with related persons at fair market
price and on an arm's length basis, (iv) properly recorded in its accounting
records, financial statements and Tax or other official returns, the creation
and release of reserves and provisions, all transactions with securities and
derivatives, and properly calculated all material non-deductible expenses and
tax-exempt income, and (v) has no outstanding Tax or similar fiscal liabilities.

 

 
(K)
The audited financial statements and balance sheet of ERIKA dated as of December
31, 2003 has been disclosed to CME ME and fairly reflect the financial condition
and results of operations of ERIKA as of that date, and there has been in
aggregate no material negative change to such condition or results of operations
as of the date hereof, except for such changes as have been disclosed to CME ME.

 

 
(L)
ERIKA's accounts make full and proper provision for (or, if appropriate,
disclose by way of notes) all liabilities (whether actual, contingent,
quantified or disputed) of ERIKA as at or on the date of such accounts, to the
extent required by the accounting standards applicable to such accounts, and
there are no other liabilities of ERIKA.

 

 
(M)
There are no material Claims pending or, to the knowledge of PPF, threatened,
before any court, arbitration panel, public administrative authority,
institution or other person against or adversely affecting ERIKA.

 

 
(N)
ERIKA has full title to all trade marks and any other intellectual property
related to TV Nova that are registered in favor of ERIKA by the relevant
authorities in the Czech Republic or elsewhere.

 

 
(O)
There are no unpaid or unsatisfied liabilities or other obligations of ERIKA
(other than those incurred in the ordinary course of business) to, or causes of
action of any nature (vested or contingent) from or against, any of the PPF
Group or any person controlled by any of the PPF Group, and there are no unpaid
or unsatisfied liabilities or other obligations of any of the PPF Group or any
person controlled by any of the PPF Group to ERIKA (other than those incurred in
the ordinary course of business), and no member of the PPF Group has assigned or
transferred or purported to assign or transfer to any person outside the PPF
Group any liabilities or other obligations of ERIKA or causes of action of any
nature (vested or contingent) in respect of the TV Nova Business.

 

--------------------------------------------------------------------------------

 
(P)
There are no past or currently pending, or, to the knowledge of PPF, threatened
actions proceedings or investigations, whether civil or criminal, against ERIKA
or the presently incumbent directors or managers of ERIKA or the present
employees of ERIKA (in connection with their employment with the company).

 

 
4.6.7
TVNH

 

 
(A)
TVNH is a private company with limited liability duly organized and validly
existing in accordance with the laws of the Netherlands, identification number
34186663, with its seat at Atrium, 7th Floor, Strawinskylaan 3105, 1077 ZX
Amsterdam, the Netherlands.

 

 
(B)
A true and complete copy of TVNH's Articles of Association as in effect on the
Execution Date and an excerpt from the Commercial Register of TVNH with current
information as of the Execution Date have been disclosed to CME ME.

 

 
(C)
The entire registered capital of TVNH amounts to € 500,000.

 

 
(D)
TVNH is in compliance with all applicable laws, regulatory rules, licenses,
permits and approvals, and has not received any notice which, after receipt or
lapse of time or both, would constitute non-compliance with any applicable law,
regulatory rule, license, permit or approval.

 

 
(E)
TVNH is not and has not been subject to any bankruptcy, insolvency, or
liquidation proceedings.

 

 
(F)
All material contracts of TVNH which relate to the TV Nova Business have been
disclosed to CME ME, and all such material contracts are in full force and
effect, and, to the knowledge of PPF after due inquiry, without any material
breach, threatened termination or other similar circumstance.

 

 
(G)
TVNH has no right or title to any trade marks or other intellectual property
related to TV Nova or the TV Nova Business.

 

 
4.6.8
Vilja

 

 
(A)
Vilja is a joint stock company duly organized and validly existing in accordance
with the laws of the Czech Republic, registered in the Commercial Register of
the City Court in Prague, file number B 6923, identification number 26419009,
with its seat at Prague 5, Krizeneckeho nam. 1078/5.

 

 
(B)
A true and complete copy of Vilja's Articles of Association as in effect on the
Execution Date and an excerpt from the Commercial Register of Vilja with current
information as of the Execution Date have been disclosed to CME ME.

--------------------------------------------------------------------------------

 
(C)
The entire registered capital of Vilja amounts to CZK 1,000,000.

 

 
(D)
Vilja is in compliance with all applicable laws, regulatory rules, licenses,
permits and approvals, and has not received any notice which, after receipt or
lapse of time or both, would constitute non-compliance with any applicable law,
regulatory rule, license, permit or approval.

 

 
(E)
Vilja has not at any time engaged in any business or owned any business or
entity other than business related directly to TV Nova.

 

 
(F)
Vilja has full title to, leases for, or other valid rights to use all assets
used for the operation of its business as of the date hereof.

 

 
(G)
Vilja is not and has not been subject to any bankruptcy, insolvency, or
liquidation proceedings.

 

 
(H)
Vilja has no subsidiaries other than CET 21.

 

 
(I)
All material contracts of Vilja have been disclosed to CME ME, and all such
material contracts are in full force and effect, and, to the knowledge of PPF
after due inquiry, without any material breach, threatened termination or other
similar circumstance.

 

 
(J)
Vilja has, in accordance with prevailing Tax Laws of the relevant Tax Authority,
(i) timely filed Tax returns that are in all material respects true, correct and
complete and timely paid all Taxes that are due and payable with respect to its
operations and assets, except for Taxes that are contested in good faith by
appropriate proceedings and for which adequate reserves have been established,
and all such Tax returns have been audited by the relevant Tax Authority or are
closed by the applicable statute of limitations for all taxable years, (ii)
established reserves that are adequate for the payment of Taxes not yet due and
payable but which relate to the carrying out of its business prior to the date
hereof, (iii) carried out all transactions with related persons at fair market
price and on an arm's length basis, (iv) properly recorded in its accounting
records, financial statements and Tax or other official returns, the creation
and release of reserves and provisions, all transactions with securities and
derivatives, and properly calculated all material non-deductible expenses and
tax-exempt income, and (v) has no outstanding Tax or similar fiscal liabilities.

 

 
(K)
The audited financial statements and balance sheet of Vilja dated as of December
31, 2003 has been disclosed to CME ME and fairly reflect the financial condition
and results of operations of Vilja as of that date, including negative equity of
CZK 76,056,000, and there has been no aggregate material negative change to such
condition or results of operations as of the date hereof, except for (i) an
interest expense to CP 2000 in the amount of approximately CZK 28,000,000 and
(ii) payments of approximately CZK 70,000,000 to Gal pursuant to the contracts
that are documents number 2.6.1.1.20 and 2.6.1.1.21 in the Data Room Index.

 

--------------------------------------------------------------------------------

 
(L)
Vilja's accounts make full and proper provision for (or, if appropriate,
disclose by way of notes) all liabilities (whether actual, contingent,
quantified or disputed) of Vilja as at or on the date of such accounts, to the
extent required by the accounting standards applicable to such accounts, and
there are no other liabilities of Vilja.

 

 
(M)
Except as disclosed against this Warranty in the relevant section of the
Disclosure Letter, there are no material Claims pending or, to the knowledge of
PPF, threatened, before any court, arbitration panel, public administrative
authority, institution or other person against or adversely affecting Vilja.

 

 
(N)
Vilja has no trade marks or any other intellectual property rights related to TV
Nova that are registered in favor of Vilja by the relevant authorities in the
Czech Republic or elsewhere.

 

 
(O)
Except as disclosed in the relevant section of the Disclosure Letter, there are
no unpaid or unsatisfied liabilities or other obligations of Vilja (other than
those incurred in the ordinary course of business) to, or causes of action of
any nature (vested or contingent) from or against, any of the PPF Group or any
person controlled by any of the PPF Group, and there are no unpaid or
unsatisfied liabilities or other obligations of any of the PPF Group or any
person controlled by any of the PPF Group to Vilja (other than those incurred in
the ordinary course of business), and no member of the PPF Group has assigned or
transferred or purported to assign or transfer to any person outside the PPF
Group any liabilities or other obligations of Vilja or causes of action of any
nature (vested or contingent) in respect of the TV Nova Business.

 

 
(P)
Except as disclosed in the relevant section of the Disclosure Letter, there are
no past or currently pending, or, to the knowledge of PPF, threatened actions
proceedings or investigations, whether civil or criminal, against Vilja or the
presently incumbent directors or managers of Vilja or the present employees of
Vilja (in connection with their employment with the company).

 
4.6.9
Plejada

 

 
(A)
Plejada is a joint stock company duly organized and validly existing in
accordance with the laws of the Czech Republic, registered in the Commercial
Register of the City Court in Prague, file number B 6183, identification number
26120623, with its seat at Prague 1, Na Prikope 12.

 

 
(B)
A true and complete copy of Plejada's Articles of Association as in effect on
the Execution Date and an excerpt from the Commercial Register of Plejada with
current information as of the Execution Date have been disclosed to CME ME.

 

--------------------------------------------------------------------------------

 
(C)
The entire registered capital of Plejada amounts to CZK 5,200,000.

 

 
(D)
Plejada is in compliance with all applicable laws, regulatory rules, licenses,
permits and approvals, and has not received any notice which, after receipt or
lapse of time or both, would constitute non-compliance with any applicable law,
regulatory rule, license, permit or approval.

 

 
(E)
Plejada has not at any time engaged in any business or owned any business or
entity other than business related directly to TV Nova.

 

 
(F)
Plejada has full title to, leases for, or other valid rights to use all assets
used for the operation of its business as of the date hereof.

 

 
(G)
Plejada is, with effect from September 5, 2004, in the process of voluntary
liquidation.

 

 
(H)
Plejada has no subsidiaries.

 

 
(I)
All material contracts of Plejada have been disclosed to CME ME, and all such
material contracts are in full force and effect, and, to the knowledge of PPF
after due inquiry, without any material breach, threatened termination or other
similar circumstance.

 

 
(J)
Plejada has, in accordance with prevailing Tax Laws of the relevant Tax
Authority, (i) timely filed Tax returns that are in all material respects true,
correct and complete and timely paid all Taxes that are due and payable with
respect to its operations and assets, except for Taxes that are contested in
good faith by appropriate proceedings and for which adequate reserves have been
established, and all such Tax returns have been audited by the relevant Tax
Authority or are closed by the applicable statute of limitations for all taxable
years, (ii) established reserves that are adequate for the payment of Taxes not
yet due and payable but which relate to the carrying out of its business prior
to the date hereof, (iii) carried out all transactions with related persons at
fair market price and on an arm's length basis, (iv) properly recorded in its
accounting records, financial statements and Tax or other official returns, the
creation and release of reserves and provisions, all transactions with
securities and derivatives, and properly calculated all material non-deductible
expenses and tax-exempt income, and (v) has no outstanding Tax or similar fiscal
liabilities.

 

 
(K)
The audited financial statements and balance sheet of Plejada dated as of
December 31, 2003 has been disclosed to CME ME and fairly reflect the financial
condition and results of operations of Plejada as of that date, and there has
been no aggregate material negative change to such condition or results of
operations as of the date hereof, except for such changes as have been disclosed
to CME ME.

 

 
(L)
Plejada's accounts make full and proper provision for (or, if appropriate,
disclose by way of notes) all liabilities (whether actual, contingent,
quantified or disputed) of Plejada as at or on the date of such accounts, to the
extent required by the accounting standards applicable to such accounts, and
there are no other liabilities of Plejada.

 

--------------------------------------------------------------------------------

 
(M)
There are no material Claims pending or, to the knowledge of PPF, threatened,
before any court, arbitration panel, public administrative authority,
institution or other person against or adversely affecting Plejada.

 

 
(N)
Plejada has no trade marks or any other intellectual property rights related to
TV Nova that are registered in favor of Plejada by the relevant authorities in
the Czech Republic or elsewhere. The Plejada trademark is validly registered in
the name of CET 21.

 

 
(O)
There are no unpaid or unsatisfied liabilities or other obligations of Plejada
(other than those incurred in the ordinary course of business) to, or causes of
action of any nature (vested or contingent) from or against, any of the PPF
Group or any person controlled by any of the PPF Group, and there are no unpaid
or unsatisfied liabilities or other obligations of any of the PPF Group or any
person controlled by any of the PPF Group to Plejada (other than those incurred
in the ordinary course of business), and no member of the PPF Group has assigned
or transferred or purported to assign or transfer to any person outside the PPF
Group any liabilities or other obligations of Plejada or causes of action of any
nature (vested or contingent) in respect of the TV Nova Business.

 

 
(P)
There are no past or currently pending, or, to the knowledge of PPF, threatened
actions proceedings or investigations, whether civil or criminal, against
Plejada or the presently incumbent directors or managers of Plejada or the
present employees of Plejada (in connection with their employment with the
company).

 

 
4.6.10
Galaxie Sport

 

 
(A)
Galaxie Sport is a limited liability company duly organized and validly existing
in accordance with the laws of the Czech Republic, registered in the Commercial
Register of the City Court in Prague, file number C 102451, identification
number 48153168, with its seat at Prague 8, Pod Hajkem 1.

 

 
(B)
A true and complete copy of Galaxie Sport's Articles of Association as in effect
on the Execution Date and an excerpt from the Commercial Register of Galaxie
Sport with current information as of the Execution Date have been disclosed to
CME ME.

 

 
(C)
The entire registered capital of Galaxie Sport amounts to CZK 105,000.

