Document:

Exhibit 10.65

 

EMPLOYMENT AGREEMENT

 

THIS
EMPLOYMENT AGREEMENT (the “Agreement”) is
entered into by CTC Media, Inc., a Delaware corporation (the “Company”), and Viacheslav Sinadski (the “Employee”).

 

WHEREAS, the Company wishes to employ the
Employee and the Employee wishes to be employed by the Company;

 

NOW, THEREFORE, in consideration of the
mutual covenants and promises contained herein, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties agree as follows:

 

1.            Term
of Employment.  The
Company hereby agrees to employ the Employee, and the Employee hereby accepts
employment with the Company, upon the terms set forth in this Agreement,
effective as of 2 May, 2007 (the “Commencement Date”).  The Employee’s employment shall continue
until it is terminated in accordance with the provisions of Section 5.

 

2.            Title; Capacity.

 

(a)           The Employee shall serve as Chief
Investment Officer of the Company and his job duties shall include managing
business development opportunities for the Company and its subsidiaries (the “Group”) including, without limitation, identifying,
negotiating, structuring and project managing acquisition opportunities.  The Employee agrees to perform such other
related duties and responsibilities as the Company’s Board of Directors (the “Board”) or the Company’s Chief Executive Officer or
Chief Operating Officer shall from time to time reasonably
assign to him.

 

(b)           The Employee shall be based at the
Company’s headquarters in Moscow, Russia.

 

(c)           The Employee shall be subject to the
supervision of, and shall have such authority as is delegated to him by, the
Company’s Chief Executive Officer, Chief Operating Officer or
the Board.

 

(d)           The Employee agrees to devote his
entire business time, attention and energies to the business and interests of
the Group during his employment with the Company and shall not engage in any
other business activities.  The Employee
agrees to abide by the rules, regulations, instructions, personnel practices
and policies of the Company and any changes therein that may be adopted from
time to time by the Company.

 

3.            Compensation and Benefits.

 

(a)           Base Salary.  The Group shall pay the Employee, in regular
installments in accordance with the Group’s standard payroll practices, an
annualized base salary of $300,000, less all applicable taxes and withholdings,
which shall be the aggregate annualized base salary payable to the Employee for
all his services to any Group company from time to time. Such salary may be
adjusted from time to time in accordance with normal business practice.

 

 

(b)           Discretionary Bonus.  The Employee shall be eligible for an annual
discretionary award, less all applicable taxes and withholdings, as set forth
below:-

 

(i)            For 2007, the Employee shall be
entitled to an annual bonus (the “2007 Bonus”) in
the amount of $250,000 (less all applicable taxes and withholding) in the event
that at least three Qualifying Transactions are Definitively Agreed during
2007.  As used herein, “Qualifying Transaction” means a strategic acquisition made
by or on behalf of the Group under the Employee’s supervision, including,
without limitation, acquisitions in Kazakhstan, Ukraine, Belarus, Russia or
Moldova but excluding any acquisitions of all of, or an interest in, television
stations in the Russian Federation that are or shall become owned –and–operated
stations of the CTC or Domashny network; and “Definitively
Agreed” means that the applicable Group company has entered into
definitive documentation with the target or its owners in respect of the
Qualifying Transaction; provided, however, that in the event that
fewer than three Qualifying Transactions have been Definitively Agreed during
2007, any memorandum of understanding or term sheet relating to a Qualifying
Transaction executed during 2007 that is consummated during the first three
months of 2008 shall be deemed to be Definitively Agreed during 2007 for
purposes hereof.  Whether the foregoing
performance targets have been achieved shall be decided by the Company’s Chief
Executive Officer and/or the Compensation Committee of the Board in his/its
reasonable discretion.

 

(ii)           In
the event the Employee does not achieve the performance targets set forth
in Section 3(b)(i) due to reasons beyond the reasonable control of
the Employee, the amount of the 2007 Bonus shall be determined by the
Company’s Chief Executive Officer and/or the Compensation Committee of the
Board,
in his/its reasonable discretion.

 

(iii)          For
all years during the term of this Agreement other than 2007, the Employee shall
be eligible for an annual discretionary award of up to $250,000 (as adjusted
annually for inflation, “Annual Bonus”),
less all applicable taxes and withholding, subject to the Employee’s
achievement of performance targets to be set by the Company’s Chief Executive
Officers and/or the Compensation Committee of the Board.

 

(iv)          The
discretionary awards described in Section 3(b)(i), (ii) and (iii) shall be the aggregate annual discretionary award for
which the Employee is eligible for all his services to any and all Group
companies from time to time.  Other than
as provided in Section 6(a) hereof, the Employee must be an active
employee of the Company on the date the bonuses for any year are distributed in
order to be eligible for any such award.

 

(c)           Benefits.  The Employee and his “dependents,” as that
term may be defined under the applicable benefit plan(s) of the Company,
shall be included, to the extent eligible thereunder, in any and all plans,
programs and policies which provide benefits for senior executives and their
dependents.  In the case of the Employee,
he shall receive, at a minimum, (i) an annual allowance of $3,000 to be
used in his sole discretion toward health 

 

 

care
insurance, and (ii) other similar or comparable benefits made available
from time to time to the Company’s other senior executives.

