COMMITMENT LETTER (including the Schedules and Annexes hereto, this “Commitment Letter”), dated as of November 14, 2014, by and between Time Warner Inc., a Delaware corporation (“Time Warner”), and Central European Media Enterprises Ltd., a Bermuda...

FORM OF CREDIT AGREEMENT

Dated as of [ ], 2015

among

CENTRAL EUROPEAN MEDIA ENTERPRISES LTD. as Borrower,   and   TIME WARNER INC., as Guarantor,

The Lenders Party Hereto,

and

[  ] as Administrative Agent,

$261,034,000 SENIOR UNSECURED TERM CREDIT FACILITY

 

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TABLE OF CONTENTS

			Page
ARTICLE I	DEFINITIONS		1
SECTION 1.01.		Defined Terms	1
SECTION 1.02.		Classification of Loans and Borrowings	19
SECTION 1.03.		Terms Generally	19
SECTION 1.04.		Accounting Terms; GAAP	20
SECTION 1.05.		Borrower Representations and Covenants	20
ARTICLE II	THE CREDITS		21
SECTION 2.01.		Commitments	21
SECTION 2.02.		Loans and Borrowings	21
SECTION 2.03.		Request for Borrowing	21
SECTION 2.04.		Intentionally Omitted	22
SECTION 2.05.		Intentionally Omitted	22
SECTION 2.06.		Funding of Borrowing	22
SECTION 2.07.		Interest Periods	22
SECTION 2.08.		Termination of Commitments	22
SECTION 2.09.		Repayment of Loans; Evidence of Debt	22
SECTION 2.10.		Prepayment of Loans	23
SECTION 2.11.		Fees	23
SECTION 2.12.		Interest	24
SECTION 2.13.		Alternate Rate of Interest	24
SECTION 2.14.		Increased Costs	25
SECTION 2.15.		Break Funding Payments	26
SECTION 2.16.		Taxes	26
SECTION 2.17.		Payments Generally; Pro Rata Treatment; Sharing of Setoffs	29
SECTION 2.18.		Mitigation Obligations; Replacement of Lenders; Purchase Option	30
SECTION 2.19.		Defaulting Lenders	31
ARTICLE III	REPRESENTATIONS AND WARRANTIES		32
SECTION 3.01.		Organization; Powers	32
SECTION 3.02.		Authorization; Enforceability	32
SECTION 3.03.		Governmental Approvals; No Conflicts	33
SECTION 3.04.		Financial Condition; No Material Adverse Change	33
SECTION 3.05.		Properties	33
SECTION 3.06.		Litigation and Environmental Matters	34
SECTION 3.07.		Compliance with Laws and Agreements	34
SECTION 3.08.		Government Regulation	34
SECTION 3.09.		Taxes	34
SECTION 3.10.		ERISA	35
SECTION 3.11.		Disclosure	35

SECTION 3.12.		Anti-Corruption Laws and Sanctions Laws	35
ARTICLE IV	CONDITIONS PRECEDENT		36
SECTION 4.01.		Closing Date Conditions	36
ARTICLE V	AFFIRMATIVE COVENANTS		38
SECTION 5.01.		Financial Statements and Other Information	38
SECTION 5.02.		Notices of Material Events	41
SECTION 5.03.		Existence; Conduct of Business	41
SECTION 5.04.		Payment of Obligations	41
SECTION 5.05.		Maintenance of Properties; Insurance	42
SECTION 5.06.		Books and Records; Inspection Rights	42
SECTION 5.07.		Compliance with Laws	42
SECTION 5.08.		Use of Proceeds	42
SECTION 5.09.		Fiscal Periods; Accounting	42
ARTICLE VI	NEGATIVE COVENANTS		43
SECTION 6.01.		Consolidated Leverage Ratio	43
SECTION 6.02.		Indebtedness	43
SECTION 6.03.		Liens	43
SECTION 6.04.		Mergers, Etc	45
SECTION 6.05.		Investments	45
SECTION 6.06.		Restricted Payments	45
SECTION 6.07.		Transactions with Affiliates	45
SECTION 6.08.		Unrestricted Subsidiaries	46
ARTICLE VII	EVENTS OF DEFAULT		47
ARTICLE VIII	THE ADMINISTRATIVE AGENT		49
ARTICLE IX	MISCELLANEOUS		52
SECTION 9.01.		Notices	52
SECTION 9.02.		Waivers; Amendments; Release of Subsidiary Guarantors	53
SECTION 9.03.		Expenses; Indemnity; Damage Waiver	54
SECTION 9.04.		Successors and Assigns	55
SECTION 9.05.		Survival	58
SECTION 9.06.		Counterparts; Integration; Effectiveness	58
SECTION 9.07.		Severability	59
SECTION 9.08.		Right of Setoff	59
SECTION 9.09.		Governing Law; Jurisdiction; Consent to Service of Process	59
SECTION 9.10.		WAIVER OF JURY TRIAL	60
SECTION 9.11.		Headings	60
SECTION 9.12.		Confidentiality	60
SECTION 9.13.		Acknowledgments	61
SECTION 9.14.		Judgment Currency	62

SECTION 9.15.		USA Patriot Act	62
SECTION 9.16.		Guarantor Payment	62
SCHEDULES:
SCHEDULE 2.01		Commitments
SCHEDULE 2.03(A)		Borrowing Notice/Prepayment Notice
SCHEDULE 6.08		Unrestricted Subsidiaries
SCHEDULE 8		List of Proper Persons
EXHIBITS:
EXHIBIT A		Form of Assignment and Acceptance
EXHIBIT B		Form of Guarantee

 

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CREDIT AGREEMENT, dated as of [  ], 2015, (as amended, supplemented or otherwise modified from time to time, this “Agreement”), among CENTRAL EUROPEAN MEDIA ENTERPRISES LTD., an exempted limited company incorporated under the laws of Bermuda (“CME” or “Borrower”), as borrower, TIME WARNER INC., a Delaware corporation (“Time Warner” or “Guarantor”), as guarantor, the several banks and other financial institutions from time to time parties to this Agreement (the “Lenders”), and [  ], as administrative agent.

 

W I T N E S S E T H:

 

WHEREAS, Borrower has requested the Lenders to make loans to it on the Closing Date in an aggregate principal amount of $261,034,000 under a term credit facility as more particularly described herein; and

 

WHEREAS, the Lenders are willing to make such loans on the terms and conditions contained herein;

NOW THEREFORE, in consideration of the premises and mutual covenants contained herein, the parties hereto agree as follows:

ARTICLE I

 

“2015 Notes” means those certain Senior Notes due 2015 issued by CME under the Indenture dated as of February 18, 2011, among CME, as issuer, the guarantors party thereto and Deutsche Bank Trust Company Americas, as trustee, paying agent, conversion agent, transfer agent and registrar.

 

“2017 PIK Notes” means those certain Senior Secured Notes due 2017 issued by CME under the Indenture dated as of May 2, 2014, among CME, as issuer, the guarantors party thereto and Deutsche Bank Trust Company Americas, as trustee, paying agent, transfer agent and registrar.

 

“Adjusted Financial Statements” means, for any period, (a) the balance sheet of Time Warner and the Restricted Subsidiaries (treating Unrestricted Subsidiaries as equity investments of Time Warner to the extent that such Unrestricted Subsidiaries would not otherwise be treated as equity investments of Time Warner in accordance with GAAP) as of the end of such period and (b) the related statements of operations and stockholders equity for such period and, if such period is not a fiscal year, for the then elapsed portion of the fiscal year (treating Unrestricted Subsidiaries as equity investments of Time Warner to the extent that such Unrestricted Subsidiaries would not otherwise be treated as equity investments of Time Warner in accordance with GAAP).

“Adjusted LIBO Rate” means, with respect to any Eurodollar Borrowing for any Interest Period, an interest rate per annum (rounded upwards, if necessary, to the next Basis Point) equal to (a) the LIBO Rate for such Interest Period multiplied by (b) the Statutory Reserve Rate.

 

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“Administrative Agent” means [  ], together with its affiliates, as administrative agent for the Lenders hereunder, together with any of its successors pursuant to Article VIII.

“Administrative Questionnaire” means, with respect to each Lender, an Administrative Questionnaire in a form supplied by the Administrative Agent.

“Affiliate” means, with respect to a specified Person, another Person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the Person specified; provided that two or more Persons shall not be deemed Affiliates because an individual is a director and/or officer of each such Person.

“Anti-Corruption Laws” means the United States Foreign Corrupt Practices Act of 1977, the U.K. ▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇ and all other laws, rules, and regulations of any jurisdiction applicable to Time Warner and its Subsidiaries or CME and its Subsidiaries, as applicable, concerning or relating to bribery, money laundering or corruption.