 

 
(D)
Galaxie Sport has all licenses (including the Galaxie Sport License), permits or
other approvals necessary to enable it to operate the Galaxie Sport channel as
currently conducted, including all requisite regulatory approvals and
authorizations to carry on the business as a broadcaster and each such license,
permit or other approval is valid, and no person in the PPF Group is aware of
any reason that any such license, permit or other approval will be withdrawn,
not renewed in due course, or materially modified.

 

--------------------------------------------------------------------------------

 
(E)
[Intentionally Omitted].

 

 
(F)
Galaxie Sport has not at any time engaged in any business or owned any business
or entity other than business related directly to the Galaxie Sport License.

 

 
(G)
[Intentionally Omitted].

 

 
(H)
[Intentionally Omitted].

 

 
(I)
[Intentionally Omitted].

 

 
(J)
All material contracts of Galaxie Sport have been summarized in document number
7b on the Additional Disclosed Documents Index, and all such material contracts
are in full force and effect, and, to the knowledge of PPF after due inquiry,
without any material breach, threatened termination or other similar
circumstance.

 

 
4.6.11
AQS

 

 
(A)
To the best of PPF's knowledge and belief, AQS is a joint stock company duly
organized and validly existing in accordance with the laws of the Czech
Republic, registered in the Commercial Register of the City Court in Prague,
file number B 5285. identification number 25655922, with its seat at Prague 2,
Riegrovy sady 38.

 

 
(B)
A true and complete copy of AQS's Articles of Association, which to the best of
PPF's knowledge and belief is in effect on the Execution Date and a true and
complete copy of an excerpt from the Commercial Register of AQS with current
information as of the Execution Date have been disclosed to CME ME and are
listed on the Data Room Index.

 

 
(C)
To the best of PPF's knowledge and belief, AQS is not and has not been subject
to any bankruptcy, insolvency, or liquidation proceedings.

 

 
(D)
All material contracts related to the Programming Library have been disclosed to
CME ME, and all such contracts are in full force and effect between AQS and the
relevant programming provider, and, to the knowledge of PPF after due inquiry,
without any material breach, threatened termination or other similar
circumstance; provided, however, that as disclosed against this Warranty in the
relevant section of the Disclosure Letter, certain contracts are subject to late
payment or other technical breaches, but such breaches have not resulted in the
termination or threatened termination of the relevant contracts, nor to the
knowledge of PPF are any of such breaches likely to be the basis for any such
termination or threatened termination.

 

 
4.6.12
PPF Media

 

--------------------------------------------------------------------------------

 

 
(A)
PPF Media is a private company with limited liability duly organized and validly
existing in accordance with the laws of the Netherlands, registered by the
Business and Industrial Chamber in Amsterdam, identification number 34186296,
with its seat at Atrium, 7th Floor, Strwinskylaan 3105, 1077 ZX Amsterdam, the
Netherlands.

 

 
(B)
PPF Media is not party to any material contracts related to the TV Nova
Business.

 

 
4.6.13
MEF Media

 

 
(A)
MEF Media is a private company with limited liability duly organized and validly
existing in accordance with the laws of the Netherlands, registered by the
Business and Industrial Chamber in Amsterdam, identification number 34186294,
with its seat at Atrium, 7th Floor, Strwinskylaan 3105, 1077 ZX Amsterdam, the
Netherlands.

 

 
(B)
MEF Media is not party to any material contracts related to the TV Nova
Business.

 

 
4.6.14
Other Entities

 

 
(A)
TV Global is a joint stock company duly organized and validly existing in
accordance with the laws of the Slovak Republic, registered in the Commercial
Register of the District Court in Kosice, file number 1118/V, identification
number 36197009, with its seat at Geresakova 10, Kosice.

 

 
(B)
[Intentionally Omitted].

 

 
(C)
TV Global is not party to any material contracts related to the TV Nova
Business.

 

 
(D)
MAC TV is a limited liability company duly organized and validly existing in
accordance with the laws of the Slovak Republic, registered in the Commercial
Register of the District Court in Bratislava, file number 29871/B,
identification number 00618322, with its seat at Brectanova 1, Bratislava.

 

 
(E)
The entire registered capital of MAC TV amounts to SKK 300,000,000.

 

 
(F)
MAC TV is not party to any material contracts related to the TV Nova Business,
except for the contract listed as document number 19 in the Additional Disclosed
Documents Index No. 25.

 

 
(G)
TV Global and MAC TV have not at any time engaged in any business or owned any
business or entity other than business related directly to TV JOJ.

 
4.7
Warranties by PPF Related to Various Claims

 

--------------------------------------------------------------------------------

PPF warrants to each of the CME Parties as at the Execution Date that each of
the statements set forth below is true, accurate and not misleading as at that
date:
 

 
4.7.1
PPF has disclosed to the CME Parties all material documents and information on
all Claims and allegations, whether pending or threatened, and releases,
settlements, withdrawal or any other form of resolution with respect to all
Claims involving Zelezny, any of Alan, Huncik, Venclik or Gal, and Krsak against
PPF, CET 21 or CP 2000, or its or their affiliates, subsidiaries, shareholders
and directors, relating in any way to the assets, ownership structure, or
affairs of CET 21, TV Nova, the TV Nova License, CP 2000, the TV Nova Business
or persons involved in the TV Nova Business.

 

 
4.7.2
There has been no material change in the facts or circumstances reflected in the
documents and information referred to in Clause 4.7.1 or otherwise with respect
to such matters.

 

 
4.7.3
Other than the Claims referred to in Clause 4.7.1, there is no material pending,
or to the knowledge of PPF, subject to Clause 4.9, threatened Claim that could
adversely affect the TV Nova Business.

 
4.8
Warranties at the Closing Commencement Date

 

 
4.8.1
Each Party shall be required to repeat the Warranties made to each other Party
in Clause 4 on the Closing Commencement Date, except that Warranties in respect
of CPI shall not be repeated on the Closing Commencement Date.

 

 
4.8.2
Any Warranty with respect to ownership of ERIKA and Media Capitol shall, when
repeated at the Closing Commencement Date, be made with respect to ownership of
ERIKA and Media Capital by CP 2000.

 

 
4.8.3
Any Warranty with respect to a person's financial statements or accounts (other
than with respect to the Original TV Nova Combined Accounts in Clauses 4.3.6 and
4.3.7) shall, when repeated at the Closing Commencement Date, be made with
reference to the December 31, 2004 financial statements or accounts of such
person, prepared using the same accounting standards, consistently applied, as
for the December 31, 2003 financial statements or accounts of such person, and
any references to changes in condition in such Warranty shall relate to the
condition of such person as of December 31, 2004.

 

--------------------------------------------------------------------------------

 
4.8.4
Each Party shall also be required to make (or to cause its affiliates entering
into any Transaction Document to make) such additional warranties to the other
Parties as may be set forth in the other Transaction Documents.

 

 
4.8.5
PPF warrants to each of the CME Parties at the Closing Completion Date that
Total Assets of the PPF Group Guarantor as of December 31, 2003 of not less than
CZK 170 billion and the Shareholders Equity of the PPF Group Guarantor as of
December 31, 2003 of not less than CZK 9 billion has been confirmed in the
audited financial statements of the PPF Group Guarantor, prepared in accordance
with generally accepted accounting principles then prevailing in the
Netherlands.

 
4.9
Acknowledgement of Disclosure

 
PPF has disclosed to the CME Parties a possible Claim as described in section
4.9 of the Disclosure Letter, and the CME Parties acknowledge that such
disclosure has been made, and further acknowledge that the filing of such a
Claim (based on the facts and theories disclosed) after the Execution Date shall
not constitute a breach of any Warranty made by PPF.
 
4.10
Breach of Warranty

 
Without prejudice to any of the rights and remedies available to the Parties
under this Agreement or the other Transaction Documents, in the event of the
breach of a Warranty given by the Parties, the Party which is in breach of such
Warranty shall take all steps necessary to remedy such breach and to establish
the state of affairs which would have existed if no such breach had occurred and
such Warranty was true and correct.
 
4.11
No Other Warranties

 
Each of the CME Parties and PPF agree and acknowledge that the Warranties are
the only warranties given by the CME Parties and PPF as at the Execution Date
and, upon Closing, as at the Closing Commencement Date, and these are the only
Warranties for which the Parties accept responsibility.
 
5
Pre-Closing Obligations

 
5.1
General Obligations of PPF

 
From and including the Execution Date and until the Closing Completion Date,
except as specifically provided otherwise in this Agreement, PPF shall:
 

 
5.1.1
procure that the TV Nova Business shall be conducted in substantially the same
manner as it is currently being conducted, as disclosed to the CME Parties, and
the companies operating the TV Nova Business shall carry on their businesses and
the TV Nova Business in the ordinary and proper course as if this Agreement had
not been entered into;

 

 
5.1.2
procure that the companies operating the TV Nova Business shall not do any of
the things described in Clause 5.2 below without the prior written consent of
CME ME, such consent not to be unreasonably withheld or delayed;

 

--------------------------------------------------------------------------------

 
5.1.3
procure that each of the companies operating the TV Nova Business shall consult
with CME ME on any decision which is material to the operations and business of
the TV Nova Business as a whole, always subject to the fiduciary duties of the
directors and other officials of such companies and in compliance with all
applicable laws and regulations, including, without limitation the Czech Act on
Protection of Economic Competition No.143/2001, as amended, and relevant
applicable competition legislation of the European Union;

 

 
5.1.4
provide the CME Parties with all reasonable information and support necessary to
apply for the Antimonopoly Approval;

 

 
5.1.5
procure that the CP 2000 Promissory Note shall not be transferred to any entity
outside the TV Nova Group;

 

 
5.1.6
provide CME ME with full access to such information and PPF or TV Nova Group
personnel as CME ME shall reasonably request in connection with the acquisition
of the TV Nova Group and the transactions contemplated hereby, including with
respect to all of the companies involved in the TV Nova Business, monthly
management accounts and updated estimates of the Actual Working Capital,
commencing from the Execution Date as soon as reasonably practicable and in any
event within 30 days of the end of the relevant calendar month;

 

 
5.1.7
use its reasonable endeavors to provide CME ME with such assistance as CME ME
may reasonably request in connection with any financing the CME Parties may
arrange in connection with this Agreement;

 

 
5.1.8
upon becoming aware prior to the Closing Commencement Date of the occurrence of
any matter, event or circumstance which would constitute a breach of any of the
Warranties hereunder or which would make any of such Warranties inaccurate if
they were repeated on the Closing Commencement Date, promptly give written
notice of such event to CME ME before the Closing Commencement Date with
sufficient details to enable CME ME to assess accurately the impact of such
event and, if so requested by CME ME, use its reasonable endeavors promptly to
remedy the same;

 

 
5.1.9
procure that (i) the unpaid amount of the CNTS Settlement (including principal
and accrued interest) shall not exceed CZK 1,230,000,000 at any time and (ii)
the cash balance of CET 21 as of the Closing Commencement Date is not greater
than the unpaid amount of the CNTS Settlement (including principal and accrued
interest) at that date;

 

 
5.1.10
procure that CET 21 negotiates and enters into the Programming Library Transfer
Agreement with AQS for purposes of transferring the Programming Library to CET
21;

 

--------------------------------------------------------------------------------

 
5.1.11
procure that the subsidiaries of CP 2000 and CET 21 that are not part of the TV
Nova Group shall be transferred out of CP 2000 and CET 21 respectively, without
any liability to CP 2000, CET 21 or the TV Nova Group, and procure that such
subsidiaries and the persons controlling such subsidiaries after the Closing
Commencement Date shall have no Claims against the TV Nova Group, Newco, Oldco
or the CME Parties;

 

 
5.1.12
procure that 100% of the business of TV JOJ is transferred outside the TV Nova
Group without any liability to the TV Nova Group, and procure that the persons
controlling TV JOJ after the Closing Commencement Date shall have no Claims
against the TV Nova Group, Newco, Oldco or the CME Parties;

 

 
5.1.13
cause the Auditors to (i) prepare audited combined US GAAP financial statements
(including cash flows) for the TV Nova Group (on the basis of such financial
statements for the material entities of the TV Nova Group) for the year 2003
(which statements shall not require 2002 comparables) and prepare audited
combined US GAAP financial statements (including cash flows) for the TV Nova
Group (on the basis of such financial statements for the material entities of
the TV Nova Group) for the year 2004 (including audited 2003 comparatives) so
that audited financial statements for 2004 along with a US GAAP audit opinion
thereon will be available on February 25, 2005;

 

 
5.1.14
use its best endeavors to procure the withdrawal and termination of the AHVG
Claim specified in section 4.5.2.2 of the Disclosure Letter, at no cost to and
without any liability to the TV Nova Group;

 

 
5.1.15
procure that as soon as practicable, but not later than within 5 Business Days
after receipt of Media Council Consent for the acquisition by PPF of CEDC's
1.25% CET 21 Ownership Interest, PPF's 1.25% Ownership Interest in CET 21 shall
be transferred to Vilja, on terms and conditions agreed by PPF and CME ME,
subject only to Media Council Consent;

 

 
5.1.16
procure that a Controlling Report as of December 31, 2004 is prepared in respect
of any controlled company in the TV Nova Group;

 

 
5.1.17
use its best endeavors to procure that applications are properly prepared and
timely submitted to the Media Council, on behalf of the TV Nova Group, in order
to obtain not less than four Digital Video Broadcasting -- Terrestrial System
Licenses for the Czech Republic; and

 

 
5.1.18
procure the preparation and, after discussion thereof with CME ME, adoption of
the 2005 TV Nova Budget by January 15, 2005.

