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| 1. | Your      employment with the Company will be for a term commencing February 2,      2004, and ending January 31, 2008 (subject to earlier termination in      accordance with paragraph 7 hereof), unless extended by a written      agreement signed by you and theCompany. |
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| 2. | Your      duties will be performed in the United States of America and in the United      Kingdom. Your annual base salary for your duties performed in the United      States of America will be $485,000 and your annual base salary for your      duties performed in the United Kingdom will be $140,000, payable in      accordance with the Company’s payroll practices. Although your duties      hereunder will be performed in the United States and in the United      Kingdom, you maintain your principal residence in Westchester County, New      York. If the performance of your duties results in the taxation of your      income and/or withholdings from your income (e.g., withholdings to fund      governmental health programs) which are in excess of the taxation and      withholdings that would apply if all of your income were received by you      in New York then, after taking account of any tax credits resulting from      tax treaties or otherwise, the Company will pay you a tax-equalization      amount so that, on an after-tax basis, your total combined income      hereunder is no less than would have been the case had all of your      compensation hereunder been received in New York. In addition, Company      will reimburse you for costs you incur for multiple tax returns and tax      advice, not to exceed US$15,000 in anyyear. |
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| 3. | The      Compensation Committee of the Board of Directors of the Company’s ultimate      sole shareholder, the Central European Media Enterprises Limited (“CME      Ltd”)  (the “Board”) will review your base salary at least      annually, and the Board may, in its discretion, increase, but not      decrease, your base salary. |
|----|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 4. | You      will be employed as the Chief Executive Officer of the Company, reporting      solely to the Board.  All employees of the Company will report      directly to you or your designees.  During the term of your      employment, you will also be a director of CME Ltd.  Your duties      shall include serving as an officer and otherwise performing services for      the Company or for any parent company of the Company, for any holding      company of the Company and any subsidiaries of the Company or of any such      holding company, any associated company of any of them and any joint      venture in which any of the foregoing are a partner, member or shareholder      (each of the foregoing, other than the Company, an “Affiliate”) as      requested by the Board.  All such services requested of you will      be consistent with your senior status as the Company’s Chief Executive      Officer.  You acknowledge that you shall be required to travel      regularly to and work at the Company’s and any Affiliate’s offices and      facilities in central and eastern Europe and/or from time to time, such      other locations in Europe as appropriate to the performance of your      services on behalf of the Company and the Affiliates, or as requested by      the Board.  You agree to serve the Company faithfully and to the      best of your ability and to devote your full business time, energy,      experience and talents to the business of the Company and the Affiliates;      provided, however, that you      shall be permitted to manage your personal investments and to engage in or      serve such civic, community, charitable, educational, or religious      organizations as you may reasonably select as long as such service does      not interfere with the performance of your duties under this      Agreement.  The Company recognizes that you currently serve as a      director of Canal Plus Nordic, Cablecom, AMC Theatres and American Media      and serve as an advisor to MortgageIT and that you may be invited to serve      on MortgageIT’s board of directors.  You agree, if so requested      by the Company, to limit your service and engagements as described in the      immediately preceding sentence to the extent necessary to comply with any      corporate governance recommendations of the U.S. Securities and Exchange      Commission or the National Association of Securities Dealers, and, as so      limited, you may continue such services and engagements as long as such      services and engagements do not interfere with the performance of your      duties under this Agreement or violate the restrictive covenants described      in paragraph 6 hereof. |
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| 5. | While      you are employed by the Company, you will be eligible to receive an annual      incentive bonus in any amount not exceeding your combined annual base      salary payable for your duties performed in the United States of America      and in the United Kingdom, as described in this paragraph      4.  One-half of any such bonus will be based upon achievement of      reasonable quantitative performance criteria established by the Board and      one-half of any such bonus shall be based upon subjective criteria      established by the Board. |
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| 6. | While      you are employed by the Company, you will be eligible to participate in      the employee benefit plans and programs made available from time to time      for the Company’s other senior executive officers (provided, however, the Company      shall continue to provide you with medical and travel insurance benefits      in the event the Company ceases to provide medical and travel insurance      benefits to other employees).  Without limiting the foregoing,      while you are employed by the Company, (a) you will be eligible to receive      options to purchase Class A Common Shares of the Company as described in      Annex A      hereto, (b) the Company will provide you with an assistant selected by      you, and (c) the Company will pay or reimburse all reasonable travel      expenses you incur in providing services for the Company, in accordance      with the Company’s policies, provided, however, that in no      event will your use of business class travel be deemed to violate such      policies. |
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| 7. | You      acknowledge and agree that the individualized services and capabilities      that you will provide to the Company under this Agreement are of a      personal, special, unique, unusual, extraordinary and intellectual      character.  Therefore, you will comply with and be bound by the      restrictive covenants set forth in Annex B      attached to, and made a part of, this Agreement, and you acknowledge and      agree that the restrictions in this Agreement (and the duration, extent      and application thereof) are no greater than is necessary to protect the      goodwill and trade connection of the Business (as defined in Annex B) and      are reasonable to protect the Company’s rights under this Agreement and to      safeguard the Company’s and the Affiliates’ Confidential Information (as      defined in Annex      B).  You and the Company agree that the obligations and      restrictions with respect to non-competition, confidentiality, Company      property, nondisparagement and non-solicitation, as set forth in Annex B, will      continue to apply to you following the termination of your relationship      regardless of the manner in which your relationship with the Company is      terminated, whether voluntarily, due to Termination for Cause (as defined      herein), not due to Termination for Cause or otherwise.  You      represent that your economic means and circumstances are such that the      provisions of this Agreement, including the noncompetition,      nonsolicitation, confidentiality and Company property provisions, will not      prevent you from providing for yourself and your family on a basis      satisfactory to you and them.  You acknowledge and agree that      your covenants and obligations with respect to noncompetition,      nonsolicitation, confidentiality and Company property relate to special,      unique and extraordinary matters and that a violation of any of the terms      of such covenants and obligations will cause the Company and the      Affiliates irreparable injury for which adequate remedies are not      available at law.  You therefore agree that the Company shall be      entitled to an order of specific performance, injunction, restraining      order or such other interim or permanent equitable relief (without the      requirement to post bond) restraining you from committing any violation of      the covenants and obligations contained in this      Agreement.  These remedies are cumulative and are in addition to      any other rights and remedies the Company may have at law or in      equity.  You agree that each of the paragraphs and      sub-paragraphs of Annex B      constitutes an entirely separate, severable and independent covenant and      restriction on you.   If the arbitrator appointed under      paragraph 9 hereof or a court determines that, but for the provisions of      this paragraph, any part of this Agreement is illegal, void as against      public policy or otherwise unenforceable, the relevant part will      automatically be amended to the extent necessary to make it sufficiently      narrow in scope, time and geographic area to be legally      enforceable.  All other terms of this Agreement will remain in      full force and effect.  If you raise any question as to the      enforceability of any part or terms of this Agreement, including, without      limitation, the provisions relating to noncompetition, nonsolicitation,      confidentiality and Company property, you specifically agree that you will      comply fully with this Agreement unless and until the entry of an arbitral      decision to the contrary. |