“Applicable Rate” means, for any day with respect to the interest spread on any Loan, the applicable rate per annum set forth below expressed in Basis Points under the caption “Applicable Rate for the Facility”, in each case based upon the senior unsecured long-term debt credit rating (or an equivalent thereof) (in each case, a “Rating”) assigned by Moody’s and S&P, respectively, applicable on such date to Time Warner:

Ratings S&P / Moody’s	Applicable Rate for the Facility (Bps)
Category A A / A2 or Higher	[  ]
Category B A- / A3	[  ]
Category C BBB+ / Baa1	[  ]
Category D BBB / Baa2	[  ]
Category E BBB- / Baa3	[  ]
Category F Lower than BBB- / Baa3	[  ]

 

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For purposes of determining the Applicable Rate (A) if either Moody’s or S&P shall not have in effect a relevant Rating (other than by reason of the circumstances referred to in clause (C) of this definition), then the Rating assigned by the other rating agency shall be used; (B) if the relevant Ratings assigned by Moody’s and S&P shall fall within different Categories, the Applicable Rate shall be based on the higher of the two Ratings unless one of the two Ratings is two or more Categories lower than the other, in which case the Applicable Rate shall be determined by reference to the Category next below that of the higher of the two Ratings; (C) if either rating agency shall cease to assign a relevant Rating solely because Time Warner elects not to participate or otherwise cooperate in the ratings process of such rating agency, the Applicable Rate shall not be less than that in effect immediately before such rating agency’s Rating for Time Warner became unavailable; and (D) if the relevant Ratings assigned by Moody’s or S&P shall be changed (other than as a result of a change in the rating system of Moody’s or S&P), such change shall be effective as of the date on which it is first announced by the applicable rating agency. Each change in the Applicable Rate shall apply during the period commencing on the effective date of such change and ending on the date immediately preceding the effective date of the next such change. If the rating system of Moody’s or S&P shall change, or if either such rating agency shall cease to be in the business of rating corporate debt obligations, Time Warner and the Lenders shall negotiate in good faith to amend this definition to reflect such changed rating system or the unavailability of ratings from such rating agency, and, pending the effectiveness of any such amendment, the Applicable Rate shall be determined by reference to the rating most recently in effect prior to such change or cessation.

 

“Assignment and Acceptance” means an assignment and acceptance entered into by a Lender and an assignee (with the consent of any party whose consent is required by Section 9.04), and accepted by the Administrative Agent, substantially in the form of Exhibit A.

 

“Base Rate” means, for any day, a rate per annum equal to the greater of (a) the Prime Rate in effect on such day and (b) the Federal Funds Effective Rate in effect on such day plus 1/2 of 1%.  Any change in the Base Rate due to a change in the Prime Rate or the Federal Funds Effective Rate shall be effective from and including the effective date of such change in the Prime Rate or the Federal Funds Effective Rate, respectively.

 

“Basis Point” or “Bps” means 1/100^th of 1%.

 

“Board” means the Board of Governors of the Federal Reserve System of the United States.

 

“Borrower” means CME (or a successor or assign permitted pursuant to Section SECTION 9.04).

 

“Borrower Material Adverse Effect” means a material adverse effect on (a) the ability of Borrower to perform any of its material obligations to the Lenders under any Credit Document to which it is or will be a party or (b) the rights of or benefits available to the Lenders under any Credit Document.

 

“Borrowing” means Loans of the same Type, made, converted or continued on the same date and, in the case of Eurodollar Loans, as to which a single Interest Period is in effect.

 

“Borrowing Request” means a request by Borrower for a Borrowing in accordance with Section 2.03.

 

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“Business Day” means any day that is not a Saturday, Sunday or other day on which commercial banks in New York City, London, Prague, Frankfurt or Amsterdam are authorized or required by law to remain closed.

 

“Capital Lease Obligations” of any Person means the obligations of such Person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital leases on a balance sheet of such Person under GAAP, and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP.

 

“Capital Stock” means, with respect to any Person, any and all shares, partnership interests or other equivalents (however designated and whether voting or non-voting) of such Person’s equity, whether outstanding on the date hereof or hereafter issued, and any and all equivalent ownership interests in a Person (other than a corporation) and any and all rights, warrants or options to purchase or acquire or exchangeable for or convertible into such shares, partnership interests or other equivalents.

 

“Cash Equivalents” means (a) securities issued or directly and fully guaranteed or insured by the United States or any agency or instrumentality thereof (provided that the full faith and credit of the United States is pledged in support thereof) that (i) have maturities of not more than six months from the date of acquisition thereof or (ii) are subject to a repurchase agreement with an institution described in clause (b)(i) or (ii) below exercisable within six months from the date of acquisition thereof, (b) U.S. Dollar-denominated and Eurodollar time deposits, certificates of deposit and bankers’ acceptances of (i) any domestic commercial bank of recognized standing having capital and surplus in excess of $500,000,000 or (ii) any bank whose short-term commercial paper rating from S&P is at least A-2 or the equivalent thereof, from ▇▇▇▇▇’▇ is at least P-2 or the equivalent thereof or from Fitch is at least F-2 or the equivalent thereof (any such bank, an “Approved Lender”), in each case with maturities of not more than six months from the date of acquisition thereof, (c) commercial paper and variable and fixed rate notes issued by any Lender or Approved Lender or by the parent company of any Lender or Approved Lender and commercial paper, auction rate notes and variable rate notes issued by, or guaranteed by, any industrial or financial company with a short-term commercial paper rating of at least A-2 or the equivalent thereof by S&P or at least P-2 or the equivalent thereof by Moody’s or at least F-2 or the equivalent thereof by Fitch, and in each case maturing within six months after the date of acquisition thereof, (d) securities with maturities of one year or less from the date of acquisition issued or fully guaranteed by any state, commonwealth or territory of the United States, by any political subdivision or taxing authority of any such state, commonwealth or territory or by any foreign government, the securities of which state, commonwealth, territory, political subdivision, taxing authority or foreign government (as the case may be) are rated at least A by S&P or A by Moody’s, (e) securities with maturities of six months or less from the date of acquisition backed by standby letters of credit issued by any Lender or any commercial bank satisfying the requirements of clause (b) of this definition, (f) tax-exempt commercial paper of U.S. municipal, state or local governments rated at least A-2 or the equivalent thereof by S&P or at least P-2 or the equivalent thereof by Moody’s or at least F-2 or the equivalent thereof by Fitch and maturing within six months after the date of acquisition thereof, (g) shares of money market mutual or similar funds sponsored by any registered broker dealer or mutual fund distributor, (h) repurchase obligations entered into with any bank meeting the qualifications of clause (b) above or any registered broker dealer whose short-term commercial paper rating from S&P is at least A-2 or the equivalent thereof or from ▇▇▇▇▇’▇ is at least P-2 or the equivalent thereof or from Fitch is at least F-2 or the equivalent thereof, having a term of not more than 30 days, with respect to securities issued or fully guaranteed or insured by the United States government or residential whole loan mortgages, and (i) demand deposit accounts maintained in the ordinary course of business.

 

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“Change in Control” means either (a) a Person or “group” (within the meaning of Sections 13(d) and 14(d) of the Exchange Act) acquiring or having beneficial ownership (it being understood that a tender of shares or other equity interests shall not be deemed acquired or giving beneficial ownership until such shares or other equity interests shall have been accepted for payment) of securities (or options to purchase securities) having a majority or more of the ordinary voting power of Time Warner (including options to acquire such voting power) or (b) persons who are directors of Time Warner as of the date hereof or persons designated or approved by such directors ceasing to constitute a majority of the board of directors of Time Warner.

 

“Change in Law” means (a) the adoption of any law, rule or regulation after the date of this Agreement, (b) any change in any law, rule or regulation or in the interpretation or application thereof by any Governmental Authority after the date of this Agreement or (c) compliance by any Lender (or, for purposes of Section 2.14(b), by any lending office of such Lender or by such Lender’s holding company, if any) with any request, guideline or directive of any Governmental Authority made or issued after the date of this Agreement; provided that notwithstanding anything herein to the contrary, (x) the ▇▇▇▇-▇▇▇▇▇ ▇▇▇▇ Street Reform and Consumer Protection Act and all requests, rules, guidelines or directives thereunder or issued in connection therewith and (y) all requests, rules, guidelines or directives promulgated by the Bank for International Settlements, the Basel Committee on Banking Supervision (or any successor or similar authority) or the United States or foreign regulatory authorities, in each case pursuant to Basel III, shall in each case be deemed to be a “Change in Law”, regardless of the date enacted, adopted or issued.

 

“Closing Date” means the date on which the conditions set out in Section 4.02 are satisfied or waived.

 

“CME” has the meaning assigned to such term in the preamble to this Agreement.

 

“Code” means the Internal Revenue Code of 1986, as amended from time to time.

 

“Commitment” means, with respect to each Lender, the commitment, if any, of such Lender to make Loans, expressed as an amount representing the maximum aggregate permitted amount of such Lender’s Credit Exposure hereunder.  The amount of each Lender’s Commitment as of the Closing Date is set forth on Schedule 2.01.

 

“Companies” means each of the Credit Parties and the Restricted Subsidiaries, collectively, and “Company” means any of them.

 

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“Conduit Lender” means any special purpose corporation organized and administered by any Lender for the purpose of making Loans otherwise required to be made by such Lender and designated by such Lender in a written instrument, subject to the consent of Borrower and Time Warner (which consent shall not be unreasonably withheld); provided that the designation by any Lender of a Conduit Lender shall not relieve the designating Lender of any of its obligations to fund a Loan under this Agreement if, for any reason, its Conduit Lender fails to fund any such Loan, and the designating Lender (and not the Conduit Lender) shall have the sole right and responsibility to deliver all consents and waivers required or requested under this Agreement with respect to its Conduit Lender, and provided further that no Conduit Lender shall (a) be entitled to receive any greater amount pursuant to Section 2.14, 2.15, 2.16 or 9.03 than the designating Lender would have been entitled to receive in respect of the Loans made by such Conduit Lender or (b) be deemed to have any Commitment.  The making of a Loan by a Conduit Lender hereunder shall utilize the applicable Commitment of a designating Lender to the same extent, and as if, such Loan were made by such designating Lender.

