Document:

Exhibit 10.67

 

EMPLOYMENT
AGREEMENT

 

THIS EMPLOYMENT
AGREEMENT (the “Agreement”) is entered into by CTC Media, Inc., a Delaware
corporation (the “Company”), and Boris Podolsky (the “Executive”).

 

WHEREAS, the Company desires to employ the Executive,
and the Executive desires to be employed by the Company.

 

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 by the parties hereto, the parties
agree as follows:

 

1.                                       Term of Employment. 
The Company hereby agrees to employ the Executive, and the Executive
hereby accepts employment with the Company, upon the terms set forth in this
Agreement, effective on December 10, 2007 (the “Commencement Date”).  The Executive’s employment shall continue
until it is terminated in accordance with the provisions of Section 4.

 

2.                                       Title; Capacity.

 

a)                                      The Executive shall serve as Chief
Financial Officer and his job duties shall include managing the finance function
of the Company and each of its subsidiaries, including, without limitation, the
preparation of management accounts, U.S. GAAP financial statements and tax
filings, and the Company’s SEC periodic reports; reporting to the Company’s
audit committee; working with the Company’s external auditors to ensure the
delivery of timely audit reports; supervising and assessing the Company’s
internal control procedures; supervising financial due diligence reviews of the
proposed acquisition targets and managing investor relations.  The Executive agrees to perform such other
duties and responsibilities as the Company’s Chief Executive Officer or his
designee shall from time to time reasonably assign to him.

 

b)                                     The Executive shall be based at the
Company’s headquarters in Moscow, Russia or such other location as the Company
and the Executive shall mutually agree.

 

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

 

d)                                     The Executive agrees to devote his entire
business time, attention and energies to the business and interests of the
Company during his employment with the Company and shall not engage in any
other business activities without the prior written approval of the Chief
Executive Officer.  The Executive 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 Company shall pay the Executive, in regular installments in
accordance with the Company’s standard payroll practices, an annual base salary
of RUR 9,625,000 (the “Base Salary”), less all applicable Russian taxes and
withholdings.  From January 1, 2009,
such salary may be adjusted from time to time in accordance with normal
business practice and upon mutual agreement of the parties.

 

b)                                     Discretionary Bonus. 
Beginning with the 2008 financial year, the Executive shall be eligible
for an annual discretionary target award of up to 60% of the Base Salary, less
all applicable Russian taxes and withholdings, subject to the reasonable
discretion of the Board or a committee thereof (which may include the Board or
a committee thereof setting performance targets the achievement thereof being
the criteria for determining whether the Executive shall be entitled to such
award).  Whether such performance
targets, if any, have been achieved will be decided by the Board or a committee
thereof in its reasonable discretion.  
In any event, the Executive must be an active employee of the Company on
the date the bonus for any fiscal year is distributed in order to be eligible
for a bonus award.

 

c)                                      Fringe Benefits.  
The Executive shall be entitled to participate in all benefit programs
that the Company establishes and makes available to its employees, if any, to
the extent that Executive’s position, tenure, salary, age, health and other
qualifications make him eligible to participate.

 

d)                                     Reimbursement of Expenses. 
The Company shall reimburse the Executive for all reasonable travel,
entertainment and other expenses incurred or paid by the Executive in
connection with, or related to, the performance of his duties, responsibilities
or services under this Agreement, in accordance with policies and procedures,
and subject to limitations, adopted by the Company from time to time.

 

e)                                      Vacation. The Executive shall be eligible to accrue a maximum
of 20 business days of paid vacation per calendar year, subject to proration to
the Commencement Date and to be taken at such times as may be approved by and
in the sole discretion of the Company. 
Such vacation days shall accrue at the rate of 1.667 days per month.

 

f)                                        Stock Option. 
The Company shall grant to the Executive an option (the “Option”)
under the terms and conditions set forth in Exhibit A hereto.

 

g)                                     Transportation. 
The Company shall provide the Executive with the exclusive use of a
luxury class sedan car such as a Volvo S80 or the reasonable equivalent  thereof (which shall remain the property of
the Company) and a driver during the term of the Executive’s employment with
the Company.   The Company shall be
responsible for insurance, maintenance and fuel expenses related to the car.

