----

| Date: | March      4, 2008 |
|-------|--------------------|

| To: | Central      European Media Enterprises Ltd. |
|-----|----------------------------------------------|

|   | Facsimile: | +44      20 7430 5402 (United Kingdom) |
|--------|------------|----------------------------------------|

|   | Telephone: | +44      20 7430 5337 / 5353 |
|--------|------------|------------------------------|

| From: | Lehman      Brothers, Inc acting as Agent |
|-------|-------------------------------------------|

|   | Facsimile: | 646-885-9546      (United States of America) |
|--------|------------|----------------------------------------------|

|   | Telephone: | 212-526-9986 |
|--------|------------|--------------|

| Ref.      Numbers: | Global      Deal ID: 3694013 |
|--------------------|------------------------------|

----

----

| General      Terms:     |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|-------------------------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| Agent:                  |   | Lehman      Brothers Inc. (“LBI”) is acting as agent on behalf of Party A and Party B      for this Transaction.  LBI has no obligations, by guarantee,      endorsement or otherwise, with respect to the performance of this      Transaction by either party.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| Trade      Date:        |   | March      4, 2008                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| Option      Style:      |   | “Modified      American” as set forth under “Procedures for Exercise”    below.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| Option      Type:       |   | Call                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| Seller:                 |   | Party      A                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| Buyer:                  |   | Party      B                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| Shares:                 |   | The      Class A common stock of Central European Media Enterprises Ltd. (the      “Issuer”), par value USD 0.08 per share, Ticker: CETV                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
| Number      of Options: |   | 148,750,      provided that if      Lehman Brothers Inc. and J.P. Morgan Securities Inc. as representatives of      the Initial Purchasers (as defined in the Purchase Agreement dated as of      March 4, 2008 between Party B and Lehman Brothers Inc. and J.P. Morgan      Securities Inc. as representatives of the initial purchasers party thereto      (the “Purchase Agreement”)), exercise the option to purchase additional      Convertible Notes pursuant to Section 2(d) of the Purchase Agreement, the      Number of Options hereunder shall be automatically increased, effective      upon payment by Party B of the Additional Premium on the Additional      Premium Payment Date, by the Applicable Percentage times the number of      Convertible Notes in denominations of USD 1,000 principal amount issued      pursuant to such exercise (such Convertible Notes, the “Additional      Convertible Notes”). For the avoidance of doubt, the Number of Options      shall be reduced by the number of any Options exercised or terminated by      Party B. In no event will the Number of Options be less than      zero. |

----

| Option      Entitlement:              |   | As      of any date, a number equal to the Conversion Rate as of such date (as      defined in the Indenture, but without regard to any adjustments to the      Conversion Rate pursuant to Section 10.04(b) or Section 10.05(i) of the      Indenture).                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|---------------------------------------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| Applicable      Percentage:           |   | 35%                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| Number      of Shares:                |   | The      product of the Number of Options and the Option    Entitlement.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| Strike      Price:                    |   | USD      105.00                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| Cap      Price:                       |   | USD      151.20                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| Premium:                              |   | USD      19,828,375 (Premium per Option: USD 133.30), provided that if the      Number of Options is increased pursuant to the proviso to the definition      of “Number of Options” above, Party B shall pay on the Additional Premium      Payment Date an additional Premium (the “Additional Premium”) equal to the      product of the number of Options by which the Number of Options is so      increased and USD 133.30.                                                                                                                                                                                                                                                                      |
|                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| Premium      Payment Date:            |   | Four      Currency Business Days after the Trade Date                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| Additional      Premium Payment Date: |   | The      closing date for the purchase and sale of the Additional Convertible      Notes.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| Exchange:                             |   | NASDAQ      Global Select Market                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| Related      Exchange(s):             |   | All      Exchanges                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
|                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| Market      Disruption Event:         |   | The      definition of “Market Disruption Event” in Section 6.3(a) of the Equity      Definitions is hereby amended by deleting the words “at any time during      the one-hour period that ends at the relevant Valuation Time, Latest      Exercise Time, Knock-in Valuation Time or Knock-out Valuation Time, as the      case may be” and inserting the words “at any time on any Averaging Date”      after the word “material,” in the third line thereof. Section      6.3(d) of the Equity Definitions is hereby amended by deleting the      remainder of the provision following the term “Scheduled Closing Time” in      the fourth line thereof. |
|                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| Disrupted      Day:                   |   | The      definition of “Disrupted Day” in Section 6.4 of the Equity Definitions      shall be amended by adding the following sentence after the first      sentence: “A Scheduled Trading Day on which a Related Exchange fails to      open during its regular trading session will not be a Disrupted Day if the      Calculation Agent determines that such failure will not have a material      adverse impact on Party A’s ability to unwind any related hedging      transactions related to theTransaction.”                                                                                                                                                                            |

----

| Procedure for      Exercise: |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|------------------------------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                         |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| Exercise      Period:        |   | Notwithstanding      anything to the contrary in the Equity Definitions, an Exercise Period      shall occur with respect to an Option hereunder only if such Option is an      Exercisable Option (as defined below) and the Exercise Period shall be, in      respect of any Exercisable Option, the period commencing on, and      including, the relevant Conversion Date and ending on, but excluding, the      first Averaging Date in respect of such Conversion Date; provided that in      respect of any Exercisable Options relating to Convertible Notes for which      the relevant Conversion Date occurs during the period beginning on, and      including, December 15, 2012, the final day of the Exercise Period shall      be the Scheduled Trading Day immediately prior to the Expiration Date      (such Exercise Period, the “Final Exercise Period”).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|                         |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| Conversion      Date:        |   | With      respect to any conversion of Convertible Notes, the date on which the      holder of such Convertible Notes satisfies all of the requirements for      conversion thereof as set forth in Section 10.02 of the      Indenture.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|                         |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| Exercisable      Options:    |   | Upon      the occurrence of a Conversion Date, a number of Options equal to (x) the      Applicable Percentage times (y) the number of      Convertible Notes in denominations of USD 1,000 principal amount converted      on such Conversion Date.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|                         |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| Expiration      Time:        |   | The      Valuation Time                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|                         |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| Expiration      Date:        |   | March      15, 2013                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|                         |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| Multiple      Exercise:      |   | Applicable,      as described under “Exercisable Options” above.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|                         |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| Automatic      Exercise:     |   | Applicable;      and means that, in respect of any Exercise Period other than the Final      Exercise Period, a number of Options not previously exercised hereunder      equal to the number of Exercisable Options shall be deemed to be exercised      on the relevant Averaging Dates to which such Options relate and, in      respect of the Final Exercise Period, all Options not previously exercised      shall be deemed exercised on the relevant Averaging Dates to which such      Options relate; provided that in each      case, if a Notice of Exercise is required, such Options shall be deemed      exercised only to the extent that Party B has provided a Notice of      Exercise to Party A (in each case, such number of Options deemed      exercised, the “Exercised Options”); provided further that,      with respect to Exercised Options relating to an Exercise Period occurring      prior to the Final Exercise Period (an “Early Conversion”), Automatic      Exercise means that an Additional Termination Event shall be deemed to      occur with respect to a portion of the Transaction relating to a number of      Options equal to the number of such Exercised Options, as provided in      clause (i) under “Additional Termination Events” below; provided further that      to the extent the number of Exercised Options relating to any Conversion      Date is less than the number of Exercisable Options relating to such      Conversion Date, Party B shall be deemed to make to Party A on the date it      provided the related Notice of Exercise to Party A (or, if no such notice      is provided, the final day of such Exercise Period) the representations      and warranties contained in paragraph (g) under “Additional      Representations and Warranties of Party B” below as if the reference      therein to “at the time of placing any order with respect to the      Transaction” were replaced with “as of the date of the related Notice of      Exercise (or, if no such notice is provided, the final day of the related      Exercise Period).” |

