Document:

Exhibit 10.8

 

Execution Version

 

GUARANTEE

 

This GUARANTEE (this “Guarantee”) is entered into as of May 2, 2014, among CENTRAL EUROPEAN MEDIA ENTERPRISES N.V., a company incorporated under the laws of the former Netherlands Antilles and existing under the laws of Curaçao (“CME NV”), CME MEDIA ENTERPRISES B.V., a private limited liability company incorporated and existing under the laws of the Netherlands (“CME BV”, and together with CME NV and any other entity that becomes a guarantor hereunder pursuant to Section 25 hereof, collectively, the “Subsidiary Guarantors” and each, a “Subsidiary Guarantor”) as guarantors and TIME WARNER INC., as administrative agent (the “Administrative Agent”), on behalf of itself and the Lenders (as defined below).

 

Reference is hereby made to that certain Revolving Loan Facility Credit Agreement, dated as May 2, 2014 (as restated, amended, modified, supplemented and in effect, the “Credit Agreement”), among CENTRAL EUROPEAN MEDIA ENTERPRISES LTD., as a borrower (the “Borrower”), the lenders party thereto from time to time (the “Lenders”) and the Administrative Agent.  Capitalized terms used in this Guarantee and not otherwise defined herein have the meanings specified in the Credit Agreement.

 

The Lenders have agreed to extend credit to the Borrower, subject to the terms and conditions set forth in the Credit Agreement, which include, among other things, the execution and delivery of this Guarantee within the timeframe set forth in the Credit Agreement.  Each Subsidiary Guarantor is an Affiliate of the Borrower, will derive substantial benefits from the extension of credit to the Borrower pursuant to the Credit Agreement, and is willing to execute and deliver this Guarantee in order to induce the Lenders to enter into the Credit Agreement.  Accordingly, for value received, the sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

 

1.              Guarantee.  Each of the Subsidiary Guarantors hereby fully, unconditionally, irrevocably, and jointly and severally guarantees on a senior basis, as primary obligor and not merely as surety, the full and punctual payment of principal of, or interest on or in respect of the  Loan when due, whether at stated maturity, by acceleration or otherwise, under the Credit Agreement or any other Loan Document, and the full and punctual payment of all expenses and indemnification payments owed by the Borrower in respect of the Loan under the Credit Agreement or any other Loan Document (the “Guaranteed Obligations”).  The Guaranteed Obligations shall include, in addition to the amount stated above, any and all costs and expenses (including counsel fees and expenses) incurred by the Administrative Agent or the Lenders in enforcing any rights under this Guarantee or any other Loan Document.

 

The guarantee hereunder is a guarantee of payment.  If there occurs an Event of Default in the payment of principal or interest, if any, or any other payment obligations in respect of the Loan under the Credit Agreement or any other Loan Document, legal proceedings may be instituted directly against one or all of the Subsidiary Guarantors without first proceeding against the Borrower.

 

2.                                      Limitation on Liability.  The obligations of each Subsidiary Guarantor hereunder will be limited to the maximum that will result in the obligations of such Subsidiary

 

 

Guarantor not constituting a fraudulent conveyance or a violation of fraudulent restrictions under applicable insolvency and other laws.

 

3.                                      No Subrogation.  Notwithstanding any payment or payments made by a Subsidiary Guarantor hereunder, no Subsidiary Guarantor shall be entitled to be subrogated to any of the rights of the Administrative Agent or any Lender against the Borrower or any guarantee or right of offset held by the Administrative Agent or any Lenders for the payment of amounts owed by the Borrower and the Subsidiary Guarantors in respect of the Guaranteed Obligations, nor shall any Subsidiary Guarantor seek or be entitled to seek any contribution or reimbursement from the Borrower in respect of payments made by such Subsidiary Guarantor hereunder, in each case until all Guaranteed Obligations (other than Unmatured Surviving Obligations) are paid in full.  If any amount shall be paid to any Subsidiary Guarantor on account of such subrogation rights at any time when all of the Guaranteed Obligations (other than Unmatured Surviving Obligations) shall not have been paid in full, such amount shall be held by the Subsidiary Guarantor for and on behalf of, and to the extent possible under applicable law in trust for, the Administrative Agent and the Lenders, segregated from other funds of the Subsidiary Guarantor and shall, forthwith upon receipt by the Subsidiary Guarantor, be turned over to the Administrative Agent in the exact form received by the Subsidiary Guarantor (duly indorsed by the Subsidiary Guarantor to the Administrative Agent, if required), to be applied against the Guaranteed Obligations.  “Unmatured Surviving Obligations” of any Subsidiary Guarantor means any Guaranteed Obligations that by their terms survive the termination of the Loan Documents but are not, as of the date of payment of all other Guaranteed Obligations, due and payable and for which no outstanding claim has been made.  Notwithstanding anything to the contrary herein, payments of principal and interest are not Unmatured Surviving Obligations.

 

4.              Release and Discharge.  (a) This Guarantee will be automatically and unconditionally released without further action on the part of any Lender or the Administrative Agent (and thereupon shall terminate and be discharged and be of no further force and effect) upon full and final payment and performance of all Guaranteed Obligations (other than Unmatured Surviving Obligations) and (b) so long as no Event of Default has occurred and is continuing, the guarantee of any Subsidiary Guarantor (together with any rights of contribution, subrogation or other similar rights against the Subsidiary Guarantor) will be automatically and unconditionally released without further action on the part of any Lender or the Administrative Agent (and thereupon shall terminate and be discharged and be of no further force and effect) so long as (i) the Subsidiary Guarantor is disposed of (whether by amalgamation, merger, demerger, split-up or consolidation, the sale, transfer or other disposal of all its Capital Stock or the sale, transfer or other disposal of all or substantially all of its assets (other than by a lease)) to an entity other than the Borrower or any Subsidiary of the Borrower in compliance with the terms of the Credit Agreement, (ii) such Subsidiary Guarantor is simultaneously and unconditionally released from its obligations in respect of all other Indebtedness of the Borrower or any other Subsidiary of the Borrower, and (iii) the proceeds from such sale, transfer or other disposition are used for the purposes permitted or required by the Credit Agreement.

 

5.              Termination; Reinstatement.  Except for any release of a Subsidiary Guarantor pursuant to Section 4 of this Guarantee, this Guarantee is a continuing, absolute and irrevocable guarantee of all Guaranteed Obligations now or hereafter existing and shall remain in full force and effect until all Guaranteed Obligations and any other amounts payable under this Guarantee

 

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are indefeasibly paid in full in cash (other than Unmatured Surviving Obligations).  This Guarantee shall continue in full force and effect or be revived, as the case may be, if any payment by or on behalf of the  Borrower or a Subsidiary Guarantor is made, or the Administrative Agent or any Lender exercises its right of setoff, in respect of the Guaranteed Obligations and such payment or the proceeds of such setoff or any part thereof is subsequently invalidated, declared to be fraudulent or preferential, set aside or required (including pursuant to any settlement entered into by the Administrative Agent or such Lender in its discretion) to be repaid to a trustee, receiver or any other party, in connection with any proceeding under any Bankruptcy Law or otherwise, all as if such payment had not been made or such setoff had not occurred and whether or not the Administrative Agent or such Lender is in possession of or has released this Guarantee and regardless of any prior revocation, rescission, termination or reduction.  The obligations of each Subsidiary Guarantor under this Section shall survive termination of this Guarantee.

