Amended and Restated Contract of Employment between Wallace Macmillan, Chief Financial Officer, and CME Development Corporation, dated October 6, 2006

 6 OCTOBER 2006

 

 

 

Name and Address of Employer:

CME Development Corporation, Aldwych House 81 Aldwych, London WC2B 4HN (the “Company”)

Name and address of Employee:

Wallace Macmillan of: Carrington House, Kew Place, High Wycombe, Bucks, HP11 1QW

Date this contract takes effect

April 1, 2006

1

1.1

This amended and restated contract replaces the contract concluded between the Company and you on 17 March 2003. Your previous employment with the Company will be treated as part of your continuous period of employment. This means that the date of commencement of your continuous period of employment is 17 March 2003.

2

2.1

Your job title is Chief Financial Officer, reporting to and subject to the direction and authorization of the Chief Executive Officer of Central European Media Enterprises Ltd. (“CME Ltd.”), you will perform such functions and undertake such responsibilities as are customarily associated with such a position as your main duties.

2.2

In addition to your main duties you will be required to carry out such other duties consistent with your position as the Company may from time to time require. You shall diligently and faithfully perform such duties and exercise such powers as may from time to time be assigned or vested in you in relation to the management or conduct of the Company by the board of directors of CME Ltd.

2.3

You shall use your best endeavours to promote and protect the interests of the Company and shall not do anything which is harmful to those interests.

2.4

You shall devote the whole of your time (unless prevented by ill-health or accident or otherwise directed by the Company) to the duties of this contract and you shall not be directly or indirectly interested or concerned in any manner in any other business except with the Company’s prior written consent. If such consent is given, you must provide the Company with the number of hours worked for any other employer each month.

3

3.1

You will be based in the Company’s London office.

3.2

The duties of this appointment shall relate primarily to the United Kingdom but it is agreed that your position will require that you spend extensive time travelling outside the United Kingdom when required by the Company for the proper performance of your duties.

4

4.1

Your basic salary is 250,000 pounds (£) per annum, payable by equal monthly instalments in arrears on or about the 20^th of each month by credit transfer into your bank account after all necessary deductions for relevant taxes and national insurance..

4.2

The Company will review your salary annually on or before March 17 of each year. Any increase of your salary is entirely at the Company’s discretion and the Company will have no contractual obligation to increase your salary.

4.3

You shall be entitled to participate in an annual discretionary bonus scheme. . The amount, if any, of such a bonus shall be determined by the Chief Executive Officer of the Company, and is subject to the approval of the Compensation Committee. Any bonus awarded will be based on a target representing 50% of your gross annual basic salary.

4.4

The Company agrees to use reasonable efforts to cause CME Ltd. to grant you 12,500 options over shares of Class A Common Stock of CME Ltd. on annual basis for each of the next four years. The date of grant shall be established by the Compensation Committee of CME Ltd. the exercise price for such options shall be the closing price of the shares of Class A Common Stock on NASDAQ on the date of grant. Such options shall vest in four equal instalments and shall otherwise be subject to the 1995 Stock Incentive Plan of CME Ltd.

5

5.1

During the term of this contract you are entitled to membership of the following schemes (each referred to below as an “insurance scheme”):

5.2

Benefits under any insurance scheme shall be subject to the rules of the scheme(s) and the terms of any applicable insurance policy and are conditional upon your complying with and satisfying any applicable requirements of the insurers. Copies of these rules and policies and particulars of the requirements shall be provided to you on request. The Company shall not have any liability to pay any benefit to you under any insurance scheme unless it receives payment of the benefit from the insurer under the scheme.

5.3

Any insurance scheme which is provided for you is also subject to the Company’s right to alter the cover provided or any term of the scheme or to cease to provide (without replacement) the scheme at any time if in the opinion of the Company your state of health is or becomes such that the Company is unable to insure the benefits under the scheme at the normal premiums applicable to a person of your age.

5.4

The provision of any insurance scheme does not in any way prevent the Company from lawfully terminating this contract in accordance with the provisions in clause 10 even if to do so would deprive you of membership of or cover under any such scheme.

5.5

In addition to the above, and except as provided in Section 4.4, you will be entitled to all Company Benefits on such terms that are no less favourable than other senior non-expatriate executives.