 
5.2
PPF Obligations Relating to the TV Nova Group

--------------------------------------------------------------------------------

PPF shall procure that without the prior written consent of CME ME (which
consent shall not be unreasonably withheld or delayed) and except as
contemplated by this Agreement, the TV Nova Group shall not before Closing:

 
5.2.1
take any action that is likely to have a Material Adverse Effect on the TV Nova
License or the TV Nova Group;

 

 
5.2.2
incur any capital expenditure other than replacement capital expenditure and
customary improvements to real property in the ordinary course of business that
are not recorded in the 2005 TV Nova Budget;

 

 
5.2.3
enter into, or commit to enter into, amend, extend the term of, or terminate any
leasing, hire purchase or other agreement or arrangement for payment on deferred
terms except in the ordinary course of business;

 

 
5.2.4
enter into, or commit to enter into, amend, extend the term of or terminate any
contract related to the Programming Library, or any contract for the production
of television programming, that are not recorded in the 2005 TV Nova Budget, or
consent to AQS doing any of the foregoing;

 

 
5.2.5
borrow any additional money except on existing bank facilities or not exceeding
CZK 50,000,000 in total or make any payments out of or drawings on their bank
account(s) (except routine payments or repayments of existing liabilities);

 

 
5.2.6
dispose of or grant any option or right of pre-emption in respect of any part of
their assets except in the ordinary course of business;

 

 
5.2.7
enter into any contract or commitment outside the ordinary course of business
that is material to the TV Nova Group;

 

 
5.2.8
grant any lease or third party right in respect of any of the material assets
owned by the TV Nova Group;

 

 
5.2.9
enter into, or commit to enter into, amend, extend the term of or terminate any
contract of whatever nature with a term of 13 months or longer or with a value
of more than CZK 10,000,000, except for contracts reflected in the 2005 TV Nova
Budget;

 
5.2.10
grant, issue or redeem, or agree to grant, issue or redeem, any mortgage, share,
debenture or other security or give any guarantee or indemnity except in the
ordinary course of business in an amount or value not to exceed CZK 5,000,000
individually or CZK 10,000,000 in the aggregate;

 

 
5.2.11
declare or make or pay any dividend or other distribution not declared before
the Execution Date;

 

--------------------------------------------------------------------------------

 

 
5.2.12
dispose of or distribute the portion of the CET 21 Registered Capital (and
related ownership rights) held as treasury interest, unless ordered to do so by
a final non-appealable decision of a competent court;

 

 
5.2.13
create, issue, purchase or redeem, or agree to create, issue, purchase or
redeem, any class of share or loan capital;

 

 
5.2.14
make any material change in the terms and conditions of employment or pension or
other benefits of its employees (other then those which would be consistent with
past practices required by law, collective bargaining agreements and those made
pursuant to any annual salary review, such review being consistent with past
practices) or terminate (except for good cause) the employment of any of the
employees;

 

 
5.2.15
make any material strategic decision with regard to changing programming
philosophy or content, operating structure or operating arrangements of the TV
Nova Group; or

 

 
5.2.16
save only as may be necessary to give effect to this Agreement or to the extent
CME ME has consented or agreed, cause or do any act or thing the commission of
which would constitute a breach of any of the Warranties herein or which would
make any of such Warranties inaccurate when they are repeated on the Closing
Commencement Date.

 
5.3
CME Parties' Obligations

 
From and including the Execution Date and until the Closing Completion Date,
except as specifically provided otherwise in this Agreement, the CME Parties
shall:
 

 
5.3.1
subject to PPF entering in a confidentiality undertaking acceptable to the CME
Parties, provide PPF with access to such information as PPF shall reasonably
request in connection with the Television Business of CME ME, for purposes of a
due diligence investigation by PPF;

 

 
5.3.2
subject to PPF providing all reasonable information as provided in Clause 5.1.4,
apply for the Antimonopoly Approval;

 

 
5.3.3
cause the incorporation and registration of Newco;

 

 
5.3.4
acquire Oldco; and

 

 
5.3.5
upon any member of the Board of Directors of CME ME becoming aware, prior to the
Closing Commencement Date, through the receipt of reports delivered to CME ME by
external legal, financial or other advisors, of the occurrence of any matter,
event or circumstance that in the opinion of CME ME would constitute, or be
likely to result in, a breach of any of the Warranties given by PPF hereunder or
which would make any of such Warranties inaccurate when they are repeated on the
Closing Commencement Date, unless PPF already shall have taken appropriate
action as required by Clause 5.1.8, CME ME shall give prompt written notice
thereof to PPF with sufficient details to enable PPF to assess the impact of
such information and thereafter to proceed as provided in Clause 5.1.8;
provided, however, that (i) the failure of CME ME's Board of Directors to become
aware of any such matter, event or circumstance, or the actual or potential
impact of such matter, event or circumstance on any Warranty, or (ii) CME ME's
failure to give notice of any such matter, event or circumstance to PPF, shall
not in any way constitute a waiver of or otherwise affect any of CME ME's rights
under this Agreement or give PPF any additional rights under this Agreement.

--------------------------------------------------------------------------------

6
Conditions to Closing

 
6.1
Conditions Precedent

 
Closing is conditional on the satisfaction of all the following conditions prior
to or upon the Closing Commencement Date:

 
6.1.1
the Antimonopoly Approval shall have been obtained and such approval shall not
contain any conditions or restrictions that in the reasonable judgment of CME ME
are unacceptable, or the Expiration of the Time Limit shall have occurred;

 

 
6.1.2
PPF shall have specified the Designated Shareholder(s), and such person(s) shall
be qualified to be Designated Shareholder(s);

 

 
6.1.3
PPF and, if appropriate, its affiliates, shall have performed and complied in
all material respects with all covenants and agreements required by this
Agreement to be performed or complied with by PPF or the PPF Group on or prior
to the Closing Date, including those obligations in Clause 5.1; provided,
however, that the failure, despite reasonable endeavors, to satisfy any of the
following conditions shall not constitute, singly or collectively, a basis for a
determination by CME ME not to proceed with Closing:

 

 
(i)
Clause 5.1.12 with respect to removal of the TV JOJ business from the TV Nova
Group, provided that (x) the TV Nova Group shall not own any interest in MAC TV
or any other Slovak television licensee as of the Closing Commencement Date, (y)
the equivalent of the Media Council in the Slovak Republic shall either have
given its consent with respect to the ownership by the TV Nova Group of such
elements of the TV JOJ business that remain in the TV Nova Group as of the
Closing Commencement Date or shall have confirmed, to the satisfaction of CME
ME, that no such consent is required, and (z) the Foreign Antimonopoly Office
for the Slovak Republic shall either have given its Anitmonopoly Approval with
respect to the ownership by the TV Nova Group of such elements of the TV JOJ
business that remain in the TV Nova Group as of the Closing Commencement Date or
such Foreign Antimonopoly Office shall have confirmed, to the satisfaction of
CME ME, that no such Antimonopoly Approval is required; or

 

 
(ii)
Clause 5.1.14 with respect to the withdrawal and termination of the AHVG Claim;
or

 

--------------------------------------------------------------------------------

 
(iii)
Clause 5.1.15 with respect to the transfer of the 1.25% CET 21 Ownership
Interest.

 

 
6.1.4
the Warranties given by PPF on the Closing Commencement Date in Clauses 4.1,
4.3.1, 4.3.3, 4.3.4, 4.3.5, 4.3.6, 4.3.10, 4.3.11, 4.3.12, 4.3.13, 4.3.15,
4.4.1, 4.4.3, 4.4.10 and 4.4.11 shall be true in all material respects, or if
not true shall have been remedied as provided in Clause 4.10 to the reasonable
satisfaction of CME ME;

 

 
6.1.5
the Warranties given by PPF on the Closing Commencement Date other than as
listed in Clause 6.1.4 shall be true in all material respects; or if not true
shall have been remedied as provided in Clause 4.10 to the reasonable
satisfaction of CME ME; provided, however, that if the Losses incurred or likely
to be incurred by the CME Parties as a result of any or all of such Warranties
not being true are or would be, in the reasonable opinion of CME ME, less than
or equal to US$ 10,000,000, such breach of Warranties shall not in itself
constitute a basis for a determination by CME ME not to proceed with Closing;

 

 
6.1.6
Smejc shall have entered into the Smejc Agreement;

 

 
6.1.7
CME ME shall have received written confirmation from CNTS regarding its
acceptance of the CNTS Settlement, and the amounts paid, due and to become due
thereunder;

 

 
6.1.8
If PPF shall have received Media Council Consent for the acquisition of the
1.25% CET 21 Ownership Interest from CEDC, PPF shall have transferred such 1.25%
CET 21 Ownership Interest to Vilja, subject only to such additional Media
Council Consent as may be required and not yet obtained;

 

 
6.1.9
the Programming Library Pledge shall have been discharged in full;

 

 
6.1.10
the Controlling Reports for each company in the TV Nova Group for 2004 shall
have been properly prepared and filed with the appropriate Czech commercial
registration court;

 

 
6.1.11
there shall not be any injunction, decision, order or decree of any nature of
any court or governmental entity restraining or prohibiting unrestricted use and
exploitation of the TV Nova License by CET 21 and the TV Nova Group;

 

 
6.1.12
in the event any consent or approval required under any financing document for
any Indebtedness of the TV Nova Group in connection with or relating to the
acquisition of the TV Nova Group by CME ME shall not have been obtained and such
failure to obtain such consent or approval results in a requirement that such
Indebtedness be refinanced, PPF shall procure that any required refinancing be
obtained on substantially the same terms as any such Indebtedness being
refinanced;

 

 
6.1.13
there shall not have been any action, or any statute enacted, by any
governmental authority which would render the Parties unable to consummate the
transactions contemplated herein or make the transactions contemplated herein
illegal or prohibit, restrict or delay the consummation of the transactions
contemplated herein;

 

--------------------------------------------------------------------------------

 
6.1.14
Oldco shall have been acquired, and Newco shall have been incorporated,
registered and capitalized as set forth in the Transaction Memorandum; and

 
6.1.15
no event or circumstance shall have occurred since the Execution Date,
regardless of any disclosure by PPF to the CME Parties prior to or since the
Execution Date, that would constitute a Material Adverse Effect on the TV Nova
Business and no event shall exist or have occurred that will give rise to any
such Material Adverse Effect.

6.2
Responsibility for Satisfaction

 
6.2.1
PPF shall:

 
(a)
satisfy the conditions in Clauses 6.1.2 to 6.1.10 on or before the Closing
Completion Date, and

 
(b)
promptly provide CME ME with all reasonable assistance to support CME ME's
application to obtain the Antimonopoly Approval to satisfy Clause 6.1.1 as soon
as is possible.

 
6.2.2
CME ME shall:

 
(a)
satisfy the condition set out in Clause 6.1.14 on or before the Closing
Completion Date; and

 
(b)
subject to receipt of all the necessary information and assistance from PPF,
promptly apply to obtain Antimonopoly Approval to satisfy Clause 6.1.1.

6.3
Satisfaction/Non-Satisfaction/Waiver

 
6.3.1
CME ME (on behalf of the CME Parties) may at any time waive, in whole or in
part, conditionally or unconditionally, any condition set out in Clause 6.1
above by notice in writing to PPF.

 
6.3.2
CME ME and PPF shall regularly communicate with each other with respect to the
progress of either Party towards the satisfaction of the conditions to Closing
and any problems experienced or foreseeable with respect to satisfaction of such
conditions.

 
6.3.3
PPF shall (unless the condition is capable of waiver and has been waived by CME
ME) promptly give written notice to the CME Parties of the satisfaction of the
relevant conditions on becoming aware of the same.

 
6.3.4
Upon the satisfaction or waiver, if appropriate, of all of the conditions set
out in Clause 6.1, the Parties shall agree on a time and place, and such other
matters as need to be arranged, for Closing as provided in Clause 7.

 

--------------------------------------------------------------------------------

 

 
6.3.5
In the event that PPF will not be able to satisfy the conditions set out in
Clause 6.1 on or before the Last Date for Closing, PPF shall promptly, and in
any event not less than 3 Business Days before the Last Date for Closing, give
written notice to the CME Parties of its inability to satisfy such conditions.

 
6.3.6
In the event that CME ME will not be able to satisfy the condition set out in
Clause 6.1.14 on or before the Last Date for Closing, CME ME shall promptly, and
in any event not less than 3 Business Days before the Last Date for Closing,
give written notice to PPF of its inability to satisfy such condition.

 
6.3.7
If any condition specified in Clause 6.1 is not satisfied (or has not been
waived by the relevant Party) on or before the Last Date for Closing, except as
specifically provided in Clauses 6.1.3 and 6.1.5, this Agreement shall, unless
otherwise agreed by the Parties, terminate and the provisions of Clause 9 shall
apply; provided, however, that the Last Date for Closing shall be extended to
October 1, 2005, if all other conditions specified in Clause 6.1 are satisfied
on or before July 1, 2005, other than the condition in Clause 6.1.1, or if the
Parties agree no later than 3 Business Days prior to July 1, 2005, that all such
conditions to Closing (other than the condition in Clause 6.1.1) are likely to
be satisfied by October 1, 2005, and that extension of the Last Date for Closing
is necessary in order to achieve satisfaction of the condition in Clause 6.1.1.