 

“Consolidated EBITDA” means, for any period, Consolidated Net Income of Time Warner and the Restricted Subsidiaries for such period plus, without duplication and to the extent reflected as a charge in the statement of such Consolidated Net Income of Time Warner and the Restricted Subsidiaries for such period, the sum of (a) income tax expense, (b) interest expense, amortization or writeoff of debt discount and debt issuance costs and commissions, discounts and other fees and charges associated with Indebtedness (including the Loans), (c) depreciation and amortization expense (excluding amortization of film inventory that does not constitute amortization of purchase price amortization), (d) amortization of intangibles (including, but not limited to, goodwill) and organization costs (excluding amortization of film inventory that does not constitute amortization of purchase price amortization), (e) any extraordinary, unusual or non-recurring non-cash expenses or losses (including, whether or not otherwise includable as a separate item in the statement of such Consolidated Net Income for such period, non-cash losses on sales of assets outside of the ordinary course of business), (f) minority interest expense in respect of preferred stock of Subsidiaries of Time Warner, and (g) non-cash expenses in respect of equity compensation and minus, to the extent included in the statement of such Consolidated Net Income for such period, the sum of (a) interest income and (b) any extraordinary, unusual or non-recurring income or gains (including, whether or not otherwise includable as a separate item in the statement of such Consolidated Net Income for such period, gains on the sales of assets outside of the ordinary course of business), all as determined on a consolidated basis.

 

“Consolidated Leverage Ratio” means, as at the last day of any period, the ratio of (a) Consolidated Total Debt on such day to (b) Consolidated EBITDA for such period.

 

“Consolidated Net Income” means, for any period, the consolidated net income (or loss) of Time Warner and its consolidated Subsidiaries, determined on a consolidated basis in accordance with GAAP; provided that there shall be excluded, without duplication, (a) the income (or deficit) of any Person accrued prior to the date it becomes a Subsidiary of Time Warner or is merged into or consolidated with Time Warner or any of its Subsidiaries or that such other Person’s assets are acquired by Time Warner or any of its Subsidiaries, (b) the income (or deficit) of any Person (other than a Restricted Subsidiary) in which Time Warner or any of its Subsidiaries has an ownership interest, except to the extent that any such income is actually received by Time Warner or its Restricted Subsidiaries in the form of dividends or similar distributions and (c) the undistributed earnings of any Subsidiary of Time Warner to the extent that the declaration or payment of dividends or similar distributions by such Subsidiary is not at the time permitted by the terms of its charter or any agreement or instrument (other than any Credit Document), judgment, decree, order, statute, rule, governmental regulation or other requirement of law applicable to such Subsidiary; provided that the income of any Subsidiary of Time Warner shall not be excluded by reason of this clause (c) so long as such Subsidiary guarantees the Obligations.

 

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“Consolidated Total Assets” means, at any date, all amounts that would, in conformity with GAAP, be included on a consolidated balance sheet of Time Warner and its Subsidiaries under total assets at such date; provided that such amounts shall be calculated in accordance with Section 1.04.

 

“Consolidated Total Debt” means, at any date, the aggregate principal amount of Indebtedness of Time Warner and the Restricted Subsidiaries minus (a) the aggregate principal amount of any such Indebtedness that is payable either by its terms or at the election of the obligor in equity securities of Time Warner or the proceeds of options in respect of such equity securities, (b) the aggregate principal amount of Film Financings and (c) the aggregate amount of cash and Cash Equivalents held by Time Warner or any of the Restricted Subsidiaries in excess of $200,000,000, all determined on a consolidated basis in accordance with GAAP.

 

“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a Person, whether through the ability to exercise voting power, by contract or otherwise. “Controlling” and “Controlled” have meanings correlative thereto.

 

“Copyright Liens” means any Liens granted by Time Warner or any of its Subsidiaries on copyrights relating to movies or other programming, which movies or other programming are subject to one or more contracts entitling Time Warner or such Subsidiary to future payments in respect of such movies or other programming and which contractual rights to future payments are to be transferred by Time Warner or such Subsidiary to a special purpose Subsidiary of Time Warner or such Subsidiary organized for the purpose of monetizing such rights to future payments; provided that such Liens (a) are granted directly or indirectly for the benefit of the special purpose Subsidiary and/or the Persons who purchase such contractual rights to future payments from such special purpose Subsidiary and (b) extend only to the copyrights for the movies or other programming subject to such contracts for the purpose of permitting the completion, distribution and exhibition of such movies or other programming.

 

“Credit Documents” means this Agreement, the Guarantee, each Note and, from and after the Purchase Date, the Reimbursement Agreement.

 

“Credit Exposure” means, with respect to any Lender at any time, the sum of the outstanding principal amount of such Lender’s Loans at such time.

 

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“Credit Parties” means Borrower, Guarantor and the Subsidiary Guarantors; and “Credit Party” means any of them.

 

“Default” means any event or condition which constitutes an Event of Default or which upon notice, lapse of time or both would, unless cured or waived, become an Event of Default.

 

“Defaulting Lender” means any Lender that (a) shall have become the subject of a bankruptcy or insolvency proceeding, or shall have taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in any such proceeding or (b) shall have had a receiver, conservator, trustee or custodian appointed for it, or shall have taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in any such appointment, or shall have a parent company that has become the subject of a bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee or custodian appointed for it, or has taken any action in furtherance of, or indicating its consent to, approval of or acquiescence in, any such proceeding or appointment; provided that a Lender shall not be a Defaulting Lender solely by virtue of the ownership or acquisition by a Governmental Authority or an instrumentality thereof of any equity interest in such Lender or a parent company thereof.

 

“Dollars” or “$” refers to lawful money of the United States.

 

“Eligible Assignee” means any financial institution whose home office is domiciled in a country that is a member of the Organization for Economic Cooperation and Development and having capital and surplus in excess of $500,000,000; provided, however, that no Lender that is or at any time was a Defaulting Lender, nor any Lender Affiliate of such Defaulting Lender, shall be an Eligible Assignee, unless consented to in writing by Borrower, Time Warner and the Administrative Agent.

 

“Environmental Law” means all applicable and binding laws, rules, regulations, codes, ordinances, orders, decrees, judgments, injunctions, or agreements issued, promulgated or entered into by any Governmental Authority, relating in any way to the environment, preservation or reclamation of natural resources, the management, release or threatened release of any Hazardous Material or to health and safety matters.

 

“Environmental Liability” means any liability, contingent or otherwise (including any liability for damages, costs of environmental remediation, fines, penalties or indemnities), of any Credit Party or any of its Subsidiaries directly or indirectly resulting from or based upon (a) a violation of any Environmental Law, (b) the generation, use, handling, transportation, storage, treatment or disposal of any Hazardous Materials, (c) the exposure to any Hazardous Materials, (d) the release or threatened release of any Hazardous Materials into the environment or (e) any contract, agreement or other consensual arrangement pursuant to which liability is assumed or imposed with respect to any of the foregoing.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time.

 

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“ERISA Affiliate” means, with respect to Time Warner, any trade or business (whether or not incorporated) that, together with Time Warner, is treated as a single employer under Section 414(b) or (c) of the Code or, solely for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as a single employer under Section 414 of the Code.

 

“ERISA Event” means (a) any “reportable event”, as defined in Section 4043 of ERISA or the regulations issued thereunder with respect to a Plan (other than an event for which the 30‑day notice period is waived); (b) a failure by any Plan to meet the minimum funding standards within the meaning of Section 412 of the Code or Section 302 of ERISA applicable to such Plan, in each case whether or not waived; (c) the filing pursuant to Section 412(c) of the Code or in Section 302(c) of ERISA of an application for a waiver of the minimum funding standard with respect to any Plan; (d) the incurrence by Time Warner or any of its ERISA Affiliates of any unfunded liability under Title IV of ERISA with respect to the termination of any Plan; (e) the receipt by Time Warner or any ERISA Affiliate from the PBGC or a Plan administrator of any notice relating to an intention to terminate any Plan or Plans or to appoint a trustee to administer any Plan; (f) the incurrence by Time Warner or any of its ERISA Affiliates of any liability with respect to the withdrawal or partial withdrawal from any Plan or Multiemployer Plan; (g) the receipt by Time Warner or any ERISA Affiliate of any notice concerning the imposition on such entity of Withdrawal Liability or a determination that a Multiemployer Plan with respect to which such entity is obligated to contribute or is otherwise liable is, or is expected to be, insolvent or in reorganization, within the meaning of Title IV of ERISA; or (h) the occurrence, with respect to a Plan or a Multiemployer Plan, of a nonexempt “prohibited transaction” (within the meaning of Section 4975 of the Code or Section 406 of ERISA) which could reasonably be expected to result in liability to Time Warner.

 

“Eurodollar” when used in reference to any Loan or Borrowing, refers to a Loan, or the Loans comprising such Borrowing, bearing interest at a rate determined by reference to the Adjusted LIBO Rate.

 

“Event of Default” has the meaning assigned to such term in Article VII.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

 

“Excluded Taxes” means, with respect to any payment made by any Credit Party under this Agreement, any of the following Taxes imposed on or with respect to the Administrative Agent, any Lender or any other recipient of any such payment, (a) income or franchise Taxes imposed on (or measured by) its net income by the jurisdiction (including any political subdivision, state or locality thereof) under the laws of which such recipient is organized or in which its principal office is located or, in the case of any Lender, in which its applicable lending office is located, (b) any branch profits Taxes imposed by the United States or any similar Tax imposed by any jurisdiction described in clause (a) above, (c) in the case of a Lender (other than an assignee pursuant to a request by Time Warner under Section 2.18(b)), any U.S. Federal withholding Taxes resulting from any law in effect on the date such Lender becomes a party to this Agreement or designates a new lending office or is attributable to such Lender’s failure or inability to comply with Section 2.16(g), except to the extent that such Lender (or its assignor, if any) was entitled, at the time of such designation of a new lending office or assignment, to receive additional amounts from such Credit Party with respect to such withholding Tax pursuant to Section 2.16(a), (d) in the case of a Lender that is a U.S. Person, any withholding Tax that is attributable to the Lender’s failure to comply with Section 2.16(h) and (e) any U.S. Federal withholding Taxes imposed under FATCA.