 

(d)           Absences.  The Employee shall be eligible to accrue 28
calendar days of paid vacation per calendar year, subject to pro-ration to the
Commencement Date and to be taken at such times as may be approved by and in
the sole discretion of the Company’s Chief Executive Officer or Chief Operating
Officer. Such vacation days shall accrue at the rate of 2.33 days per
month.  The Employee shall also be
entitled to absences because of illness or other incapacity, and such other
absences, whether for public holidays, personal time, or for any other purpose,
as set forth in the Company’s current procedures and policies, as the same may
be amended from time to time.

 

(e)           Car allowance.  The Company shall provide the Employee with
an annual allowance of $20,000 to be used in the sole discretion of the
Employee toward the Employee’s car-related and other travel expenses.  Such allowance shall be pro-rated and paid
together with the Employee’s base salary in regular installments in accordance
with the Group’s standard payroll practices.

 

(f)            Expenses.  Subject to and in accordance with the Company’s
policies and procedures, the Employee hereby is authorized to incur, and, upon
presentation of itemized accounts, shall be reimbursed by the Company for, any
and all reasonable and necessary business-related expenses, which expenses are
incurred by the Employee on behalf of the Company or any Group company.

 

(g)           Stock
Options.  On the Commencement Date,
the Company shall grant the Employee an option under the terms and conditions
set forth in Exhibit A hereto (the “Option”),
subject to the Employee executing and delivering the Option.

 

4.            Taxes.  The Employee shall be responsible for all of
his own taxes payable in any jurisdiction in which he is subject to taxation.

 

5.            Employment
Termination.  The employment of the
Employee by the Company pursuant to this Agreement shall terminate upon the
occurrence of any of the following:

 

(a)           At the election
of the Company, for Cause, immediately upon written notice by the Company to
the Employee; provided, however, the Employee shall be provided a reasonable
opportunity to present his case to the Board before his employment is
terminated for Cause hereunder.  For the
purposes of this Agreement, “Cause” for
termination shall be deemed to exist upon: (i) a good faith finding by the
Company that (A) except in the case of Disability (in which case Section 5(e) shall
govern), the Employee has failed to adequately perform the material aspects of
his assigned duties for the Group in a manner that materially and adversely
affects the Group and the Employee has failed to remedy such failure within 30
calendar days following written notice from the Company to the Employee
notifying him of such failure, or (B) the Employee has engaged in
dishonesty, gross negligence or misconduct that materially and adversely
affects the Group; (ii) the Employee’s conviction of, or the entry of a
pleading of guilty or nolo contendere
by the Employee, to any crime involving moral turpitude or any felony; (iii) the
Employee’s material breach of the non-competition provisions contained in Section 7
below or the non-disclosure provisions contained in Section 8 below; or (iv) the
Employee’s violation 

 

 

of Group
policy in a manner that materially and adversely affects the Group which
remains uncured 30 calendar days following written notice from the Company of
such violation.

 

(b)           At the
election of the Company, without Cause, upon not less than six months’ prior
written notice of termination.

 

(c)           At the
election of the Employee, upon not less than six months’ prior written notice
of resignation.

 

(d)           Automatically,
in the event of the death of the Employee.

 

(e)           At the
election of the Company by giving written notice to the Employee, in the event
that the Employee shall be unable to perform duties hereunder for a period of
180 days in any twelve-month period or 120 consecutive calendar days by reason
of a disability resulting from illness, accident or other physical or mental
incapacity or disability (“Disability”);
provided that on the effective date of such termination the Employee is still
disabled.

 

(f)            By
mutual agreement of the Employee and the Company at any time.

 

6.            Compensation
in the Event of Certain Terminations.

 

(a)           In
the event that the Employee’s employment hereunder is terminated by the Company
without Cause pursuant to Section 5(b) hereof then the Company shall:
(1) pay a lump sum severance payment equal to six months of the Employee’s
then current annual base salary, (2) continue coverage, in accordance with
such programs, plans and policies, for the Employee and his eligible dependents
under all of the Company’s benefit plans, programs and policies in effect as of
the date of termination for six months following such termination and (3) pay
a pro rata portion of his Annual Bonus based on the level of achievement of the
performance targets to be achieved in the year in which such termination
occurs, in each case, less applicable taxes and withholdings; provided, however,
that such severance payment and benefits shall be conditioned upon the Employee
signing a severance agreement and release in a form satisfactory to the Company
(the “Release”).  The Employee shall not be required to
mitigate the amount of any payment provided for in this Section 6(a) by
seeking employment or otherwise. The cash compensation set out in subclauses (1) and
(3) of this subsection shall be paid in a lump sum no later than ten (10) days
after the Employee executes and delivers the Release.

 

(b)           In the event that
the Employee’s employment hereunder is terminated as a result of his death at a
time when the Company is not then providing him with life insurance coverage,
the Company shall continue to pay his base salary to his wife and/or immediate
family for a period of six months after the month in which his death occurred.

 

(c)           In the event that
the Employee’s employment hereunder is terminated as a result of his Disability
at a time when the Company is not then providing him with disability insurance
coverage, the Company shall continue to pay his base salary to him for a period
of six months after the date of such termination.