 

6.                                      No Setoff or Deductions; Taxes; Payments.  CME BV represents and warrants that it is incorporated and existing under the laws of the Netherlands, and CME NV represents and warrants it is incorporated under the laws of the former Netherlands Antilles and existing under the laws of Curacao.  Each Subsidiary Guarantor shall make all payments hereunder without setoff or counterclaim and subject to, and in accordance with, Section 2.11 of the Credit Agreement, free and clear of and without deduction for any Taxes.  The obligations of each Subsidiary Guarantor under this Section shall survive the payment in full of the Guaranteed Obligations and termination of this Guarantee.  All payments under this Guarantee shall be made in accordance with Section 2.12 of the Credit Agreement.  The obligations hereunder shall not be affected by any acts of any legislative body or governmental authority affecting the Borrower, including, but not limited to, any restrictions on the conversion of currency or repatriation or control of funds or any total or partial expropriation of the Borrower’s property, or by economic, political, regulatory or other events in the countries where the Borrower is located.

 

7.                                      Rights of Administrative Agent.  Subject to the terms of the Credit Agreement, each Subsidiary Guarantor consents and agrees that the Administrative Agent, on behalf of itself and the Lenders, and the Lenders, may, at any time and from time to time, without notice or demand, and without affecting the enforceability or continuing effectiveness hereof:  (a) amend, extend, renew, compromise, discharge, accelerate or otherwise change the time for payment or the terms of the Guaranteed Obligations or any part thereof and (b) release or substitute one or more of any endorsers or other guarantors of any of the Guaranteed Obligations.  Without limiting the generality of the foregoing, each Subsidiary Guarantor consents to the taking of, or failure to take, any action which might in any manner or to any extent vary the risks of such Subsidiary Guarantor under this Guarantee or which, but for this provision, might operate as a discharge of such Subsidiary Guarantor.

 

8.                                      Certain Waivers.  Each Subsidiary Guarantor waives (a) any defense arising by reason of any disability or other defense of the Borrower or any other guarantor, or the cessation from any cause whatsoever (including any act or omission of the Administrative Agent or any Lender) of the liability of the Borrower; (b) any defense based on any claim that such Subsidiary Guarantor’s obligations exceed or are more burdensome than those of the Borrower; (c) the benefit of any statute of limitations affecting such Subsidiary Guarantor’s liability hereunder; (d) any right to require the Administrative Agent or any Lender to proceed against the Borrower or

 

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pursue any other remedy in the Administrative Agent’s or any Lender’s power whatsoever; and (e) to the fullest extent permitted by law, any and all other defenses or benefits that may be derived from or afforded by applicable law limiting the liability of or exonerating guarantors or sureties.

 

Each Subsidiary Guarantor expressly waives all setoffs and counterclaims and all presentments, demands for payment or performance, notices of nonpayment or nonperformance, protests, notices of protest, notices of dishonor and all other notices or demands of any kind or nature whatsoever with respect to the Guaranteed Obligations, and all notices of acceptance of this Guarantee or of the existence, creation or incurrence of new or additional Guaranteed Obligations; subject, however, to such Subsidiary Guarantor’s right to make inquiry to the Administrative Agent to ascertain the amount of the Guaranteed Obligations at any reasonable time.

 

9.                                      Obligations Independent.  The obligations of each Subsidiary Guarantor hereunder are those of primary obligor, and not merely as surety, and are independent of the Guaranteed Obligations and the obligations of any other guarantor, and a separate action may be brought against such Subsidiary Guarantor to enforce this Guarantee whether or not the Borrower or any other person or entity is joined as a party.

 

10.                               Subordination.  Each Subsidiary Guarantor hereby subordinates the payment of all obligations and indebtedness of the Borrower owing to such Subsidiary Guarantor, whether now existing or hereafter arising, including, but not limited to, any obligation of the Borrower to such Subsidiary Guarantor as subrogee of the Administrative Agent or the Lenders or resulting from such Subsidiary Guarantor’s performance under this Guarantee, to the indefeasible payment in full in cash of all Guaranteed Obligations (other than Unmatured Surviving Obligations).  Notwithstanding anything to the contrary set forth herein and to the extent permitted under the Credit Agreement, the Borrower may make any payment to such Subsidiary Guarantor in respect of such obligations and indebtedness.  If the Administrative Agent so requests at any time following the occurrence and during the continuance of any Event of Default, any such obligation or indebtedness of the Borrower to such Subsidiary Guarantor shall be enforced and performance received by such Subsidiary Guarantor for and on behalf of, and to the extent possible under applicable law as trustee for, the Administrative Agent or the Lenders and the proceeds thereof shall be paid over to the Administrative Agent, for the benefit of itself, and the Lenders, on account of the Guaranteed Obligations, but without reducing or affecting in any manner the liability of such Subsidiary Guarantor under this Guarantee.

 

11.                               Stay of Acceleration.  In the event that acceleration of the time for payment of any of the Guaranteed Obligations is stayed, in connection with any case commenced by or against any Subsidiary Guarantor or the Borrower under any Bankruptcy Law, or otherwise, all such amounts shall nonetheless be payable by the Subsidiary Guarantors immediately upon written demand by the Administrative Agent.

 

12.                               Expenses.  Each Subsidiary Guarantor shall pay all reasonable invoiced out-of-pocket expenses of the Administrative Agent and the Lenders in accordance with Section 8.03 of the Credit Agreement.  The obligations of each Subsidiary Guarantor under this Section shall survive the payment in full of the Guaranteed Obligations and termination of this Guarantee.

 

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13.                               Miscellaneous.  Subject to the terms of the Credit Agreement and Section 25 of this Guarantee, no provision of this Guarantee may be waived, amended, supplemented or modified, except by a written instrument executed by the Administrative Agent and each Subsidiary Guarantor.  No failure by the Administrative Agent to exercise, and no delay in exercising, any right, remedy or power hereunder shall operate as a waiver thereof; nor shall any single or partial exercise of any right, remedy or power hereunder preclude any other or further exercise thereof or the exercise of any other right, power or remedy.  The remedies herein provided are cumulative and not exclusive of any remedies provided by law or in equity.  The unenforceability or invalidity of any provision of this Guarantee shall not affect the enforceability or validity of any other provision herein.  Unless otherwise agreed by the Administrative Agent and each Subsidiary Guarantor in writing, this Guarantee is not intended to supersede or otherwise affect any other guarantee now or hereafter given by any Subsidiary Guarantor for the benefit of the Administrative Agent or any Lender or any term or provision thereof.  The Administrative Agent and the Borrower may agree to changes to this Guarantee with respect to foreign guarantors as may be required by local law.

 

14.                               Condition of Borrower.  Each Subsidiary Guarantor acknowledges and agrees that it has the sole responsibility for, and has adequate means of, obtaining from the Borrower and any other guarantor such information concerning the financial condition, business and operations of the Borrower and any such other guarantor as such Subsidiary Guarantor requires, and that the Administrative Agent has and the Lenders have no duty, and such Subsidiary Guarantor is not relying on the Administrative Agent at any time, to disclose to such Subsidiary Guarantor any information relating to the business, operations or financial condition of the Borrower or any other guarantor (each Subsidiary Guarantor waiving any duty on the part of the Administrative Agent or any Lender to disclose such information and any defense relating to the failure to provide the same).

 

15.                               Setoff.  If and to the extent any payment is not made when due hereunder and subject to Section 8.08 of the Credit Agreement, the Administrative Agent or any Lender may, at any time following the occurrence and during the continuance of an Event of Default, set off and charge from time to time any amount so due against any or all of a Subsidiary Guarantor’s accounts or deposits with the Administrative Agent or such Lender, respectively.