7
Closing

7.1
Time and Place of Closing

 
7.1.1
Closing shall take place in Prague, Czech Republic at the offices of Dewey
Ballantine, or such other location as may be agreed by the Parties, on a
Business Day to be specified by the Parties pursuant to Clause 6.3.4 following
the satisfaction or waiver of the conditions set out in Clause 6.1 (the "Closing
Commencement Date").

 
7.1.2
The Parties agree that the Closing Commencement Date shall take place on the
first Business Day of a month, and to the extent practicable, on the first
Business Day of a calendar quarter. The Closing Management Report and any other
financial report to be delivered in connection with the Closing shall be as at
the last day of the month immediately preceding the Closing Commencement Date.

 
7.1.3
Upon the completion of all of the actions described in this Clause 7, which the
Parties acknowledge may take several Business Days, the Closing shall be deemed
complete (the "Closing Completion Date").

 
7.1.4
All transactions constituting Closing will be deemed to take place
simultaneously, and for purposes of this Agreement, no delivery or payment shall
be deemed to have been made until all the transactions to be made at Closing
have been completed.

7.2
PPF's Closing Obligations

 

--------------------------------------------------------------------------------

 
On or before Closing PPF shall:

 
7.2.1
deliver or shall procure the delivery to CME ME of:

 
(i)
the Transfer Agreements duly executed by all parties thereto other than CME ME,
Newco or Oldco;

 
(ii)
the Programming Library Transfer Agreement duly executed by AQS and CET 21;

 
(iii)
the TV Nova Group Agreement duly executed by PPF;

 
(iv)
the Oldco Promissory Note Assignment Agreement(s) duly executed by PPF;

 
(v)
the PPF Promissory Note duly executed by PPF;

 
(vi)
the CME Loan Notes duly endorsed for exchange for the CME Consideration Shares;

 
(vii)
the Subscription Agreement duly executed by the Designated Shareholders;

 
(viii)
the Registration Rights Agreement duly executed by the Designated Shareholders;

 
(ix)
the PPF Loan Agreement duly executed by PPF;

 
(x)
the Guarantee duly executed by PPF a.s. and the PPF Group Guarantee duly
executed by PPF Group N.V.;

 
(xi)
the Smejc Agreement duly executed by Smejc and PPF;

 
(xii)
the Controlling Reports for 2004, along with evidence that such Controlling
Reports have been properly filed as provided in Clause 5.1.16;

 
(xiii)
combined financial statements for the TV Nova Group for 2003 prepared in
accordance with US GAAP;

 
(xiv)
combined 2004 financial statements (including cash flows and 2003 comparables)
for the TV Nova Group prepared in accordance with US GAAP (which shall include
only those entities required pursuant to US GAAP) and a US GAAP audit opinion
without any qualifications in respect of such accounts, and, in the event that
the Closing Commencement Date is after April 1, 2005, quarterly combined
financial statements (including cash flows) for the TV Nova Group prepared in
accordance with US GAAP (which shall include only those entities required
pursuant to US GAAP) for any quarter of 2005 ending not less than 30 days prior
to the Closing Commencement Date;

 
(xv)
the Closing Management Report, which shall include Combined Accounts CET 21, CP
2000 and MAG MEDIA for the full year of 2004, prepared in accordance with Czech
accounting standards, reflecting total operating revenues of not less than CZK
5,072,711,000, profit from operations (EBIT) of not less than CZK 2,367,830,000,
profit before tax of not less than CZK 2,178,130,000, and net profit of not less
than CZK 1,557,010,000;

--------------------------------------------------------------------------------

 

 
(xvi)
a draft of the Closing Certificate; and

 
(xvii)
such certificates, comfort letters, evidence of completion of corporate acts,
and corporate documents of PPF and the PPF Group as may be reasonably required
by CME ME;

 
7.2.2
deliver evidence confirming (i) the withdrawal and termination of the AHVG Claim
as provided in Clause 5.1.14, if completed, (ii) removal or satisfaction of the
Programming Library Pledge, and (iii) if the Media Council Consent for the
acquisition by PPF of the 1.25% CET 21 Ownership Interest from CEDC has been
obtained, the transfer to Vilja of such 1.25% CET 21 Ownership Interest, subject
only to Media Council Consent, to the extent not obtained;

 
7.2.3
procure that a General Meeting of each person that is a party to a Transfer
Agreement, other than CME ME, Oldco or Newco, is held at which it is resolved:

 
(i)
to approve the transfers referred to in the relevant Transfer Agreements
delivered as provided in Clause 7.2.1(i) above, as applicable, for registration;
and

 
(ii)
any other necessary corporate matters as may be reasonably required by the CME
Parties to be included on the agenda of such meeting; and

 
7.2.4
procure that a General Meeting of each of Vilja, CP 2000, MAG MEDIA, Nova
Consulting, Media Capitol, ERIKA, CET 21 and Plejada is held at which it is
resolved:

 
(a)
to approve the resignation of all directors agreed by the Parties and the
appointment of directors (including three executives for CET 21) nominated by
CME ME and PPF as provided in the TV Nova Group Agreement; and

 
(b)
any other necessary corporate matters as may be reasonably required by the CME
Parties to be included on the agenda of such meeting.

7.3
CME ME's Closing Obligations

On or before Closing CME ME shall:

 
7.3.1
deliver or shall procure the delivery to PPF of:

 
(i)
the Transfer Agreements duly executed by Newco, Oldco or CME ME, as appropriate;

 
(ii)
the TV Nova Group Agreement duly executed by CME ME, Newco and Oldco;

--------------------------------------------------------------------------------

 

 
(iii)
the Oldco Promissory Note(s) duly executed by Oldco;

 
(iv)
the Oldco Promissory Note Assignment Agreement(s) duly executed by Oldco;

 
(v)
the CME Loan Notes;

 
(vi)
the PPF Loan Agreement duly executed by Oldco;

 
(vii)
the Subscription Agreement duly executed by CME Ltd;

 
(viii)
the Registration Rights Agreement duly executed by CME Ltd;

 
(ix)
the Smejc Agreement duly executed by CME ME,

 
(x)
the Guarantee and the PPF Group Guarantee duly executed by CME ME and CME Ltd;
and

 
(xi)
such certificates, evidence of completion of corporate acts and corporate
documents of CME ME and CME Ltd as may be reasonably required by PPF;

 
7.3.2
cause the issue and delivery of the CME Consideration Shares to the Designated
Shareholder(s);

 
7.3.3
execute the CME Loan Agreement;

 
7.3.4
cause Oldco to execute the CME Loan Agreement and the PPF Loan Agreement;

 
7.3.5
procure that a shareholders meeting of each of Newco and Oldco is held at which
it is resolved:

 
(i)
to approve the transfers referred to in the relevant Transfer Agreements
delivered as provided in Clause 7.2.1(i) above, as applicable, for registration;

 
(ii)
to approve the resignation of all such directors of Newco and Oldco as agreed by
the Parties and the appointment of directors agreed by the Parties as provided
in the TV Nova Group Agreement;

 
(iii)
to approve the Amended Newco Memorandum of Association and the Amended Oldco
Memorandum of Association; and

 
(iv)
any other necessary corporate matters as may be reasonably required by the
Parties to be included on the agenda of such meeting; and

 
7.3.6
subject to and in accordance with Clause 3, pay the Estimated Total Cash
Consideration and provide to PPF all necessary information to confirm that such
payment has been made.

8
Undertakings To Benefit The TV Nova Business

8.1
PPF's Undertakings

--------------------------------------------------------------------------------

 

 
8.1.1
PPF undertakes that for so long as both PPF (or any of its affiliates) and CME
ME (or any of CME ME's affiliates) hold a direct or indirect interest in the TV
Nova Group, no member of the PPF Group, nor any of its affiliates, shall engage
or participate in, or have an interest in, directly or indirectly, in any manner
or capacity, in any Television Business in the Czech Republic or in the Slovak
Republic other than through the TV Nova Group.

 
(i)
Nothing in this Clause shall restrict the right of any of the PPF Group to own
or control, directly or indirectly, not more than a 10% Ownership Interest of
any entity involved in TV JOJ, or to own or control indirectly, through PPF's
interest in the TV Nova Group such Ownership Interests of any entity involved in
TV JOJ that remain in the TV Nova Group as of the Closing Completion Date.

 
(ii)
Nothing in this Clause shall restrict the right of any of the PPF Group
(excluding specifically PPF and PPF a.s.) whose business includes the provision
of financing, to directly or indirectly own an Ownership Interest in or control
any entity engaged in the Television Business in the Czech Republic or Slovakia,
provided that (i) such Ownership Interest was acquired as a result of
foreclosing on security provided by a debtor to the PPF Group, (ii) no member of
the PPF Group exercises any management or operational control over such entity,
(iii) the PPF Group's ownership of such Ownership Interest is not a violation of
the Media Act or otherwise exposes the TV Nova License to any risk of revocation
or the TV Nova Group to any risk of sanctions from the Media Council, and (iv)
the PPF Group takes all reasonable steps to dispose, on an orderly basis, of
such Ownership Interests to persons not affiliated with the PPF Group.

 
8.1.2
PPF undertakes that no member of the PPF Group, or any of its affiliates, shall
invest in or become involved (other than as a result of ownership of the CME
Consideration Shares), whether directly or indirectly, in any Television
Business in the Czech Republic during the period of two years from the later of
(1) PPF Group's exit from the TV Nova Group (pursuant to the provisions of the
TV Nova Group Agreement) and (2) the date on which the aggregate shareholding of
the PPF Group in CME Ltd falls below 5% of the total outstanding CME Shares, or
for such shorter period during which CME ME or any of its affiliates continues
to retain an interest in the TV Nova Group.

 
8.1.3
PPF undertakes to procure the full and complete performance by Smejc of the
Smejc Agreement, and shall be responsible for any breach thereof by Smejc or
PPF.

8.2
CME ME's Undertakings

 
8.2.1
CME ME undertakes that for so long as CME ME (or any of its affiliates) and PPF
(or any of its affiliates) holds a direct interest in the TV Nova Group, neither
CME ME nor any of its affiliates, shall engage or participate in, directly or
indirectly, in any manner or capacity, in any Television Business in the Czech
Republic other than through the TV Nova Group and its associated companies,
except as permitted in the TV Nova Group Agreement.

--------------------------------------------------------------------------------

 
8.2.2
CME ME undertakes that neither CME ME, nor any of its affiliates, shall invest
in or become involved, whether directly or indirectly, in any television
business activity in the Czech Republic during the period of two years from CME
ME's exit from the TV Nova Group, or for such shorter period during which PPF
Group continues to retain a direct interest in the TV Nova Group.

8.3
Effect of Breach of Undertakings

The Parties acknowledge that irreparable damage would result to the other Party
and the TV Nova Business if the provisions of Clauses 8.1 and 8.2 were not
specifically enforced, and agree that a non-breaching Party shall be entitled to
any appropriate legal, equitable or other remedy, including injunctive relief,
in respect of any material failure to comply with the provisions of Clauses 8.1
to 8.2.

8.4
Additional Undertaking by PPF

PPF undertakes that the PPF Group shall, in each of the first two years
following the Closing Completion Date, spend the same percentage of its
television advertising budget on advertising on TV Nova as the PPF Group is
spending, on an annual basis, as of the Execution Date; provided, that TV Nova
continues to be the number-one rated television broadcaster in the Czech
Republic and such advertising is offered on substantially the same terms as is
provided as of the Execution Date.

8.5
Additional Undertaking by CME ME and PPF

CME ME and PPF undertake to present the transactions contemplated by this
Agreement to the Media Council promptly following the Execution Date.

9
Termination

9.1
Termination by Consent

This Agreement may be terminated at any time by the mutual written consent of
the CME Parties and PPF.

9.2
Termination by the Parties Prior to Closing

This Agreement may be terminated at any time prior to the Closing Completion
Date by:

 
9.2.1
the mutual written consent of the CME Parties and PPF;

 
9.2.2
CME ME, subject to Clauses 6.1.3 and 6.1.5, if there shall have been a material
breach of any covenant, Warranty, Transaction Document or other obligation of
PPF hereunder, and such breach shall not have been remedied within 30 Business
Days after PPF became aware of such breach or after receipt by PPF of a notice
in writing from CME ME specifying the breach and requesting such breach be
remedied; or

--------------------------------------------------------------------------------

 
9.2.3
by PPF, if there shall have been a material breach of any covenant, Warranty,
Transaction Document or other obligation of either of the CME Parties hereunder,
and such breach shall not have been remedied within 30 Business Days after CME
ME became aware of such breach or after receipt by either of the CME Parties of
notice in writing from PPF specifying the breach and requesting such breach be
remedied; or

 
9.2.4
by PPF, if (i) CME ME shall have given written notice to PPF that CME ME desires
to proceed to Closing notwithstanding its reasonable belief that if Closing were
to occur it would have Claims against PPF for Losses in excess of US$
10,000,000, along with sufficient details to enable PPF to evaluate the basis
for CME ME's conclusions regarding such Claims, and (ii) within 30 Business Days
of the receipt of notice from CME ME the Parties have not been able to agree on
a basis to proceed with the transaction.

Notwithstanding any other provision contained herein, no Party may terminate
this Agreement as a result of any change in the trading price of the CME Shares
on or after the Execution Date.