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| 8. | You      may terminate your employment hereunder upon at least ninety days' prior      written notice to the Company, and you will not be entitled to any      additional compensation, severance, termination pay, salary continuation      or similar compensation or benefits upon or after such termination of      employment.  If the Company terminates your employment, other      than due to Termination for Cause, and not because of your death or      disability (as determined in the good faith judgment of the Board) and not      due to expiration of the employment term set forth in paragraph 1 hereof      (or if you terminate your employment other than pursuant to the      immediately preceding sentence because of alleged breaches by the Company      of this Agreement), you will have those rights to which you are entitled      as a matter of law in respect of your loss of compensation, stock options      and other contractual entitlements hereunder, and (a) you will not      otherwise be entitled to any additional compensation, severance,      termination pay, salary continuation or similar compensation or benefits      upon or after termination of your employment with the Company, and (b) in      connection with such termination of employment the Company will not assert      that you have any duty to mitigate damages, provided, however, that if you      are engaged to render full-time services following such termination of      employment with the Company, amounts you earn from such full-time      employment during the period you otherwise would have been on the      Company's payroll hereunder shall offset any financial obligation of the      Company to you, and you agree to notify the Company in writing of your      acceptance of any such other employment within five (5) days after      accepting such other employment.  For purposes of this      Agreement, “Termination for Cause” means a determination by a majority of      the Board to terminate your employment due to your (i) conviction of a      felony or entering of a plea of nolo contendere with respect to a charged      felony, (ii) gross negligence, recklessness, dishonesty, fraud, willful      malfeasance or willful misconduct in the performance of the services      contemplated by this Agreement, (iii) willful misrepresentation to      shareholders or directors of the Company which is injurious to the      Company; (iv) willful failure without reasonable justification to comply      with a reasonable written order of the Board; or (v) willful and material      breach of your duties or obligations under this      Agreement.  Notwithstanding the foregoing, a termination shall      not be treated as a Termination for Cause unless (A) the Company shall      have delivered a written notice to you, stating that it intends to      terminate your employment due to Termination for Cause not less than seven      days following the giving of such notice, and specifying the factual basis      for such termination, and (B) the event or events that form the basis for      such notice, if capable of being cured, shall not have been cured within      30 days of receipt of suchnotice. |
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| 9. | For      one year following termination of your employment with the Company other      than due to Termination for Cause, the Company will engage you as a      consultant, and you agree to consult and cooperate with, and assist the      Company in any legal or business matter relating to the Company or the      Affiliates, as requested by the Company, upon reasonable advance notice by      the Company; provided that you shall      not be required to devote more than twenty hours per month to providing      such services and such services need not be provided to the Company on an      exclusive basis, as long as you comply with the restrictive covenants      described in paragraph 6 hereof.  In consideration for your      provision of such services during such one-year period, the Company will      pay you an aggregate fee of $250,000, payable in equal monthly      installments in arrears. |
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| 10. | You      and the Company agree that any dispute, claim or controversy between you      and the Company or an Affiliate or any of their respective officers,      directors, employees or shareholders (who are hereby expressly made      third-party beneficiaries of this Agreement for this purpose) arising out      of, relating to or in connection with this Agreement, or the breach,      termination or validity thereof, or otherwise arising from your employment      or the termination of your employment, will be referred to and finally      resolved by binding and non-appealable arbitration, before a single      arbitrator under the American Arbitration Association’s National Rules for      the Resolution of Employment Disputes, which Rules are deemed to be      incorporated by reference into this Agreement.  The place of      arbitration shall be New York City.  To the extent practicable,      any such arbitration shall be consolidated with any other arbitration      proceeding between you and anyAffiliate. |
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| 11. | You      and the Company agree that neither you nor the Company will be entitled to      seek or obtain punitive, exemplary or similar damages of any kind from the      other or, in your case, from the Company’s officers, directors, employees      or shareholders, or to seek or obtain damages or compensation for      emotional distress, as a result of any dispute, controversy or claim      arising out of, relating to or in connection with this Agreement, or the      performance, breach, termination or validity thereof.  Nothing      herein shall preclude an award of compensatory or punitive damages against      any other third party. |
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| 12. | The      Company will indemnify and hold you harmless from and against any claim,      loss or cause of action arising from or out of your performance as an      officer, director or employee of the Company or any of its subsidiaries or      in any other capacity, including any fiduciary capacity, in which you      serve at the request of the Company to the maximum extent permitted by      applicable law and the Company’s Memorandum of Association and      Bye-Laws.  If any claim is asserted against you with respect to      which you reasonably believe in good faith you are entitled to      indemnification, the Company will either defend you or, at its option, pay      your reasonable legal expenses (or cause such expenses to be paid) as they      become payable by you, provided that you will      reimburse the Company for any such amounts, plus simple interest thereon      at the 90-day United States Treasury Bill rate as in effect from time to      time, compounded annually, if the Company’s payment or reimbursement of      such amounts violates any law binding on the  Company. |
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| 13. | All      notices and other communications required or permitted hereunder shall be      sufficiently given if (a) delivered personally, (b) sent by facsimile      transmission (with confirmation received), (c) sent by a      nationally-recognized air courier assuring overnight delivery, or (d)      mailed (by registered or certified mail, return receipt requested and      postage prepaid) as follows: |
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| 14. | This      Agreement constitutes the entire agreement between you and the Company      with respect to the subject matter hereof, supersedes any prior agreements      and undertakings, both written and oral, and may not be modified or      amended in any way except in writing by you and the      Company.  The validity, interpretation, construction and      performance of this Agreement, and all disputes arising under or in      connection with this Agreement, shall be governed by the laws of the State      of New York (to the exclusion of its conflict of law      rules).  All amounts payable hereunder shall be subject to the      withholding of all applicable taxes and deductions required by any      applicable law. |
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|   | Sincerely,                       |
|--------|----------------------------------|
|   |                             |
|   | CME      Development Corporation |
|   |                             |
|   |                             |
|   | By:                              | /s/ Ronald S. Lauder |
|   |                             | Name:  Ronald      S. Lauder |
|   |                             | Title:  Director |