 

16.                               Representations and Warranties.  Each Subsidiary Guarantor represents and warrants, as of the date hereof, the Revolving Loan Effective Date and the date of any Borrowing, that (a) it (i)(A) is validly existing and (if applicable) in good standing under the laws of the jurisdiction of its organization, (B) has all requisite power and authority to carry on its business as now conducted, and (C) is qualified to do business in, and (if applicable) is in good standing in, every jurisdiction where such qualification is required, except in the case of (B) and (C) to the extent that failure to do so could not reasonably be expected to have a Material Adverse Effect and (ii) this Guarantee is within its powers and has been duly authorized by all necessary corporate and, if required, shareholder action; (b) this Guarantee has been duly executed and delivered by it and constitutes a legal, valid and binding obligation of it, enforceable against it in accordance with its terms, subject to (i) the effects of bankruptcy, insolvency, moratorium, reorganization, fraudulent conveyance or other similar laws affecting creditors’ rights generally, (ii) general principles of equity and (iii) implied covenants of good faith and fair dealing; (c) no authorization or approval or other action by, and no notice to or

 

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filing with, any Governmental Authority or any other third party is required for the due execution, delivery and performance by it of this Guarantee, or the consummation of the transactions contemplated hereby, except such as have been obtained or made and are in full force and effect; (d) the execution, delivery and performance by it of this Guarantee and the consummation of the transactions contemplated hereby (i) do not contravene (A) any law applicable to it, in any material respect or (B) its organizational documents, and (ii) will not violate or result in a default or require any consent or approval under any material indenture, agreement or other instrument binding upon it or its property, or give rise to a right thereunder to require any payment to be made by it; (e) it is, and immediately after giving effect to this Guarantee and all the transactions contemplated hereby will be, Solvent; (f) its payment obligations under this Guarantee  rank at least pari passu with the claims of all its other unsecured and unsubordinated creditors, except for obligations mandatorily preferred by law applying to companies generally; and (g) under the law of its jurisdiction of incorporation, it is not necessary that this Guarantee be filed, recorded or enrolled with any court or other authority in that jurisdiction or that any stamp, registration or similar tax be paid on or in relation to this Guarantee or the transactions contemplated hereby (other than any such stamp, registration or similar tax that has been paid as of the date of this Guarantee or any nominal stamp, registration or similar tax pursuant to Curaçao law).

 

17.       Indemnification and Survival.  Without limitation on any other obligations of each Subsidiary Guarantor or remedies of the Administrative Agent under this Guarantee, each Subsidiary Guarantor shall, in accordance with Section 8.03 of the Credit Agreement (as if such Subsidiary Guarantor were the indemnifying party under the Credit Agreement) and to the fullest extent permitted by law, indemnify, defend and save and hold harmless the Administrative Agent and the Lenders from and against, and shall pay on demand, any and all damages, losses, liabilities and expenses (including reasonable and documented out-of-pocket attorneys’ fees and expenses) that may be suffered or incurred by the Administrative Agent or any Lender in connection with or as a result of any failure of any Guaranteed Obligations to be the legal, valid and binding obligations of the Borrower enforceable against the Borrower in accordance with their terms.  The obligations of each Subsidiary Guarantor under this Section shall survive the payment in full of the Guaranteed Obligations and termination of this Guarantee.

 

18.       GOVERNING LAW.  THIS GUARANTEE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK.

 

19.       Assignment.  Subject to the terms of the Credit Agreement, this Guarantee shall (a) bind each Subsidiary Guarantor and its successors and assigns, provided that no Subsidiary Guarantor may assign its rights or obligations under this Guarantee without the prior written consent of the Administrative Agent and the Lenders (and any attempted assignment without such consent shall be void), and (b) inure to the benefit of the Administrative Agent, the Lenders, and their respective successors and permitted assigns and the Administrative Agent and the Lenders may, without notice to any Subsidiary Guarantor and without affecting any Subsidiary Guarantor’s obligations hereunder, assign, sell or grant participations in the Guaranteed Obligations and this Guarantee, in whole or in part, in each case, to the extent permitted under the Credit Agreement.

 

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20.       Jurisdiction.  Each Subsidiary Guarantor hereto hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of the Supreme Court of the State of New York sitting in New York County and of the United States District Court of the Southern District of New York, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Guarantee, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York State or, to the extent permitted by law, in such federal court.  To the extent that any Subsidiary Guarantor has or hereafter may acquire any immunity from jurisdiction of any court or from any legal process (whether through service or notice, attachment prior to judgment, attachment in aid of execution, execution or otherwise) with respect to itself or its property, such Subsidiary Guarantor hereby irrevocably waives such immunity in respect of its obligations under this Guarantee.  Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.  Nothing in this Guarantee shall affect any right that the Administrative Agent or any Lender may otherwise have to bring any action or proceeding relating to this Guarantee against the Borrower or any Subsidiary Guarantor or any of their respective properties in the courts of any jurisdiction to enforce a judgment obtained in accordance with this Section.

 

Each Subsidiary Guarantor hereby irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Guarantee in any court referred to in the preceding paragraph.  Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.

 

21.       Notice; Service of Process.  All notices and other communications to any Subsidiary Guarantor under this Guarantee shall be in accordance with the Credit Agreement.

 

22.       WAIVER OF JURY TRIAL.  EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS GUARANTEE OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS GUARANTEE BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

 

23.       Judgment Currency.  (a) The Subsidiary Guarantors’ obligations hereunder to make payments in Dollars (pursuant to such obligation, the “Obligation Currency”) shall not be discharged or satisfied by any tender or recovery pursuant to any judgment expressed in or converted into any currency other than the Obligation Currency, except to the extent that such

 

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tender or recovery results in the effective receipt by the Administrative Agent or the respective Lender of the full amount of the Obligation Currency expressed to be payable to the Administrative Agent or such Lender under this Guarantee.  If, for the purpose of obtaining or enforcing judgment against any Subsidiary Guarantor in any court or in any jurisdiction, it becomes necessary to convert into or from any currency other than the Obligation Currency (such other currency being hereinafter referred to as the “Judgment Currency”) an amount due in the Obligation Currency, the conversion shall be made at the rate of exchange (as quoted by the Administrative Agent or if the Administrative Agent does not quote a rate of exchange on such currency, by a known dealer in such currency designated by the Administrative Agent) determined, in each case, as of the Business Day immediately preceding the day on which the judgment is given (such Business Day being hereinafter referred to as the “Judgment Currency Conversion Date”), (b) if there is a change in the rate of exchange prevailing between the Judgment Currency Conversion Date and the date of actual payment of the amount due, the Subsidiary Guarantors covenant and agree to pay, or cause to be paid, either (i) such additional amounts, if any (but in any event not a lesser amount) as may be necessary to ensure that the amount paid in the Judgment Currency, when converted at the rate of exchange prevailing on the date of payment, will produce the amount of the Obligation Currency which could have been purchased with the amount of Judgment Currency stipulated in the judgment or judicial award at the rate of exchange prevailing on the Judgment Currency Conversion Date, or (ii) such amount, in the Obligation Currency, equal to the amount of the applicable judgment denominated in the Judgment Currency, converted to the Obligation Currency in accordance with the Judgment Currency Conversion Date and (c) for purposes of determining the rate of exchange for this Section, such amounts shall include any premium and costs payable in connection with the purchase of the Obligation Currency.

 

24.       Concerning Joint and Several Liability of the Subsidiary Guarantors.  Subject to any limitations set forth in Section 2 herein, each Subsidiary Guarantor accepts joint and several liability for the Guaranteed Obligations hereunder and under the other Loan Documents in consideration of the financial accommodations to be provided by the Administrative Agent and the Lenders under the Credit Agreement, for the mutual benefit, directly and indirectly, of each Subsidiary Guarantor and in consideration of the undertakings of each other Subsidiary Guarantor to accept joint and several liability for the Guaranteed Obligations.