 

h)                                     Personal assistant. 
The Company shall provide the Executive with a personal assistant who
shall work exclusively for the Executive. 
Such personal assistant shall be fluent in English.

 

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i)                                         Mobile phone. 
The Company shall provide the Executive with a mobile phone and shall
pay the line rental and service fees and the cost of any business-related
calls.

 

j)                                         Equipment.  The Company
shall consider on a case-by-case basis the Executive’s reasonable requests for
home office equipment (such as a laptop computer, printer and/or fax machine)
and, to the extent the Company believes the Executive’s service to the Company
requires the use of such items, it shall provide them to the Executive (but, at
all times, such items shall remain the property of the Company).

 

k)                                      Indemnification Agreement. 
The Company shall enter into an officer indemnification agreement with
the Executive in the form of Exhibit B hereto (the “Indemnification
Agreement”).

 

4.                                       Employment Termination. 
The employment of the Executive 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 Executive.  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) the Executive has failed to adequately perform the
material aspects of his  assigned duties
for the Company in a manner that materially and adversely affects the Company,
after written notice of such failure of such duties and a reasonable
opportunity to correct such failure, or (B) the Executive has engaged in
dishonesty, gross negligence or intentional misconduct that materially and
adversely affects the Company; (ii) the Executive’s conviction of, or the
entry of a pleading of guilty or nolo
contendere by the Executive, to any crime involving moral turpitude
or any felony; (iii) the Executive’s material breach of Section 6 or
7 hereof if such breach is caused by the Executive’s intentional misconduct or
gross negligence; or (iv) the Executive’s intentional violation of Company
policy in a manner that materially and adversely affects the Company, after
written notice of such violation and a reasonable opportunity to correct such
failure.

 

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 Executive upon not
less than six months’ prior written notice of resignation.

 

d)                                     Upon the death or disability of the
Executive.  As used in this Agreement,
the term “disability” shall mean the inability of the Executive, due to a
physical or mental disability, for a period of seventy-five (75) business days,
whether or not consecutive, during any 360-day period to perform the services
contemplated under this Agreement.  A
determination of disability shall be made by a physician satisfactory to both
the Executive and the Company, provided  that if the Executive and
the Company do not agree on a physician, the Executive and the Company shall
each select a physician and these two together shall select a third physician,
whose determination as to disability shall be binding on all parties.

 

3

 

5.                                       Effect of Termination.

 

a)                                      In the event the Executive’s employment
is terminated for Cause pursuant to Section 4(a), or at the election of
either party pursuant to Sections 4(b) or 4(c), the Company shall pay to
the Executive the compensation and benefits otherwise payable to the Executive
under Section 3 through the last day of the Executive’s actual employment
by the Company.

 

b)                                     If the Executive’s employment is
terminated by death or because of disability pursuant to Section 4(d), the
Company shall pay to the Executive or the Executive’s estate, as the case may
be, the compensation which would otherwise be payable to Executive under Section 3
up to the end of a one month period after which the termination of the
Executive’s employment occurs because of death or disability.

 

6.                                       Non-Competition and Non-Solicitation.

 

a)                                      During the term of the Executive’s
employment and for a period of one (1) year with respect to subclause (i) below,
and for a period of two (2) years with respect to subclause (ii) and (iii) below,
after the termination of such employment, the Executive 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 one
percent (1%) of the total outstanding stock of a publicly held company), engage
in the business of television broadcasting in Russia or any other country in
which the Company or any of its subsidiaries (collectively, the “Group”) is
then operating or in which it has undertaken material preparations to begin
operating; or

 

ii)                                      recruit, solicit or induce, or attempt to
induce, any employee or employees of the Group to terminate their employment
with, or otherwise cease their relationship with, the Group; or

 

iii)                                   solicit, divert or take away, or attempt
to 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 Executive had significant contact while employed by the Company.

 

(b)                                 If any restriction set forth in this Section 6
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 Executive acknowledges and agrees
that the restrictions contained in this Section 6 are necessary for the
protection of the business and goodwill of the Group and are considered by the
Executive to be reasonable for such purpose. 
The Executive 

 

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agrees that any breach of
this Section 6 will cause the Company substantial and irrevocable damage
and therefore, in the event of any such breach, in addition to such other
remedies which may be available, the Company shall have the right to seek
specific performance and injunctive relief.