9.3
Automatic Termination

This Agreement shall terminate automatically upon the Last Date for Closing
(except as provided in Clause 6.3.7) if (i) any condition specified in Clause
6.1 is not satisfied (and has not been waived by the relevant Party) on or
before the Last Date for Closing or (ii) if the Closing Commencement Date has
not occurred on or before the Last Date for Closing, in either case as a result
of:

 
9.3.1
any action or failure to act on the part of PPF (other than any such action or
failure to act that is due to the gross negligence or willful misconduct of any
CME Party);

 
9.3.2
any action or failure to act on the part of either CME Party (other than any
such action or failure to act that is due to gross negligence or willful
misconduct of PPF); or

 
9.3.3
any circumstance other than as set out or addressed in Clauses 9.3.1 or 9.3.2
above.

9.4
Payments Upon Termination

In the event of termination of this Agreement:

 
9.4.1
by CME ME pursuant to Clause 9.2.2, then PPF shall pay to CME ME the sum of US$
25,000,000; or

 
9.4.2
by PPF pursuant to Clause 9.2.3, then CME ME shall pay to PPF the sum of US$
25,000,000; or

 
9.4.3
by PPF pursuant to Clause 9.2.4, then PPF shall pay to CME ME the sum of US$
25,000,000; or

--------------------------------------------------------------------------------

 

 
9.4.4
automatically pursuant to Clause 9.3.1, then PPF shall pay to CME ME the sum of
US$ 25,000,000; or

 
9.4.5
automatically pursuant to Clause 9.3.2, then CME ME shall pay to PPF the sum of
US$ 25,000,000.

9.5
Effects of Termination

 
9.5.1
In the event of termination of this Agreement prior to the Closing Completion
Date:

 
(i)
Clauses 9.4, 19.1 and 19.2 shall survive any such termination, and Clauses
13, 14 and 15 shall survive any such termination for the purposes only of
enforcing Clauses 9.4, 19.1 and 19.2; and

 
(ii)
accrued rights arising in any way out of this Agreement other than out of
Clauses 9.4, 19.1 and 19.2 as at the date of termination shall be extinguished,
and the aggregate liability of the relevant Party under this Agreement shall be
limited to US$ 25,000,000.

 
9.5.2
In the event of termination of this Agreement after the Closing Completion Date:

 
(i)
Clauses 10, 11, 13, 14, 15, and 19 and the Guarantee and the PPF Group Guarantee
(or such Security as may be in effect at the time of termination) shall survive
any such termination; and

 
(ii)
accrued rights arising in any way out of this Agreement as at the date of
termination shall not be affected, except to the extent that the CME Parties and
PPF agree otherwise in writing in connection with any termination by mutual
consent.

 
9.5.3
In the event of termination of this Agreement at any time the CME Parties shall
take all such steps as are reasonably practicable to return any confidential
information concerning the TV Nova Business to PPF, and PPF shall take all such
steps as are reasonably practicable to return any confidential information
concerning the business of the CME Parties to CME ME.

10
Indemnity

10.1
Indemnity by PPF

 
10.1.1
Subject to the limitations provided in Clause 11, PPF shall indemnify and keep
indemnified the CME Parties and their affiliates and subsidiaries, including the
TV Nova Group, and their respective representatives, officers, directors,
shareholders and controlling persons (the "CME Protected Parties") from and
against all costs, claims, demands, damages, expenses, penalties, fines,
liabilities or losses (including the reasonable fees and expenses of
investigation and counsel (collectively, "Losses") whatsoever arising out of or
in connection with:

--------------------------------------------------------------------------------

 

 
(i)
any false, incorrect or misleading Warranty by PPF or any of its affiliates,

 
(ii)
any and all actions, suits, proceedings, claims, demands, assessments, judgments
incidental to the foregoing or the enforcement of such indemnification, and

 
(iii)
any item subject to indemnification as identified in Clauses 10.1.2 or 10.1.3.

 
10.1.2
Subject to the limitations provided in Clause 11, in addition to the foregoing
provisions of Clause 10.1.1, without limiting the generality of such provisions,
PPF agrees to indemnify and hold harmless the CME Protected Parties against any
Losses in respect of: 

 
(i)
the non-fulfillment of any agreement, covenant or obligation by PPF or any of
its affiliates provided herein or in any other Transaction Document,

 
(ii)
any and all liability whatsoever, however imposed (including any claim asserted
or deficiency assessed against or collected from or paid by the CME Parties or
the TV Nova Group), in respect of any Taxes (including any penalties, interest
and fines thereon whether accrued before or after the Closing Completion Date)
of the TV Nova Group for any and all periods up to and including the period
ending on the Closing Completion Date (including in connection with any Tax
return filed after the Closing Completion Date);

 
(iii)
any Zelezny Claims or AHVG Claims;

 
(iv)
any Smejc Claims, Gerner Claims or Komar Claims;

 
(v)
any Claims by any CME Protected Party against Smejc arising out of any breach by
Smejc of any Transaction Document;

 
(vi)
any and all liability whatsoever arising with respect to or as a result of (1)
the business of any direct or indirect subsidiary of CP 2000 as of the Execution
Date that is not a member of the TV Nova Group, including but not limited to
CPI, Europa TV, MEF Media, a.s., and EDIKON, a.s., or the transfer of those
persons out of the TV Nova Group by PPF prior to the Closing Commencement Date,
(2) the licensing or business of Galaxie Sport or the acquisition of any Galaxie
Sport Ownership Interest by PPF prior to such time, if ever, that Galaxie Sport
becomes part of the TV Nova Group, (3) the licensing or business of TV JOJ prior
to the Closing Commencement Date or the disposal of any TV JOJ Ownership
Interest by PPF prior to the Closing Commencement Date, or any liabilities
arising in connection with any TV JOJ Ownership Interest remaining in the TV
Nova Group as of the Closing Commencement Date, or the transfer of any remaining
TV JOJ Ownership Interest out of the companies in the TV Nova Group, including
but not limited to the transfer of TV Global and MAC TV, or (4) the lawsuit
filed by CSOB in the City Court in Prague under Reference Number 41 Cm 108/2003,
or any related Claim;

--------------------------------------------------------------------------------

 

 
(vii)
any liability arising out of or resulting from the Programming Library Pledge;

 
(viii)
any breach by AQS of the Programming Library Transfer Agreement;

 
(ix)
the revocation or cancellation of the TV Nova License, based on facts or
circumstances that occurred prior to the Closing Completion Date;

 
(x)
Vilja not having good title to the 52.075% CET 21 Ownership Interest;

 
(xi)
PPF not having good title to the 100% CP 2000 Ownership Interest;

 
(xii)
any Krsak Claims; and

 
(xiii)
any and all actions, suits, proceedings, claims, demands, assessments, judgments
incidental to the foregoing or the enforcement of such indemnification.

 
10.1.3
Subject to the limitations provided in Clause 11, in addition to the foregoing
provisions of Clauses 10.1.1 and 10.1.2, without limiting the generality of such
provisions, PPF agrees to indemnify and hold harmless the CME Protected Parties
against any Losses in respect of: 

 
(i)
any and all liability whatsoever, however imposed, whether paid by the CME
Parties or the TV Nova Group, in respect of any fraudulent or criminal act or
omission by PPF or any member of the PPF Group or any officer, director,
representative, employee or agent thereof in respect of the ownership and
operation of the TV Nova Group; and

 
(ii)
any and all actions, suits, proceedings, claims, demands, assessments, judgments
incidental to the foregoing or the enforcement of such indemnification.

10.2
Indemnity by CME

Subject to the limitations provided in Clause 11, CME ME shall indemnify and
keep indemnified PPF and its affiliates and subsidiaries (the "PPF Protected
Parties") from and against all Losses whatsoever arising out of or in connection
with:

 
(i)
any false, incorrect or misleading Warranty by any of the CME Parties;

 
(ii)
the non-fulfillment of any agreement, covenant or obligation by the CME Parties
provided herein or in any other Transaction Document; and

 
(iii)
any and all actions, suits, proceedings, claims, demands, assessments, judgments
incidental to the foregoing or the enforcement of such indemnification.

10.3
Threshold for Indemnification

No Losses shall be subject to the indemnification pursuant to Clauses 10.1.1,
10.1.2, or 10.2 unless:

--------------------------------------------------------------------------------

 

 
(i)
any such individual Loss exceeds an amount of US$ 250,000; and

 
(ii)
the aggregate of all Losses incurred by any Protected Party shall equal or
exceed US$ 1,000,000, but once such threshold of Losses has occurred, all Losses
(including those taken into account in determining such threshold shall be
subject to indemnity.

10.4
Notice of Potential Indemnity Claims

 
10.4.1
If any CME Protected Party becomes aware of any matter not involving a Third
Party Claim, in respect of which it is or can reasonably be expected to make an
Indemnity Claim, CME ME shall, or shall procure that the CME Protected Party,
promptly notify PPF, as the prospective indemnifying Party, of such matter. If
any PPF Protected Party becomes aware of any matter not involving a Third Party
Claim, in respect of which it is or can reasonably be expected to make an
Indemnity Claim, PPF shall, or shall procure that the PPF Protected Party,
promptly notify CME ME, as the prospective indemnifying Party, of such matter.

 
10.4.2
If any Protected Party becomes aware of any matter involving a Third Party
Claim, in respect of which it is or can reasonably be expected to make an
Indemnity Claim, it shall within 20 Business Days after receipt by the Protected
Party of notice of the commencement (which shall include letters before action,
notice that that Third Party Claims have been filed in any competent court or
tribunal or an invitation to settlement discussion and analogous measures) of
the potentially indemnifiable Third Party Claim, cause the Party with whom it is
affiliated to give notice to the prospective indemnifying Party of the
commencement of such Third Party Claim, provided however that the failure to
notify the prospective indemnifying Party of the Third Party Claim pursuant to
this Clause 10.4.2 shall not prejudice the Protected Party's right to make an
Indemnity Claim in respect of the relevant Third Party Claim pursuant to Clause
10.5, except to the extent that the prospective Indemnifying Party demonstrates
that the defense of the Third Party Claim is materially prejudiced by the
Indemnified Party's failure to give notice pursuant to this Clause 10.4.2.

10.5
Notice of Indemnity Claims

 
10.5.1
An Indemnity Claim shall be asserted by written notice from the Protected Party
asserting such Claim (the "Indemnified Party") to the Party from whom
indemnification is sought (the "Indemnifying Party"). For all purposes under
this Agreement, and without prejudice to the rights of the CME Protected
Parties, CME ME has agreed that it will act as the Indemnified Party for all
Indemnity Claims involving the CME Protected Parties, and no CME Protected Party
other than CME ME and CME Ltd shall be entitled to prosecute any Indemnity Claim
against PPF.

 
10.5.2
The notice shall include information regarding the nature and basis for the
Indemnity Claim and an estimate of the amount of Losses (detailing, to the
extent practicable, the Indemnified Party's calculation of the Losses thereby
alleged to have been suffered by it) demanded.

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10.6
Defense of Third Party Claims

 
10.6.1
As soon as an Indemnified Party has asserted an Indemnity Claim involving a
Third Party Claim, it shall thereafter consult with the Indemnifying Party in
respect of the Third Party Claim and permit, and procure that any relevant
Protected Party shall permit, the Indemnifying Party and its advisers reasonable
access to relevant employees, premises, chattels, documents and records
(including the right to take copies at Indemnifying Party's expense of such
documents and records) for the purposes of investigating the matter and enabling
Indemnifying Party to take any action permitted by this Clause 10.

 
10.6.2
Subject to the Indemnifying Party indemnifying the Indemnified Party or other
relevant Protected Party against any liabilities, losses or expenses which it
may reasonably suffer or incur thereby and which it would not otherwise suffer
or incur, the Indemnifying Party shall be entitled by notice in writing to
Indemnified Party at any time to require that the Indemnifying Party shall
thereafter on behalf of the Indemnified Party or other Protected Party have the
sole conduct, control and costs of the indemnified Third Party Claim. Following
such notice, the Indemnifying Party shall be entitled to avoid, dispute, resist,
settle, compromise, defend or appeal the Third Party Claim; provided, however,
that any action to avoid, dispute, resist, settle, compromise, defend or appeal
any Third Party Claim shall not create or be reasonably expected to create any
Losses for any Protected Party; and provided, further that in no event shall the
Indemnifying Party enter into any settlement, compromise or similar arrangement
of such Third Party Claim if the amount of such Third Party Claim, when
aggregated with all such other Indemnity Claims then outstanding, exceeds the
amount of total indemnity then available pursuant to Clause 11.3 or 11.12 as
applicable. The Indemnified Party shall not do and shall procure that no other
Protected Party shall do anything inconsistent therewith.

 
10.6.3
If the Indemnifying Party assumes the defense of a Third Party Claim, the
Indemnified Party shall, and shall procure that each relevant Protected Party
shall, give to the Indemnifying Party all such information and assistance as the
Indemnifying Party may reasonably require for the purpose of such defense,
including without limitation instructing any such lawyers or other professional
advisers as the Indemnifying Party may nominate to act on behalf of the
Indemnified Party but in accordance with the Indemnifying Party's instructions.

 
10.6.4
The Indemnifying Party shall keep the Indemnified Party informed of all material
developments in relation to any Third Party Claim in respect of which the
Indemnified Party has served a notice pursuant to this Clause 10 by providing
written reports on a quarterly basis or more frequently, where reasonably
necessary, that contain such information as the Indemnified Party shall
reasonably require or request.