 

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“Existing Revolving Loan Credit Agreement” means that certain Amended and Restated Revolving Loan Facility Credit Agreement dated as of May 2, 2014, as amended and restated as of November 14, 2014, among CME, Time Warner and the other lenders party thereto from time to time and Time Warner, as administrative agent.

 

“Existing Term Loan Agreement” means that certain Amended and Restated Term Loan Facility Agreement dated as of February 28, 2014, as amended and restated as of November 14, 2014, among CME, the lenders party thereto from time to time and Time Warner, as administrative agent.

 

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version not materially more onerous to comply with), current and future regulations or official interpretations thereof, any agreements entered into pursuant to Section 1471(b) of the Code and any intergovernmental agreements in respect thereof.

 

“Federal Funds Effective Rate” means, for any day, the weighted average (rounded upwards, if necessary, to the next Basis Point) of the rates on overnight Federal funds transactions with members of the United States Federal Reserve System arranged by Federal funds brokers, as published on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if such rate is not so published for any day that is a Business Day, the average (rounded upwards, if necessary, to the next Basis Point) of the quotations for such day for such transactions received by the Administrative Agent from three Federal funds brokers of recognized standing selected by it.

 

“Film Financing” means, without duplication, monetary obligations arising out of transactions in which so-called tax-based financing groups or other third-party investors provide financing for the acquisition, production or distribution of motion pictures, television programs, sound recordings or books or rights with respect thereto in exchange, in part, for certain tax or other benefits which are derived from such motion pictures, television programs, sound recordings, books or rights; provided that no such monetary obligations shall have, directly or indirectly, recourse (including by way of setoff) to Guarantor or any Restricted Subsidiary or any of its assets other than to the profits or distribution rights related to such motion pictures, television programs, sound recordings, books or rights and other than to a Subsidiary of Warner Communications LLC or ▇▇▇▇▇▇ Broadcasting System, Inc. substantially all of the assets of which consist of the motion pictures, television programs, sound recordings, books or rights which are the subject of such transaction and related cash and Cash Equivalents.

 

“Financial Officer” means, with respect to any Person, the chief financial officer, the deputy chief financial officer, principal accounting officer, treasurer or controller of such Person.

 

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“Fitch” means Fitch, Inc.

 

“Foreign Lender” means any Lender that is organized under the laws of a jurisdiction other than that in which the applicable Credit Party is located.

 

“Franchise” means, with respect to any Person, a franchise, license, authorization or right to construct, own, operate, manage, promote, extend or otherwise utilize any cable television distribution system operated or to be operated by such Person or any of its Subsidiaries granted by any Governmental Authority, but shall not include any such franchise, license, authorization or right that is incidentally required for the purpose of installing, constructing or extending a cable television system.

 

“GAAP” means generally accepted accounting principles in the United States.

 

“Governmental Authority” means the government of the United States, any other nation or any political subdivision thereof, whether state or local, and any agency, authority, instrumentality, regulatory body, court, central bank, independent regulatory authority or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government.

 

“Guarantee” means a guarantee by Guarantor and the Subsidiary Guarantors, substantially in the form of Exhibit B.

 

“Guarantee Obligations” of or by any Person (the “guarantor”) means any obligation, contingent or otherwise, of the guarantor guaranteeing or having the economic effect of guaranteeing any Indebtedness of any other Person (the “primary obligor”) in any manner, whether directly or indirectly, and including any obligation of the guarantor, direct or indirect, (a) to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness or to purchase (or to advance or supply funds for the purchase of) any security for the payment thereof, (b) to purchase or lease property, securities or services for the purpose of assuring the owner of such Indebtedness of the payment thereof, (c) to maintain working capital, equity capital or any other financial statement condition or liquidity of the primary obligor so as to enable the primary obligor to pay such Indebtedness or (d) as an account party in respect of any letter of credit or letter of guaranty issued to support such Indebtedness; provided that the term Guarantee Obligations shall not include endorsements for collection or deposit in the ordinary course of business.

 

“Guarantor” means Time Warner.

 

“Guarantor Notice Period” has the meaning assigned to such term in the first paragraph of Article V.

 

“Hazardous Materials” means all explosive or radioactive substances or wastes and all hazardous or toxic substances, wastes or other pollutants, including petroleum or petroleum distillates, asbestos or asbestos containing materials, polychlorinated biphenyls, radon gas, infectious or medical wastes and all other substances or wastes of any nature regulated pursuant to any Environmental Law.

 

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“Indebtedness” of any Person means, without duplication, (a) all obligations of such Person for borrowed money, (b) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments, (c) all obligations of such Person upon which interest charges are customarily paid, (d) all obligations of such Person under conditional sale or other title retention agreements relating to property acquired by such Person (but not including operating leases), (e) all obligations of such Person in respect of the deferred purchase price of property or services (excluding current accounts payable incurred in the ordinary course of business and payment obligations of such Person pursuant to agreements entered into in the ordinary course of business, which payment obligations are contingent on another Person’s satisfactory provision of services or products), (f) all Indebtedness of others secured by (or for which the holder of such Indebtedness has an existing right, contingent or otherwise, to be secured by) any Lien (other than Copyright Liens or Liens on interests or Investments in Unrestricted Subsidiaries) on property owned or acquired by such Person, whether or not the Indebtedness secured thereby has been assumed (but only to the extent of the lesser of the fair market value of the property subject to such Lien and the amount of such Indebtedness), (g) all Guarantee Obligations of such Person with respect to Indebtedness of others (except to the extent that such Guarantee Obligation guarantees Indebtedness of a Restricted Subsidiary), (h) all Capital Lease Obligations of such Person, (i) all obligations, contingent or otherwise, of such Person as an account party in respect of letters of credit (but only to the extent of all drafts drawn and outstanding thereunder) and (j) all obligations, contingent or otherwise, of such Person in respect of bankers’ acceptances.  Notwithstanding the foregoing, Indebtedness shall not include (i) any obligation of such Person to guarantee performance of, or enter into indemnification agreements with respect to, obligations, entered into in the ordinary course of business, under any and all Franchises, leases, performance bonds, franchise bonds and obligations to reimburse drawings under letters of credit issued in lieu of performance or franchise bonds, (ii) completion bonds or guarantees or indemnities of a similar nature issued in the ordinary course of business in connection with the production of motion pictures and video and television programming or (iii) obligations to make Tax Distributions.  The Indebtedness of any Person shall include the Indebtedness of any other entity (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other contractual relationship with such entity, except to the extent the terms of such Indebtedness provide that such Person is not liable therefor.

 

“Indebtedness For Borrowed Money” means, for the purpose of Section 9.02(c), without duplication, with respect to any Person (a) all obligations of such Person for borrowed money, (b) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments and (c) all guarantee obligations of such Person with respect to Indebtedness For Borrowed Money of others.  The Indebtedness For Borrowed Money of any Person shall include the Indebtedness For Borrowed Money of any other entity (including any partnership in which such Person is a general partner) to the extent such Person is liable therefor as a result of such Person’s ownership interest in or other contractual relationship with such entity, except to the extent the terms of such Indebtedness For Borrowed Money provide that such Person is not liable therefor.

 

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“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by a Credit Party under this Agreement and (b) Other Taxes.

 

“Interest Payment Date” means (a) with respect to any Base Rate Loan, the last day of each March, June, September and December and (b) with respect to any Eurodollar Loan, the last day of the Interest Period applicable to the Borrowing of which such Loan is a part.

 

“Interest Period” means with respect to any Eurodollar Borrowing, the period commencing on the date of such Borrowing and ending on the numerically corresponding day in the calendar month that is three months thereafter; provided that (i) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day, and (ii) any Interest Period pertaining to such a Borrowing that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of such Interest Period.  For purposes hereof, the date of a Borrowing initially shall be the date on which such Borrowing is made and thereafter shall be the effective date of the most recent conversion or continuation of such Borrowing.

 

“Investment” by any Person means any direct or indirect (a) loan, advance or other extension of credit or contribution to any other Person (by means of transfer of cash or other property to others, payments for property or services for the account or use of others, mergers or otherwise), (b) purchase or acquisition of Capital Stock, bonds, notes, debentures or other securities (including any option, warrant or other right to acquire any of the foregoing) or evidences of Indebtedness issued by any other Person (whether by merger, consolidation, amalgamation or otherwise and whether or not purchased directly from the issuer of such securities or evidences of Indebtedness), (c) purchase or acquisition (in one transaction or a series of transactions) of any assets of any other Person constituting a business unit and (d) all other items that would be classified as investments on a balance sheet of such Person prepared in accordance with GAAP.  Investments shall exclude extension of trade credit and advances to customers and suppliers to the extent made in the ordinary course of business and in accordance with customary industry practice.

 

“Lender Affiliate” means, (a) with respect to any Lender, (i) an Affiliate of such Lender or (ii) any entity (whether a corporation, partnership, trust or otherwise) that is engaged in making, purchasing, holding or otherwise investing in bank loans and similar extensions of credit in the ordinary course of its business and is administered or managed by such Lender or an Affiliate of such Lender and (b) with respect to any Lender that is a fund which invests in bank loans and similar extensions of credit, any other fund that invests in bank loans and similar extensions of credit and is managed by the same investment advisor as such Lender or by an Affiliate of such investment advisor.

 

“Lenders” means the Persons listed on Schedule 2.01 and any other Person that shall have become a party hereto pursuant to an Assignment and Acceptance or pursuant to Section 2.19, other than any such Person that ceases to be a party hereto pursuant to an Assignment and Acceptance.