 

d)                                     The provisions of Section 6 survive
the termination of the Executive’s employment and the termination of this
Agreement.

 

7.                                       Proprietary Information.

 

a)                                      The Executive agrees that all information
and know-how, whether or not in writing, of a private, secret or confidential
nature concerning the Group’s business 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;
planned programming schedules; material terms of contracts, research data,
personnel data, computer programs and supplier lists.  The Executive shall not disclose any
Proprietary Information to others outside the Group or use the same for any
unauthorized purposes without written approval of the Chief Executive Officer
or the Board, either during or after his employment, unless and until such
Proprietary Information has become public knowledge without fault by the
Executive.

 

(b)                                 The Executive agrees that all files,
letters, memoranda, reports, records, data, notebooks, program listings, or
other written, photographic, or other tangible material containing Proprietary
Information, whether created by the Executive 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 Executive only in the performance of his duties for the
Group.

 

(c)                                  The Executive agrees that his obligation
not to disclose or use information, know-how and records of the types set forth
in paragraphs (a) and (b) above, also extends to such types of
information, know-how, records 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 Executive in the course of the Group’s business.

 

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

 

8.                                       No Restrictions On Employment. 
The Executive 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 Company or to refrain from competing,
directly or indirectly, with the business of such previous employer or any other
party.  The Executive further represents
that his performance of all the terms of this Agreement and as an employee of
the Company 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 Company.

 

5

 

9.                                       Notices.  All notices
required or permitted under this Agreement shall be in writing in English and
shall be deemed to have been duly given when delivered either in person and
shall be deemed effective upon personal delivery or upon sending by a reputable
overnight courier service, addressed to the other party at the address shown on
the signature page hereto, or at such other address or addresses as either
party shall designate to the other in accordance with this Section 9.

 

10.                                 Entire Agreement. 
This Agreement, together with the Option and the Indemnification
Agreement, constitutes the entire agreement between the parties and supersedes
all prior agreements and understandings, whether written or oral, relating to
the subject matter of this Agreement.

 

11.                                 Amendment.  This
Agreement may be amended or modified only by a written instrument executed by
both the Chief Executive Officer or the Board and the Executive.

 

12.                                 Governing Law, Forum and Jurisdiction. 
This Agreement shall be governed by and construed under and in
accordance with the laws of the State of Delaware.  Any action, suit, or other legal proceeding
which is commenced to resolve any matter arising under or relating to any
provision of this Agreement shall be commenced only in a court of the State of
Delaware (or, if appropriate, a federal court located within Delaware), and the
Company and the Executive each consents to the exclusive jurisdiction of such a
court.

 

13.                                 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 Executive
are personal and shall not be assigned by him.

 

14.                                 Acknowledgment. 
The Executive 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 Executive 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.

 

15.                                 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.

 

16.                                 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.

 

17.                                 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.

 

6

 

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

 

 

CTC MEDIA, INC.

 

 

	
  Dated:

  	
  February 27, 2008

  	
   

  	
  /s/ Alexander
  Rodnyansky

  
	
   

  	
  By:  

  	
  Alexander Rodnyansky

  
	
   

  	
   

  	
  Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
  Address: 

  	
  15A Pravda Street

  
	
   

  	
   

  	
  Moscow 125124

  
	
   

  	
   

  	
  Russia

  
	
   

  	
   

  
	
   

  	
  BORIS PODOLSKY

  
	
   

  	
   

  
	
   

  	
   

  
	
  Dated:

  	
  February 27, 2008

  	
   

  	
  /s/ Boris Podolsky

  
						

 

7Exhibit 10.68

 

CTC MEDIA, INC.

STOCK OPTION AGREEMENT

 

                                                THIS
STOCK OPTION AGREEMENT (this “Agreement”) made as of this 10th day
of December 2007, is entered into between CTC Media, Inc., a Delaware
corporation (the “Company”), and Boris Podolsky (“Optionee”).

 

Preliminary Statements:

 

A.                                   The
Company desires to retain the services of Optionee by providing him with an
incentive to contribute to the financial success of the Company and its
subsidiaries.