 

 

7.            Non-Competition
and Non-Solicitation.

 

(a)           During
the term of the Employee’s employment and for a period of six months after the
termination of such employment, the Employee will not directly or indirectly:

 

(i)            as an
individual proprietor, partner, stockholder, officer, employee, director, joint
venturer, investor, lender, or in any other capacity whatsoever (other than as
the holder of not more than five percent (5%) of the total outstanding stock of
a publicly held company), engage in the business of television broadcasting in
Russia and/or in any country in which the Group did business or planned to do
business at the time of the Employee’s termination; or

 

(ii)           (A) recruit,
solicit or induce, or attempt to recruit, solicit or induce, any employee or
employees of the Group to terminate their employment with, or otherwise cease
their relationship with, the Group; or (B) recruit, solicit or induce or
attempt to recruit, solicit or induce for employment or hire or engage as an
independent contractor, or permit any organization directly or indirectly
controlled by the Employee to recruit, solicit or induce, or attempt to
recruit, solicit or induce for employment or hire or engage as an independent
contractor any person who was employed by the Group at any time during the
period that the Employee was employed by the Group; provided, however, that
this subsection 7(a)(ii)(B) shall not apply to any individual whose
employment or engagement with the Group has been terminated for a period of six
months or longer; or

 

(iii)          solicit,
divert or take away, or attempt to solicit, divert or to take away, the
business or patronage of any of the current or prospective business partners,
advertisers or affiliate stations of the Group with whom the Employee had
significant contact while employed by the Group.

 

(b)           If any
restriction set forth in this Section 7 is found by any court of competent
jurisdiction to be unenforceable because it extends for too long a period of
time or over too great a range of activities or in too broad a geographic area,
it shall be interpreted to extend only over the maximum period of time, range
of activities or geographic area as to which it may be enforceable.

 

(c)           The
Employee acknowledges and agrees that the restrictions contained in this Section 7
are necessary for the protection of the business and goodwill of the Group and
are considered by the Employee to be reasonable for such purpose.  The Employee agrees that any breach of this Section 7
is likely to cause the Company substantial and irrevocable damage that is
difficult to measure and therefore, in the event of any such breach or
threatened breach, the Employee agrees that the Company, in addition to such
other remedies that may be available, shall have the right to obtain an
injunction from a court restraining such a breach or a threatened breach and the
right to specific performance of the provisions of this Section 7 without
posting a bond and the Employee hereby waives the adequacy of a remedy at law
as a defense to such relief.

 

(d)           The
provisions of this Section 7 survive the termination of the Employee’s
employment and the termination of this Agreement.

 

 

8.            Proprietary
Information.

 

(a)           The
Employee agrees that all information and know-how, whether or not in writing,
of a private, secret or confidential nature concerning the Group’s business,
business relationships or financial affairs (collectively, “Proprietary Information”) is and shall be the exclusive
property of the Group.  By way of
illustration, but not limitation, Proprietary Information may include business
processes, methods and techniques; programming schedules; material terms of
contracts; projects; developments; plans; research, financial and personnel
data; computer programs; and supplier lists. 
The Employee shall not disclose any Proprietary Information to others
outside the Group or use the same for any unauthorized purposes without prior
written approval of the Chief Employee Officer or the Board, either during or
after his employment, unless and until such Proprietary Information has become
public knowledge without fault by the Employee.

 

(b)           The
Employee agrees that all files, documents, letters, memoranda, reports,
records, data, sketches, drawings, notebooks, program listings, or other
written, photographic, or other tangible material containing Proprietary
Information, whether created by the Employee or others, which shall come into
his custody or possession, shall be and are the exclusive property of the Group
to be used by the Employee only in the performance of his duties for the
Group.  All such materials or copies
thereof and all tangible property of the Company in the custody or possession
of the Employee shall be delivered to the Company upon the earlier of (i) a
request by the Company or (ii) termination of his employment.  After such delivery, the Employee shall not
retain any such materials or copies thereof or any such tangible property.

 

(c)           The
Employee agrees that his obligation not to disclose or use information,
know-how and materials of the types set forth in paragraphs (a) and (b) above
also extends to such types of information, know-how, materials and tangible
property of business partners of the Group or other third parties who may have
disclosed or entrusted the same to the Group or to the Employee in the course
of the Group’s business.

 

(d)           The
provisions of this Section 8 survive the termination of the Employee’s
employment and the termination of this Agreement.  The Employee acknowledges and agrees that the
restrictions contained in this Section 8 are necessary for the protection
of the business and goodwill of the Group and are considered by the Employee to
be reasonable for such purpose.  The
Employee agrees that any breach of this Section 8 is likely to cause the
Company substantial and irrevocable damage that is difficult to measure and
therefore, in the event of any such breach or threatened breach, the Employee
agrees that the Company, in addition to such other remedies that may be
available, shall have the right to obtain an injunction from a curt restraining
such a breach or a threatened breach and the right to specific performance of
the provisions of this Section 8 without posting a bond and the Employee
hereby waives the adequacy of a remedy at law as a defense to such relief.

 

9.            No
Restrictions On Employment.  The
Employee hereby represents that he is not bound by the terms of any agreement
with any previous employer or other party to refrain from using or disclosing
any trade secret or confidential or proprietary information in the course of
his employment with the Group or to refrain from competing, directly or
indirectly, with the business of such previous employer or any other
party.  The Employee further represents
that his performance of all the terms of this Agreement and as an employee of
the Group does not and will 

 

 

not breach any agreement to keep in confidence proprietary
information, knowledge or data acquired by him in confidence or in trust prior
to his employment with the Group.