 

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“LIBO Rate” means, with respect to any Eurodollar Borrowing for any Interest Period, the rate per annum equal to the ICE Benchmark Administration (or any other Person that takes over the administration of such rate) LIBOR Rate (the “ICE LIBOR”), as published by Reuters (or any other commercially available source providing quotations of ICE LIBOR as designated by the Administrative Agent from time to time for purposes of providing quotations of interest rates applicable to Dollar deposits (as applicable) in the London interbank market) at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period, as the rate for Dollar deposits with a maturity comparable to such Interest Period.  In the event that such rate is not available at such time for any reason, then the “LIBO Rate” with respect to such Eurodollar Borrowing for such Interest Period shall be the rate per annum (rounded upwards, if necessary, to the next Basis Point) equal to the arithmetic average of the rates at which deposits in Dollars approximately equal in principal amount to of $5,000,000 and for a maturity comparable to such Interest Period are offered with respect to any Eurodollar Borrowing to the principal London offices of the Reference Banks (or, if any Reference Bank does not at the time maintain a London office, the principal London office of any Affiliate of such Reference Bank) in immediately available funds in the London interbank market at approximately 11:00 a.m., London time, two Business Days prior to the commencement of such Interest Period and; provided, however, that, if only two Reference Banks notify the Administrative Agent of the rates offered to such Reference Banks (or any Affiliates of such Reference Banks) as aforesaid, the LIBO Rate with respect to such Eurodollar Borrowing shall be equal to the arithmetic average of the rates so offered to such Reference Banks (or any such Affiliates).

 

“Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien, pledge, hypothecation, encumbrance, charge or security interest in (including sales of accounts), on or of such asset, (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing, but excluding any operating leases) relating to such asset and (c) in the case of securities, any purchase option, call or similar right of a third party with respect to such securities.

 

“Loan” means a loan made by a Lender to Borrower pursuant to this Agreement.

 

“Local Time” means, for payments and disbursements in respect of Dollars, New York City time.

 

“Material Adverse Effect” means a material adverse effect on (a) the financial condition, business, results of operations, properties or liabilities of Time Warner and the Restricted Subsidiaries taken as a whole, (b) the ability of any Credit Party to perform any of its material obligations to the Lenders under any Credit Document to which it is or will be a party or (c) the rights of or benefits available to the Lenders under any Credit Document.

 

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“Material Indebtedness” means Indebtedness (other than the Loans) of any one or more of Time Warner and the Restricted Subsidiaries in an aggregate principal amount exceeding $200,000,000.

 

“Material Subsidiary” means, at any date, each Subsidiary of Time Warner which, either alone or together with the Subsidiaries of such Subsidiary, meets any of the following conditions:

 

 

 

 

“Maturity Date” means November 1, 2019.

 

“Moody’s” means ▇▇▇▇▇’▇ Investors Service, Inc.

 

“Multiemployer Plan” means a multiemployer plan as defined in Section 4001(a)(3) of ERISA.

 

“Note” means any promissory note evidencing Loans issued pursuant to Section 2.09(e).

 

“Obligations” has the meaning assigned to such term in the Guarantee.

 

“Officer’s Certificate” means a certificate executed by the Chief Financial Officer, the Treasurer or the Controller of Time Warner or such other officer of Time Warner reasonably acceptable to the Administrative Agent and designated as such in writing to the Administrative Agent by Time Warner.

 

“Other Taxes” means any and all present or future stamp or documentary Taxes or any other excise or property Taxes, charges or similar levies arising from any payment made hereunder or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement.

 

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“Participant” has the meaning assigned to such term in Section 9.04(e).

 

“Participant Register” has the meaning set forth in Section 9.04(e).

 

“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA and any successor entity thereto.

 

“Person” means any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.

 

“Plan” means any employee pension benefit plan (other than a Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA sponsored or maintained by Time Warner or any ERISA Affiliate.

 

“Platform” has the meaning set forth in Section 5.01.

 

“Prime Rate” means the rate of interest per annum publicly announced from time to time by the Administrative Agent as its prime rate in effect at its principal office in New York City; each change in the Prime Rate shall be effective from and including the date such change is publicly announced as being effective.

 

“Purchase Date” has the meaning assigned to such term in Section 2.18(c).

 

“Rating” has the meaning assigned to such term in the definition of “Applicable Rate”.

 

“Reference Banks” means BNP Paribas, Citibank, N.A. and Deutsche Bank AG New York Branch.

 

“Register” has the meaning set forth in Section 9.04(c).

 

“Reimbursement Agreement” means that certain Guarantee Reimbursement Agreement dated as of the date hereof, by and between CME and Time Warner.

 

“Related Parties” means, with respect to any specified Person, such Person’s Affiliates and the respective directors, officers, employees, agents and advisors of such Person and such Person’s Affiliates.

 

“Required Lenders” means, at any time and subject to Section 2.19(b), Lenders having Credit Exposures representing more than 50% of the sum total of the Credit Exposures at such time.

 

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“Responsible Officer” means any of the Chief Executive Officer, Chief Legal Officer, Chief Financial Officer, Treasurer or Controller (or any equivalent of the foregoing officers) of the applicable Credit Party.

 

“Restricted Payment” means, as to any Person, any dividend or other distribution (whether in cash, securities or other property) with respect to any shares of any class of capital stock or other equity interests of such Person, or any payment (whether in cash, securities or other property), including any sinking fund or similar deposit, on account of the purchase, redemption, retirement, acquisition, cancellation or termination of any such shares of capital stock or other equity interests of such Person or any option, warrant or other right to acquire any such shares of capital stock or other equity interests of such Person.

 

“Restricted Subsidiaries” means, as of any date, all Subsidiaries of Time Warner that have not been designated as Unrestricted Subsidiaries by Time Warner pursuant to Section 6.08 or have been so designated as Unrestricted Subsidiaries by Time Warner but prior to such date have been (or have been deemed to be) redesignated by Time Warner as Restricted Subsidiaries pursuant to Section 6.08.  On the date hereof, none of CME or its Subsidiaries is a Restricted Subsidiary of Time Warner.

 

“S&P” means Standard & Poor’s Rating Services.

 

“Sanctions Laws” means any applicable laws and regulations concerning economic sanctions imposed, administered or enforced by (a) the Office of Foreign Assets Control (“OFAC”) of the U.S. Department of the Treasury or by the U.S. Department of State, including but not limited to those pursuant to the International Emergency Economic Powers Act, Trading with the Enemy Act, United Nations Participation Act, Foreign Narcotics Kingpin Designation Act, Comprehensive Iran Sanctions, Accountability, and Divestment Act, Iran Threat Reduction and Syria Human Rights Act and related executive orders and regulations, (b) Her Majesty’s Treasury of the United Kingdom, (c) the European Union, (d) solely in the case of the Borrower, Bermuda and (e) the United Nations Security Council.

 

“Sanctioned Person” means any Person with whom dealings are restricted or prohibited under Sanctions Laws, including any Person (a) currently named on OFAC’s List of Specially Designated Nationals and Blocked Persons or any similar list issued by a relevant United Nations, United Kingdom, or European Union sanctions authority (“SDNs”), (b) any Person located, organized or resident in a country or territory that is, or whose government is, the subject of Sanctions Laws, (c) any entity that is 50 percent or more owned by such SDNs, and (d) any person currently named on the State Department’s Sanctioned Entities List.

 

“SEC” means the Securities and Exchange Commission, any successor thereto and any analogous Governmental Authority.

 

“Statutory Reserve Rate” means a fraction (expressed as a decimal), the numerator of which is the number one and the denominator of which is the number one minus the aggregate of the maximum reserve percentage (including any marginal, special, emergency or supplemental reserves) expressed as a decimal established by the Board to which the Administrative Agent is subject for eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in Regulation D of the Board).  Such reserve percentage shall include those imposed pursuant to such Regulation D.  Eurodollar Loans shall be deemed to constitute eurocurrency funding and to be subject to such reserve requirements without benefit of or credit for proration, exemptions or offsets that may be available from time to time to any Lender under such Regulation D or any comparable regulation.  The Statutory Reserve Rate shall be adjusted automatically on and as of the effective date of any change in any reserve percentage.

 

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“Subsidiary” means, with respect to any Person (the “parent”) at any date, any corporation, limited liability company, partnership, association or other entity the accounts of which would be consolidated with those of the parent in the parent’s consolidated financial statements if such financial statements were prepared in accordance with GAAP as of such date, as well as any other corporation, limited liability company, partnership, association or other entity of which more than 50% of the ordinary voting power or, in the case of a partnership, more than 50% of the general partnership interests are, as of such date, owned, controlled or held.  On the date hereof, none of CME or its Subsidiaries is a Subsidiary of Time Warner.

 

“Subsidiary Guarantors” means Historic TW Inc., ▇▇▇▇▇▇ Broadcasting System, Inc., Home Box Office, Inc. and any other Person that becomes and remains a party to the Guarantee after the Closing Date that is a Subsidiary of Time Warner, in each case until such entity is released from the Guarantee pursuant to Section 9.02(c), and “Subsidiary Guarantor” means any one of them.

 

“Tax Distribution” means, with respect to any period, distributions made to any Person by a Subsidiary of such Person on or with respect to income and other Taxes, which distributions are not in excess of the Tax liabilities that, (i) in the case of a Subsidiary that is a corporation, would have been payable by such Subsidiary on a standalone basis, and (ii) in the case of a Subsidiary that is a partnership, would have been distributed by such Subsidiary to its owners with respect to Taxes, and in each case which are calculated in accordance with, and made no earlier than 10 days prior to the date required by, the terms of the applicable organizational document which requires such distribution.

 

“Taxes” means any and all present or future taxes, levies, imposts, duties, deductions, charges or withholdings imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

 

 “Time Warner” has the meaning assigned to such term in the preamble to this Agreement.