--------------------------------------------------------------------------------

 

 
10.6.5
Where the Indemnifying Party has not by a notice pursuant to this Clause 10
assumed sole conduct, control and costs in relation to a Third Party Claim, the
Indemnified Party shall and shall procure that each relevant Protected Party
shall:

 
(i)
keep the Indemnifying Party informed of all material developments in relation to
the Third Party Claim by providing written reports on a quarterly basis or more
frequently, where reasonably necessary, that contain such information as the
Indemnifying Party shall reasonably require;

 
(ii)
not make any admission of liability, agreement, settlement or compromise with
any third party in relation to the Third Party Claim without the prior written
consent of the Indemnifying Party, such consent not to be unreasonably withheld
or delayed;

 
(iii)
take all actions that the Indemnifying Party may reasonably request to avoid,
dispute, resist, defend or appeal the Third Party Claim; provided, that any such
action to avoid, dispute, resist, settle, compromise, defend or appeal any Third
Party Claim shall not create or be reasonably expected to create any Losses for
any Protected Party;

 
(iv)
procure that no Third Party Claim relating to Tax is settled or otherwise
compromised without the Indemnifying Party's prior written consent, such consent
not to unreasonably withheld or delayed.

 
10.6.6
In addition, if the Third Party Claim relates to Tax, the Indemnified Party
shall, and shall procure that each relevant Protected Party shall, take such
action as the Indemnifying Party may reasonably and promptly by written notice
request, including (without limitation) the relevant Protected Party applying to
postpone (so far as legally possible) the payment of any Tax; provided, that
such Third Party Claim shall include any penalties, interest or fines incurred
as a result of such postponement.

 
10.6.7
Unless an Indemnifying Party elects, pursuant to Clause 10.6, to assume the
control and costs of defense, the costs of defense of any Third Party Claims,
including any Krsak Claim but excluding those Claims referred to in Clause
10.6.8, shall be the responsibility of the TV Nova Group, provided that such
costs borne by the TV Nova Group shall include only the reasonable costs of
attorneys, experts, other advisors, court fees, and related items, and shall not
include the cost of any judgment or award made in favor of any claimant.

 
10.6.8
Regardless of whether PPF elects, pursuant to Clause 10.6, to assume the control
and costs of defense, the cost of the prosecution, defense and resolution of any
Zelezny Claims, AHVG Claims, Komar Claims, Gerner Claims or Smejc Claims,
including any judgment or award made in favor of any claimant or any settlement
or compromise payment made in respect of any such Claim, shall be borne solely
by PPF. If any of such costs are incurred in the first instance by the TV Nova
Group, PPF shall reimburse the TV Nova Group for all such costs reasonably
incurred.

--------------------------------------------------------------------------------

 
10.6.9
The cost of any payments made to Krsak in connection with a Krsak Claim or
settlement or other resolution of a Krsak Claim shall be borne by PPF, unless
CME ME and PPF agree that such costs shall be borne by the TV Nova Group.

 
10.6.10
The Party responsible for the defense of any Claim shall keep the other Party
reasonably informed of all material developments in relation to any such Claim
by providing written reports on a quarterly basis or more frequently, where
reasonably necessary, that contain such information as the Indemnified Party
shall reasonably require.

11
Limitation Of Liability

11.1
General

 
11.1.1
The Parties acknowledge that the occurrence of Closing shall not prejudice the
rights of the Parties with respect to any claims concerning the Warranties of
any other Party made as of the Closing Commencement Date or the performance or
failure to perform by any other Party of its obligations under this Agreement
that were due to be performed prior to Closing.

 
11.1.2
The value of any Losses claimed by one Party against another Party shall be
reduced by the value of any related savings or other net benefits gained by the
Party entitled to such Losses as a result of such violation, and by any amounts
with respect to such Losses that the injured Party recovers with respect to such
Losses through insurance policies or other guarantees.

 
11.1.3
PPF's liability under Clause 10 in respect of any Loss resulting from Tax shall
not arise to the extent that (i) the corresponding provision or reserve in
respect of that liability to Tax (other than deferred tax) has been made in the
Closing Audit Report or to the extent that payment or discharge of such
liability to Tax (other than deferred tax) has been taken into account in the
Closing Audit Report, (ii) the corresponding provision or reserve in respect of
that liability to Tax has been made in the Closing Audit Report which is
insufficient only by reason of any increase in rates of Tax or change in Tax Law
after the date hereof having retrospective effect, (iii) it is a liability to
Tax which arises directly from a voluntary act or transaction (a) that could
reasonably have been avoided without any adverse affect on the CME Parties or
any of their affiliates or the TV Nova Business and any negative impact of which
giving rise to a Loss could reasonably have been expected by the CME Parties,
and (b) that is carried out by the CME Parties or the TV Nova Group after the
Closing Completion Date otherwise than in the ordinary course of business,
except for any such voluntary act or transaction carried out with the prior
written consent of PPF or carried out pursuant to any Tax Law. Notwithstanding
the foregoing, PPF's liability shall not be reduced in respect of any reasonable
action undertaken by the CME Parties or the TV Nova Group after the Closing
Completion Date to minimize exposure to Tax for periods up to and including the
Closing Completion Date.

--------------------------------------------------------------------------------

 

 
11.1.4
If PPF pays to or for the benefit of the CME Parties or the TV Nova Group an
amount in respect of any Losses and TV Nova Group or any CME Protected Party
subsequently receives from any other person any payment or benefit in respect of
the matter giving rise to such Claim, the CME Parties shall thereupon pay to PPF
an amount equal to the payment or benefit received (except to any extent that
the liability of PPF in respect of such Losses was reduced to take account of
such payment or benefit).

 
11.1.5
Each Party shall be under an obligation to take all reasonable steps and to
procure that all other Protected Parties take all reasonable steps to mitigate
any Loss which is or might become the subject of a Claim against another Party
before making an Indemnity Claim against such other Party; provided, however,
the obligation to mitigate shall not include the obligation to bring any action
or make any claims against any third person, but provided further that any
Indemnifying Party shall have the right to subrogate to any claim of the
Indemnified Party against any such third person, after the Indemnifying Party
has fully covered all Losses of the Indemnified Party.

11.2
Time for Making Claims

The liability of the CME Parties and PPF for any false, incorrect or misleading
Warranty and for any partial or complete failure to fulfil or incorrect
fulfilment of their obligations hereunder, or for indemnification relating to
such matters, shall be limited to the Claims made by the claiming Party to the
other Party in writing in accordance with Clause 10.5 above, on or before the
second anniversary of the Closing Completion Date; provided, however, that:

 
(i)
with respect to any Claims made by the CME Protected Parties related to Zelezny
Claims, AHVG Claims, Gerner Claims, Komar Claims, Krsak Claims for damages
arising from facts or circumstances prior to the Closing Completion Date, the
failure of PPF to transfer to the TV Nova Group good title to the 100% CP 2000
Ownership Interest or the failure of Vilja to have good title to the 52.075% CET
21 Ownership Interest, the liability of PPF shall extend to Claims made by the
claiming CME Protected Party to PPF in writing on or before the third
anniversary of the Closing Completion Date;

 
(ii)
with respect to any Claims made by the CME Protected Parties related to Taxes,
the liability of PPF shall extend to Claims made by the claiming CME Protected
Party to PPF in writing on or before the third anniversary of the later of the
Closing Completion Date and the filing of the relevant Tax return for any tax
period or portion thereof up to and including the Closing Completion Date;

 
(iii)
with respect to any Claims made by the CME Protected Parties related to Smejc
Claims or Claims against Smejc, the liability of PPF shall extend to Claims made
by the claiming CME Protected Party to PPF in writing on or before the later of
(a) the third anniversary of the Closing Completion Date or (b) three years from
the expiration or termination of the Smejc Agreement; and

--------------------------------------------------------------------------------

 

 
(iv)
notice given of a potential or contingent Claim pursuant to Clause 10.4 shall
constitute duly given notice for purposes of this Clause.

11.3
Limitation on PPF's Liability

 
11.3.1
Subject to Clause 11.3.2, the aggregate liability of PPF to the CME Protected
Parties for any Losses arising from or related to any false, incorrect or
misleading Warranty and for indemnification relating to such matters shall be
limited to an aggregate sum of CZK 2,000,000,000.

 
11.3.2
Notwithstanding Clause 11.3.1, the aggregate liability of PPF to the CME
Protected Parties for any Losses arising from or with respect to (i) Taxes, (ii)
any Zelezny Claim, (iii) any AHVG Claim, (iv) any Smejc Claim, (v) the failure
of Vilja to have good title to the 52.075% CET 21 Ownership Interest, (vi) any
Komar or Gerner Claim, (vii) Claims by any CME Protected Party against Smejc
arising out of any breach by Smejc of any Transaction Document, (viii) any
fraudulent or criminal act or omission by PPF or any member of the PPF Group or
any officer, director, representative, employee or agent thereof in respect of
the ownership and operation of the TV Nova Group, and (ix) for indemnification
relating to all such matters, shall be limited to an aggregate amount equal to
the Purchase Price.

 
11.3.3
The aggregate liability of PPF to the CME Protected Parties in respect of any
Losses howsoever caused shall be limited to an aggregate amount equal to the
Purchase Price.

11.4
Allowances, Provisions and Reserves

PPF shall not be liable in respect of a Claim to the extent that allowance,
provision or reserve in respect of the matter giving rise to the Claim or a
specific category of such matters was made in the Closing Audit Report.

11.5
Change in Law

PPF shall not be liable in respect of any Claim to the extent that it arises
solely as a result of any change in any law, decree, ordinance, order or
regulation having retrospective effect occurring after the Closing Completion
Date.

11.6
Accounting Bases

PPF shall not be liable in respect of any Claim to the extent that it arises or
is increased as a result of any change after the Closing Completion Date in the
accounting bases, policies, practices or methods applied in preparing any
accounts or valuing any assets or liabilities of the Company from those used in
the Closing Audit Report.

11.7
Contingent and Non-quantifiable Liabilities

PPF shall not be liable in respect of any Claim to the extent that it relates to
a liability which is contingent or not capable of being quantified unless and
until the liability ceases to be contingent or becomes capable of being
quantified, as the case may be.

--------------------------------------------------------------------------------

11.8
No Double Recovery

 
11.8.1
PPF shall not be liable in respect of any Claim to the extent that the subject
of the Claim has been or is made good or is otherwise compensated for without
cost to the CME Parties.

 
11.8.2
The CME Parties shall not be entitled to recover damages or otherwise obtain
reimbursement or restitution more than once in respect of the same Loss.

11.9
CME Parties' Approval

PPF shall not be liable in respect of any Claim for any Loss arising from any
act or decision taken pursuant to Clause 5.2 to the extent that the conduct of
PPF that gave rise to such Loss was undertaken at the express direction of or
with the express consent of CME ME or CME Ltd, or otherwise as agreed in writing
between CME ME and PPF.

11.10
Status of Clause 11

The provisions of this Clause 11 shall apply notwithstanding anything else in
the Transaction Documents to the contrary.

11.11
Pre-1996 Event Facts and Circumstances

Notwithstanding any other provision of this Agreement or another Transaction
Document, PPF shall have no liability to any CME Protected Party in relation to
any Loss to the extent it arises from any fact or circumstance occurring or
existing prior to August 30, 1996.

11.12
Limitation on CME Parties' Liability

The aggregate liability of the CME Parties to the PPF Protected Parties for any
Losses howsoever caused shall be limited to an aggregate amount equal to US$
25,000,000, except as provided in the Subscription Agreement; provided, however,
that nothing in this Clause shall affect the obligation of the CME Parties to
pay the Purchase Price if such amount is otherwise due pursuant to this
Agreement.

12
Tax Issues

12.1
Tax Returns

Each member of the TV Nova Group (which may act through a duly authorised agent
for the purposes of this Clause 12), shall at its own cost, prepare and submit
its statutory accounts and tax returns for accounting periods ended on or prior
to Closing Completion Date, to the extent they have not been prepared or
submitted prior to the Closing Completion Date. PPF shall give each member of
the TV Nova Group, or shall procure that each member of the TV Nova Group is
given, all such assistance as may be required to prepare the said returns and
agree them with the appropriate authorities. Each member of the TV Nova Group
shall deliver to PPF copies of all material documentation and drafts of all
material correspondence relating to the said returns which it intends to submit
to the relevant Tax Authority before submission and give consideration to PPF's
reasonable comments concerning them.

--------------------------------------------------------------------------------

12.2
Tax Credits

If any Indemnity Claim relating to Tax represents Tax for which credit is or may
become due to the TV Nova Group at a later date or in respect of which it is
subsequently found that there arises a corresponding credit or right to
repayment of Tax, the amount of the Claim relating to Tax shall nevertheless be
payable in full by PPF but if subsequently any reduction is made in the Claim
relating to Tax or it is found that PPF's liability in respect of the Claim
relating to Tax falls short of the amount paid by PPF or such credit or
repayment is received by the TV Nova Group, CME ME shall promptly repay to PPF
an amount equal to such reduction, shortfall, credit or repayment up to the
amount previously paid by PPF in respect of that Claim relating to Tax and net
of the CME ME's reasonable costs and interest on such amount. For this purpose,
no credit shall be taken to have been received by the TV Nova Group unless it
shall have relieved the TV Nova Group of a present obligation to pay Tax.