 

10.          Notices.  All notices, demands and all other
communications required or permitted under this Agreement shall be in writing
in Russian or English and shall be deemed to have been duly given when
delivered or (unless otherwise specified) mailed by certified or registered
mail, return receipt requested, postage prepaid, to the registered address of
the Company (in the case of notices by the Employee) or to the address of the
Employee indicated on the signature page hereto (in the case of notices by
the Company); or to such other address as either party may have furnished to
the other pursuant to the terms of this Section 10; except that notices of
changes of address shall be effective only upon receipt.

 

11.          Currency
of Payments.  The salary and other
payments set forth in this Agreement, although denominated in U.S. dollars,
shall be payable in Russian rubles, calculated at the official exchange rate of
the Central Bank of the Russian Federation effective as of the date of payment,
and paid by wire transfer to the Employee’s account with an authorized Russian
bank.

 

12.          Entire
Agreement.

 

(a)           This
Agreement, the notice of grant of stock option with a grant date of the
Commencement Date from the Company to the Employee (and the related stock
option agreements) and any other employment agreement that the Employee enters
into with a Group company after the date hereof (an “Other Group
Employment Agreement”) together constitute the entire agreement
between the parties and supersede all prior agreements and understandings,
whether written or oral, relating to the subject matter hereof and
thereof.  In the event of any
inconsistency between this Agreement and any Other Group Employment Agreement,
the terms of this Agreement shall govern to the extent permissible under
applicable laws.

 

(b)           For the
avoidance of doubt, payments, benefits and entitlements under this Agreement
and all Other Group Employment Agreements shall not be cumulative. Any
payments, benefits or entitlements provided for under any Other Group
Employment Agreement shall be deducted from any payments, benefits or
entitlements due pursuant to this Agreement.

 

(c)           The
Employee agrees that any changes in his employment duties or compensation after
the signing of this Agreement which are agreed to by the Employee shall not
affect the validity or scope of this Agreement.

 

13.          Amendment.  This Agreement may be amended or modified
only by a written instrument executed by both the Company, acting by a duly
authorized officer, and the Employee.

 

14.          Governing
Law.  This Agreement shall be
governed by and construed under and in accordance with the laws of the State of
Delaware.

 

15.          Dispute
Resolution.

 

(a)           Any claim
or controversy arising out of or relating to this Agreement shall be finally
determined by arbitration in accordance with the arbitration rules (the “Rules”) of the London Court of International Arbitration (“LCIA”). The arbitration proceeding 

 

 

shall be
conducted in the English language and shall take place in London, England. The
arbitral tribunal shall be composed of one arbitrator selected by the LCIA.

 

(b)           In the
event of any conflict between the Rules and the provisions of this
Agreement, the provisions of this Agreement shall prevail.

 

(c)           The award
of the arbitrator shall be final and binding on the Employee and the Company.

 

(d)           The award
of the arbitrator may be enforced by any court of competent jurisdiction and
may be executed against the person and assets of the losing party in any
competent jurisdiction.

 

(e)           Except
for arbitration proceedings pursuant to this Section 15, no action,
lawsuit or other proceeding (other than the enforcement of an arbitration
decision, an action to compel arbitration or an application for interim,
provisional or conservatory measures in connection with the arbitration) shall
be brought by the parties hereto in connection with any matter arising out of
or in connection with this Agreement.

 

16.          Successors
and Assigns.  This Agreement shall be
binding upon and inure to the benefit of both parties and their respective
successors and assigns, including any corporation with which or into which the
Company may be merged or which may succeed to its assets or business, provided,
however, that the obligations of the Employee are personal and shall not be
assigned by him.

 

17.          Acknowledgment.  The Employee states and represents that he
has had an opportunity to fully discuss and review the terms of this Agreement
with an attorney of his own choosing. 
The Employee further states and represents that he has carefully read
this Agreement, understands the contents herein, freely and voluntarily assents
to all of the terms and conditions hereof, and signs his name of his own free
act.

 

18.          No
Waiver.  No delay or omission by the
Company in exercising any right under this Agreement shall operate as a waiver
of that or any other right.  A waiver or
consent given by the Company on any one occasion shall be effective only in
that instance and shall not be construed as a bar or waiver of any right on any
other occasion.

 

19.          Validity/Severability.  In case any provision of this Agreement shall
be invalid, illegal or otherwise unenforceable, the validity, legality and
enforceability of the remaining provisions shall in no way be affected or
impaired thereby.

 

20.          Captions.  The captions of the sections of this
Agreement are for convenience of reference only and in no way define, limit or
affect the scope or substance of any section of this Agreement.

 

[The remainder of
this page is intentionally left blank.]

 

 

IN WITNESS WHEREOF,
the parties hereto have executed this Agreement as of the day and year set
forth below.

 

	
   

  	
  CTC MEDIA, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
  Dated: May 2, 2007

  	
  /s/ Alexander Rodnyansky

  
	
   

  	
  By:

  	
  Alexander Rodnyansky

  
	
   

  	
   

  	
  Chief Executive Officer 

  
	
   

  	
   

  
	
   

  	
  Address:

  	
  Pravda Street, 15A

  125124 Moscow, Russia

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  VIACHESLAV SINADSKI

  
	
   

  	
   

  
	
   

  	
   

  
	
  Dated: May 2, 2007

  	
  /s/ Viacheslav SinadskiExhibit 10.66

 

CTC MEDIA, INC.