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| Notice      of Exercise: |   | Notwithstanding      anything to the contrary in the Equity Definitions, in order to exercise      any Exercisable Options in respect of any Conversion Date occurring prior      to the Final Exercise Period, Party B must notify Party A in writing      before 5:00 p.m. (New York City time) on the Scheduled Trading Day prior      to the scheduled first Averaging Date for the Exercisable Options being      exercised of (i) the number of such Options, (ii) such first scheduled      Averaging Date and the scheduled Settlement Date and (iii) if Party B elected      to satisfy its obligations under the Convertible Notes solely with Shares      (a “Gross Physical Settlement”) in connection with the related conversion      of the Convertible Notes, the fact that Gross Physical Settlement applies      to such conversion, and, in order to exercise any Exercisable Options      during the Final Exercise Period, if Party B elected Gross Physical      Settlement for any conversion of the Convertible Notes during the Final      Exercise Period, Party B must notify Party A of such election in writing      before 5:00 p.m. (New York City time) on December 15,  2012. |
|--------------------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| Valuation:                                            |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
|-------------------------------------------------------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
| Valuation      Time:                                  |   | At      the close of trading on the Exchange, without regard to extended or after      hours trading.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|                                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
| Averaging      Dates:                                 |   | (x)      For any Exercised Option relating to an Exercise Period occurring prior to      the Final Exercise Period, the 25 (or 60 if Party B has notified Party A      that Gross Physical Settlement applies to the related conversion)      consecutive Scheduled Trading Days commencing on and including the third      “Settlement Period Trading Day” (as defined in the Indenture) following      the relevant Conversion Date, or (y) for any Exercisable Option relating      to the Final Exercise Period, the 25 (or 60 if Party B has notified Party      A that Gross Physical Settlement applies to conversions during the Final      Exercise Period) consecutive Scheduled Trading Days commencing on, and      including, the 27th (or 62nd if Party B has notified Party A that Gross      Physical Settlement applies to conversions during the Final Exercise      Period) Scheduled Trading Day immediately preceding the Expiration      Date. |
|                                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
| Averaging      Date Market Disruption:                |   | Modified      Postponement; provided that,      notwithstanding anything to the contrary in the Equity Definitions and in      addition to the provisions of Section 6.7(c)(iii) of the Equity      Definitions, if any Averaging Date is a Disrupted Day, the Calculation      Agent may assign additional dates to be Averaging Dates and/or make      adjustments to the number of Options to which each Averaging Date relates      (including increasing such number or reducing such number to zero with      respect to one or more Averaging Dates).                                                                                                                                                                                                                                                                                                                                                                                                                     |
|                                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
| Relevant      Price:                                  |   | For      any Averaging Date, the VWAP Price for such Averaging  Date.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|                                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
| VWAP      Price:                                      |   | For      any Exchange Business Day, the dollar volume weighted average price per      Share for that Exchange Business Day based on transactions executed during      that Exchange Business Day on the Exchange, as reported on Bloomberg Page      “CETV.UQ <Equity> AQR” (or any successor thereto), or in the event      such price is not so reported on such Exchange Business Day for any      reason, as reasonably determined by the Calculation  Agent.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|                                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
| Settlement      Terms:                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
|                                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
| Settlement      Currency:                             |   | USD                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|                                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
| Settlement      Date or Cash Settlement Payment Date: |   | For      any Exercised Option, the date Shares will be delivered or cash will be      paid with respect to the Convertible Notes related to such Exercised      Options, under the terms of the Indenture; provided that if Gross      Physical Settlement applies to the related conversion of the Convertible      Notes and the Exercised Option relates to an Exercise Period other than      the Final Exercise Period, one Settlement Cycle immediately following the      final Averaging Date relating to such Exercised  Option.                                                                                                                                                                                                                                                                                                                                                                                                                                        |

----

| Settlement      Method Election:      |   | Applicable;      provided that      Party B shall not be permitted to elect Cash Settlement and hereby agrees      not to make an election other than the Default Settlement Method with      respect to the Transaction unless Party B makes to Party A in writing on      the date of its election the representations and warranties contained in      paragraph (g) under “Additional Representations and Warranties of Party B”      below where the reference therein to “at the time of placing any order      with respect to the Transaction” shall be replaced with “as of the date of      such election of Cash Settlement.”                                                                                                                                                                                                                                                                          |
|---------------------------------------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| Electing      Party:                  |   | Party      B                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| Settlement      Method Election Date: |   | The      third Scheduled Trading Day immediately preceding the first Averaging Date      for the relevant Exercisable Options.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| Default      Settlement Method:       |   | Physical      Settlement                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| Cash      Settlement Terms:           |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| Cash      Settlement:                 |   | If      Cash Settlement applies with respect to any Exercised Options, a relevant      portion of the Transaction shall expire on each Averaging Date with      respect to a number of Options equal to the relevant number of Exercised      Options divided      by the number of scheduled Averaging Dates relating to such      Exercised Options, rounded down to the nearest whole number, except the      portion relating to the last such Averaging Date shall equal such relevant      number of Exercised Options minus the number of      Options relating to all preceding Averaging Dates relating to such      Exercised Options (in each case subject to adjustment by the Calculation      Agent in respect of any Disrupted Day). On the Cash Settlement Payment      Date relating to the relevant Exercised Options, Party A shall pay to      Party B the aggregate Cash Settlement Amount for all related Averaging      Dates. |
|                                  |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
| Cash      Settlement Amount:          |   | For      each Averaging Date, an amount, as calculated by the Calculation Agent,      equal to (i) the Strike Price Differential for such Averaging Date, multiplied by (ii) the      number of Options to which such Averaging Date relates, multiplied by (iii) the      Option Entitlement as of such AveragingDate.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |

----

| Strike      Price Differential:                                         |   | For      each Averaging Date, if the Relevant Price for such Averaging Date is (a)      greater than the Strike Price and less than or equal to the Cap Price, an      amount equal to the excess of the Relevant Price for such Averaging Date      over the Strike Price, (b) greater than the Cap Price, an amount equal to      the excess of the Cap Price over the Strike Price, or (c) less than or      equal to the Strike Price, zero.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|-------------------------------------------------------------------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| Physical      Settlement Terms:                                         |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|                                                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| Physical      Settlement:                                               |   | If      Physical Settlement applies with respect to any Exercised Options, a      relevant portion of the Transaction shall expire on each Averaging Date      with respect to a number of Options equal to the relevant number of      Exercised Options divided by the number      of scheduled Averaging Dates, rounded down to the nearest whole number,      except the portion relating to the last such Averaging Date shall equal      such relevant number of Exercised Options minus the number of      Options relating to all preceding Averaging Dates relating to such      Exercised Options (in each case subject to adjustment by the Calculation      Agent in respect of any Disrupted Day). On the Settlement Date relating to      the relevant Exercised Options, Party A shall deliver to Party B the      aggregate Number of Shares to be Delivered for all related Averaging Dates      and pay to Party B any Fractional Share Amount resulting from such      aggregation (valued at the Relevant Price for the last Averaging      Date). |
|                                                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| Number      of Shares to be Delivered:                                  |   | An      amount of Shares equal to the Cash Settlement Amount for such Averaging      Date divided by      the Relevant Price for such Averaging Date.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|                                                                    |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| Other      Applicable Provisionsin      Respect of Physical Settlement: |   | The      representations and agreements contained in Section 9.11 of the Equity      Definitions shall be modified by excluding any representations therein      relating to restrictions, obligations, limitations or requirements under      applicable securities laws that exist as a result of the fact that Party B      is the issuer of the Shares.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |

----

| Share      Adjustments:                          |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|--------------------------------------------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                             |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| Potential      Adjustment Events:                |   | Notwithstanding      Section 11.2(e) of the Equity Definitions, a “Potential Adjustment Event”      means an occurrence of any event or condition, as set forth in Section      10.05 of the Indenture, that would result in an adjustment to the      Conversion Rate of the Convertible Notes; provided that in no      event shall there be any adjustment hereunder as a result of an adjustment      to the Conversion Rate pursuant to Section 10.04(b) or Section 10.05(i) of      the Indenture.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|                                             |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| Method      of Adjustment:                       |   | Calculation      Agent Adjustment; which means, notwithstanding anything to the contrary in      the Equity Definitions, upon any adjustment to the Conversion Rate of the      Convertible Notes pursuant to the Indenture (other than pursuant to      Section 10.04(b) or Section 10.05(i) of the Indenture) (i) the Calculation      Agent shall make a corresponding adjustment to any of the Strike Price,      Number of Options and the Option Entitlement and (ii) the Calculation      Agent may, but is not required to, make any adjustment consistent with the      Calculation Agent Adjustment set forth in Section 11.2(c) of the Equity      Definitions to the Cap Price or any other variable relevant to the      exercise, settlement or payment for the Transaction (other than the Strike      Price) to preserve the fair value of the Options to Party A after taking      into account the effect of such Potential Adjustment Event; provided that in no      event shall the Cap Price be less than the Strike Price; provided further, that      adjustments may be made to the Cap Price to account for changes in      volatility, expected dividends, stock loan rate and liquidity relevant to      the Shares or to the Transaction. |
|                                             |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| Extraordinary      Events:                       |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|                                             |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| Merger      Events:                              |   | Notwithstanding      Section 12.1(b) of the Equity Definitions, a “Merger Event” means the      occurrence of any event or condition set forth in Section 10.06(a) or      Section 10.06(b)  of the Indenture.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
|                                             |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| Tender      Offers:                              |   | Applicable;      provided that      notwithstanding Section 12.1(d) of the Equity Definitions, a “Tender      Offer” means the occurrence of any event or condition set forth in Section      10.05(f) or clause (1) of the definition of “Fundamental Change” in      Section 1.01 of the Indenture.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|                                             |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |
| Consequence      of Merger Events/Tender Offers: |   | Notwithstanding      Sections 12.2 and 12.3 of the Equity Definitions, upon the occurrence of a      Merger Event or a Tender Offer:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |

----

|   |   | (i)   the      Calculation Agent shall make a corresponding adjustment in respect of any      adjustment under the Indenture to any one or more of the nature of the      Shares, Strike Price, Number of Options and the Option Entitlement; provided, however, that such      adjustment shall be made without regard to any adjustment to the      Conversion Rate for the issuance of additional shares as set forth in      Section 10.04(b) or Section 10.05(i)  of the Indenture;      and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|   |   | (ii)   the      Calculation Agent may, in its sole discretion, make any adjustment      consistent with the Modified Calculation Agent Adjustment set forth in      Section 12.2(e) or 12.3(d) of the Equity Definitions, as applicable, to      the Cap Price or any other variable relevant to the exercise, settlement      or payment for the Transaction; provided, however, that in no      event shall the Cap Price be less than the StrikePrice;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|   |   | provided that, for the      avoidance of doubt, adjustments shall be made pursuant to the provisions      of subparagraphs (i) and (ii) above regardless of whether any Merger Event      or Tender Offer gives rise to an Early Conversion; and provided further that,      notwithstanding the foregoing, with respect to any Majority Tender Offer,      Party A may elect for Cancellation and Payment (Calculation Agent      Determination) to apply.  “Majority Tender Offer” means A Tender      Offer as defined in Section 12.1(d) of the Equity Definitions that results      in the relevant entity or person purchasing, or otherwise obtaining or      having the right to obtain, by conversion or other means, 50% or greater      than 50% of the outstanding voting shares of the Issuer, as determined by      the Calculation Agent, based upon the making of filings with governmental      or self-regulatory agencies or such other information as the Calculation      Agent deems relevant. |

----

| Modified      Calculation Agent Adjustment:    |   | For      greater certainty, the definition of “Modified Calculation Adjustment” in      Sections 12.2 and 12.3 of the Equity Definitions shall be amended by (i)      adding the following italicized language after the stipulated      parenthetical provision: “(including adjustments to account for      changes in      expected dividends, stock loan rate, liquidity, or, in the case of the Cap      Price, also changes in volatility, relevant to the Shares or to the      Transaction) from the      Announcement Date to the Merger Date (Section 12.2)  or Tender      Offer Date (Section 12.3),” and (ii) deleting the phrase “,      expected dividends, stock loan rate” from such stipulated parenthetical      provision.                                                                                                                                                                                                                                                                                                                                                    |
|------------------------------------------------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                           |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| Announcement      Event:                       |   | If      an Announcement Event occurs, the Calculation Agent will determine the      economic effect of the Announcement Event on the theoretical value of the      Transaction (including without limitation any change in expected      dividends, stock loan rate, liquidity, or, in the case of the Cap Price,      also changes in volatility, relevant to the Shares or to the Transaction)      from the Announcement Date to the Expiration Date. If such economic effect      is material to either party, the Calculation Agent will adjust the Cap      Price to account for such economic effect; provided that in no      event shall the Cap Price be less than the Strike Price. “Announcement      Event” shall mean the occurrence of (i) the first public announcement of a      firm intention to engage in a transaction that may lead to a Merger Event,      (ii) the first public announcement of a firm intention to purchase or      otherwise obtain the requisite number of shares that may lead to a Tender      Offer or (iii) in each case, any subsequent amendment to or withdrawal of      such announcement. |
|                                           |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| Composition      of Combined Consideration:    |   | Not      Applicable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|                                           |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| Nationalization,      Insolvency or Delisting: |   | Cancellation      and Payment (Calculation Agent      Determination)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
|                                           |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
| Delisting:                                     |   | The      definition of “Delisting” in Section 12.6 of the Equity Definitions shall      be deleted in its entirety and replaced with the following: ‘“Delisting”      means that the Exchange announces that pursuant to the rules of such      Exchange, the Shares cease (or will cease) to be listed, traded or      publicly quoted on the Exchange for any reason (other than a Merger Event      or Tender Offer) and are not immediately re-listed, re-traded or re-quoted      on the New York Stock Exchange, the American Stock Exchange, the NASDAQ      Global Select Market or the NASDAQ Global Market (or their respective      successors)”                                                                                                                                                                                                                                                                                                                                                                                                                                                           |