 

Each Subsidiary Guarantor, jointly and severally, hereby irrevocably and unconditionally accepts, not merely as a surety but also as a co-debtor, joint and several liability with the other Subsidiary Guarantors with respect to the payment of all of the Guaranteed Obligations without preferences or distinction among them.

 

The obligations of each Subsidiary Guarantor under the provisions of this Guarantee constitute full recourse obligations of each Subsidiary Guarantor enforceable against such Subsidiary Guarantor to the full extent of its properties and assets, irrespective of the validity, regularity, genuineness or enforceability of the Credit Agreement or any other Loan Documents or any other circumstance whatsoever.

 

25.       Additional Subsidiary Guarantors.  Each Subsidiary of the Borrower that becomes a Subsidiary Guarantor pursuant to the Credit Agreement shall become a Subsidiary Guarantor

 

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for all purposes of this Guarantee upon execution and delivery by such Subsidiary of a duly executed instrument of accession in the form attached as Exhibit A hereto.

 

26.       Compliance with Credit Agreement.  Each Subsidiary Guarantor agrees to comply with all obligations applicable to it under the Credit Agreement.

 

27.       Parallel Debt. For the purpose of this Section 27, “Corresponding Debt” means any amount which any Subsidiary Guarantor owes under or in connection with under this Guarantee or any other Loan Document, and “Parallel Debt” means any amount which a Subsidiary Guarantor owes to the Administrative Agent under this Section 27. Each Subsidiary Guarantor irrevocably and unconditionally undertakes to pay to the Administrative Agent amounts equal to, and in the currency or currencies of, its Corresponding Debt. The Parallel Debt of each Subsidiary Guarantor (a) shall become due and payable at the same time as its Corresponding Debt and (b) is independent and separate from, and without prejudice to, its Corresponding Debt. For the purposes of this Section 27, the Administrative Agent (a) is the independent and separate creditor of each Parallel Debt, (b) acts in its own name and not as agent, representative or trustee of the Lenders and its claims in respect of each Parallel Debt and any security in connection with such claims shall not be held on trust and (c) shall have the independent and separate right to demand payment of each Parallel Debt in its own name (including, without limitation, through any suit, execution, enforcement of security, recovery of guarantees and applications for and voting in any kind of insolvency proceeding). The Parallel Debt of a Subsidiary Guarantor shall be (a) decreased to the extent that its Corresponding Debt has been irrevocably and unconditionally paid or discharged, and (b) increased to the extent to that its Corresponding Debt has increased, and its Corresponding Debt shall be (x) decreased to the extent that its Parallel Debt has been irrevocably and unconditionally paid or discharged, and (y) increased to the extent that its Parallel Debt has increased, in each case provided that the Parallel Debt of a Subsidiary Guarantor shall never exceed its Corresponding Debt.

 

[Signature Pages Follow]

 

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IN WITNESS WHEREOF, the parties hereto have duly executed this Guarantee as of the day and year first above written.

 

	
 
    	
CENTRAL EUROPEAN MEDIA   ENTERPRISES N.V.
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Daniel Penn
    
	
 
    	
 
    	
 
    
	
 
    	
Name:
    	
Daniel   Penn
    
	
 
    	
 
    	
 
    
	
 
    	
Title:
    	
Managing   Director
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
Address:
    	
Schottegatweg   Oost 44
    
	
 
    	
 
    
	
 
    	
Willemstad,   Curaçao
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
CME MEDIA ENTERPRISES B.V.
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   David Sturgeon
    
	
 
    	
 
    	
 
    
	
 
    	
Name:
    	
David   Sturgeon
    
	
 
    	
 
    	
 
    
	
 
    	
Title:
    	
acting   Chief Financial Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
Address:
    	
Dam   5B, 1012 JS,
    
	
 
    	
 
    
	
 
    	
Amsterdam,   The Netherlands
    

 

 

	
 
    	
TIME   WARNER INC., as Administrative Agent
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/   Edward B. Ruggiero
    
	
 
    	
 
    	
 
    
	
 
    	
Name:
    	
Edward   B. Ruggiero
    
	
 
    	
 
    	
 
    
	
 
    	
Title:
    	
Senior   Vice President & Treasurer
    

 

 

EXHIBIT A

 

FORM OF GUARANTEE JOINDER AGREEMENT

 

as of                                      , 20

 

To:                             The Administrative Agent (as defined in the Credit Agreement referenced below) and the Lenders who are party to the Credit Agreement (as such terms are defined below):

 

Reference is hereby made to the Guarantee (the “Guarantee”) dated as of [·], 2014, by and among the Subsidiary Guarantors party thereto (and as defined therein), any other Subsidiary Guarantors that became a Subsidiary Guarantor thereunder pursuant to a duly executed instrument of accession in the form of Exhibit A attached thereto and TIME WARNER INC., as Administrative Agent, on behalf of itself and the Lenders, delivered pursuant to that certain Revolving Loan Facility Credit Agreement, dated as of [·], 2014 (as restated, amended, modified, supplemented and in effect, the “Credit Agreement”), among CENTRAL EUROPEAN MEDIA ENTERPRISES LTD.,  as borrower (the “Borrower”), the lenders party thereto from time to time (the “Lenders”) and TIME WARNER INC., as Administrative Agent.  Capitalized terms used herein and not otherwise defined herein have the meanings specified in the Credit Agreement, as applicable.

 

The undersigned acknowledges, and represents and warrants, the following: (1) the undersigned is a [corporation incorporated] [a general/limited partnership formed] [an entity constituted] on or prior to the date hereof; (2) the financial success of the undersigned is expected to depend in whole or in part upon the financial success of the Borrower; (3) the undersigned will receive substantial direct and indirect benefits from the Lenders’ extensions of credit to the Borrower pursuant to the Credit Agreement; and (4) the undersigned wishes to become party to the Guarantee and to guarantee the full and prompt payment of the Guaranteed Obligations.

 

In consideration of the foregoing, and for other valuable consideration the receipt and sufficiency of which is hereby acknowledged, the undersigned by its execution of this Guarantee Joinder Agreement hereby joins the Guarantee and becomes a Subsidiary Guarantor party thereto for all purposes thereof.  The undersigned further covenants and agrees that by its execution hereof it makes each of the representations and warranties made by a Subsidiary Guarantor thereunder and it shall be bound by and shall comply with all terms and conditions of the Guarantee and that it is jointly and severally liable with all of the Subsidiary Guarantors for the payment of all the Guaranteed Obligations.

 

[Signature Page Follows]

 

 

	
 
    	
Very truly yours,
    
	
 
    	
 
    
	
 
    	
[NAME]
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Title:Exhibit 10.9

 

Execution copy

5th

 

DEED OF PLEDGE OF SHARES

(CME Media Enterprises B.V.)