NOTICE
OF GRANT OF STOCK OPTION

 

Notice is
hereby given of the following option grant (the “Option”) to purchase shares of
the Common Stock of CTC Media, Inc. (the “Corporation”):

 

Optionee:  Viacheslav Sinadski

 

Grant Date:  May 2, 2007

 

Exercise Price:  $26.74 per share.

 

Number of Option Shares:  150,000 shares

 

Expiration Date:  May 2, 2017

 

Type of Option:
o 
Incentive Stock Option

 

x   Non-Statutory Stock Option

 

Date
Exercisable: 
The Option shall become exercisable with respect to the Option Shares as
follows:

 

	
  Date

  	
   

  	
  Aggregate Number of Option Shares for

  which the Option is then Exercisable

  	
   

  
	
  On and after May 2, 2008

  	
   

  	
  50,000

  	
   

  
	
  On and after September 30, 2008

  	
   

  	
  62,500

  	
   

  
	
  On and after December 31, 2008

  	
   

  	
  75,000

  	
   

  
	
  On and after March 31, 2009

  	
   

  	
  87,500

  	
   

  
	
  On and after June 30, 2009

  	
   

  	
  100,000

  	
   

  
	
  On and after September 30, 2009

  	
   

  	
  112,500

  	
   

  
	
  On and after December 31, 2009

  	
   

  	
  125,000

  	
   

  
	
  On and after March 31, 2010

  	
   

  	
  137,500

  	
   

  
	
  On and after June 30, 2010

  	
   

  	
  150,000

  	
   

  

 

Optionee
understands and agrees that the Option is granted subject to and in accordance
with the terms of the CTC Media, Inc. (f/k/a StoryFirst Communications, Inc.)
1997 Stock Option/Stock Issuance Plan (as amended to date, the “Plan”).
Optionee further agrees to be bound by the terms of the Plan and the terms of
the Option as set forth in the Stock Option Agreement attached hereto as Exhibit A
and incorporated herein by reference.

 

Optionee
hereby acknowledges receipt of a copy of the Plan in the form attached
hereto as Exhibit B.

 

No Employment
or Service Contract. Nothing in this Notice or in the
attached Stock Option Agreement or Plan shall confer upon Optionee any right to
continue in Service for any 

 

 

period of
specific duration or interfere with or otherwise restrict in any way the rights
of the Corporation (or any Parent or Subsidiary employing or retaining
Optionee) or of Optionee, which rights are hereby expressly reserved by each,
to terminate Optionee’s Service at any time for any reason, with or without
cause.

 

Definitions.
All capitalized terms in this Notice shall have the meaning assigned to them in
this Notice or in the attached Stock Option Agreement.

 

May 2, 2007

	
   

  	
  CTC MEDIA, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Alexander Rodnyansky

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Viacheslav Sinadski

  
	
   

  	
  Viacheslav Sinadski

  

 

 

EXHIBIT A

 

STOCK
OPTION AGREEMENT

 

 

CTC MEDIA, INC.

STOCK
OPTION AGREEMENT

 

RECITALS

 

A.                              The Board has adopted the Plan for the
purpose of retaining the services of selected Employees, non-employee members
of the Board or the board of directors of any Parent or Subsidiary and
consultants and other independent advisors in the service of the Corporation
(or any Parent or Subsidiary).

 

B.                                Optionee is to render valuable services to
the Corporation (or a Parent or Subsidiary), and this Agreement is executed
pursuant to, and is intended to carry out the purposes of, the Plan in
connection with the Corporation’s grant of an option to Optionee.

 

C.                                All
capitalized terms in this Agreement shall have the meaning assigned to them in
the attached Appendix.

 

NOW, THEREFORE, it is hereby agreed as follows:

 

1.                                        Grant of Option. The Corporation hereby grants to Optionee,
as of the Grant Date, an option to purchase up to the number of Option Shares
specified in the Grant Notice. The Option Shares shall be purchasable from time
to time during the option term specified in Paragraph 2 at the Exercise Price.

 

2.                                        Option Term. This option shall have a term of ten (10) years
measured from the Grant Date and shall accordingly expire at the close of
business on the Expiration Date, unless sooner terminated in accordance with
Paragraph 5 or 6.

 

3.                                        Limited Transferability. During Optionee’s
lifetime, this option shall be exercisable only by Optionee and shall not be
assignable or transferable other than by will or by the laws of descent and
distribution following Optionee’s death.

 

4.                                        Dates of Exercise. This option shall become
exercisable for the Option Shares in one or more installments as specified in
the Grant Notice. As the option becomes exercisable for such installments,
those installments shall accumulate and the option shall remain exercisable for
the accumulated installments until the Expiration Date or sooner termination of
the option term under Paragraph 5 or 6.

 

5.                                        Cessation of Service. The option term specified
in Paragraph 2 shall terminate (and this option shall cease to be outstanding)
prior to the Expiration Date should any of the following provisions become
applicable:

 

(a)                                  Should
Optionee cease to remain in Service for any reason (other than death or
Disability) while this option is outstanding, then Optionee shall have a period
of ninety (90) days (commencing with the date of such cessation of Service)
during which to exercise this option, but in no event shall this option be
exercisable at any time after the Expiration Date.