 

“Time Warner Credit Agreement” means the Amended and Restated Credit Agreement, dated as of January 19, 2011 and amended and restated as of December 18, 2013, among Time Warner, Time Warner International Finance Limited, the lenders party thereto from time to time, and Citibank, N.A., as administrative agent, as it may be further amended, amended and restated, supplemented or otherwise modified from time to time.  For the avoidance of doubt, any such amendment, amendment and restatement, supplement or other modification shall only apply to the Time Warner Credit Agreement, and this Agreement may only be amended pursuant to Section 9.02(b).

 

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“Transactions” means (a) the execution and delivery of this Agreement and the Guarantee and the performance by (i) Borrower of this Agreement and (ii) Guarantor and the Subsidiary Guarantors of the Guarantee, and (b) the borrowing of Loans.

 

“Type” when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are ABR Loans or Eurodollar Loans.

 

“United States” means the United States of America.

 

“Unrestricted Subsidiaries” means, as of any time, all Subsidiaries of Time Warner that have been designated as Unrestricted Subsidiaries by Time Warner pursuant to Section 6.08, and “Unrestricted Subsidiary” means any one of them.

 

“U.S. Person” means a Person who is a citizen or resident of the United States and any corporation or other entity created or organized in or under the laws of the United States.

 

“Withdrawal Liability” means liability to a Multiemployer Plan as a result of a complete or partial withdrawal from such Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.

 

 

 

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Promptly following receipt of a Borrowing Request in accordance with this Section, the Administrative Agent shall advise each Lender of the details thereof and of the amount of such Lender’s Loan to be made as part of the requested Borrowing

 

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then the Administrative Agent shall give notice thereof to Borrower and Lenders by telephone or facsimile or email as promptly as practicable thereafter and, until the Administrative Agent notifies Borrower and Lenders that the circumstances giving rise to such notice no longer exist, any such Borrowing shall, unless otherwise repaid by Borrower, be converted to (as of the last day of the then current Interest Period) a Base Rate Borrowing (to the extent, in the Administrative Agent’s reasonable determination, it is practicable to do so).

 

(in each case other than Indemnified Taxes, Excluded Taxes and Taxes on gross or net income, profits or revenue (including value-added or similar Taxes)) and the result of any of the foregoing shall be to increase the cost to such Lender of making or maintaining any Eurodollar Loan (or of maintaining its obligation to make any such Loan), then Borrower will pay to such Lender such additional amount or amounts as will compensate such Lender for such additional costs actually incurred or reduction actually suffered.

 

 

 

 

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Notwithstanding any other provision of this Section 2.14, no Lender shall demand compensation for any increased costs or reduction referred to above if it shall not be the general policy or practice of such Lender to demand such compensation in similar circumstances under comparable provisions of other credit agreements, if any (it being understood that this sentence shall not in any way limit the discretion of any Lender to waive the right to demand such compensation in any given case).

 

 

 

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ARTICLE III

 

 

Each of Borrower and Guarantor, as applicable, represents and warrants (as to itself, and in the case of Guarantor, the Restricted Subsidiaries (including the Subsidiary Guarantors)) to the Lenders (except that only Guarantor shall make the representations and warranties with respect to Sections 3.04, 3.06. 3.07, 3.09, 3.10, and 3.12(a)) that:

 

 

 

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ARTICLE IV

 

 

 

 

 

 

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Without limiting the generality of the provisions of Article VIII, for purposes of determining compliance with the conditions specified in this Article IV, each Lender that has signed this Agreement shall be deemed to have accepted, and to be satisfied with, each document or other matter required under this Article IV unless the Administrative Agent shall have received notice from such Lender prior to the proposed Closing Date specifying its objection thereto.

 

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ARTICLE V

Until the principal of and interest on each Loan and all fees payable hereunder and all other Obligations shall have been paid in full (but with respect to such other Obligations only to the extent that actual amounts hereunder are owing at the time the Loans, together with interest and fees, have been paid in full), each of Borrower and Guarantor, as applicable, (for itself and, in the case of Guarantor, the Restricted Subsidiaries (including the Subsidiary Guarantors)) covenants and agrees with the Lenders that; provided that any non-compliance of covenants contained in Sections 5.01(g), 5.01(h), 5.01(i), 5.02, 5.03 to 5.07 and 5.09 solely as the result of the actions or inactions of Borrower and its Subsidiaries shall not constitute a breach under such Sections unless such non-compliance has occurred for 10 Business Days after notice thereof has been given to Guarantor (any such period, a “Guarantor Notice Period”):

 

 

 

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Information required to be delivered pursuant to paragraphs (a), (b), (d), (g) and (h) shall be deemed to have been delivered on the date on which Borrower or Time Warner, as applicable, provides notice to the Administrative Agent, or as the case may be the Administrative Agent gives notice to the Lenders, that such information has been posted on Borrower’s or Time Warner’s website, as applicable, on the internet at the website address listed on the signature pages of such notice, at ▇▇▇.▇▇▇.▇▇▇ or at another website identified in such notice and accessible by the Lenders without charge; provided that (x) Borrower shall deliver paper copies of the reports and financial statements referred to in paragraphs (g), (h), and (i) of this Section 5.01 to the Administrative Agent or any Lender who requests Borrower to deliver such paper copies until written notice to cease delivering paper copies is given by the Administrative Agent or such Lender and (y) Time Warner shall deliver paper copies of the reports and financial statements referred to in paragraphs (a), (b), (d) and (j) of this Section 5.01 to the Administrative Agent or any Lender who requests Time Warner to deliver such paper copies until written notice to cease delivering paper copies is given by the Administrative Agent or such Lender.

 

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Notwithstanding anything to the contrary above in this Section 5.01, so long as a Lender is also a lender under the Time Warner Credit Agreement, in the event Time Warner delivers to such Lender, or to the administrative agent under the Time Warner Credit Agreement, any information which is the same as that required to be delivered pursuant to this Section 5.01 in order to satisfy its obligations under the Time Warner Credit Agreement, Time Warner will be deemed to have satisfied its obligations to the Administrative Agent hereunder.  Additionally, if a Lender is not also a lender under the Time Warner Credit Agreement, in the event Time Warner delivers to such Lender a copy of any information required to be delivered pursuant to Sections 5.01 or 5.02 of the Time Warner Credit Agreement, Time Warner will be deemed to have satisfied its obligations to the Administrative Agent hereunder.   Notwithstanding the foregoing, if, after the Closing Date, any amendment, waiver, consent, amendment and restatement, supplement or other modification of Section 5.01 or 5.02 of the Time Warner Credit Agreement shall modify the information required to be delivered thereunder such that it is no longer the same as that required to be delivered pursuant to Section 5.01(a)-(e) and (j) above, this paragraph shall not apply.

 

 

 

 

 

Each of the foregoing notices delivered under this Section shall be accompanied by a statement of a Financial Officer or other executive officer of Borrower setting forth the details of the event or development requiring such notice and any action taken or proposed to be taken with respect thereto.  In addition, Borrower shall promptly furnish to the Administrative Agent copies of any notices of default (or similar events) delivered under the Reimbursement Agreement.

 

 

 

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ARTICLE VII

 

 

If any of the following events (“Events of Default”) shall occur:

 

 

 

 

 

 

 

 

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then, and in every such event (other than an event with respect to Borrower described in clause (h) or (i) of this Article), and at any time thereafter during the continuance of such event, the Administrative Agent may, and at the request of the Required Lenders shall, by notice to each of Borrower and Guarantor, declare the Loans then outstanding to be due and payable in whole (or in part, in which case any principal not so declared to be due and payable may thereafter be declared to be due and payable), and thereupon the principal of the Loans so declared to be due and payable, together with accrued interest thereon and all fees and other obligations of Borrower accrued hereunder, shall become due and payable immediately, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by Borrower; and in case of any event with respect to Borrower described in clause (h) or (i) of this Article, the principal of the Loans then outstanding, together with accrued interest thereon and all fees and other obligations of Borrower accrued hereunder, shall automatically become due and payable, without presentment, demand, protest or other notice of any kind, all of which are hereby waived by Borrower.

 

ARTICLE VIII

Each of the Lenders hereby irrevocably appoints the Administrative Agent as its agent and authorizes the Administrative Agent to take such actions on its behalf and to exercise such powers as are delegated to the Administrative Agent by the terms hereof, together with such actions and powers as are reasonably incidental thereto.

 

Each bank serving as an Administrative Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not an Administrative Agent, and such bank and its Affiliates may accept deposits from, lend money to, act as the financial advisor or in any other advisory capacity for and generally engage in any kind of business with any Company or Affiliate thereof as if it were not an Administrative Agent hereunder and without any duty to account therefor to the Lenders.

 

The Administrative Agent shall not have any duties or obligations except those expressly set forth herein and in the other Credit Documents.  Without limiting the generality of the foregoing, (a) the Administrative Agent shall not be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing, (b) the Administrative Agent shall not have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or by the other Credit Documents that the Administrative Agent is required to exercise in writing by the Required Lenders (or, if so specified by this Agreement, all the Lenders) and (c) except as expressly set forth herein and in the other Credit Documents, the Administrative Agent shall not have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to any Company or any of its Affiliates that is communicated to or obtained by the bank serving as Administrative Agent or any of its Affiliates in any capacity.  The Administrative Agent shall not be liable for any action taken or not taken by it with the consent or at the request of the Required Lenders (or, if so specified by this Agreement, all the Lenders, or as the Administrative Agent shall believe in good faith shall be necessary, under the circumstances as provided in Article VII and Section 9.02) or in the absence of its own gross negligence or willful misconduct.  The Administrative Agent shall be deemed not to have knowledge of any Default unless and until written notice thereof is given to the Administrative Agent by Borrower or a Lender, and the Administrative Agent shall not be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement or any other Credit Document, (ii) the contents of any certificate, report or other document delivered under any Credit Document or in connection therewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth in the Credit Documents or the occurrence of any Default, (iv) the validity, enforceability, effectiveness or genuineness of any Credit Document or any other agreement, instrument or document, or (v) the satisfaction of any condition set forth in Article IV or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to the Administrative Agent.