----

| Additional      Disruption Events:                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|-------------------------------------------------------------------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Change      in Law:                                               |   | Applicable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Failure      to Deliver:                                          |   | Applicable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Insolvency      Filing:                                           |   | Applicable The      definition of “Insolvency Filing” in Section 12.9 of the Equity      Definitions shall be amended by deleting the clause “provided that such      proceedings instituted or petitions presented by creditors and not      consented to by the Issuer shall not be deemed an Insolvency Filing” at      the end of such definition and replacing it with the following: “; or it      has instituted against it a proceeding seeking a judgment of insolvency or      bankruptcy or any other relief under any bankruptcy or insolvency law or      other similar law affecting creditors’ rights, or a petition is presented      for its winding-up or liquidation by a creditor and such proceeding is not      dismissed, discharged, stayed or restrained in each case within fifteen      (15) days of the institution or presentation thereof.” |
|                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Hedging      Disruption:                                          |   | Applicable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Increased      Cost of Hedging:                                   |   | Applicable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Loss      of Stock Borrow:                                        |   | Not      Applicable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Increased      Cost of Stock Borrow:                              |   | Not      Applicable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Hedging      Party:                                               |   | Party      A shall be the Hedging Party for all Extraordinary  Events                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
|                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Determining      Party:                                           |   | Party      A shall be the Determining Party for all Extraordinary    Events                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Additional      Provisions:                                       |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
|                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Non-Reliance:                                                     |   | Applicable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Agreements      and Acknowledgments Regarding Hedging Activities: |   | Applicable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Additional      Acknowledgments:                                  |   | Applicable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Credit      Support Provider:                                     |   | With      respect to Party A, the guarantee (the “Parent Guarantee”) made by Lehman      Brothers Holdings, Inc. (“Holdings”), in favor of Party B, attached hereto      as Exhibit A.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Credit      Support Document:                                     |   | With      respect to Party A, the Parent Guarantee.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |
|                                                              |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |
| Additional Representations and      Warranties of Party B:        |   | In      addition to the representations set forth in the Agreement, Party B      further represents that;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |

----

|    |   | (a)      (i) It is not entering into the Transaction on behalf of or for the      accounts of any other person or entity, and will not transfer or assign      its obligations under the Transaction or any portion of such obligations      to any other person or entity except in compliance with applicable laws      and the terms of the Transaction; (ii) it understands that the Transaction      is subject to complex risks which may arise without warning, may at times      be volatile, and that losses may occur quickly and in unanticipated      magnitude; (iii) it is authorized to enter into the Transaction and such      action does not violate any laws of its jurisdiction of organization or      residence (including, but not limited to, any applicable position or      exercise limits set by any self-regulatory organization, either acting      alone or in concert with others) or the terms of      any agreement to which it is a party; (iv) it has consulted with its legal      advisor(s) and has reached its own conclusions about the Transaction, and      any legal, regulatory, tax, accounting or economic consequences arising      from the Transaction; and (v) it has concluded that the Transaction is      suitable in light of its own investment objectives, financial capabilities      and expertise. (b)      If Party B purchases any Shares pursuant to the Transaction, such      purchase(s) will comply with (i) all laws and regulations applicable to it      and (ii) all contractual obligations of Party B. (c)      At all times until termination of the Transaction, Party B is an “eligible      contract participant” as the term is defined in the Commodity Futures      Modernization Act of 2000. |
|--------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |  (d)      Neither Party A nor any of its affiliates has advised it with respect to      any legal, regulatory, tax, accounting or economic consequences arising      from the Transaction, and neither Party A nor any of its affiliates is      acting as agent (other than LBI as dual agent if specified above), or      advisor for Party B in connection with the Transaction. (e)      Each of its required filings under all applicable securities laws have      been filed and that, as of the respective dates thereof there is no      material misstatement of material fact contained therein or omission of a      material fact required to be stated therein or necessary to make the      statements therein not misleading. (f)      It has not entered into any obligation that would contractually limit it      from effecting Physical Settlement or Cash Settlement under the      Transaction. |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|   |   | (g)      As of the Trade Date, Party B is in compliance with its reporting      obligations under the Exchange Act and its most recent Annual Report on      Form 10-K, together with all reports subsequently filed by it pursuant to      the Exchange Act, taken together and as amended and supplemented to the      Trade Date, do not, as of their respective filing dates, contain any      untrue statement of a material fact or omit to state any material fact      required to be stated therein or necessary to make the statements therein,      in the light of the circumstances under which they were made, not      misleading such that Party B’s officers and directors are not in      possession of any material non-public information concerning Party B or      its securities.                                                                                                                        |

----

|   |   | (h)      The Transaction and any repurchase of Shares by Party B in connection with      the Transaction has been approved by its board of directors and that any      such repurchase has been publicly disclosed.                                                                                                                                                                                                                                                                                                                |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|   |   | (i)      It is not entering into the Transaction to create actual or apparent      trading activity in the Shares (or any security convertible into or      exchangeable for Shares), to manipulate the price of the Shares (or any      security convertible into or exchangeable for Shares) or to facilitate a      distribution of Shares (or any security convertible into or exchangeable      for Shares).                                                                                                                  |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|   |   | (j)      It is not, and, after giving effect to the transactions contemplated      hereby will not be, an “investment company” as such term is defined in the      Investment Company Act of 1940, as amended.                                                                                                                                                                                                                                                                                                         |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|   |   | (k)      It is not on the Trade Date engaged in a distribution, as such term is      used in Regulation M under the Securities Exchange Act of 1934, as amended      (“Regulation M”), of any securities of Party B, other than a distribution      meeting the requirements of the exception set forth in section 101(b)(10)      or 102(b)(7) of Regulation M.  Party B shall not, until the      second Exchange Business Day immediately following the Trade Date, engage      in any such distribution. |
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|   |   | (l)      On the Trade Date and on any Additional Premium Payment Date (A) the      assets of Party B at their fair valuation exceed the liabilities of Party      B, including contingent liabilities, (B) the capital of Party B is      adequate to conduct the business of Party B and (C) Party B has the      ability to pay its debts and obligations as such debts mature and does not      intend to, or does not believe that it will, incur debt beyond its ability      to pay as such debts mature.                    |

| Other      Provisions: |   |   |
|------------------------|--------|--------|
|                   |   |   |