 

This second day of May two thousand and fourteen, there appeared before me, Jan Hendrik Gerrit Visser, hereafter to be called civil law notary, as deputy of Guido Marcel Portier, civil law notary officiating in Amsterdam, the Netherlands:

 

1.                            Robert-Jan Simon Peter Boekweit, born in Hoorn, the Netherlands, on the fourth day of January nineteen hundred eighty-five, employed at Fred. Roeskestraat 100, 1076 ED Amsterdam, the Netherlands, in this respect acting as authorized representative of:

 

a.                             Central European Media Enterprises N.V., a public company (naamloze vennootschap) under the laws of Curaçao, having its registered offices in Curaçao, and its office address at Schottegatweg Oost 44, Curaçao, and registered with the Commercial Register of the Curaçao Chamber of Commerce and Industry under number 67248 (the “Pledgor”);

 

b.                             CME Media Enterprises B.V., a private company with limited liability (besloten vennootschap met beperkte aansprakelijkheid) incorporated under the laws of the Netherlands, having its registered offices in Amsterdam, the Netherlands, and its office address at Dam 5B, 1012 JS Amsterdam, the Netherlands, and registered with the trade register of the Chambers of Commerce under file number 33246826 (the “Company”);

 

2.                            Leonie Louise van Gulik, residing at Overtoom 238 B-1, 1054 HZ Amsterdam, the Netherlands, born in Rotterdam, the Netherlands, on the fourth day of March nineteen hundred eighty-eight, identified by means of her passport with number NNL72CJR2, valid until the twelve day of November two thousand fifteen, in this respect acting as authorized representative of:

 

Time Warner Inc., a corporation incorporated under the laws of the State of Delaware, United States of America, with an address at One Time Warner Center, New York, NY 10019, United States of America (administrative agent under the Term Loan Credit Agreement (as defined hereafter) and as sole creditor under each Parallel Debt (as defined hereafter), the “Pledgee”).

 

Powers of attorney.

 

The authorization of the persons appearing is evidenced by three (3) written powers of attorney, copies of which shall be attached to this deed (Annex I).

 

The persons appearing declared the following:

 

the Pledgor and the Pledgee have agreed as follows:

 

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Whereas:

 

a.                            the Pledgor and the Pledgee wish to hereby establish a right of pledge with a fifth priority (on the date hereof) in respect to the Shares (as defined hereafter) under the following terms;

 

b.                            the holders of the Existing Rights of Pledge (as defined hereafter) have approved the creation of the Right of Pledge (as defined hereafter) and the Permitted Right of Pledge (as defined hereafter), as appears from the Amended Intercreditor Agreement (as defined hereafter).

 

Definitions.

Article 1.

 

In this deed, the following words shall have the following meaning:

 

a.                            the “Amended Intercreditor Agreement”: the intercreditor agreement dated the twenty-first day of July two thousand and six (and amended and restated on the sixteenth day of May two thousand and seven, on the twenty-second day of August two thousand and seven, the tenth day of March two thousand and eight, the seventeenth day of September two thousand and nine, the twenty-ninth day of September two thousand nine, the twenty-first day of October two thousand and ten, the eighteenth day of February two thousand and eleven, the eighth day of October two thousand and twelve, and as further amended and restated on this second day of May two thousand and fourteen) by and between (among others) Central European Media Enterprises Ltd., the Pledgor, the Company, The Bank of New York Mellon, acting through its London branch (in its capacity as notes trustee under the 2009 Indenture), The Law Debenture Trust Corporation p.l.c. (in its capacity as security trustee under the 2009 Indenture), Citibank, N.A., London Branch (in its capacity as trustee under the 2010 Indenture), BNP Paribas Trust Corporation UK Limited (in its capacity as security agent under the 2010 Indenture), Deutsche Bank Trust Company Americas (in its capacity as trustee and security agent under the 2011 Indenture), the Pledgee (in its capacity as security agent under the 2014 Term Loan (as defined therein) and the Revolving Loan Facility Credit Agreement) and Deutsche Bank Trust Company Americas (in its capacity as trustee and security agent under the 2014 Indenture);

 

b.                            an “Event of Default”: each “Event of Default” as defined in the Indenture;

 

c.                             an “Event of Statutory Default”: each Event of Default which also constitutes a default (verzuim) in the fulfilment of the Secured Obligations within the meaning of Section 3:248 of the Dutch Civil Code;

 

d.                            “Existing Rights of Pledge”: the rights of pledge on the Shares (as defined hereinafter) created in favor of (i) The Law Debenture Trust Corporation p.l.c., on the seventeenth day of September two thousand and nine pursuant to that certain notarial deed of pledge dated the seventeenth day of September two thousand and nine by and between the Pledgor, the Bank of New York Mellon, The Law Debenture Trust Corporation p.l.c. and the Company, (ii) BNP Paribas Trust Corporation UK Limited, on the twenty-first day of October two thousand and ten pursuant to that certain notarial deed of pledge dated the twenty-first day of October two thousand and ten by and between the Pledgor, BNP

 

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Paribas Trust Corporation UK Limited and the Company, (iii) Deutsche Bank Trust Company Americas, on the eighteenth day of February two thousand and eleven pursuant to that certain notarial deed of pledge dated the eighteenth day of February two thousand and eleven by and between the Pledgor, Deutsche Bank Trust Company Americas and the Company and (iv) the Pledgee, on the this second day of May two thousand and fourteen pursuant to that certain notarial deed of pledge dated this second day of May two thousand and fourteen by and between the Pledgor, Pledgee and the Company;

 

e.                             “Future Shares”: any and all future shares in the capital of the Company to be acquired (either through issue, purchase, distribution or otherwise) by the Pledgor after the date of this deed;

 

f.                              the “Guarantee”: the guarantee dated this second day of May two thousand and fourteen by and between the Pledgor and the Company as subsidiary guarantors and the Pledgee as administrative agent in relation to the Revolving Loan Facility Credit Agreement;

 

g.                             a “Parallel Debt”: a Parallel Debt (as defined in Section 27 of the Guarantee);

 

h.                            the “Permitted Right of Pledge”: the right of pledge on the Shares with a sixth priority, in favour of Deutsche Bank Trust Company Americas, to be created pursuant to a pledge agreement by and between the Pledgor, Deutsche Bank Trust Company Americas and the Company;

 

i.                                the “Present Shares”: one hundred ninety-nine thousand nine hundred and ninety-nine (199,999) ordinary shares in the capital of the Company owned by the Pledgor, numbered 1 through 199,997, and 199,999 and 200,000, each share having a nominal value of one Netherlands Guilder (NLG 1) or (converted into euro in accordance with section 2:178c of the Dutch Civil Code) forty-five eurocent (EUR 0.45);

 

j.                               the “Revolving Loan Facility Credit Agreement”: the revolving loan facility credit agreement dated this second day of May two thousand and fourteen by and between (among others) Central European Media Enterprises Ltd. as borrower, the lenders party thereto from time to time and the Pledgee as administrative agent;

 

k.                            the “Right of Pledge”: the right of pledge with a fifth priority (on the date hereof) in respect of the Shares established by the execution of this deed;

 

l.                                the “Secured Obligations”: all present and future obligations and liabilities consisting of monetary payment obligations (verbintenissen tot betaling van een geldsom) of the Pledgor to the Pledgee, whether actual or contingent, whether owed jointly, severally or in any other capacity whatsoever, under or in connection with its Parallel Debt, provided that no obligation or liability shall be included in the definition of “Secured Obligations” to the extent that, if it were so included, the Right of Pledge (or any part thereof) or any provision of this deed would be unlawful or prohibited by any applicable law;

 

m.                        the “Shares”: collectively, the Present Shares and the Future Shares;

 

n.                            “Voting Event”: the occurrence of an Event of Statutory Default of which the Pledgee has given notice to the Pledgor and the Company;

 

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o.                            the “2009 Indenture”: the indenture dated the seventeenth day of September two thousand and nine by and between (among others) Central European Media Enterprises Ltd. as issuer, the Pledgor and the Company as guarantors, and The Law Debenture Trust Corporation p.l.c. as security trustee;

 

p.                            the “2010 Indenture”: the indenture dated the twenty-first day of October two thousand and ten by and between (among others) CET 21 spol s r.o. as issuer, and Citibank, N.A., London Branch as trustee;

 

q.                            the “2011 Indenture”: the indenture dated the eighteenth day of February two thousand and eleven by and between (among others) Central European Media Enterprises Ltd. as issuer, the Pledgor and the Company as guarantors, and Deutsche Bank Trust Company Americas as trustee, security agent, paying agent, conversion agent, transfer agent and registrar; and

 

r.                               the “2014 Indenture”: the indenture to be entered into by and between (among others) Central European Media Enterprises Ltd. as issuer, the Pledgor and the Company as guarantors and Deutsche Bank Trust Company Americas, as trustee, paying agent and transfer agent and registrar.