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| 1 | Definitions |
|---|-------------|

| the      Business      | the      business of investing in, developing and operating national and regional      commercial television stations and networks in Central and Eastern Europe      or any part of it carried on by the Company or any Affiliate at any time,      or, with respect to matters following the Termination Date, any such      business in respect of which Executive had been concerned or involved to      any material extent at any time during the twelve (12) month period      immediately prior to the Termination Date.                                                                                                                                                  |
|------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| Executive              | Michael      Garin                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| Material      Interest | (a)   the      holding of any position as director, officer, employee, consultant,      partner, principal or agent;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|                   | (b)   the      direct or indirect control or ownership (whether jointly or alone) of any      shares (or any voting rights attached to them) or debentures except for      the ownership for investment purposes only of not more than 1% of the      issued ordinary shares of a company whose shares are listed on any      recognized investment exchange; or                                                                                                                                                                                                                                                                                                   |
|                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|                   | (c)   the      direct or indirect provision of any financial  assistance.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |
|                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| Senior      Executive  | a      person with whom Executive had dealings in the course of his employment or      services and who is or was:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |
|                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|                   | (a)    engaged      or employed as an employee, director or consultant of the Company or any      Affiliate;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |
|                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|                   | (b)   engaged      or employed in a capacity in which he obtained Confidential Information;      and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |
|                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
|                   | (c)   with      respect to matters following the Termination Date, engaged or employed at      the Termination Date or at any time during the twelve (12) month period      immediately prior to the Termination Date.                                                                                                                                                                                                                                                                                                                                                                                                                                             |
|                   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |
| Termination      Date  | the      date on which Executive’s employment with the Company terminates,      howsoever occurring, or, if later, the later of:  (a) the date      on which the one-year term of Executive’s consulting, cooperation and      assistance services pursuant to paragraph 8 of this Agreement terminates,      and (b) the expiration of any period during or with respect to which      Executive received compensation or other payments from the Company in      respect of his loss of compensation, stock options and other contractual      entitlements under this Agreement in connection with any termination of      his employment by theCompany. |