 

1

 

(b)                                 Should
Optionee die while this option is outstanding, then the personal representative
of Optionee’s estate or the person or persons to whom the option is transferred
pursuant to Optionee’s will or in accordance with the laws of inheritance shall
have the right to exercise this option. Such right shall lapse, and this option
shall cease to be outstanding, upon the earlier of (i) the expiration of
the twelve (12) month period measured from the date of Optionee’s death or (ii) the
Expiration Date.

 

(c)                                  Should
Optionee cease Service by reason of Disability while this option is
outstanding, then Optionee shall have a period of twelve (12) months
(commencing with the date of such cessation of Service) during which to
exercise this option. In no event shall this option be exercisable at any time
after the Expiration Date.

 

(d)                                 During
the limited period of post-Service exercisability, (i) this option may not
be exercised in the aggregate for more than the number of Option Shares for
which this Option is, at the time of Optionee’s cessation of Service,
exercisable pursuant to the exercise schedule specified in the Grant
Notice or the special acceleration provisions of Paragraph 6 and (ii) this
Option may not be exercised at all if the Optionee is in breach of any
non-competition or non-solicitation provisions of any employment agreement with
the Corporation. Upon the expiration of such limited exercise period or (if
earlier) upon the Expiration Date, this option shall terminate and cease to be
outstanding for any vested Option Shares for which the option has not been
exercised. To the extent Optionee is not vested in the Option Shares at the
time of Optionee’s cessation of Service, this option shall immediately
terminate and cease to be outstanding with respect to those shares.

 

6.                                       Acceleration of Option.

 

(a)                                  In
the event of any Corporate Transaction, the exercisability of this option, to
the extent this option is not otherwise fully exercisable, shall automatically
accelerate in full so that this option shall, immediately prior to the
effective date of the Corporate Transaction, become fully exercisable for all
the Option Shares and may be exercised for any or all of those Option
Shares as fully-vested shares of Common Stock. However, the exercisability of
the Option Shares shall not so
accelerate if and to the extent: (i) this option is assumed by the
successor corporation (or parent thereof) in the Corporate Transaction of this
option to the extent this option is not otherwise fully exercisable or (ii) this
option is to be replaced with a cash incentive program of the successor
corporation which preserves the spread existing on the unvested Option Shares
at the time of the Corporate Transaction (the excess of the Fair Market Value
of those Option Shares over the Exercise Price payable for such shares) and
provides for subsequent payout in accordance with the same exercise schedule applicable
to those unvested Option Shares as set forth in the Grant Notice unless, in
either case, the Plan Administrator has determined that the exercisability of
the Option Shares shall accelerate automatically upon the occurrence of a
Corporate Transaction regardless of whether those options are to be assumed or
replaced in the Corporate Transaction.

 

(b)                                 Immediately
following the Corporate Transaction, this option shall terminate and cease to
be outstanding, except to the extent assumed by the successor corporation (or
parent thereof) in connection with the Corporate Transaction.

 

(c)                                  If
this option is assumed in connection with a Corporate Transaction, then this
option shall be appropriately adjusted, immediately after such Corporate
Transaction, to apply to the number and class of securities which would
have been issuable to Optionee in 

 

2

 

consummation
of such Corporate Transaction had the option been exercised immediately prior
to such Corporate Transaction, and appropriate adjustments shall also be made
to the Exercise Price, provided the aggregate Exercise Price shall remain the
same.

 

(d)                                 This
Agreement shall not in any way affect the right of the Corporation to adjust,
reclassify, reorganize or otherwise change its capital or business structure or
to merge, consolidate, dissolve, liquidate or sell or transfer all or any part of
its business or assets.

 

7.                                       Adjustment in Option Shares. Should any change be made
to the Common Stock by reason of any stock split, stock dividend,
recapitalization, combination of shares, exchange of shares or other change
affecting the outstanding Common Stock as a class without the Corporation’s
receipt of consideration, appropriate adjustments shall be made to (i) the
total number and/or class of securities subject to this option and (ii) the
Exercise Price in order to reflect such change and thereby preclude a dilution
or enlargement of benefits hereunder.

 

8.                                       Shareholder Rights. The holder of this option shall
not have any shareholder rights with respect to the Option Shares until such
person shall have exercised the option, paid the Exercise Price and become a
holder of record of the purchased shares.

 

9.                                       Manner of Exercising Option.

 

(a)                                  In
order to exercise this option with respect to all or any part of the
Option Shares for which this option is at the time exercisable, Optionee (or
any other person or persons exercising the option) must take the following
actions:

 

(i)                                     Execute
and deliver to the Corporation an Exercise Notice.

 

(ii)                                  Pay
the aggregate Exercise Price for the purchased shares in one or more of the
following forms:

 

(A)                              cash
or check made payable to the Corporation or by wire transfer to an account
designated by the Corporation; or

 

(B)                                a
promissory note payable to the Corporation, but only to the extent authorized
by the Plan Administrator in accordance with Paragraph 13.