----

| Alternative      Calculations and Payment on Early Termination and on      Certain  Extraordinary Events: |   | If,      in respect of the Transaction, an amount is payable by Party A to Party B      (i) pursuant to Sections 12.2, 12.3, 12.6, 12.7 or 12.9 of the Equity      Definitions (except in the event of a Nationalization, Insolvency, Tender      Offer or a Merger Event, in each case, in which the consideration to be      paid to holders of Shares consists solely of cash) or (ii) pursuant to      Section 6(d)(ii) of the Agreement (except in the event of an Event of      Default in which Party B is the Defaulting Party or a Termination Event in      which Party B is the Affected Party that resulted from an event or events      outside Party B’s control) (a “Payment Obligation”), Party B shall have      the right, in its sole discretion, to require Party A to satisfy any such      Payment Obligation by the Share Termination Alternative (as defined below)      by giving irrevocable telephonic notice to Party A, confirmed in writing      within one Currency Business Day, no later than 4:00 p.m. New York local      time on the Merger Date, Tender Offer Date, Announcement Date or Early      Termination Date, as applicable (“Notice of Share      Termination”). Notwithstanding      anything to the contrary in the foregoing, with respect to any Payment      Obligation resulting from an Additional Termination Event in connection      with an Early Conversion, Party B shall be deemed to have elected as of      the Trade Date to require Party A to satisfy any such Payment Obligation      by the Share Termination Alternative; provided that Party B      may elect for the Share Termination Alternative not to apply to such      Payment Obligation by (x) giving written notice of such election to Party      A no later than 4:00 p.m., New York local time, on the Scheduled Trading      Day immediately preceding the relevant Early Termination Date and (y)      making to Party A in such written notice the representations and      warranties contained in paragraph (g) under “Additional Representations      and Warranties of Party B” above where the reference therein to “at the      time of placing any order with respect to the Transaction” shall be      replaced with “as of the date of this written notice.” Upon      Notice of Share Termination no later than 8:00 a.m. on the Exchange      Business Day immediately following the Merger Date, Tender Offer Date,      Announcement or Early Termination Date, as applicable, the following      provisions shall apply: |
|---------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |
| Share      Termination Alternative:                                                                                 |   | Applicable      and means that Party A shall deliver to Party B the Share Termination      Delivery Property on the date, or within a commercially reasonable period      of time after, when the Payment Obligation would otherwise be due pursuant      to Section 12.7 or 12.9 of the Equity Definitions or Section 6(d)(ii) and      6(e) of the Agreement, as applicable (the “Share Termination Payment      Date”), in satisfaction of the Payment Obligation in the manner reasonably      requested by Party B free ofpayment.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     |

----

| Share      Termination Delivery Property: |   | A      number of Share Termination Delivery Units, as calculated by the      Calculation Agent, equal to the Payment Obligation divided by the Share      Termination Unit Price.  The Calculation Agent shall adjust the      Share Termination Delivery Property by replacing any fractional portion of      a security therein with an amount of cash equal to the value of such      fractional security based on the values used to calculate the Share      Termination Unit Price.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |
|-------------------------------------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                      |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| Share      Termination Unit Price:        |   | The      value to Party A of property contained in one Share Termination Delivery      Unit on the date such Share Termination Delivery Units are to be delivered      as Share Termination Delivery Property, as determined by the Calculation      Agent in its discretion by commercially reasonable means and notified by      the Calculation Agent to Party A at the time of notification of the      Payment Obligation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|                                      |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
| Share      Termination Delivery Unit:     |   | In      the case of a Termination Event or Event of Default, one Share or, in the      case of Nationalization, Insolvency or Merger Event or Tender Offer, a      unit consisting of the number or amount of each type of property received      by a holder of one Share (without consideration of any requirement to pay      cash or other consideration in lieu of fractional amounts of any      securities) in such Nationalization, Insolvency, Merger Event or Tender      Offer, as determined by the Calculation Agent. If a Share Termination      Delivery Unit consists of property other than cash or New Shares and if      Party B provides irrevocable written notice to the Calculation Agent on or      prior to the Merger Date that it elects to have Party A deliver cash, New      Shares or a combination thereof (in such proportion as Party B designates)      in lieu of such other property, the Calculation Agent will replace such      property with cash, New Shares or a combination thereof as components of a      Share Termination Delivery Unit in such amounts, as determined by the      Calculation Agent in its discretion by commercially reasonable means, as      shall have a value equal to the value of the property so      replaced.  If such Nationalization, Insolvency, Merger Event or      Tender Offer involves a choice of consideration to be received by holders,      such holder shall be deemed to have elected to receive the maximum      possible amount of cash. |

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| Failure      to Deliver:                      |   | Applicable                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |
|-----------------------------------------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                          |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| Other      applicable provisions:             |   | If      the Transaction is to be Share Termination Settled, the provisions of      Sections 9.8, 9.9, 9.10, 9.11 and 9.12 (as modified above) of the Equity      Definitions will be applicable, as if “Physical Settlement” applied to the      Transaction; provided that all      references to “Shares” shall be read as references to “Share Termination      Delivery Units” and the representations and agreements contained in      Section 9.11 of the Equity Definitions shall be modified by excluding any      representations therein relating to restrictions, obligations, limitations      or requirements under applicable securities laws that exist as a result of      the fact that Party B is the issuer of the Shares.  “Share      Termination Settled” in relation to a Transaction means that Share      Termination Settlement is applicable to theTransaction. |
|                                          |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| Special      Provisions for Party B Payments: |   | Party      A and Party B agree that, notwithstanding anything to the contrary herein      or in the Agreement, in the event that (i) an Early Termination Date      (whether as a result of an Event of Default or Termination Event) occurs      or is designated with respect to any Transaction and, as a result, Party B      owes to Party A an amount calculated under Section 6(e) of the Agreement      or (ii) an Extraordinary Event occurs that results in the termination or      cancellation of any Transaction pursuant to Article 12 of the Equity      Definitions and, as a result, Party B owes to Party A a Cancellation      Amount or any other amount in respect to this Transaction, such amount      shall be deemed to be zero.                                                                                                                                                                                            |
|                                          |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| Regulatory      Provisions:                   |   | (a)      Party B represents and warrants that it has received and read and      understands the Notice of Regulatory Treatment and the OTC Option Risk      Disclosure Statement. (b)      The Agent will furnish Party B upon written request a statement as to the      source and amount of any remuneration received or to be received by the      Agent in connection with the Transaction evidenced  hereby.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|                                          |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |
| Transfer:                                     |   | Notwithstanding      Section 7 of the Agreement, Party A may assign its rights and obligations      under the Transaction, in whole and not in part, to any Affiliate of      Holdings effective upon delivery to Party B of the full unconditional      guarantee by Holdings, substantially in the form of the Parent Guarantee,      in favor of Party B, of the obligations of such Affiliate; provided, however, that      notwithstanding the foregoing no such assignment by Party A as assignor      (the “Assignor”) shall be permitted unless:                                                                                                                                                                                                                                                                                                                                                                            |