6

7

8

8.1

You are entitled to 25 days’ holiday with pay every calendar year in addition to bank and other public holidays. The Company’s holiday year runs from 1^st January to 31^st December.

8.2

Your holiday entitlement is inclusive of your statutory entitlement which is twenty (20) days per annum. When calculating your statutory entitlement bank and public holidays are taken into account. The statutory entitlement cannot be carried over from one holiday year to the next and no pay in lieu can be made to you.

8.3

Your holiday entitlement accrues pro rata on an annual basis as calculated from 1 January of each year.

8.4.1

If you have taken holiday in excess of your entitlement on termination of employment you will be required to give account for it and the Company will make a deduction from your final salary payment accordingly. If you have accrued holiday owing to you, the Company may at its discretion, require you to take the outstanding holiday during any notice period or make a payment in lieu thereof. 

8.5

If your employment is terminated without notice, you will not be entitled to holiday pay for holiday which would have accrued during the notice period, had you continued to be employed throughout that time.

9

9.1

The Company may from time to time require you to be examined by a medical adviser nominated by the Company and you agree to provide such formal consents as may be necessary for the results of such examinations to be disclosed to the Company.

10

10.1

This Contract shall commence on the day set forth in Clause 1 above and shall continue indefinitely, unless terminated by you or the Company as set forth below:

12.2

You may terminate this Agreement upon ninety days written notice to the Company. The Company may terminate this contract on giving you twelve months notice in writing (the “Notice Term”) to expire at any time.

10.2

The Company may at any time and in its absolute discretion (whether or not any notice of termination has been given under clause 10.1 above) terminate this contract with immediate effect and make a payment in lieu of notice. This payment will comprise solely your basic salary (at the rate payable when this option is exercised) in respect of the portion of the notice period remaining at the time the Company exercises this option and shall be subject to deductions for income tax and national insurance contributions as appropriate. You will not, under any circumstances, have any right to payment in lieu unless the Company has exercised its option to pay in lieu of notice.

10.3

Your employment may be terminated by the Company without notice or payment in lieu of notice only by reason of your gross misconduct. Examples of gross misconduct are set out in the Company’s Employee Handbook, and the disciplinary and appeal procedures set forth therein shall govern any such circumstance.

10.5

In case you fail for a period of 180 consecutive days, or for shorter periods aggregating more than 180 days during any twelve-month period, to render the services contemplated hereunder for reasons other then sickness as described in Section 8.2 above, then the Company, at its option, may terminate your employment by notice from the Company to you, effective on the giving of 12 months notice or terminate with immediate effect and make a payment in lieu of notice.In case of termination for Retirement or Death, you will be entitled to your earned salary, your accrued vacation and your basic salary (at the rate payable when this option is exercised) and to all benefits vested at the effective date of termination. All payments shall be subject to deductions for income tax and national insurance contributions as appropriate.

10.6

You may also terminate your employment with the Company immediately upon giving notice to the Company for Good Reason. For purposes of this contract, Good Reason shall include a material breach by the Company of this contract, a reduction in your compensation, title, position or duties. Within five (5) business days of such termination by you, the Company shall pay to you in a lump sum any earned but unpaid basic salary, accrued vacation, one year of your basic salary (at the rate payable when this option is exercised), and all benefits vested at the time of termination, subject to appropriate deductions for income tax and national insurance contributions

11

11.1

The Company may suspend you from your duties on full pay to allow the Company to investigate any complaint made against you in relation to your employment with the Company.

11.2

Provided you continue to enjoy your full contractual benefits and receive your pay in accordance with this contract, the Company may in its absolute discretion do all or any of the following during the notice period or any part of the notice period, after you or the Company have given notice of termination to the other, without breaching this contract or incurring any liability or giving rise to any claim against it:

11.3

You will continue to be bound by all obligations owed to the Company under this contract.

12

12.1

You agree during and after the termination of your employment not to use or disclose to any person (and shall use your best endeavours to prevent the use, publication or disclosure of ) any confidential information:

12.2

For the purposes of paragraph 12.1.1 above information of a confidential or secret nature includes but is not limited to information disclosed to you or known, learned, created or observed by you as a consequence of or through your employment, not generally known in the relevant trade or industry, about the Company’s business activities, services and processes, including but not limited to information concerning advertising, sales promotion, publicity, sales data, research, programming and plans for programming, finances, accounting, methods, processes, business plans (including prospective or pending licence applications or investments in licence holders or applicants), client or supplier lists and records, potential client or supplier lists, and client or supplier billing.