 

Should
the Common Stock be registered under Section 12(g) of the 1934 Act at
the time the option is exercised, then the Exercise Price may also be paid
as follows:

 

(C)                                in
shares of Common Stock held by Optionee (or any other person or persons
exercising the option) for the requisite period necessary to avoid a charge to
the Corporation’s earnings for financial reporting purposes and valued at Fair
Market Value on the Exercise Date; or

 

(D)                               through
a special sale and remittance procedure pursuant to which Optionee (or any
other person or persons exercising the option) shall concurrently provide
irrevocable written instructions (a) to a Corporation-designated brokerage
firm to effect the immediate sale of the 

 

3

 

purchased
shares and remit to the Corporation, out of the sale proceeds available on the
settlement date, sufficient funds to cover the aggregate Exercise Price payable
for the purchased shares plus all applicable federal, state and local income
and employment taxes required to be withheld by the Corporation by reason of
such exercise and (b) to the Corporation to deliver the certificates for
the purchased shares directly to such brokerage firm in order to complete the
sale.

 

Except
to the extent the sale and remittance procedure is utilized in connection with
the option exercise, payment of the Exercise Price must accompany the Exercise
Notice delivered to the Corporation in connection with the option exercise.

 

(iii)                               Furnish
to the Corporation appropriate documentation that the person or persons
exercising the option (if other than Optionee) have the right to exercise this
option.

 

(iv)                              Execute
and deliver to the Corporation such written representations as may be
requested by the Corporation in order for it to comply with the applicable
requirements of Federal and state securities laws.

 

(v)                                 Make
appropriate arrangements with the Corporation (or Parent or Subsidiary
employing or retaining Optionee) for the satisfaction of all federal, state and
local income and employment tax withholding requirements applicable to the
option exercise.

 

(b)                                 As
soon as practical after the Exercise Date, the Corporation shall issue to or on
behalf of Optionee (or any other person or persons exercising this option) a
certificate for the purchased Option Shares, with the appropriate legends
affixed thereto.

 

(c)                                  In
no event may this option be exercised for any fractional shares.

 

10.                                 Compliance with Laws and Regulations.

 

(a)                                  The
exercise of this option and the issuance of the Option Shares upon such
exercise shall be subject to compliance by the Corporation and Optionee with
all applicable requirements of law relating thereto and with all applicable
regulations of any stock exchange (or the Nasdaq Global Market, if applicable)
on which the Common Stock may be listed for trading at the time of such
exercise and issuance.

 

(b)                                 The
inability of the Corporation to obtain approval from any regulatory body having
authority deemed by the Corporation to be necessary to the lawful issuance and
sale of any Common Stock pursuant to this option shall relieve the Corporation
of any liability with respect to the non-issuance or sale of the Common Stock
as to which such approval shall not have been obtained. The Corporation,
however, shall use its best efforts to obtain all such approvals.

 

11.                                 Successors and Assigns. Except to the extent
otherwise provided in Paragraphs 3 and 6, the provisions of this Agreement
shall inure to the benefit of, and be binding 

 

4

 

upon,
the Corporation and its successors and assigns and Optionee, Optionee’s assigns
and the legal representatives, heirs and legatees of Optionee’s estate.

 

12.                                 Notices. Any notice required to be given or
delivered to the Corporation under the terms of this Agreement shall be in
writing and addressed to the Corporation at its principal corporate offices. Any
notice required to be given or delivered to Optionee shall be in writing and
addressed to Optionee at the address indicated below Optionee’s signature line
on the Grant Notice. All notices shall be deemed effective upon personal
delivery or upon deposit in the mail, postage prepaid and properly addressed to
the party to be notified.

 

13.                                 Financing. The Plan Administrator may, in its
absolute discretion and without any obligation to do so, permit Optionee to pay
the Exercise Price for the purchased Option Shares by delivering a
full-recourse, interest-bearing promissory note secured by those Option Shares.
The payment schedule in effect for any such promissory note shall be
established by the Plan Administrator in its sole discretion.

 

14.                                 Construction. This Agreement and the option
evidenced hereby are made and granted pursuant to the Plan and are in all
respects limited by and subject to the terms of the Plan. All decisions of the
Plan Administrator with respect to any question or issue arising under the Plan
or this Agreement shall be conclusive and binding on all persons having an
interest in this option.

 

15.                                 Governing Law. The interpretation, performance
and enforcement of this Agreement shall be governed by the laws of the State of
Delaware without resort to that State’s conflict-of-laws rules.

 

16.                                 Shareholder Approval. If the Option Shares
covered by this Agreement exceed, as of the Grant Date, the number of shares of
Common Stock which may be issued under the Plan as last approved by the
shareholders, then this option shall be void with respect to such excess
shares, unless shareholder approval of an amendment sufficiently increasing the
number of shares of Common Stock issuable under the Plan is obtained in
accordance with the provisions of the Plan.

 

5

 

APPENDIX

 

The following
definitions shall be in effect under the Agreement:

 

A. Agreement
shall mean this Stock Option Agreement.

 

B. Board shall mean the
Corporation’s Board of Directors.

 

C. Common
Stock shall mean the Corporation’s common stock.

 

D. Corporate
Transaction shall mean either of the following
shareholder-approved transactions to which the Corporation is a party:

 

(i)                                     a
merger or consolidation in which securities possessing more than fifty percent
(50%) of the total combined voting power of the Corporation’s outstanding securities
are transferred to a person or persons different from the persons holding those
securities immediately prior to such transaction, or

 

(ii)                                  the
sale, transfer or other disposition of all or substantially all of the
Corporation’s assets in complete liquidation or dissolution of the Corporation.