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|   |   | (i)      Party B will not, as a result of such assignment, be required to pay to      such Affiliate any amount in respect of an Indemnifiable Tax under Section      2(d)(i)(4) of the Agreement greater than the amount in respect of which      Party B would have been required to pay to the Assignor absent such      transfer or otherwise suffer any other additional tax burden (whether an      Indemnifiable Tax or otherwise) or Party A or such Affiliate waives any      such additional payment obligation under Section 2(d)(i)(4) of the      Agreement or agrees to make Party B whole for such additional tax      burden; (ii)      such Affiliate will not, as a result of such assignment, be required to      withhold or deduct on account of a Tax under Section 2(d)(i) of the      Agreement in an amount in excess of that which the Assignor would have      been required to so withhold or deduct absent such transfer unless such      Affiliate elects (or is required pursuant to Section 2(d)(i)(4) of the      Agreement) to gross up Party B with respect to such excess withholding      (either by payment directly to the taxing authority or a payment to Party      B); and (iii)      immediately upon giving effect to such assignment, no Event of Default and      no Termination Event will occur as a direct result of such      assignment.                                                                                        |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|   |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|   |   | If      Party A, in its sole discretion, determines that its “beneficial      ownership” at any time (within the meaning of Section 16 of the Exchange      Act and rules promulgated thereunder) exceeds 8.0% or more of Party B’s      outstanding Shares; and, in its sole discretion, Party A is unable after      its commercially reasonable efforts to effect a transfer or assignment on      pricing terms and in a time period reasonably acceptable to Party A that      would reduce its “beneficial ownership” to 7.5%; Party A may designate any      Exchange Business Day as an Early Termination Date with respect to a      portion (the “Terminated Portion”) of the Transaction, such that its      “beneficial ownership” following such partial termination will be equal to      or less than (but not materially less than) 7.5%.  In the event      that Party A so designates an Early Termination Date with respect to a      portion of the Transaction, a payment shall be made pursuant to Section 6      of the Agreement as if (i) an Early Termination Date had been designated      in respect of Transaction having terms identical to the Transaction and      Numbers of Options equal to the Terminated Portion, (ii) Party B shall be      the sole Affected Party with respect to such partial termination and (iii)      such Transaction shall be the only Terminated  Transaction. |

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| Staggered      Settlement: |   | Party      A may, by notice to Party B on or prior to any Settlement Date (a “Nominal      Settlement Date”), elect to deliver any Shares required to be delivered by      it on two or more dates (each, a “Staggered Settlement Date”) as      follows: (i)         in such notice, Party A will specify to Party B the related Staggered      Settlement Dates (the first of which will be such Nominal Settlement Date      and the last of which will be no later than the twentieth (20th)      Exchange Business Day following such Nominal Settlement Date) and the      number of Shares that it will deliver on each Staggered Settlement      Date; (ii)        the aggregate number of Shares that Party A will deliver to Party B      hereunder on all such Staggered Settlement Dates will equal the number of      Shares that Party A would otherwise be required to deliver on such Nominal      Settlement Date; and (iii)       if the Physical Settlement terms set forth above were to apply on      such Nominal Settlement Date, then the Physical Settlement terms will      apply on each Staggered Settlement Date, except that the related Shares to      be delivered by Party A will be allocated among such Staggered Settlement      Dates as specified by Party A in the notice referred to in clause (i)      above and Party B shall pay the Settlement Amount for those Shares on the      Nominal Settlement Date. |
|----------------------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                       |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
| Set-Off      and Netting:  |   | Party      A agrees not to set-off or net amounts due from Party B with respect to      the Transaction hereunder against amounts due from Party A to Party B      under obligations other than Equity Contracts. Section 2(c) of the      Agreement as it applies to payments due with respect to the Transaction      hereunder shall remain in effect and is not subject to the first sentence      of this provision. Upon      the occurrence of an Event of Default or Termination Event with respect to      a party who is the Defaulting Party or the Affected Party (“X”), the other      party (“Y”) will have the right (but not be obliged) without prior notice      to X or any other person to set-off or apply any obligation of X under an      Equity Contract owed to Y (or any Affiliate of Y) (whether or not matured      or contingent and whether or not arising under the Agreement, and      regardless of the currency, place of payment or booking office of the      obligation) against any obligation of Y (or any Affiliate of Y) under an      Equity Contract owed to X (whether or not matured or contingent and      whether or not arising under the Agreement, and regardless of the      currency, place of payment or booking office of the      obligation).  Y will give notice to the other party of any      set-off effected under thisparagraph.                                                                                       |

----

|                      |   | “Equity      Contract” shall mean for purposes of this paragraph any transaction      relating to Shares between X and Y (or any Affiliate of Y) that qualifies      as ‘equity’ under applicable accounting rules. Amounts      (or the relevant portion of such amounts) subject to set-off may be      converted by Y into the Termination Currency at the rate of exchange at      which such party would be able, acting in a reasonable manner and in good      faith, to purchase the relevant amount of such currency. If      any obligation is unascertained, Y may in good faith and a commercially      reasonable manner estimate that obligation and set-off in respect of the      estimate, subject to the relevant party accounting to the other when the      obligation is ascertained. Nothing      in this section shall be effective to create a charge or other security      interest.  This section shall be without prejudice and in      addition to any right of set-off, combination of accounts, lien or other      right to which any party is at any time otherwise entitled (whether by      operation of law, contract or otherwise).  |
|---------------------------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|  Equity      Rights: |   | Party      A acknowledges and agrees that this Confirmation is not intended to convey      to it rights with respect to the Transaction that are senior to the claims      of common stockholders in the event of Party B’s      bankruptcy.  For the avoidance of doubt, the parties agree that      the preceding sentence shall not apply at any time other than during Party      B’s bankruptcy to any claim arising as a result of a breach by Party B of      any of its obligations under this Confirmation or the      Agreement.  For the avoidance of doubt, the parties acknowledge      that this Confirmation is not secured by any collateral that would      otherwise secure the obligations of Party B herein under or pursuant to      any other agreement.                                                                                                                                                                                                                                                                                                                                                                                                                 |