 

B.                                     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 Company hereby grants to Optionee, as of
the Grant Date, an option to purchase up to 400,000 shares of Common Stock (the
“Option Shares”).    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.

 

1

 

4.                                       Dates of Exercise.  This option shall become exercisable for the
Option Shares in accordance with the following schedule:

 

	
   

  	
   

  	
  Aggregate number of Option Shares for

  	
   

  
	
  Date:

  	
   

  	
  which
  the option is then exercisable:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  On or after
  December 10, 2008

  	
   

  	
  100,000

  	
   

  
	
  On or after
  March 31, 2009

  	
   

  	
  125,000

  	
   

  
	
  On or after
  June 30, 2009

  	
   

  	
  150,000

  	
   

  
	
  On or after
  September 30, 2009

  	
   

  	
  175,000

  	
   

  
	
  On or after
  December 31, 2009

  	
   

  	
  200,000

  	
   

  
	
  On or after
  March 31, 2010

  	
   

  	
  225,000

  	
   

  
	
  On or after
  June 30, 2010

  	
   

  	
  250,000

  	
   

  
	
  On or after
  September 30, 2010

  	
   

  	
  275,000

  	
   

  
	
  On or after
  December 31, 2010

  	
   

  	
  300,000

  	
   

  
	
  On or after
  March 31, 2011

  	
   

  	
  325,000

  	
   

  
	
  On or after
  June 30, 2011

  	
   

  	
  350,000

  	
   

  
	
  On or after
  September 30, 2011

  	
   

  	
  375,000

  	
   

  
	
  On or after
  December 10, 2011

  	
   

  	
  400,000

  	
   

  

 

Provided, however, that,
without limiting the generality of Paragraph 6 below, if a Change of Control or
a Corporate Transaction occurs prior to December 10, 2008, this option
shall become exercisable for the Option Shares in accordance with the following
schedule (instead of the schedule set out above):

 

	
   

  	
   

  	
  Aggregate number of Option Shares for

  	
   

  
	
  Date:

  	
   

  	
  which
  the option is then exercisable:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  On or after
  March 31, 2008

  	
   

  	
  25,000

  	
   

  
	
  On or after
  June 30, 2008

  	
   

  	
  50,000

  	
   

  
	
  On or after
  September 30, 2008

  	
   

  	
  75,000

  	
   

  
	
  On or after
  December 31, 2008

  	
   

  	
  100,000

  	
   

  
	
  On or after
  March 31, 2009

  	
   

  	
  125,000

  	
   

  
	
  On or after
  June 30, 2009

  	
   

  	
  150,000

  	
   

  
	
  On or after
  September 30, 2009

  	
   

  	
  175,000

  	
   

  
	
  On or after
  December 31, 2009

  	
   

  	
  200,000

  	
   

  
	
  On or after
  March 31, 2010

  	
   

  	
  225,000

  	
   

  
	
  On or after
  June 30, 2010

  	
   

  	
  250,000

  	
   

  
	
  On or after
  September 30, 2010

  	
   

  	
  275,000

  	
   

  
	
  On or after
  December 31, 2010

  	
   

  	
  300,000

  	
   

  
	
  On or after
  March 31, 2011

  	
   

  	
  325,000

  	
   

  
	
  On or after
  June 30, 2011

  	
   

  	
  350,000

  	
   

  
	
  On or after
  September 30, 2011

  	
   

  	
  375,000

  	
   

  
	
  On or after
  December 10, 2011

  	
   

  	
  400,000

  	
   

  

 

2

 

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.

 

(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, 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 Paragraph 4 or the special
acceleration provisions of Paragraph 6. 
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 

 

3

 

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 Paragraph 4.

 

(b)                                 In
connection with any Corporate Transaction where the exercisability of this
option automatically accelerates in full, this option shall be exercised prior
to or in connection with the closing of such Corporate Transaction and, to the
extent that this option is not so exercised, it shall terminate and cease to be
outstanding immediately following the closing of such Corporate Transaction.  Without limiting the generality of Section 5,
a Change in Control that is not also a Corporate Transaction shall not effect
the term of the option.