12.3

This clause shall not apply to information which is:

13

13.1

You shall assign with full title your entire interest in any Intellectual Property Right (defined below) to the Company to hold as absolute owner.

13.3

In addition to and without derogation of the covenants imposed by the Law of Property (Miscellaneous Provisions) Act 1994 you shall prepare and execute such instruments and do such other acts and things as may be necessary or desirable (at the request and expense of the Company) to enable the Company (or its nominee) to obtain protection of any Intellectual Property Right vested in the Company in such parts of the world as may be specified by the Company (or its nominee) and to enable the Company to exploit any Intellectual Property Right vested in it to best advantage.

13.4

You hereby irrevocably appoint the Company to be your attorney in your name and on your behalf to sign, execute or do any instrument or thing and generally to use your name for the purpose of giving to the Company (or its nominees) the full benefit of the provisions of this clause and in favour of any third party a certificate in writing signed by any director or the secretary of the Company that any instrument or act falls within the authority conferred by this clause and shall be conclusive evidence that such is the case.

13.5

You hereby waive all of your moral rights (as defined in the Copyright, Designs and Patents Act 1988) in respect of any act by the Company and any act of a third party done with the Company’s authority in relation to any Intellectual Property Right which is or becomes the property of the Company.

13.6

“Intellectual Property Right” means a copyright, know-how, trade secret and any other intellectual property right of any nature whatsoever throughout the world (whether registered or unregistered and including all applications and rights to apply for the same) which:

14

15

16.1

You acknowledge that the Company will hold personal data relating to you. Such data will include your employment application, address, references, bank details, performance appraisals, work, holiday and sickness records, next of kin, salary reviews, remuneration details and other records (which may, where necessary, include sensitive data relating to your health and data held for equal opportunities purposes). The Company will hold such personal data for personnel administration and management purposes and to comply with its obligations regarding the retention of your records. Your right of access to such data is as prescribed by law.

16.2

By signing this contract, you agree that the Company may process personal data relating to you for personnel administration and management purposes and may, when necessary for those purposes, make such data available to its advisers, to third parties providing products and/or services to the Company and as required by law.

17

18

18.1

The Company will monitor messages sent and received via the email and voicemail system to ensure that employees are complying with the Company’s Information Technology policy.

18.2

The Company reserves the right to retrieve the contents of messages for the purpose of monitoring whether the use of the email system is in accordance with the Company’s best practice, for the purpose of performance management, for the purpose of monitoring whether use of the computer system is legitimate, to find lost messages or to retrieve messages lost due to computer failure, to assist in the investigations of wrongful acts or to comply with any legal obligation.

18.3

You should be aware that no email or voice mail sent or received through the Company’s system is private. The Company reserves and intends to exercise its right to review, audit, intercept, access and disclose on a random basis all messages created from it or sent over its computer system for any purpose. The contents of email or voice mail so obtained by the Company in the proper exercise of these powers may be disclosed without the permission of the employee. Employees should be aware that the emails or voice mails or any document created on the Company’s computer system, however confidential or damaging, may have to be disclosed in court or other proceedings. An email which has been trashed or deleted can still be retrieved.

18.4

The Company further reserves and intends to exercise its right to monitor all use of the internet through its information technology systems, to the extent authorised by law. By your signature to this contract you consent to any such monitoring.

19.2

The term "Proceeding" shall include any threatened, pending or completed action, suit or proceeding, or any inquiry or investigation, whether brought in the name of the Company or otherwise and whether of a civil, criminal, administrative or investigative nature, including, but not limited to, actions, suits or proceedings brought under or predicated upon any securities laws, in which you may be or may have been involved as a party or otherwise, and any threatened, pending or completed action, suit or proceeding or any inquiry or investigation that you in good faith believe might lead to the institution of any such action, suit or proceeding or any such inquiry or investigation, by reason of the fact that you are or were a director, officer, employee, agent or fiduciary of the Company, by reason of any action taken by you or of any inaction on your part while acting as such director, officer, employee, agent or fiduciary or by reason of the fact that you are or were serving at the request of the Company as a director, officer, employee, trustee, fiduciary or agent of another corporation, partnership, joint venture, employee benefit plan, trust or other enterprise, whether or not you are serving in such capacity at the time any liability or expense is incurred for which indemnification or reimbursement can be provided under this Agreement.