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| No      Collateral:              |   | No      collateral is required to be posted by Party B in respect of the      Transaction.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
|----------------------------------|--------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                             |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| Bankruptcy      Code Provisions: |   | Each      of Party A and Party B agrees and acknowledges that Party A is a “swap      participant” and/or “financial participant” within the meaning of Sections      101(53C) and 101(22A) of Title 11 of the United States Code (the      “Bankruptcy Code”).  The parties hereto further agree and      acknowledge (A) that this Confirmation is (i) a “securities contract,” as      such term is defined in Section 741(7) of the Bankruptcy Code, with      respect to which each payment and delivery hereunder is a “settlement      payment,” as such term is defined in Section 741(8) of the Bankruptcy      Code, and (ii) a “swap agreement,” as such term is defined in Section      101(53B) of the Bankruptcy Code, with respect to which each payment and      delivery hereunder is a “transfer,” as such term is defined in Section      101(54) of the Bankruptcy Code, and (B) that Party A is entitled to the      protections afforded by, among other sections, Sections 362(b)(6),      362(b)(17), 546(e), 546(g), 555 and 560 of the Bankruptcy      Code.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|                             |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
| Early      Unwind:               |   | In      the event the sale of the Convertible Notes by the Issuer is not      consummated with the initial purchasers for any reason, other than as a      result of a breach by Party A, by the close of business in New York on      March 10, 2008 (or such later date as agreed upon by the parties) (March      10, 2008 or such later date as agreed upon being the “Early Unwind Date”),      the Transaction shall automatically terminate (the “Early Unwind”), on the      Early Unwind Date and (i) the Transaction and all of the respective rights      and obligations of Party A and Party B under the Transaction shall be      cancelled and terminated and (ii) each party shall be released and      discharged by the other party from and agrees not to make any claim      against the other party with respect to any obligations or liabilities of      the other party arising out of and to be performed in connection with the      Transaction either prior to or after the Early Unwind Date; provided that Party B      shall reimburse the costs and expenses (including market losses) relating      to reselling those Shares to unwind its hedge positions, and will assume,      or reimburse the cost of unwinding, any and all derivatives entered into      by Party A or one or more of its affiliates in connection with hedging the      Transaction (to the extent such costs and expenses in the aggregate do not      exceed the product of USD 3,000,000 times the Applicable      Percentage). Party A and Party B represent and acknowledge to the other      that, subject to the proviso included in the preceding sentence, upon an      Early Unwind, all obligations with respect to the Transaction shall be      deemed fully and finallydischarged. |

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| Additional      Termination Events: |   | Notwithstanding      anything to the contrary in this Confirmation, (i) upon the occurrence of      an Early Conversion: (A)      such Early Conversion shall constitute an Additional Termination Event      hereunder with respect to a number of Options equal to the number of the      relevant Exercised Options (the “Affected Number of Options”), in which      case (x) the sole Affected Transaction shall consist of a transaction      identical to the Transaction except that Number of Options for such      Affected Transaction shall equal the Affected Number of Options and Party      B shall be deemed the sole Affected Party and (y) the Transaction shall      remain in full force and effect, except that the Number of Options subject      to the Transaction immediately prior to the Conversion Date for such Early      Conversion shall as of such Conversion Date be reduced by the Affected      Number of Options; (B)      notwithstanding anything to the contrary in the Agreement, Party A shall      designate an Early Termination Date in respect of such Affected      Transaction, which shall be no earlier than one Scheduled Trading Day      following the Conversion Date for the related Early Conversion;      and (C)      for the avoidance of doubt, in determining the amount payable in respect      of such Affected Transaction pursuant to Section 6 of the Agreement, the      Calculation Agent shall assume that (x) the relevant Early Conversion and      any adjustments, agreements, payments, deliveries or acquisitions by or on      behalf of Party B leading thereto had not occurred, (y) no adjustments to      the Conversion Rate have occurred pursuant to Section 10.04(b) or Section      10.05(i) of the Indenture and (z) the corresponding Convertible Notes      remain outstanding, and (ii)      if there has occurred an acceleration of the Convertible Notes after an      event of default with respect to Party B under the terms of the      Convertible Notes as set forth in Section 6.02  of the      Indenture, then such acceleration shall constitute an Additional      Termination Event applicable to the Transaction and, with respect to such      event of default (A) Party B shall be deemed to be the sole Affected Party      and the Transaction shall be the sole Affected Transaction and (B) Party A      shall be the party entitled to designate an Early Termination Date      pursuant to Section 6(b) of theAgreement. |
|-------------------------------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| Right      to Extend:              |   | Party      A may extend, for as long as it is reasonably necessary, any Averaging      Date, the Expiration Date, the Settlement Date or any other date of      delivery by Party A, with respect to some or all of the Options hereunder,      if Party A determines, in its commercially reasonable      discretion based on the advice of nationally recognized outside      counsel, that such extension is reasonably necessary or appropriate to      preserve Party A’s hedging or hedge unwind activity hereunder in light of      existing liquidity conditions or to enable Party A to effect purchases or      sales of Shares in connection with its hedging or settlement activity      hereunder in a manner that would, if Party A were Party B or an affiliated      purchaser of Party B, be in compliance with applicable legal and      regulatory or self-regulatory requirements or with related policies or      procedures applicable to Party A.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
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| Registration      of Hedge Shares: |   | Party      B hereby agrees that if Party A determines, in its reasonable judgment      based on the advice of nationally recognized outside counsel, that the      Shares (the “Hedge Shares”) acquired by Party A for the purpose of hedging      its obligations pursuant to the Transaction cannot be sold in the U.S.      public market by Party A without registration under the Securities Act,      Party B shall, at Party B’s election: (i) in order to allow Party A to      sell the Hedge Shares in a registered offering, make available to Party A      an effective registration statement under the Securities Act to cover the      resale of such Hedge Shares and (A) enter into an agreement, in form and      substance satisfactory to Party A, substantially in the form of an      underwriting agreement for a registered offering, (B) provide accountant’s      “comfort” letters in customary form for registered offerings of equity      securities, (C) provide disclosure opinions of nationally recognized      outside counsel to Party B reasonably acceptable to Party A, (D) provide      other customary opinions, certificates and closing documents customary in      form for registered offerings of equity securities and (E) afford Party A      a reasonable opportunity to conduct a “due diligence” investigation with      respect to Party B customary in scope for underwritten offerings of equity      securities (provided,      however, that if Party A, in its sole reasonable discretion, is not      satisfied with access to due diligence materials, the results of its due      diligence investigation, or the procedures and documentation for the      registered offering referred to above, then clause (ii) or clause (iii) of      this paragraph shall apply at the election of Party B); (ii) in order to      allow Party A to sell the Hedge Shares in a private placement, enter into      a private placement agreement substantially similar to private placement      purchase agreements customary for private placements of equity securities,      in form and substance satisfactory to Party A, including customary      representations, covenants, blue sky and other governmental filings and/or      registrations, indemnities to Party A, due diligence rights (for Party A      or any designated buyer of the Hedge Shares from Party A), opinions and      certificates and such other documentation as is customary for private      placements agreements, all reasonably acceptable to Party A (in which      case, the Calculation Agent shall make any adjustments to the terms of the      Transaction that are necessary, in its reasonable judgment, to compensate      Party A for any discount from the public market price of the Shares      incurred on the sale of Hedge Shares in a private placement); or (iii)      purchase the Hedge Shares from Party A at the VWAP Price on such Exchange      Business Days, and in the amounts, as requested by Party      A.   |