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| 2 | Executive      covenants with the Company that he shall not (other than on behalf of the      Company) without the prior written consent of the Board (such consent to      be withheld only insofar as it may be reasonably necessary to protect the      legitimate interests of the Company and any Affiliates) directly or      indirectly: |
|---|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 2.1 | during      the term of Executive’s employment by, or other services to, the Company,      and for twelve (12) months following the Termination Date hold a Material      Interest in a business the same as or in competition with the Business      anywhere in the Czech Republic; Romania; Ukraine; Bulgaria; Slovakia;      Slovenia; Russia; Poland; Latvia; Croatia; Yugoslavia or any other country      or territory in which the Company of any Affiliate has any business      interests. |
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|   | 2.2 | during      the term of Executive’s employment by, or other services to, the Company,      and for 12 months following the Termination  Date: |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 2.2.1 | in      relation to a business the same as or in competition with the Business      perform any services or supply goods to any person, firm or company who      was a client or customer of the Company or any Affiliate at any time, or,      with respect to matters following the Termination Date, at the Termination      Date or during the twelve (12) month period immediately prior to the      Termination Date, and with whom during that period Executive had contact      or dealings or was aware of in the course of his employment or      services; |
|--------|-------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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|   | 2.2.2 | in      relation to a business the same as or in competition with the Business,      canvass, solicit or approach, or cause to be canvassed, solicited or      approached, for the purpose of obtaining business, orders or custom any      person, firm or company who was a client or customer of the Company or any      Affiliate at any time, or, with respect to matters following the      Termination Date, at the Termination Date or during the twelve (12) month      period immediately prior to the Termination Date and with whom during that      period Executive had contact or dealings or was aware of in the course of      his employment or services; or |
|--------|-------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 2.2.3 | in      relation to a business the same as or in competition with the Business,      offer employment to or employ or offer or conclude any contract for      services with any Senior Executive or procure or facilitate the making of      such an offer by any person, firm orcompany; |
|--------|-------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 2.3 | at      any time solicit, entice or prepare or endeavor to solicit, entice or      procure: |
|--------|-----|---------------------------------------------------------------------------------------------|