 

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The Administrative Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message) believed by it to be genuine and to have been signed, sent or otherwise authenticated by a proper Person.  An initial list of the respective proper Persons with respect to each of the Credit Parties appears on Schedule 8. Schedule 8 shall not be altered except in writing by a Person appearing thereon (or by a successor to such Person occupying the equivalent office).  The Administrative Agent also may rely upon any statement made to it orally or by telephone and believed by it to be made by the proper Person, and shall not incur any liability for relying thereon so long as such statement, in the case of a Borrowing Request, complies with the requirements of Section 2.03 in all material respects (it being understood that oral notices of borrowing will be confirmed in writing by Borrower in accordance with Section 2.03).  In determining compliance with any condition hereunder to the making of a Loan, that by its terms must be fulfilled to the satisfaction of a Lender, the Administrative Agent may presume that such condition is satisfactory to such Lender unless the Administrative Agent shall have received notice to the contrary from such Lender prior to the making of such Loan.  The Administrative Agent may consult with legal counsel (who may be counsel for Borrower), independent accountants and other experts selected by it, and shall not be liable for any action taken or not taken by it in accordance with the advice of any such counsel, accountants or experts.

 

The Administrative Agent may perform any and all its duties and exercise its rights and powers hereunder or under any other Credit Document by or through any one or more sub-agents appointed by the Administrative Agent.  The Administrative Agent and any such sub-agent may perform any and all its duties and exercise its rights and powers through their respective Related Parties.  The exculpatory provisions of the preceding paragraphs shall apply to any such sub-agent and to the Related Parties of the Administrative Agent and any such sub-agent, and shall apply to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as Administrative Agent.

 

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Subject to the appointment and acceptance of a successor Administrative Agent as provided in this paragraph, (i) the Administrative Agent may be removed by Time Warner at any time after the Purchase Date and (ii) the Administrative Agent may resign at any time by notifying the Lenders and Borrower.  Upon any such resignation or removal pursuant to clause (i) above, the Required Lenders shall have the right, in consultation with Borrower, to appoint a successor which, so long as no Event of Default is continuing, shall be reasonably acceptable to Borrower.  If no successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within 30 days after the retiring Administrative Agent gives notice of its resignation or the Administrative Agent is removed pursuant to clause (i) above, then the retiring or removed Administrative Agent, as the case may be, may, on behalf of the Lenders, appoint a successor Administrative Agent which shall be a bank with an office in New York, New York, or an Affiliate of any such bank.  Upon the acceptance of its appointment as Administrative Agent hereunder by a successor, such successor shall succeed to and become vested with all the rights, powers, privileges and duties of the removed or retiring (or retired) Administrative Agent, and the retiring or removed Administrative Agent shall be discharged from its duties and obligations hereunder or under the other Credit Documents.  The fees payable by Borrower to a successor Administrative Agent shall be the same as those payable to its predecessor unless otherwise agreed between Borrower and such successor; provided that the predecessor Administrative Agent shall pay the unearned portion of any fees paid in advance to either the successor Administrative Agent or Borrower.  After the Administrative Agent’s resignation or removal hereunder, the provisions of this Article and Section 9.03 shall continue in effect for the benefit of such retiring Administrative Agent, its sub-agents and their respective Related Parties in respect of any actions taken or omitted to be taken by it while it was acting as Administrative Agent.

 

The Lenders agree to indemnify the Administrative Agent in its capacity as such (to the extent not reimbursed by Borrower and without limiting the obligation of Borrower to do so), ratably according to their Credit Exposures in effect on the date on which indemnification is sought under this Article VIII (or, if indemnification is sought after the date upon which the Loans shall have been paid in full, ratably in accordance with their Credit Exposures immediately prior to such date), from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind whatsoever that may at any time (whether before or after the payment of the Loans) be imposed on, incurred by or asserted against the Administrative Agent in any way relating to or arising out of, this Agreement, any of the other Credit Documents or any documents contemplated by or referred to herein or therein or the transactions contemplated hereby or thereby or any action taken or omitted by the Administrative Agent under or in connection with any of the foregoing; provided that no Lender shall be liable for the payment of any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements that are found by a final and nonappealable decision of a court of competent jurisdiction to have resulted from the Administrative Agent’s gross negligence or willful misconduct.  The agreements in this paragraph shall survive the payment of the Loans and all other amounts payable hereunder.

 

Each Lender acknowledges that it has, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement. Each Lender also acknowledges that it will, independently and without reliance upon the Administrative Agent or any other Lender and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any related agreement or any document furnished hereunder or thereunder.

 

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ARTICLE IX

 

Central European Media Enterprises Ltd.

c/o CME Media Services Ltd.

Kříženeckého náměstí 1078/5

▇▇▇ ▇▇  ▇▇▇▇▇▇ ▇ - ▇▇▇▇▇▇▇▇▇

▇▇▇▇▇ ▇▇▇▇▇▇▇▇

with a copy to (which shall not constitute notice):

 

DLA Piper LLP (US)

▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇

▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇

▇▇▇▇ ▇▇▇▇▇

 

and to Time Warner (as set out below)

 

 

 

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Any party hereto may change its address or facsimile number for notices and other communications hereunder by notice to the other parties hereto.  All notices and other communications given to any party hereto in accordance with the provisions of this Agreement shall be deemed to have been given on the date of receipt if received prior to or during the recipient’s normal business hours.

 

 

 

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[Signature Pages Follow]

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IN WITNESS WHEREOF, the undersigned has caused this Agreement to be duly executed and delivered by its duly authorized officer as of the day and year first above written.

	CENTRAL EUROPEAN MEDIA ENTERPRISES
	LTD., as Borrower
	By:
		Name:
		Title:

Signature Page to Credit Agreement

 

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	TIME WARNER INC., as Guarantor
	By:
		Name:
		Title:

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	[  ], as Administrative Agent and as Lender
	By:
		Name:
		Title:

Signature Page to Credit Agreement

 

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Lender	Commitment
[  ]	$[_____]
TOTAL	$[           ]

 

 

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Loan Type:	A borrowing notice (pursuant and subject to Section 2.03, as applicable) must be given not later than:	Prepayment notice (pursuant to Section 2.10) must be given not later than:
LOANS
Any Eurodollar Borrowing	11:00 a.m. New York City time three (3) Business Days before the date of the proposed Borrowing.	12:00 p.m. New York City time three (3) Business Days (or such shorter period of time as reasonably acceptable to the Administrative Agent) before the date of prepayment.

 

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1.	TW Receivables, Inc.
2.	Sellers, LLC
3.	Witty, LLC
4.	281, LLC
5.	Conspire, LLC
6.	Stormy, LLC
7.	▇▇▇▇▇, LLC
8.	Umbria, LLC
9.	LIS Distribution, Inc.
10.	Love and War Distribution, Inc.
11.	Starter, LLC
12.	Like It, LLC

 

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In the case of Borrower:

 

▇▇▇▇ ▇▇▇▇▇▇▇▇	Chief Financial Officer
▇▇▇▇▇▇ ▇▇▇▇▇▇	Deputy Chief Financial Officer

In the case of Guarantor and the Subsidiary Guarantors:

Name	Title
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇	Executive Vice President and Chief Financial Officer
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇	Senior Vice President and Treasurer
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇*	Vice President and Assistant Treasurer
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇*	Vice President and Assistant Treasurer
▇▇▇▇ ▇▇▇▇▇▇*	Vice President and Assistant Treasurer

*  The Administrative Agent may act upon verbal instructions with respect to Guarantor and the Subsidiary Guarantors from ▇▇. ▇▇▇▇▇▇, ▇▇. ▇▇▇▇▇▇ or ▇▇. ▇▇▇▇▇▇, which will be followed by written confirmation from one of the other above-named officers.

 

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FORM OF

ASSIGNMENT AND ACCEPTANCE

Reference is made to the Credit Agreement, dated as of November [___], 2015 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among CENTRAL EUROPEAN MEDIA ENTERPRISES LTD., TIME WARNER INC., the Lenders party thereto and [  ], as administrative agent (in such capacity, the “Administrative Agent”).  Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

The Assignor identified on Schedule l hereto (the “Assignor”) and the Assignee identified on Schedule l hereto (the “Assignee”) agree as follows:

1.  The Assignor hereby irrevocably sells and assigns to the Assignee without recourse to the Assignor, and the Assignee hereby irrevocably purchases and assumes from the Assignor without recourse to the Assignor, as of the Effective Date (as defined below), the interest described in Schedule 1 hereto (the “Assigned Interest”) in and to the Assignor’s rights and obligations under the Credit Agreement with respect to the amount set forth on Schedule 1 hereto for the Commitments and Credit Exposure of the Assignor on the Effective Date of this Assignment and Acceptance.

2.  The Assignor (a) makes no representation or warranty and assumes no responsibility with respect to any statements, warranties or representations made in or in connection with the Credit Agreement or with respect to the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Credit Agreement, any other Credit Document or any other instrument or document furnished pursuant thereto, other than that the Assignor has not created any adverse claim upon the interest being assigned by it hereunder and that such interest is free and clear of any such adverse claim and (b) makes no representation or warranty and assumes no responsibility with respect to the financial condition of Guarantor or Borrower, any of their Affiliates or any other obligor or the performance or observance by Borrower, any of its Affiliates or any other obligor of any of its respective obligations under the Credit Agreement or any other Credit Documents or any other instrument or document furnished pursuant hereto or thereto.