 

Agreement to pledge.

Article 2.

 

1.                            To secure the performance of the Secured Obligations, the Pledgor and the Pledgee hereby agree that the Pledgor will establish the Right of Pledge in favor of the Pledgee, which the Pledgee hereby accepts.

 

2.                            If and to the extent at any time it shall appear that any right of pledge created hereby or pursuant hereto shall not have the ranking as referred to in the definition of Right of Pledge, the Pledgor and the Pledgee confirm, and — to the extent necessary — hereby further agree, that a valid right of pledge has or shall nevertheless have been created which shall have the highest possible ranking as permitted under Dutch law.

 

Pledge of shares.

Article 3.

 

1.                           To secure the performance of the Secured Obligations, the Pledgor hereby establishes the Right of Pledge in favor of the Pledgee, which the Pledgee hereby accepts. The Right of Pledge is one and indivisible (één en ondeelbaar). The Right of Pledge shall not be affected by one or more but not all of the Secured Obligations being discharged or the Secured Obligations being amended. The Right of Pledge includes a right of pledge over all accessory rights (afhankelijke rechten) and all ancillary rights (nevenrechten) attached to the Shares.

 

2.                            The right of pledge on the Future Shares shall be effected ipso facto at the time the Pledgor becomes authorised to dispose (beschikkingsbevoegd) of such Future Shares and to the extent any further action shall be required to effectuate such right of pledge on Future Shares the Pledgor agrees to take such action and herewith grants an irrevocable power of attorney to the Pledgee to take such action on behalf of the Pledgor.

 

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Voting rights.

Article 4.

 

1.                            The voting and other consensual rights and similar rights or powers attaching to the Shares or any part thereof (the “Voting Rights”) are hereby transferred by the Pledgor to the Pledgee under the conditions precedent (opschortende voorwaarden) of (i) the occurrence of a Voting Event and (ii) the termination and/or release of the Existing Rights of Pledge. This conditional transfer of Voting Rights was approved by the shareholders meeting of the Company in a written resolution adopted outside of a general meeting on the second day of May two thousand and fourteen. Until the occurrence of a Voting Event and subject to the termination and/or release of the Existing Rights of Pledge, the Pledgor may exercise any and all such Voting Rights, save:

 

(a)                         that no such exercise may violate or be inconsistent with the express terms or purpose of this deed, the Existing Rights of Pledge, the Revolving Loan Facility Credit Agreement and/or the Guarantee;

 

(b)                         that no such exercise may have the effect of impairing the position or interests of the Pledgee hereunder; and

 

(c)                         as set out in Article 4.2 below.

 

2.                            Upon the occurrence of a Voting Event and subject to the termination or release of the Existing Rights of Pledge:

 

(a)                         any and all rights of the Pledgor to exercise the Voting Rights which it is entitled to exercise pursuant to Article 4.1 above shall cease automatically without further notice to the Pledgor being required and the Pledgee shall have the sole and exclusive right, but not the obligation, and authority to exercise such Voting Rights and shall be entitled to exercise or refrain from exercising such rights in such manner as the Pledgee may in its absolute discretion deem fit; and

 

(b)                         the Pledgee shall immediately be entitled, but not obliged, at any time at its sole discretion, to effect the resignation of and/or to dismiss the directors of the Company or any of them, and to appoint new directors of the Company and the Pledgor hereby undertakes to do all things and execute all documents and instruments as may be required by the Pledgee to ensure the effectiveness of any such resignations, dismissals or appointments.

 

3.                            By signing this deed, the Company confirms (and the other parties agree) that a written notice from the Pledgee to the Company stating that a Voting Event has occurred, shall be sufficient for the Company to accept the Pledgee as being exclusively entitled to such rights and other powers which it is entitled to exercise pursuant to this Article 4 upon the occurrence of such a Voting Event and subject to the termination and/or release of the Existing Rights of Pledge.

 

4.                            The Pledgor and the Company agree to notify the Pledgee immediately in writing of any event or circumstance which could be of material importance to the Pledgee with a view to the preservation and exercise of the Pledgee’s rights under or pursuant to this deed, such as (without limitation) the filing of a petition for the bankruptcy (faillissement) of the Pledgor, the filing of a petition for a moratorium of payments (surseance van betaling) by the Pledgor, attachment

 

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or garnishment of the Pledgor’s assets, the termination of any one of the Pledgor’s commercial activities or its dissolution.

 

5.                            Upon the occurrence of a Voting Event and subject to the termination and/or release of the Existing Rights of Pledge, the Pledgee shall have the rights which the law attributes to holders of depositary receipts with meeting rights (vergaderrechten) of shares in its capital.

 

6.                            During the term of the Right of Pledge, the foregoing provisions of this Article 4 with respect to the Voting Rights on the Present Shares also apply to the Future Shares. In addition, the Pledgor and the Pledgee shall, if reasonably practicable, at the time of or, if not practicable at such time, as soon as reasonably practicable after the acquisition of such Future Shares, arrange that the attribution of the Voting Rights attaching thereto shall be ratified if that is reasonably deemed necessary, to enable the Pledgee to exercise such voting rights upon the occurrence of the conditions precedent as provided in Article 4.1 of this deed. If such ratification is, at the Pledgee’s sole discretion, not obtained in time, the Pledgor shall fully co-operate in the taking of such other reasonable measures relating to such transfer of voting rights as are proposed by the Pledgee.

 

Authority to collect.

Article 5.

 

1.                            The authority to collect dividends, distributions from reserves, repayments of capital and all other distributions and payments in any form, which, at any time, during the term of the Right of Pledge, become payable in respect of any one or more of the Shares, shall accrue to the Pledgee, as provided for in paragraph 1 of Section 3:246 of the Dutch Civil Code, subject to the termination and/or release of the Existing Rights of Pledge.

 

2.                            In derogation of the provisions of Article 5.1 above, the Pledgee hereby grants approval to the Pledgor to collect all dividends, distributions from reserves, repayments of capital and all other distributions and payments in any form, which, at any time, during the term of the Right of Pledge, become payable on any one or more of the Shares, subject to the termination and/or release of the Existing Rights of Pledge.

 

3.                            The Pledgee may terminate the authorization mentioned in Article 5.2 above upon occurrence of an Event of Default only. Termination of the authorization is made by written statement to that effect, by the Pledgee to the Pledgor, copied to the Company.

 

Further obligations of the Pledgor.

Article 6.