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| Repurchase      notices: |   | Party      B shall, no later than ten Scheduled Trading Days prior to the day on      which Party B effects any repurchase of Shares, give Party A a written      notice of such repurchase (a “Repurchase Notice”) on such day if following      such repurchase, the Options Equity Percentage as determined on such day      is (i) greater than 8.0% and (ii) greater by 0.5% than the Options Equity      Percentage included in the immediately preceding Repurchase Notice (or, in      the case of the first such Repurchase Notice, greater than the Options      Equity Percentage as of the date hereof).  The “Options Equity      Percentage” as of any day is the fraction (A) the numerator of which is      the Number of Shares and (B) the denominator of which is the number of      Shares outstanding on such day.  Party B agrees to indemnify and      hold harmless Party A and its affiliates and their respective officers,      directors, employees, affiliates, advisors, agents and controlling persons      (each, an “Indemnified Person”) from and against any and all losses      (including losses relating to Party A's hedging activities as a      consequence of becoming, or of the risk of becoming, a Section 16      “insider”, including without limitation, any forbearance from hedging      activities or cessation of hedging activities and any losses in connection      therewith with respect to the Transaction), claims, damages, judgments,      liabilities and expenses (including reasonable attorney’s fees), joint or      several, which an Indemnified Person may become subject to, as a result of      Party B's failure to provide Party A with a Repurchase Notice on the day      and in the manner specified in this paragraph, and to reimburse, within 30      days, upon written request, each of such Indemnified Persons for any      reasonable legal or other expenses incurred in connection with      investigating, preparing for, providing testimony or other evidence in      connection with or defending any of the foregoing.  If any suit,      action, proceeding (including any governmental or regulatory      investigation), claim or demand shall be brought or asserted against the      Indemnified Person,  |
|--------------------------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| Repurchase      notices: |   | such      Indemnified Person shall promptly notify Party B in writing, and Party B,      upon request of the Indemnified Person, shall retain counsel reasonably      satisfactory to the Indemnified Person to represent the Indemnified Person      and any others Party B may designate in such proceeding and shall pay the      fees and expenses of such counsel related to such      proceeding.  Party B shall not be liable for any settlement of      any proceeding effected without its written consent, but if settled with      such consent or if there be a final judgment for the plaintiff, Party B      agrees to indemnify any Indemnified Person from and against any loss or      liability by reason of such settlement or judgment.  Party B      shall not, without the prior written consent of the Indemnified Person,      effect any settlement of any pending or threatened proceeding in respect      of which any Indemnified Person is or could have been a party and      indemnity could have been sought hereunder by such Indemnified Person,      unless such settlement includes an unconditional release of such      Indemnified Person from all liability on claims that are the subject      matter of such proceeding on terms reasonably satisfactory to such      Indemnified Person.  If the indemnification provided for in this      paragraph is unavailable to an Indemnified Person or insufficient in      respect of any losses, claims, damages or liabilities referred to therein,      then Party B, in lieu of indemnifying such Indemnified Person thereunder,      shall contribute to the amount paid or payable by such Indemnified Person      as a result of such losses, claims, damages or liabilities.  The      remedies provided for in this paragraph are not exclusive and shall not      limit any rights or remedies that may otherwise be available to any      Indemnified Person at law or in equity.  The indemnity and      contribution agreements contained in this paragraph shall remain operative      and in full force and effect regardless of the termination of the      Transaction. |
|--------------------------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| Restrictions      on Repurchases:           |   | On      any Averaging Date, neither Party B nor any “affiliate” or “affiliated      purchaser” (each as defined in Rule 10b-18 under the Exchange Act (“Rule      10b-18”)) shall directly or indirectly (including, without limitation, by      means of any cash-settled or other derivative instrument) purchase, offer      to purchase, place any bid or limit order that would effect a purchase of,      or commence any tender offer relating to, any Shares (or an equivalent      interest, including a unit of beneficial interest in a trust or limited      partnership or a depository share) or any security convertible into or      exchangeable or exercisable for Shares. |
|---------------------------------------------|--------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                        |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
| Restrictions      on Certain Distributions: |   | During      any Averaging Period, the Shares or securities that are convertible into,      or exchangeable or exercisable for Shares shall not be subject to a      “restricted period” (as such term is defined in Regulation M) and Party A      shall not engage in any “distribution” (as such term is defined in      Regulation M) until the sixth Exchange Business Day immediately following      the Averaging Period.                                                                                                                                                                                                                                                                          |
|                                        |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
| Payments      on Early Termination:         |   | Party      A and Party B agree that for the Transaction, for the purposes of Section      6(e) of the Agreement, Loss and the Second Method will    apply.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |
|                                        |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
| Governing      Law:                         |   | The      laws of the State of New York (without reference to choice of law doctrine      other than Section 5-1401 of the New York General Obligations      Law).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|                                        |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
| Termination      Currency:                  |   | USD                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|                                        |   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |
| Office:                                     |   | For      the purposes of the Transaction, Party A is not a Multibranch Party, and      Party B is not a Multibranch Party.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |

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| Calculation      Agent:    |   | LBI;      provided that,      upon written request by Party B, the Calculation Agent shall provide in      writing in reasonable detail evidence and explanation of any calculation      or determination it made in respect of the Transaction, including a      description of the methodology and data applied in making any adjustment      to any terms of the Transaction, in each case within five Exchange Trading      Days of receipt by Party A of such written request by Party B; provided further that      (i) if the Calculation Agent fails to provide such evidence or calculation      within such required time period and such failure resulted from      administrative or clerical error, such failure shall not constitute an      Event of Default with respect to the Calculation Agent if the Calculation      Agent provides such evidence or calculation within three Exchange Business      Days of being made aware of such failure and (ii) in providing such      evidence and explanation, in no event shall the Calculation Agent be      obligated to disclose any trading information proprietary to Party A or      its affiliates or any information which Party A or its affiliate is      required by contract or law to hold confidential. |
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| WAIVER      OF JURY TRIAL: |   | EACH      PARTY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT      IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY SUIT, ACTION OR      PROCEEDING RELATING TO THE TRANSACTION.  EACH PARTY (I)      CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF THE OTHER PARTY HAS      REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN      THE EVENT OF SUCH A SUIT, ACTION OR PROCEEDING, SEEK TO ENFORCE THE      FOREGOING WAIVER AND (II) ACKNOWLEDGES THAT IT AND THE OTHER PARTY HAVE      BEEN INDUCED TO ENTER INTO THE TRANSACTION, AS APPLICABLE, BY, AMONG OTHER      THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS PROVIDED    HEREIN.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |
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| Tax      Disclosure:       |   | Effective      from the date of commencement of discussions concerning the Transaction,      Party B and each of its employees, representatives, or other agents may      disclose to any and all persons, without limitation of any kind, the tax      treatment and tax structure of the transaction and all materials of any      kind (including opinions or other tax analyses) that are provided to Party      B relating to such tax treatment and tax  structure.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |

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| Yours      sincerely,                                                                                    | Accepted      and agreed to:                                                                                 |
|----------------------------------------------------------------------------------------------------------|--------------------------------------------------------------------------------------------------------------|
|                                                                                                     |                                                                                                         |
| Lehman      Brothers OTC Derivatives Inc.                                                                | Central      European Media Enterprises Ltd                                                                  |
|                                                                                                     |                                                                                                         |
|                                                                                                     |                                                                                                         |
| By:   /s/ Locke R.      McMurrayName:      Locke R. McMurrayTitle:      Managing Director | By:    /s/ Michael      GarinName:      Michael GarinTitle:      Chief Executive Officer |

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|   | LEHMAN      BROTHERS HOLDINGS INC. |
|--------|------------------------------------|
|   |                               |   |   |
|   |                               |   |   |
|   | By:                                | _____________________________  |   |
|   | Name:                              |   |   |
|   | Title:                             |   |   |
|   | Date:                              |   |   |

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