19.3

The term "Expenses" shall include, without limitation thereto, expenses (including, without limitation, attorneys' fees and expenses) of investigations, judicial or administrative proceedings or appeals, damages, judgements, fines, penalties or amounts paid in settlement by or on behalf of you and any Expenses of establishing a right to indemnification under this Agreement.

19.4

The Expenses incurred by you in any Proceeding shall be paid by the Company as incurred and in advance of the final disposition of the Proceeding at your written request. You hereby agree and undertake to repay such amounts if it shall ultimately be decided in a Proceeding that you are not entitled to be indemnified by the Company pursuant to this Agreement or otherwise.

19.5

The indemnification and advancement of Expenses provided by this Agreement shall not be deemed exclusive of any other rights to which you may be entitled under the Company’s Articles of Incorporation or Bye-Laws, any agreement, any vote of stockholders or disinterested directors, the laws under which the Company was formed, or otherwise, and may be exercised in any order you elect and prior to, concurrently with or following the exercise of any other such rights to which you may be entitled, including pursuant to directors and officers insurance maintained by the Company, both as to action in official capacity and as to action in another capacity while holding such office, and the exercise of such rights shall not be deemed a waiver of any of the provisions of this Agreement. To the extent that a change in law (whether by statute or judicial decision) permits greater indemnification by agreement than would be afforded currently under the Company's Articles of Incorporation, Bye-Laws and this Agreement, it is the intent of the parties hereto that you shall enjoy by this Agreement the greater benefit so afforded by such change. The provisions of this Section 20 shall survive the expiration or termination, for any reason, of this Agreement and shall be separately enforceable.

20

20.1

You agree for a period of 12 months after the termination of your employment that you shall not either on your own account or on behalf of any other person, firm or company directly or indirectly, carry on or be engaged, concerned or interested in any business which is competitive with the business of the Company and with which you were actively involved in the twelve months preceding the termination of your employment (the “Restricted Business”) within the territories of operation of the CME Group;

20.2

You agree, in connection with the carrying on of the Restricted Business, that for a period of 12 months after the termination of your employment, you shall not, either on your own account or on behalf of any other person, firm or company directly or indirectly solicit or canvass for business from any person, firm or company who at any time during the twelve months preceding the termination of your employment was a customer of the Company or any Associated Company and with whom during that period you had material dealings;

20.3

You agree, in connection with the carrying on of the Restricted Business that for a period of 12 months after the termination of your employment, you shall not, either on your own account or on behalf of any other person, firm or company directly or indirectly seek to do business and/or do business with any person, firm or company who at any time during the twelve months preceding the termination of your employment was a customer of the Company or any Associated Company and with whom during that period you had material dealings.

20.4

You agree for a period of 12 months following the termination of your employment, that you shall not solicit or employ or cause to be employed, whether directly or indirectly, any employee of the Company who has substantial knowledge of confidential aspects of the business of the Company and with whom at any time during the period of twelve months prior to such termination you had material dealings.

20.5

Each of the restrictions in this clause shall be enforceable independently of each other and its validity shall not be affected if any of the others is invalid. If any of the restrictions is void but would be valid if some part of the restriction were deleted, the restriction in question shall apply with such modification as may be necessary to make it valid.

20.6

For the avoidance of doubt these restrictions shall not apply if the Company terminates this contract in breach.

21

21.1

You hereby authorise the Company to deduct from any salary payable to you any sums owing by you to the Company.

21.2

As from the effective date of this contract all other agreements or arrangements between you and the Company shall cease to have effect.

21.3

This shall be governed by and construed in accordance with English law.

Executed as a Deed by Michael Garin and Mark Wyllie,

/s/ Michael Garin

/s/ Mark Wyllie

Witness signature:

/s/ C. Rauch

Name:

Carol Rauch

Address:

Aldwych House, 81 Aldwych

London, WC2B 4HN

Occupation:

Legal Assistant

 

Signed as a Deed by Wallace Macmillan in the presence of:

 

/s/ Wallace Macmillan

Witness signature:

/s/ Jessica Yu

Name:

Jessica Yu

Address:

Aldwych House, 81 Aldwych

London, WC2B 4HN

Occupation:

Legal Assistant