 

(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 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 Company 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 Company’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) shall provide written notice of
Optionee’s election to exercise all or a portion of the option and shall take
the following additional actions:

 

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

 

4

 

(A)                              cash
or check made payable to the Company; or

 

(B)                                a
promissory note payable to the Company, but only to the extent authorized by
the Board 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 Company’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 Company-designated brokerage
firm to effect the immediate sale of the purchased shares and remit to the
Company, 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 Company by reason of such exercise and (b) to the
Company 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 notice
delivered to the Company in connection with the option exercise.

 

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

 

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

 

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

 

5

 

(b)                                 As
soon as practical after the Exercise Date, the Company 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 (if
any) 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 Company and Optionee with all
applicable requirements of law relating thereto and with all applicable
regulations of any stock exchange (or The Nasdaq Global Select 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 Company to obtain approval from any regulatory body having
authority deemed by the Company to be necessary to the lawful issuance and sale
of any Common Stock pursuant to this option shall relieve the Company 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 Company, 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 upon, the Company 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 Company under the terms of this Agreement shall be in writing and
addressed to the Company 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. 
All notices shall be deemed effective (i) upon personal delivery, (ii) five
business days after being sent by registered or certified mail, return receipt
requested, postage prepaid or (iii) two business days after being sent via
reputable international overnight courier.

 

13.                                 Financing.  The Board 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 Board in its sole discretion.

 

14.                                 Non-Statutory Option.  Optionee acknowledges that this option is not
intended to satisfy the requirements of Section 422 of the U.S. Internal
Revenue Code of 1986, as amended.

 

6

 

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.

 

7

 

                                                IN
WITNESS WHEREOF, the parties hereto have caused this option to be executed as
of the date set forth in the preamble.

 

 

	
   

  	
  CTC MEDIA, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Alexander Rodnyansky

  
	
   

  	
   

  	
       Alexander Rodnyansky

  
	
   

  	
   

  	
       President and CEO

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Optionee:

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Boris Podolsky

  
	
   

  	
  Boris Podolsky

  

 

8

 

APPENDIX

 

                                                The
following definitions shall be in effect under the Agreement:

 

A.                                   Agreement shall mean this Stock
Option Agreement.

 

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

 

C.                                     Change in Control shall mean any
party either alone or with its affiliates (as such term is defined in the 1934
Act) achieving control of a majority of the voting power of the Company’s then
outstanding capital stock through direct and/or indirect beneficial ownership.

 

D.                                    Common Stock shall mean the Company’s
common stock.

 

E.                                      Corporate Transaction shall mean
either of the following shareholder-approved transactions to which the Company
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 Company’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 Company’s
assets in complete liquidation or dissolution of the Company.

 

F.                                      Company shall mean CTC Media, Inc.,
a Delaware corporation.

 

G.                                     Disability
shall have the meaning assigned to such term in Optionee’s employment
agreement with the Company, as such agreement is amended from time to time.

 

H.                                    Employee shall mean an individual
who is in the employ of the Company (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.

 

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

 

J.                                        Exercise Price shall mean the
closing sales price per share of the Common Stock for the Grant Date as
reported on the Nasdaq Global Select Market, or $26.81 per share.

 

K.                                    Expiration Date shall mean December 10,
2017.

 

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 Select 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 Dealers on the Nasdaq Global Select 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 Board 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 Select
Market, then the Fair Market Value shall be determined by the Board after
taking into account such factors as the Board shall deem appropriate.

 

M.                                 Grant Date shall mean December 10,
2007.

 

N.                                    1934 Act shall mean the U.S.
Securities Exchange Act of 1934, as amended.

 

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

 

P.                                      Optionee shall mean Boris Podolsky.

 

Q.                                    Parent shall mean any corporation
(other than the Company) in an unbroken chain of corporations ending with the
Company, provided each corporation in the unbroken chain (other than the
Company) 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.

 

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

 

S.                                      Stock Exchange shall mean any
market of the Nasdaq, the American Stock Exchange, the New York Stock Exchange
or the London Stock Exchange.

 

T.                                     Subsidiary shall mean any
corporation (other than the Company) in an unbroken chain of corporations
beginning with the Company, provided each corporation (other than the last
corporation) in the unbroken chain 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.

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