 

E. Corporation
shall mean CTC Media, Inc., a Delaware corporation.

 

F. Disability
shall mean the inability of Optionee to engage in any substantial gainful
activity by reason of any medically determinable physical or mental impairment
and shall be determined by the Plan Administrator on the basis of such medical
evidence as the Plan Administrator deems warranted under the circumstances. Disability
shall be deemed to constitute Permanent Disability
in the event that such Disability is expected to result in death or has lasted
or can be expected to last for a continuous period of twelve (12) months or
more.

 

G. Employee
shall mean an individual who is in the employ of the Corporation (or any Parent
or Subsidiary), subject to the control and direction of the employer entity as
to both the work to be performed and the manner and method of performance.

 

H. Exercise
Date shall mean the date on which the option shall have been
exercised in accordance with Paragraph 9 of the Agreement.

 

I. Exercise
Price shall mean the exercise price payable per Option Share as
specified in the Grant Notice.

 

J. Expiration
Date shall mean the date on which the option expires as
specified in the Grant Notice.

 

K. Exercise
Notice shall mean the notice substantially in the form of Exhibit A
hereto.

 

L. Fair
Market Value per share of Common Stock on any relevant date
shall be determined in accordance with the following provisions:

 

(i)                                     If
the Common Stock is at the time traded on the Nasdaq Global Market, then the
Fair Market Value shall be the closing selling price per share of Common Stock
on the date in question, as the price is reported by the National Association
of Securities 

 

A-1

 

Dealers
on the Nasdaq Global Market or any successor system. If there is no closing
selling price for the Common Stock on the date in question, then the Fair
Market Value shall be the closing selling price on the last preceding date for
which such quotation exists.

 

(ii)                                  If
the Common Stock is at the time listed on any stock exchange, then the Fair
Market Value shall be the closing selling price per share of Common Stock on
the date in question on the stock exchange determined by the Plan Administrator
to be the primary market for the Common Stock, as such price is officially
quoted in the composite tape of transactions on such exchange. If there is no
closing selling price for the Common Stock on the date in question, then the
Fair Market Value shall be the closing selling price on the last preceding date
for which such quotation exists.

 

(iii)                               If
the Common Stock is at the time neither listed on any stock exchange nor traded
on the Nasdaq Global Market, then the Fair Market Value shall be determined by
the Plan Administrator after taking into account such factors as the Plan
Administrator shall deem appropriate.

 

M. Grant
Date shall mean the date of grant of the option as specified in
the Grant Notice.

 

N. Grant
Notice shall mean the Notice of Grant of Stock Option
accompanying the Agreement, pursuant to which Optionee has been informed of the
basic terms of the option evidenced hereby.

 

O. 1934 Act
shall mean the Securities Exchange Act of 1934, as amended.

 

P. Option
Shares shall mean the number of shares of Common Stock subject
to the option.

 

Q. Optionee
shall mean the person to whom the option is granted as specified in the Grant
Notice.

 

R. Parent
shall mean any corporation (other than the Corporation) in an unbroken chain of
corporations ending with the Corporation, provided each corporation in the
unbroken chain (other than the Corporation) owns, at the time of the
determination, stock possessing fifty percent (50%) or more of the total
combined voting power of all classes of stock in one of the other corporations
in such chain.

 

S. Plan
shall mean the Corporation’s 1997 Stock Option/Stock Issuance Plan.

 

T. Plan
Administrator shall mean either the Board or a committee of the
Board acting in its capacity as administrator of the Plan.

 

U. Service
shall mean the Optionee’s performance of services for the Corporation (or any
Parent or Subsidiary) in the capacity of an Employee, a non-employee member of
the board of directors or an independent consultant.

 

V. Subsidiary
shall mean any corporation (other than the Corporation) in an unbroken chain of
corporations beginning with the Corporation, provided each corporation (other
than the last corporation) in the unbroken chain owns, at the time of the
determination, stock possessing 

 

A-2

 

fifty percent (50%) or more of the total combined voting power of all
classes of stock in one of  the other
corporations in such chain.

A-3

 

Exhibit A

 

EXERCISE
NOTICE

 

The
undersigned, pursuant to the provisions set forth in his/her Notice of Grant of
Stock Option dated May 2, 2007 (the “Option”), hereby elects to exercise
the Option to purchase
                
Option Shares. The aggregate Exercise Price is being paid as follows (check
one):

 

	
  o

  	
   

  	
  In cash, cheque or wire transfer

  
	
   

  	
   

  	
   

  
	
  o

  	
   

  	
  By promissory note*

  
	
   

  	
   

  	
   

  
	
  o

  	
   

  	
  By delivery of shares of Common Stock of
  the Corporation already held by the undersigned*

  
	
   

  	
   

  	
   

  
	
  o

  	
   

  	
  Through the special sale and remittance
  program in accordance with Section 9(a)(ii)(D) of the Stock Option
  Agreement

  

 

*
Prior consent of the Corporation must be received to pay the Exercise Price in
this manner (which consent is at the sole
discretion of the Corporation).

 

	
   

  	
  Signature:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Date:

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