 

The Pledgor assumes the following obligations vis-à-vis the Pledgee:

 

a.                            on first demand in writing from the Pledgee, the Pledgor shall take all actions, and draw up and sign all supplementary documents as the Pledgee may consider necessary or desirable for the performance of the Pledgor’s obligations under this deed, and to fully cooperate so as to enable the Pledgee to exercise his rights, with due regard to the relevant provisions of the Existing Rights of Pledge;

 

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b.                           the Pledgor shall, on first demand from the Pledgee, submit to the Pledgee all requested material information and data with respect to the Shares;

 

c.                            during the term of the Right of Pledge, the Pledgor shall not alienate, pledge or in any other way encumber the Shares, (depositary receipts for) shares and/or rights to acquire (depository receipts for) shares in the capital of the Company without the prior written consent of the Pledgee except for the Permitted Right of Pledge and an encumbrance permitted in accordance with the provisions of the Revolving Loan Facility Credit Agreement, the Amended Intercreditor Agreement or the Guarantee;

 

d.                           the Pledgor shall with due regard to the relevant provisions of the Existing Rights of Pledge provide that the (depositary receipts for) Future Shares and/or rights to acquire (depositary receipts for) Future Shares in the capital of the Company it acquires after execution of this deed shall be pledgeable, and that the transferability thereof shall not be more cumbersome than the transferability of the Shares;

 

e.                            whenever the Pledgor is aware that the Company is involved in the preparation of a legal merger or demerger as a result of which the Company would cease to exist, the Pledgor shall inform the Pledgee thereof in writing immediately; and

 

f.                             whenever the Pledgor is aware that actions have been taken for the winding-up, dissolution, administration, bankruptcy, suspension of payments or reorganization of the Company, or that an Event of Statutory Default has occurred, the Pledgor shall inform the Pledgee thereof in writing immediately.

 

Warranties. Declarations.

Article 7.

 

1.                            The Pledgor warrants to the Pledgee that, at this time, the following is correct:

 

a.                             the Company is a private company with limited liability, legally established under the laws of the Netherlands by notarial deed, executed before H. van Wilsum, at that time civil law notary officiating in Amsterdam, the Netherlands, on the third day of August nineteen hundred and ninety-four. The articles of association of the Company were last partially amended by deed executed before a substitute of M.P. Bongard, civil law notary officiating in Amsterdam, the Netherlands, on the thirty-first day of May nineteen hundred and ninety-eight. A copy of the present articles of association shall be attached to this deed (Annex II). The Company is currently registered with the trade register of the Chamber of Commerce for Amsterdam, the Netherlands, under file number 33246826. A copy of the extract from the trade register shall be attached to this deed (Annex III);

 

b.                             the Company has not been dissolved, and no resolution has been adopted to dissolve the Company, nor has any request therefor been filed, nor has any notice by the Chambers of Commerce, as described in Section 2:19a of the Dutch Civil Code, been received. The Company has not been declared bankrupt nor has a suspension of payment been granted, nor have any requests thereto been filed nor are any such petitions anticipated;

 

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c.                              the shareholders’ register of the Company is completely accurate and up to date. A copy of the shareholders’ register is attached to this deed (Annex IV);

 

d.                             the entire issued share capital of the Company consists of two hundred thousand (200,000) ordinary shares, numbered 1 through 200,000; one (1) share with the number 199,998 is held by the Company in its own capital and all of the issued shares are fully paid-up; the Company has not granted any rights to subscribe for shares in its capital which have not yet been exercised;

 

e.                              the Pledgor has a complete and unencumbered right to the Present Shares, with the exception of the Existing Rights of Pledge, and any attachments made after the date of this deed, and its rights to the Shares are not subjected to revocation (herroeping), rescission (ontbinding) or any form of annulment (vernietiging) whatsoever;

 

f.                               the Pledgor has not been deprived of the authority to alienate the Shares by virtue of Section 2:22a subsection 1 of the Dutch Civil Code;

 

g.                              the Shares are not subject to either (limited) rights or obligations to transfer to third parties or claims based on contracts of any nature and have not been encumbered with any attachment, except for the Existing Rights of Pledge and the Permitted Right of Pledge;

 

h.                             the Pledgor is authorized to establish the Right of Pledge and is entitled to transfer the voting rights pertaining to the Shares to the Pledgee, subject to the Existing Rights of Pledge and in accordance with Article 4.1 above;

 

i.                                 all resolutions and approvals, required for establishing the Right of Pledge with the transfer to the Pledgee of the voting rights pertaining to the Shares pursuant to Article 4.1 above, have been adopted and/or obtained respectively;

 

j.                                the obligations of the Pledgor and the Company vis-à-vis the Pledgee, resulting from the Revolving Loan Facility Credit Agreement, the Guarantee and this deed (as the case may be), are lawful obligations of the Pledgor and the Company, respectively, and are legally enforceable against the Pledgor and the Company, respectively subject to the Amended Intercreditor Agreement and the Permitted Right of Pledge;

 

k.                             the assumption and performance by the Pledgor and the Company respectively of the obligations vis-à-vis the Pledgee resulting from the Indenture, the Amended Intercreditor Agreement and this deed are not contrary to any provision of applicable law or any agreement to which the Pledgor or the Company is a party, or by which the Pledgor or the Company is bound in any other way; and

 

l.                                 the Pledgor has provided the Pledgee with all information and data with respect to the Shares which the Pledgor reasonably believes to be of importance to the Pledgee.

 

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2.                            Furthermore, the Pledgor hereby declares to have acquired the Present Shares as follows:

 

·                                 as for the numbers 1 through 199,997 pursuant to a notarial deed of transfer of shares, executed before H. van Wilsum, mentioned above, on the nineteenth day of September nineteen hundred and ninety-four; and

 

·                                 as for the numbers 199,999 and 200,000 pursuant to a notarial deed of issuance of shares, issued before R.W. Clumpkens, civil law notary officiating in Amsterdam, the Netherlands, on the sixteenth day of December nineteen hundred and ninety-six.

 

Exercise of the Right of Pledge.

Article 8.

 

1.                            Upon the occurrence of an Event of Statutory Default, the Pledgee has (without any further notice (ingebrekestelling) being required), with due regard to the relevant provisions of the Existing Rights of Pledge, the Permitted Right of Pledge and the Amended Intercreditor Agreement, the right to exercise all rights and powers which the Pledgee has under Dutch law as holder of a right of pledge over the Shares, and the Pledgee shall be authorized to sell the Shares or part thereof, in accordance with Section 3:248 of the Dutch Civil Code, without prejudice to the provision of Section 3:251 of the Dutch Civil Code, in order to recover the proceeds thereof.

 

2.                            The blocking clause contained in the articles of association of the Company shall apply to the transfer of the Shares by the Pledgee, it being understood that the Pledgee shall, with due regard to the relevant provisions of the Existing Rights of Pledge, exercise all of the Pledgor’s rights relevant to the alienation and transfer of the Shares, and that the Pledgee shall fulfill the Pledgor’s obligations relevant thereto.

 

3.                            The Pledgee shall be entitled, following a sale pursuant to this Article 8, to have the Present Shares and the Future Shares registered in the name of the new shareholder and - to the extent necessary, on behalf of the Pledgor - to perform any action and execute any agreement required by law or by the articles of association of the Company to that effect.

 

4.                            The terms and conditions and location of the public sale pursuant to this Article 8 shall be determined by the Pledgee, taking into consideration local practice and customary terms and conditions.

 

5.                           In the event the Pledgee enforces execution of the Right of Pledge, the Pledgee shall, with due regard to the relevant provisions of the Existing Rights of Pledge, following payment of the enforcement costs from the proceeds, allocate the net proceeds to fulfill the Secured Obligations.

 

6.                            The Pledgee does not bear the obligations referred to in Sections 3:249 and 3:252 of the Dutch Civil Code towards others than the Pledgor.

 

Termination.

Article 9.

 

1.                            The Right of Pledge shall terminate if and when (a) any and all Secured Obligations have been irrevocably and unconditionally fulfilled, or (b) any and all Secured Obligations have been otherwise terminated or cancelled.