|   | 2.3.1 | an      employee of the Company or any Affiliate to breach his contract of      employment; or |
|--------|-------|------------------------------------------------------------------------------------------------|

|   | 2.3.2 | a      person to breach his contract for services with the Company or any      Affiliate; |
|--------|-------|-------------------------------------------------------------------------------------------|

|   | 2.4 | at      any time: |
|--------|-----|-------------------|

|   | 2.4.1 | falsely      represent himself as being connected with or interested in the Company or      any Affiliate or in the Business;or |
|--------|-------|---------------------------------------------------------------------------------------------------------------------------------|

|   | 2.4.2 | do      or say anything likely or calculated to lead any person firm or company to      withdraw from or cease to continue offering to the Company or any      Affiliate any rights of purchase, sale, import, distribution or agency      then enjoyed by it. |
|--------|-------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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| 3 | Without      the prior written consent of the Company, Executive shall not disclose at      any time during his term of employment or services with the Company or any      time thereafter any Confidential Information (as defined below) to any      third person other than in the course of fulfilling Executive’s      responsibilities under this Agreement unless such Confidential Information      has been previously disclosed to the public by the Company or an Affiliate      or is in the public domain (other than by reason of Executive’s breach of      the provisions of this paragraph).  “Confidential Information”      is any non-public information pertaining to the Company or an Affiliate,      any of their businesses or the business or personal affairs of Ronald S.      Lauder (“Lauder”) or his family and how any of them conducts its or his      business or affairs.  “Confidential Information” includes not      only information disclosed by the Company or an Affiliate to Executive,      but information developed, created or learned by Executive during the      course of or as a result of Executive’s employment with the      Company.  “Confidential Information” specifically includes      information and documents concerning the Company’s and Affiliates’ methods      of doing business; research, telecommunications technology, its actual and      potential clients, transactions and suppliers (including the Company’s or      an Affiliate’s terms, conditions and other business arrangements with      them); client or potential client or transaction lists and billing;      advertising, marketing and business plans and strategies (including      perspective or pending licensing applications or investments in license      holders or applicants); profit margins, goals, objectives and projections;      compilations, analyses and projections regarding the Company, Affiliates      or any of its clients or potential clients or their business; trade      secrets; salary, staffing, management organization or employment      information; information relating to members of the Board of Directors and      management of the Company or an Affiliate; files, drawings or designs;      information regarding product development, marketing plans, sales plans or      manufacturing plans; operating policies or manuals, business plans,      financial records or packaging design; or any other financial, commercial,      business or technical information relating to the Company, an Affiliate,      Lauder or his family or information designated as confidential or      proprietary that the Company, an Affiliate or Lauder may receive belonging      to others who do business with any of them.  Nothing herein      shall prevent the disclosure by Executive of any information required by      an order of a court having competent jurisdiction or under subpoena from a      government agency, provided that, if      Executive receives a request for the disclosure of any Confidential      Information pursuant to court process or by a government agency, Executive      shall immediately (and at the latest within two business days) notify the      Company of that request and cooperate to the maximum extent authorized by      law with the Company in protecting the Company’s and the Affiliates’      interest in maintaining the confidentiality of any Confidential      Information. |
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| 4 | Each      of the parties to this Agreement agrees not to make disparaging or      derogatory comments about the other party, members of the Board or      Affiliates, except to the extent required by law, and then only after      consultation with the other party to the maximum extent possible in order      to maintain goodwill for each of theparties. |
|---|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| 5 | Promptly      (and at the latest within ten business days) following Executive’s      termination of services, Executiveshall: |
|---|--------------------------------------------------------------------------------------------------------------------------------------|

|   | 5.1 | return      to the Company all documents, records, notebooks, computer diskettes and      tapes and anything else containing the Company’s Confidential Information,      and any other property or Confidential Information of the Company or      Affiliates, including all copies thereof in Executive’s possession,      custody or control, and |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   | 5.2 | delete      from any computer or other electronic storage medium owned by Executive      any of the proprietary or Confidential Information of the Company or      Affiliate |
|--------|-----|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

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