13
Security

13.1
Required Security

 
13.1.1
On the Closing Commencement Date, PPF shall provide security for the performance
by PPF of the Obligations in form of the Guarantee to be issued in favor of the
CME Parties by the Guarantor. The Guarantee shall be effective from the Closing
Commencement Date.

 
13.1.2
On the Closing Commencement Date, PPF shall provide security for the performance
by Guarantor of all Guarantor Obligations in the form of the PPF Group Guarantee
to be issued in favor of the CME Parties by the PPF Group Guarantor. The PPF
Group Guarantee shall be effective from the Closing Commencement Date, and shall
be available to be called on once the aggregate demands made under the Guarantee
amount to CZK 2,000,000,000 or more, provided, that all Guarantor Obligations
shall be subject to this PPF Group Guarantee after the threshold has been
exceeded.

13.2
Substitute Security

 
13.2.1
At any time after the Closing Completion Date PPF may replace the PPF Group
Guarantee with Substitute Security by giving CME ME a Substitution Notice, and
thereafter may replace any Substitute Security provided to secure the Guarantor
Obligations with other Substitute Security by giving CME ME a Substitution
Notice.

 
(i)
PPF shall not submit more than one Substitution Notice during any one-year
period from the Closing Commencement Date in respect of the substitution of the
PPF Group Guarantee except in the event that additional security is required for
purposes of satisfying the Guarantor Obligations pursuant to the terms hereof or
of the PPF Group Guarantee.

--------------------------------------------------------------------------------

 

 
(ii)
Upon completion of the replacement of the PPF Group Guarantee with Substitute
Security, as provided herein, the PPF Group Guarantee shall cease to be valid
and effective.

 
(iii)
The Parties agree that any Substitution Notice with respect to the PPF Group
Guarantee shall not contain more than three forms of Substitute Security, but if
more than one form of Substitute Security is proposed at any one time, no single
form of Substitute Security shall be proposed with a value less than US$
40,000,000.

 
(iv)
At no time shall the Substitute Security for the Guaranteed Obligations consist
of more than three forms of Substitute Security, unless CME ME shall agree
otherwise.

 
13.2.2
At any time after PPF or the Guarantor has provided Initial Security pursuant to
the Guarantee, PPF may replace the Initial Security with Substitute Security by
giving the CME Parties a Substitution Notice.

 
(i)
PPF shall not submit more than one Substitution Notice during any one-year
period from the Closing Commencement Date in respect of such substitution except
in the event that additional security is required for purposes of satisfying the
Guarantor Obligations pursuant to the terms here of or of the Guarantee.

 
(ii)
The Parties agree that any Substitution Notice with respect to the Initial
Security shall not contain more than three forms of Substitute Security, but if
more than one form of Substitute Security is proposed at any one time, no single
form of Substitute Security shall be proposed with a value less than US$
20,000,000.

 
(iii)
At no time shall the Substitute Security for the Obligations consist of more
than three forms of Substitute Security.

 
13.2.3
Any Substitution Notice delivered to the CME Parties while either the Guarantor
is in breach of its obligations under the Guarantee or the PPF Group is in
breach of its obligations under the PPF Group Guarantee shall be invalid.

 
13.2.4
The Substitution Notice shall specify:

 
(i)
the form of Substitute Security,

 
(ii)
the estimated value of the Substitute Security,

 
(iii)
the proposed substitution date (the "Substitution Date"); and

 
(iv)
the procedure and contracts and other documentation necessary for the
substitution.

--------------------------------------------------------------------------------

 

 
13.2.5
If the CME Parties receive a Substitution Notice in respect of security provided
by the Guarantor, they can object to the proposed substitution within 15
Business Days of receipt of the Substitution Notice on the grounds that:

 
(i)
the value of the Substitute Security is less than the aggregate value of the
outstanding Demand Amounts on the Substitution Date,

 
(ii)
the Substitute Security is not reasonably liquid; or

 
(iii)
the substitution procedure could at any time leave the CME Parties without the
benefit of sufficient security

provided, however, that no objection can be made to the form of any of the types
of Substitute Security specified in Clause 13.2.9.

 
13.2.6
If the CME Parties receive a Substitution Notice in respect of security
originally provided by the PPF Group Guarantee, they can object to the proposed
substitution within 15 Business Days of receipt of the Substitution Notice on
the grounds that:

 
(i)
the value of the Substitute Security is less than an amount equal to the greater
of:

 
(a)
CZK 10 billion, or

 
(b)
the aggregate value of the outstanding Demand Amounts on the date of the
Substitution Notice; or

 
(ii)
the Substitute Security is not reasonably liquid; or

 
(iii)
the substitution procedure could at any time leave the CME Parties without the
benefit of sufficient security.

provided, however, that no objection can be made to the form of any of the types
of Substitute Security specified in Clause 13.2.9.

 
13.2.7
If the CME Parties object to the proposed Substitute Security on the grounds
stated in Clauses 13.2.5(i), 13.2.5(ii), 13.2.6(i) or 13.2.6(ii), PPF and CME
may appoint the Independent Accountant to determine whether the CME Parties'
objection is valid.

 
13.2.8
As soon as reasonably practical after the appointment of the Independent
Accountant, PPF shall make available to the Independent Accountant all relevant
documentation concerning the proposed Substitute Security and CME ME shall make
available all relevant information concerning the basis for its objection. The
Independent Accountant shall review the Substitution Notice and the relevant
information provided by PPF and CME ME and shall, as promptly as practicable,
and in no event later than 25 Business Days following the date of delivery of
the relevant information described above, deliver to CME ME and PPF a decision
as to whether the CME Parties' objections to the Substitute Security were valid.

--------------------------------------------------------------------------------

 

 
(i)
The Independent Accountant, if appointed, shall act as an expert and not as an
arbitrator, and its decisions on matters which shall be referred to it pursuant
to this Clause shall be, absent manifest error, final and binding upon the CME
Parties and PPF. PPF shall pay the fees and expenses of the Independent
Accountant incurred in resolving the objections to the Substitute Security.

 
(ii)
If the Independent Accountant determines that the CME Parties' objections to the
Substitute Security are not valid the CME Parties shall be bound to accept the
Substitute Security proposed in the Substitution Notice, subject to the
agreement of the CME Parties and PPF on definitive documentation and appropriate
procedures. If the Independent Accountant determines that the CME Parties'
objections to the Substitute Security are valid, no such substitution of
Security shall be made.

 
(iii)
During the pendency of any such determination by the Independent Accountant, the
Security in effect at the time the Substitution Notice is given shall remain in
full force and effect.

 
13.2.9
Permitted forms of substitute security ("Substitute Security") shall consist of,
at the election of PPF:

 
(i)
cash in an Escrow Account, denominated in US$, Euros or CZK,

 
(ii)
a bank guarantee to be irrevocably issued in favour of the CME Parties by a
reputable international bank reasonably acceptable to the CME Parties (such bank
(a) to have a credit rating for its US Dollar obligations from an international
rating agency of no less than the credit rating of the Czech Republic for its
sovereign foreign currency obligations, (b) to be a bank other than a Czech
bank, and (c) to issue the bank guarantee from a branch situated outside of the
Czech Republic) and shall be in form and substance reasonably acceptable to the
CME Parties (a "Bank Guarantee"),

 
(iii)
a pledge on such number of publicly tradeable booked bearer shares of the common
stock of Ceska pojistovna a.s. as have readily realizable value of not less than
the amount required above with respect to the amount of such Security, including
the right to receive dividends earned on such shares during the time that they
are subject to the Pledge, in form and substance reasonably acceptable to the
CME Parties (a "CP Pledge"), or 

 
(iv)
solely in respect of a Substitution Notice delivered in respect of the PPF Group
Guarantee, a pledge on such number of CME Shares as have readily realizable
value of not less than the amount required above with respect to the amount of
such Security, including the right to receive dividends earned on such shares
during the time that they are subject to the Pledge, in form and substance
reasonably acceptable to the CME Parties (a "CME Pledge").

13.3
Financial Condition of Guarantors and Mandatory Substitution

--------------------------------------------------------------------------------

 
13.3.1
During all periods when any Security is in the form of the Guarantee or the PPF
Group Guarantee,

 
(i)
PPF shall promptly provide the CME Parties with (1) a copy of the Guarantor's
audited annual financial statements, beginning with 2004, and the guarantor's
unaudited quarterly (to the extent prepared by such guarantor) and half-yearly
financial statements (to the extent prepared by such guarantor) all on the
accounting basis normally used by the Guarantor, (2) the PPF Group Guarantor's
audited annual financial statements, beginning with 2003, and the guarantor's
audited quarterly financial statements (to the extent prepared by the PPF Group
Guarantor) all on the accounting basis normally used by the PPF Group Guarantor,
and PPF shall procure that the PPF Group Guarantor shall provide to the CME
Parties certification that the PPF Group Guarantor has sufficient assets
available to it in order to satisfy any Guarantor Obligations that may arise on
the basis provided in the PPF Group Guarantee together with delivery of its
annual financial statements and also on the request of CME ME not more often
than quarterly (provided that the PPF Group Guarantor's failure to deliver such
certification in response to a CME ME request shall not in any way constitute a
waiver of or otherwise affect any of PPF's rights or the PPF Group Guarantor's
rights under this Agreement); and

 
(ii)
if there is a (a) decline in the Tangible Net Worth of the Guarantor by more
than 10% from the Guarantor's Tangible Net Worth at December 31, 2004, or (b)
material adverse change in the financial standing or creditworthiness of any
guarantor since December 31, 2003, (x) PPF shall immediately notify CME ME of
such occurrence and (y) within five Business Days of becoming aware of such
occurrence give to the CME Parties a Substitution Notice or certify to the
reasonable satisfaction of CME ME that notwithstanding the decline in Tangible
Net Worth of the Guarantor or Total Assets or Shareholders Equity of the PPF
Group Guarantor that the PPF Group Guarantor has sufficient assets available to
it in order to satisfy any Guarantor Obligations that may arise; provided, that
it is acknowledged that such certification will be satisfactory to CME ME if it
is made on the basis of a then current consolidated balance sheet of the PPF
Group Guarantor; and

provided, further, that nothing in this Clause or this Agreement shall entitle
the CME Parties or their advisors or lenders to require the PPF Group Guarantor
to participate in any valuation or creditworthiness examinations, or due
diligence, or deliver any information, other than (1) pursuant to Clause 5.1.7
if and when agreed in each particular case, (2) in connection with the provision
of Substitute Security pursuant to Clause 13.2, or (3) a dispute pursuant to
Clause 15.

 
13.3.2
Upon issuance of a Substitution Notice pursuant to Clause 13.3.1(ii), the
Parties shall proceed as provided in Clause 13.2.6. If CME ME makes valid
objections to the Substitute Security proposed as provided in Clause 13.3.1, PPF
shall be obliged to provide to CME ME another form of Substitute Security that
reasonably satisfies the CME Parties.

--------------------------------------------------------------------------------

13.4
Costs and Expenses

All the costs and expenses incurred in connection with the substitution
procedure (including any legal fees of the CME Parties and taxes) and the costs
and expenses incurred in connection the Substitute Security itself (including
any bank costs related to Escrow Accounts or the provision of bank guarantees)
shall be borne entirely by PPF.

13.5
Further Assurances Regarding Security

PPF shall promptly give the CME Parties all such assistance as they may
reasonably require to enable the CME Parties to perfect the CME Parties rights
to any Substitute Security and the CME Parties' rights thereunder, including
without limitation the registration of any CP Pledge or CME Pledge on the
Substitution Date.

13.6
Duration of Security

 
(i)
The Security shall remain in full force and effect until released by the CME
Parties upon the later of (i) the expiration of the statute of limitations
period for claims that could have been asserted on or before the third
anniversary of the Closing Completion Date and (ii) resolution of any Indemnity
Claims by any CME Protected Party that are outstanding on that date.

 
(ii)
The total amount of Security required to be provided following the third
anniversary of the Closing Completion Date shall be limited to the amount of
Indemnity Claims that are outstanding on that date.

14
Governing Law

This Agreement shall be governed by and construed in accordance with the laws of
England and Wales.

15
Dispute Resolution

Any disputes, claims or controversy arising out of or related to this Agreement,
including any question as to its formation, validity, interpretation or
termination, that cannot be resolved by negotiations between the Parties shall
be settled by arbitration on an ad hoc basis in accordance with the UNCITRAL
Arbitration Rules, by three arbitrators appointed by the Parties or otherwise
appointed by the London Court of International Arbitration in accordance with
such rules. Unless the Parties agree otherwise, any arbitration proceeding shall
be conducted in two phases, beginning with a determination of the merits of the
dispute, and followed, if necessary, by a determination of the relevant damages
or other relief. The arbitration shall be conducted in London and all documents
and proceedings shall be in the English language. Any of the Parties shall have
the right to initiate the proceedings.

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16
Non-Business Days

If Closing or any other performance would otherwise be required by the terms of
this Agreement or any other Transaction Document to take place on a day which is
not a Business Day, it will instead take place on the next Business Day.

17
Amendments

This Agreement may be amended or modified only if in writing (including a
writing evidenced by a facsimile transmission) and signed by all of the Parties.
Notwithstanding the provisions of Clause 22.2, the Parties may amend or modify
this Agreement in any way without the consent of the Protected Parties.

18
Counterparts

This Agreement may be executed in any number of counterparts each of which when
executed shall constitute an original of this Agreement and all the counterparts
together shall constitute one and the same instrument.