 

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2.                            The Pledgee shall be entitled to terminate the Right of Pledge in whole or in part at any time. Termination shall be effectuated by a written notification to that effect by the Pledgee to the Pledgor with copy to the Company.

 

Final provisions.

Article 10.

 

1.                            Any notices or other communication under or in connection with this deed shall be in writing in the English language and shall be delivered personally or by registered mail or fax. Proof of posting shall be deemed to be proof of receipt:

 

(i)                            in the case of hand delivery: on the day the notice is received by recipient;

 

(ii)                         in the case of a registered letter: on the third business day after posting; or

 

(iii)                      in the case of a fax transmission: upon receipt of fax confirmation.

 

Notices and other communications under this deed may in each case be sent to the following address of the parties hereto:

 

Address Pledgor:

 

Central European Media Enterprises N.V.

c/o Curaçao Corporation Company N.V.

Schottegatweg Oost 44

Curaçao

Fax number: + 5999 732 2500

Attention: Managing Director

 

with a copy to:

 

CME Media Services Limited

Kříženeckého náměstí 1078/5

152 00  Prague 5 — Barrandov

Czech Republic

Fax number: +420 242 464 483

Attention: Legal Department

 

Address Pledgee:

 

Time Warner Inc.

One Time Warner Center,

New York, NY 10019, United States of America

Attn: Chief Financial Officer

Fax: + 1 (212) 484-7175

(Facsimile No. + 1 (212) 484-7175),

with copies to its General Counsel

(Facsimile No. + 1 (212) 484-7167)

and its Treasurer

(Facsimile No. + 1 (212) 484-7151)

 

Address of the Company:

 

CME Media Enterprises B.V.

Dam 5B

1012 JS Amsterdam

The Netherlands

Fax number: +31 204231404

Attention: Finance Officer

 

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with a copy to:

 

CME Media Services Limited

Kříženeckého náměstí 1078/5

152 00  Prague 5 — Barrandov

Czech Republic

Fax number: +420 242 464 483

Attention: Legal Department

 

or such other address or fax number as notified by the relevant party by not less than five business days prior notice.

 

2.                            As to the existence and composition of the Secured Obligations, a written statement by the Pledgee made in accordance with its books shall constitute full proof, subject to proof to the contrary, it being understood that in the event of a disagreement with respect thereto, the Pledgee shall be authorized to exercise his right of execution, with due observance of the obligation of the Pledgee to pay over all amounts which afterwards would appear to be received by him in excess of his rights and with due regard to the relevant provisions of the Existing Rights of Pledge.

 

3.                            The Right of Pledge, including all provisions of this deed, shall be governed by the laws of the Netherlands.

 

4.                            The competent court of law in Amsterdam, the Netherlands, shall have non-exclusive jurisdiction with regard to all disputes relating to the Right of Pledge and/or this deed.

 

5.                            If a provision of this deed is or becomes illegal, invalid or unenforceable in any jurisdiction, that shall not affect the legality, validity or enforceability of any other provision of this deed in that jurisdiction and the legality, validity or enforceability in other jurisdictions of that or any other provision of this deed.

 

6.                            All costs, fees, taxes and other amounts (including notarial fees, taxes, legal fees, registration fees, translation costs and stamp duties) incurred by the Pledgee in connection with the negotiation, creation or execution of any documentation in connection with the Right of Pledge and the enforcement of the Right of Pledge will be for the account of the Pledgor.

 

7.                            The Pledgor, the Company and the Pledgee hereby waive, to the fullest extent permitted by law, their right to rescind (ontbinden) this deed pursuant to failure in the performance of one or more of their obligations as referred to in Section 6:265 of the Dutch Civil Code or on any other ground, to suspend (opschorten) any of its obligations under this deed pursuant to section 6:52, 6:262 or 6:263 of the Dutch Civil Code or on any other ground, and to nullify (vernietigen) this deed pursuant to section 6:228 of the Dutch Civil Code or on any other ground.

 

8.                            The Pledgee shall not be obligated to give notice of a sale to someone other than to the Pledgor as referred to in the Sections 3:249 and 3:252 of the Dutch Civil Code.

 

9.                            Neither the Pledgee, nor any of its respective officers, employees or agents will be in any way liable or responsible to the Pledgor or the Company or any other party for any loss or liability of any kind arising from any act or omission by it of any kind (whether as mortgagee in possession or otherwise) in relation to the Right of Pledge or this deed, except to the extent caused by its own negligence

 

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or wilful misconduct. The Pledgor shall indemnify the Pledgee in respect of all losses, claims or liabilities (including reasonable expenses) incurred by the Pledgee in connection with its acceptance of the Right of Pledge and the exercise by the Pledgee of any rights or powers vested in it hereunder, other than losses, claims or liabilities resulting from the wilful misconduct or negligence of the Pledgee.

 

10.                     The Pledgor is not entitled to file a request with the voorzieningenrechter of the district court to sell the Shares in a manner which deviates from the sale in public as referred to in Section 3:251 paragraph 1 of the Dutch Civil Code.

 

11.                     The parties hereto acknowledge that in accordance with Section 326 of the USA Patriot Act the Pledgee, as a financial institution, is required, in order to help fight the funding of terrorism and money laundering, to obtain, verify, and record information that identifies each person or legal entity that establishes a relationship or opens an account.  The parties to this deed agree that they will provide the Pledgee with such information as it may request in order to satisfy the requirements of the USA Patriot Act.

 

FINALLY, THE COMPANY HAS DECLARED:

 

a.                            that it acknowledges the aforementioned Right of Pledge;

 

b.                            that it has been informed of the provisions under which the Right of Pledge is established, and fully cooperates with the implementation thereof;

 

c.                             that no facts or circumstances are known to the Company, which in any way are inconsistent with the warranties and declarations of the Pledgor stated in this deed;

 

d.                            it shall register in the Company’s shareholders’ register that the Shares are encumbered with a right of pledge in favor of the Pledgee, that, subject to the provisions of Article 4, the Pledgee has the Voting Rights and to whom, the Pledgor or the Pledgee, the rights accrue which the law attributes to holders of depositary receipts with meeting rights (vergaderrechten) of shares in the capital of a company;

 

e.                             that all resolutions and approvals required from the Company for establishing a right of pledge with a fifth priority (on the date hereof) on the Shares by the Pledgor in favor of the Pledgee under the provisions contained in this deed, have been adopted and received respectively;

 

f.                             that it is a private company with limited liability, duly incorporated and validly existing under the laws of the Netherlands and is registered in the trade register of the Chamber of Commerce for Amsterdam, the Netherlands, under number 33246826 and that the information contained in the trade register is correct and complete;

 

g.                             that the Company has not been dissolved, nor has a resolution to dissolve the Company been approved nor has a petition been filed to dissolve the Company, nor has a notice from the Chamber of Commerce pursuant to Section 2:19a paragraph 3 of the Dutch Civil Code been received; and

 

h.                            that the Company has not been declared bankrupt, nor has a suspension of payments, including any other types of regulations with similar legal

 

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consequences been granted, nor have any petitions thereto been filed nor are any such petitions expected.

 

End.

 

The persons appearing are known to me, civil law notary.

 

This deed was executed in Amsterdam, the Netherlands, on the date stated in the first paragraph of this deed. The contents of the deed have been stated and clarified to the person appearing. The persons appearing have declared not to wish the deed to be fully read out, to have noted the contents of the deed timely before its execution and to agree with the contents. After limited reading, this deed was signed first by the persons appearing and thereafter by me, civil law notary.

 

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