19
Confidentiality and Announcements

19.1
Non-Disclosure

 
19.1.1
The Parties shall not divulge or communicate to any person (other than those of
its employees and professional advisers whose province it is to know the same)
or use or exploit for any reason whatsoever this Agreement, the matters
contemplated hereby, any other Transaction Document, or the information
disclosed by any Party to another Party, and shall use its reasonable endeavors
to prevent its employees from so acting.

 
19.1.2
No announcement concerning this Agreement or any other Transaction Document
shall be made by any Party without the prior written approval of the other
Party, such approval not to be unreasonably withheld or delayed. Prior to any
public announcement relating to any Transaction Document the Parties shall agree
on the timing and content of any announcement.

 
19.1.3
Notwithstanding the provisions of Clauses 19.1 to 19.1.2 above, any Party may
make an announcement or disclosure concerning this Agreement or any other
Transaction Document:

 
(i)
if required by law or requirement of any securities exchange or regulatory or
governmental body to which that Party is subject, wherever situated, whether or
not the requirement has the force of law, or

 
(ii)
to a Party's or its affiliates' directors, officers, employees, professional
advisers, counsel, rating agencies, and lenders or other providers of funds (a)
who are directly concerned with this Agreement or any other Transaction Document
or any related arrangements or transactions, and (b) whose knowledge of such
information is essential, and (c) who by its position or otherwise is under duty
to observe confidentiality in dealing with this Agreement and such related
arrangements or otherwise must comply with the provisions of this Agreement in
respect of confidentiality.

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19.2
Duration of Restrictions

The restrictions contained in this Clause 19 shall continue to apply for the
period of three years following the expiration or termination of this Agreement.

19.3
Public Support

To the extent permitted by law and the foregoing obligations, each Party
undertakes to provide the others with reasonable public support in relation to
the matters contemplated in this Agreement.

20
Notices

20.1
Form of Notice

 
20.1.1
A notice under this Agreement shall only be effective if it is in writing,
otherwise being deemed null and void.

 
20.1.2
Notices (including accompanying papers) with respect to this Agreement shall be
prepared in the English language or, in respect of accompanying papers,
accompanied by a certified English translation.

20.2
Addresses for Notices

Notices under this Agreement shall be sent to a Party at its address set forth
on the first page hereof or faxed to the fax number and for the attention of the
individual set out below:

 
(A)
if to CME Ltd, or

 
(B)
if to CME ME,

 
all to:
Central European Media Enterprises

 

for the attention of General Counsel

 

fax number: +44 20 7430 5403

 
(C)
if to PPF

 
to:
c/o PPF a.s.

 

fax number: +420 2 559222

with a copy to:

Brzobohaty, Broz & Honsa

for the attention of Josef Broz

fax number: +420 2 34091366

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Any such notice shall be effective on the date of the fax transmission, provided
that a facsimile-generated confirmation statement is retained by the sender and
delivered to the recipient upon request and that the date of delivery that does
not occur on a Business Day during normal business hours shall be deemed to be
the next succeeding Business Day.

Each Party may change its notice details on giving notice to the other Parties
of the change in accordance with this Clause 20. Such change shall become
effective five Business Days following the making of the notice.

21
Assignment

21.1
Successors

This Agreement shall be binding on and inure for the benefit of each Party's
successors in title.

21.2
Restriction on Assignment

No Party shall assign or transfer (by way of corporate restructuring or
otherwise), or declare any trust in favor of a third party over, all or any part
of its obligations or undertakings under this Agreement without the prior
written consent of the other Parties, which shall not be unreasonably withheld;
provided, however, that CME ME may effect such an assignment, transfer or
declaration of trust in order to grant security interests to a non-affiliated
financial institution for purposes of securing financing; and provided further,
however, that PPF may only withhold consent to any other assignment or transfer
by either of the CME Parties to CME Ltd or any of the CME Parties' respective
affiliates, if PPF reasonably demonstrates to the CME Parties the basis for
PPF's conclusion that such assignment or transfer would negatively affect the
rights of PPF under this Agreement or PPF's ability to enforce or recover
against those rights. Any assignment or transfer by any of the CME Parties shall
be undertaken by the CME Parties at no cost to PPF.

21.3
Substitute Performance

Any obligation of either CME Party hereunder may be satisfied by substitute
performance by the other CME Party or any of their respective affiliates, and
any right accruing to either CME Party hereunder may be exercised by the other
CME Party; provided that PPF shall be entitled to rely on such substitute
performance or exercise of rights as binding on the CME Party otherwise entitled
to such performance or exercise pursuant to this Agreement.

22
Rights of Third Parties

22.1
General

Subject to Clause 22.2, no person who is not a Party to this Agreement shall
have any rights under the Contracts (Rights of Third Parties) Act 1999 to
enforce a term of this Agreement.

22.2
Protected Parties

--------------------------------------------------------------------------------

 
The Protected Parties shall have the right under the Contracts (Rights of Third
Parties) Act 1999 to enforce Clause 10 and any other relevant Clauses necessary
for the enforcement of the indemnities therein, including Clause 11, 13, 14, 15,
and the Guarantee (or such Security as may be in effect at the time).

23
Entire Agreement

This Agreement and the other Transaction Documents, each when executed and
effective pursuant to its terms, constitute the whole and only agreement between
the Parties relating to the subject matter of this Agreement and supersedes any
Pre-contractual statement. Each Party acknowledges in entering into this
Agreement it is not relying upon any Pre-contractual Statement (except those
expressly set out in this Agreement and the documents referred to herein). Each
of the Parties waives all rights and remedies which, but for this Clause 23,
might otherwise be available to it in respect of any Pre-contractual Statement,
provided that nothing in this Clause 23 shall limit or exclude any liability for
fraud.

24
Waivers

The single or partial exercise of any right, power or remedy provided by law or
under this Agreement shall not preclude any other or further exercise of it or
the exercise of any other right, power or remedy.

25
Costs and Expenses

Each Party shall be liable for its costs and expenses in relation to the
negotiation, preparation, execution and carrying into effect of this Agreement.

26
Severability

26.1
Effect of Invalidity

 
26.1.1
If any provision or part of this Agreement is ruled invalid, illegal or
unenforceable by an arbitration tribunal described in Clause 15 or by any court
of competent jurisdiction, the invalidity, illegality or unenforceability of
such provision or part shall not affect any of the remaining provisions of this
Agreement.

26.1.2 If from any circumstances whatsoever fulfillment of any provisions of
this Agreement, at the time performance of such provisions shall be due, shall
result in transcending the limit of validity, legality or enforceability, the
right or obligation to be fulfilled shall be reduced to the limit of such
validity, legality or enforceability, so that in no event shall any action be
possible under this Agreement that is in excess of the current limit of such
validity, legality and enforceability, but such obligation shall be fulfilled to
the limit of such validity and enforceability.

 

--------------------------------------------------------------------------------

 
26.2
Cure

If any provision or part of this Agreement is ruled invalid, illegal or
unenforceable, then the Parties shall use their reasonable endeavors, to the
fullest extent permitted under the law, in order to amend the terms of this
Agreement so as to reasonably preserve the benefit of the bargain for the
Parties.

27
Legality

The Parties to this Agreement shall not contest the legality of this Agreement,
any Transaction Document, or any other agreement entered into pursuant to or in
conjunction with this Agreement.

28
Further Assurance

Each of the Parties shall, at the request of the other Party, do or so far as
each is able procure the doing of all such acts and/or execute or procure the
execution of all such documents in a form satisfactory to the Party concerned as
they may reasonably consider necessary for giving full effect to this Agreement
and securing to them the full benefit of the rights, powers and remedies
conferred upon them in this Agreement.

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In witness hereof, this Agreement has been executed as a deed on the day and
year first above written.
 
 
EXECUTED as a Deed for and on behalf of

CME MEDIA ENTERPRISES B.V.
 
 
By: /s/ Michael Garin

Name: Michael Garin

Title: Director

 
EXECUTED as a Deed for and on behalf of

CENTRAL EUROPEAN MEDIA ENTERPRISES LTD
 
 
By: /s/ Michael Garin

Name: Michael Garin

Title: Director
 
 
EXECUTED as a Deed for and on behalf of

PPF (CYPRUS) LTD
 
 
By: /s/ Miroslav Horsky

Name: Miroslav Horsky

Title: Director

--------------------------------------------------------------------------------

 
Annex 1

Programming Library Transfer

Agreed Principles

Parties

AQS a.s and CET 21 s.r.o. (or a party designated by CET 21, the "Transferee"))

Assignment

Subject to the receipt of any required consents, AQS will assign and transfer
all rights, title and interest in the Programming Library to Transferee in
accordance with the Programming Library Transfer Agreement ("PLTA"). The
Programming Library of the TV Nova Business as of August 31, 2004 is
incorporated into document number 2a on the Additional Disclosed Documents Index
No. 34. The Programming Library to be transferred shall include rights to titles
or runs that have been identified therein as reserved by Nova or AQS.

Assignment and Transfer Procedure

AQS shall cause true and correct copies of all AQS Programming Agreements to be
Assigned and all master tapes and program broadcasting materials ("Program
Materials") in its possession in respect of the AQS Programming Agreements to be
Assigned to be delivered to Transferee.

The Programming Library to be transferred shall specifically exclude the
transfer of the Program Materials in respect of certain titles identified in the
PLTA Annex (the "Retained Master Tapes"). Transferee shall have no liability for
the Retained Master Tapes or any obligations attached thereto other than as
specified in the PLTA Annex.

AQS and Transferee shall agree a form of notice of consent to assignment of each
AQS Programming Agreement to be Assigned to be delivered to the corresponding
Distributor. Each of AQS and Transferee shall use its best efforts to procure
that each Distributor consents to the assignment. Until the consent of any
Distributor is obtained, the Transferee shall be deemed to be a sublicense in
accordance with the corresponding AQS Programming Agreement to be Assigned.

AQS will inform each Distributor that all future deliveries of Program Materials
(other than any Retained Master Tapes) shall be made directly to Transferee. In
the event AQS or its affiliates receive any Program Materials in respect of the
AQS Programming Agreements to be Assigned, it shall promptly cause such Program
Materials to be delivered to Transferee.

The failure to deliver Program Materials in accordance with the PLTA, a change
of control of AQS prior to the transfer of the Programming Library, and AQS'
holding itself out or acting as an agent or representative of the TV Nova Group
or amending or extending the terms of any Programming Agreements to be Assigned
will be included as breaches of the PLTA.

--------------------------------------------------------------------------------

 
Payment

Subject to the satisfaction of the Assignment and Transfer Procedure and the
delivery of the Program Materials, Transferee will pay to AQS: The agreed value
of each of the AQS Programming Agreements to be Assigned in the amounts set
forth in the PLTA Annex (which value shall be 59.5% of the indicated value in
respect of any title reserved by AQS) minus those outstanding liabilities to
Distributors under the AQS Programming Agreements to be Assigned assumed by
Transferee in the amounts set forth in the PLTA Annex.

The agreed value shall be reduced all amounts invoiced by AQS to CET 21 in
respect of the Programming Library under any AQS Programming Agreement to be
Assigned that has been issued by AQS to CET 21 pursuant to the Agreement on
Basic Principle of Purchase of Foreign and Domestic Programs dated September 24,
1998, the Contract for the Purchase of TV Broadcasting Rights and Rights to
Language Versions and for the Provision of Shipping Services dated May 10, 2004
or otherwise.

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Annex 2

PPF Group

The PPF Group, as of the Execution Date, consists of the following persons. This
information is based on the annual report of PPF as of December 31, 2003 as well
as other disclosures made by PPF. PPF shall update this list as of the Closing
Commencement Date, and thereafter to reflect changes in the corporate structure
and activities of the PPF Group; provided, that any change to this Annex shall
be subject to the agreement of the CME Parties prior to making any changes as
amendments to the Framework Agreement.

·
Petr Kellner

·
PPF Group N.V.

·
Cespo Holdings B.V.

·
Cespo B.V.

·
Česká pojíšťovna a.s.

·
Česká pojíšťovna Group

·
Home Credit Group

·
eBanka, a.s.

·
PPF a.s

·
PPF banka a.s. (formerly Prvni městská banka a.s.)

·
PPF burzovni společnost a.s.

·
PPF Capital Management a.s.

·
PPF majetková a.s.

·
CM - CREDIT a.s.

·
PPF (CYPRUS) LIMITED

·
PPF SERVICES LIMITED

·
PPF Asset Management a.s.

·
PPF CONSULTING a.s.

·
TV Nova Group (including CET 21 and CP 2000, and all subsidiaries of CET 21 and
CP 2000)

·
MEF Media B.V.

·
PPF Media B.V.

·
TV Nova Holdings B.V.

·
All members of the Board of Directors, Supervisory Board or Company Management
of the foregoing persons

For purposes of Clauses 1.2, 4, 8 (excluding 8.4), 10 and 11 of the Agreement,
PPF Group shall also include:

·
Messrs. Smejc, Komar and Gerner

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Annex 3
Working Capital
 

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Annex 4

Form of Transfer Agreement (CZ a.s. Entity)
 

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Annex 5

Form of Transfer Agreement (CZ s.r.o. Entity)
 

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Annex 6

Subscription Agreement
 

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Annex 7

Registration Rights Agreement
 

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Annex 8

TV Nova Group Agreement
 

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Annex 9

Guarantee
 

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Annex 10

Smejc Agreement
 

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Annex 11

Amended Newco/Oldco Memorandum of Association
 

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Annex 12

PPF Group Guarantee

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