3.  The Assignee (a) represents and warrants that it is legally authorized to enter into this Assignment and Acceptance; (b) confirms that it has received a copy of the Credit Agreement, together with copies of the financial statements delivered pursuant to Section 3.04 thereof and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Assignment and Acceptance; (c) agrees that it will, independently and without reliance upon the Assignor, the Administrative Agent or any Lender and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Credit Agreement and other Credit Documents or any other instrument or document furnished pursuant hereto or thereto; (d) appoints and authorizes the Administrative Agent to take such action as agent on its behalf and to exercise such powers and discretion under the Credit Agreement and other Credit Documents or any other instrument or document furnished pursuant hereto or thereto as are delegated to the Administrative Agent by the terms thereof, together with such powers as are incidental thereto; and (e) agrees that it will be bound by the provisions of the Credit Agreement and will perform in accordance with its terms all the obligations which by the terms of the Credit Agreement are required to be performed by it as a Lender.

 

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4.  The effective date of this Assignment and Acceptance shall be the Effective Date of Assignment described in Schedule 1 hereto (the “Effective Date”).  Following the execution of this Assignment and Acceptance, it will be delivered to the Administrative Agent (and Time Warner, to the extent required by Section 9.04(b) of the Credit Agreement) for acceptance by it and recording by the Administrative Agent pursuant to the Credit Agreement, effective as of the Effective Date (which shall not, unless otherwise agreed to by the Administrative Agent, be earlier than five Business Days after the date of such acceptance and recording by the Administrative Agent).  The Administrative Agent shall keep records of this Assignment and Acceptance in accordance with Section 9.04(d) of the Credit Agreement.

5.  Upon such acceptance and recording, from and after the Effective Date, the Administrative Agent shall make all payments in respect of the Assigned Interest (including payments of principal, interest, fees and other amounts) to the Assignor for amounts which have accrued to the Effective Date and to the Assignee for amounts which have accrued subsequent to the Effective Date.

6.  From and after the Effective Date, (a) the Assignee shall be a party to the Credit Agreement and, to the extent provided in this Assignment and Acceptance, have the rights and obligations of a Lender thereunder and under the other Credit Documents and shall be bound by the provisions thereof and (b) the Assignor shall, to the extent provided in this Assignment and Acceptance, relinquish its rights and be released from its obligations under the Credit Agreement.

7.  This Assignment and Acceptance shall be construed in accordance with and governed by the law of the State of New York.

IN WITNESS WHEREOF, the parties hereto have caused this Assignment and Acceptance to be executed as of the date first above written by their respective duly authorized officers on Schedule 1 hereto.

 

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Schedule 1

to Assignment and Acceptance with respect to the

Credit Agreement, dated as of [___], 2015,

 

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among TIME WARNER INC., CENTRAL EUROPEAN MEDIA ENTERPRISES LTD., the Lenders party thereto and [  ],

as administrative agent (in such capacity, the “Administrative Agent”)

Name of Assignor:  _______________________

Name of Assignee:  _______________________

Effective Date of Assignment:  _________________

$

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Accepted for Recordation in the Register:
[  ], as
Administrative Agent
By:
	Title:
Required Consents (if any):
[TIME WARNER INC.
By:
Title:]
[CENTRAL EUROPEAN MEDIA
ENTERPRISES LTD.
By:
	Title:]

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FORM OF

2015 GUARANTEE

GUARANTEE, dated as of  [__________], 2015 (as amended, supplemented or otherwise modified from time to time, this “Guarantee”), made by TIME WARNER INC., a Delaware corporation (“Time Warner”), HISTORIC TW INC., a Delaware corporation (“Historic TW”), ▇▇▇▇▇▇ BROADCASTING SYSTEM, INC., a Georgia corporation (“TBS”), and HOME BOX OFFICE, INC., a Delaware corporation (“HBO”) (each, a “Guarantor”, and collectively, the “Guarantors”), in favor of [____________], as administrative agent (in such capacity, the “Administrative Agent”) for the lenders (the “Lenders”) party to the Credit Agreement, dated as of [_____________], 2015 (as amended, supplemented or otherwise modified from time to time, the “Credit Agreement”), among CENTRAL EUROPEAN MEDIA ENTERPRISES LTD., an exempted limited company incorporated under the laws of Bermuda (“CME”), Time Warner, the Lenders and the Administrative Agent.

WHEREAS, pursuant to the Credit Agreement, the Lenders have severally agreed to make Loans (as defined below) to Borrower (as defined below) upon the terms and subject to the conditions set forth therein;

WHEREAS, it is a condition precedent to the obligation of the Lenders to make their respective Loans to Borrower under the Credit Agreement that the Guarantors shall have executed and delivered this Guarantee to the Administrative Agent for the ratable benefit of the Lenders; and

WHEREAS, each Guarantor has determined that such Guarantor’s execution, delivery and performance of this Guarantee may reasonably be expected to benefit the Guarantor, directly or indirectly, and be in the interest of such Guarantor.

NOW, THEREFORE, in consideration of the premises and to induce the Administrative Agent and the Lenders to enter into the Credit Agreement and to induce the Lenders to make their respective loans to Borrower under the Credit Agreement, each Guarantor hereby agrees with the Administrative Agent, for the ratable benefit of the Lenders, as follows:

1.  Defined Terms.  Unless otherwise defined herein, terms defined in the Credit Agreement and used herein shall have the meanings given to them in the Credit Agreement.

 

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(f)  As used herein, “Time Warner Obligations” has the meaning assigned to such term in Section 2(b) of this Guarantee.

2.  Guarantee.

 

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3.  Right of Contribution.  Each Guarantor hereby agrees that to the extent that a Guarantor shall have paid more than its proportionate share of any payment made hereunder, such Guarantor shall be entitled to seek and receive contribution from and against any other Guarantor hereunder who has not paid its proportionate share of such payment.  Each Guarantor’s right of contribution shall be subject to the terms and conditions of Section 5 hereof.  The provisions of this Section shall in no respect limit the obligations and liabilities of any Guarantor to the Administrative Agent and the Lenders, and each Guarantor shall remain liable to the Administrative Agent and the Lenders for the full amount guaranteed by such Guarantor hereunder.

4.  Right of Setoff.  (a) Time Warner hereby authorizes each Lender at any time and from time to time when any amounts owed by Borrower under the Credit Agreement are due and payable and have not been paid (taking into account any applicable grace periods), to the fullest extent permitted by law, to set off and apply any and all deposits (general or special, time or demand, provisional or final), at any time held and other indebtedness at any time owing by such Lender to or for the credit or the account of Time Warner (other than indebtedness related to commercial advertising and marketing arrangements entered into in the ordinary course of business) against any of and all of the obligations of Time Warner to such Lender hereunder now or hereafter existing under the Credit Agreement or any other Credit Document whether or not such Lender has made any demand for payment.  Each Lender shall notify Time Warner promptly of any such setoff and the application made by such Lender of the proceeds thereof; provided that the failure to give such notice shall not affect the validity of such setoff and application.  The rights of each Lender under this paragraph are in addition to other rights and remedies (including other rights of setoff) which such Lender may have.

 

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5.  No Subrogation.  Notwithstanding any payment or payments made by any Guarantor hereunder, or any setoff or application of funds of any Guarantor by any Lender, no Guarantor shall be entitled to be subrogated to any of the rights of the Administrative Agent or any Lender against Borrower or against any collateral security or guarantee or right of offset held by the Administrative Agent or any Lender for the payment of the Obligations, Time Warner Obligations or Historic TW Obligations, nor shall any Guarantor seek or be entitled to seek any contribution or reimbursement from Borrower in respect of payments made by such Guarantor hereunder, until all amounts owing to the Administrative Agent and the Lenders by Borrower on account of the Obligations are paid in full and the Lenders’ commitments, if any, to make Loans under the Credit Agreement are terminated.  If any amount shall be paid to any Guarantor on account of such subrogation rights at any time when all of the Obligations shall not have been paid in full, such amount shall be held by such Guarantor in trust for the Administrative Agent and the Lenders, segregated from other funds of such Guarantor, and shall, forthwith upon receipt by such Guarantor, be turned over to the Administrative Agent in the exact form received by such Guarantor (duly indorsed by such Guarantor to the Administrative Agent, if required), to be applied against the Obligations, whether matured or unmatured, in such order as the Administrative Agent may determine.

6.  Amendments, etc. with Respect to the Obligations; Waiver of Rights.  Each Guarantor shall remain obligated hereunder notwithstanding that, without any reservation of rights against any Guarantor, and without notice to or further assent by any Guarantor, (a) any demand for payment of any of the Obligations, Time Warner Obligations and Historic TW Obligations made by the Administrative Agent or any Lender may be rescinded by the Administrative Agent or such Lender, and any of the Obligations, Time Warner Obligations and Historic TW Obligations continued, (b) the Obligations, Time Warner Obligations and/or Historic TW Obligations, or the liability of any other Person upon or for any part thereof, or any collateral security or guarantee therefor or right of offset with respect thereto, may, from time to time, in whole or in part, be renewed, extended, amended, modified, accelerated, compromised, waived, surrendered or released by the Administrative Agent or any Lender, (c) the Credit Agreement and any other Credit Document may be amended, modified, supplemented or terminated, in whole or in part, and (d) any collateral security, guarantee or right of offset at any time held by the Administrative Agent or any Lender for the payment of the Obligations, Time Warner Obligations and/or Historic TW Obligations may be sold, exchanged, waived, surrendered or released.  Neither the Administrative Agent nor any Lender shall have any obligation to protect, secure, perfect or insure any Lien at any time held by it as security for the Obligations or for this Guarantee or any property subject thereto.

 

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7.  Guarantee Absolute and Unconditional.  Each Guarantor waives any and all notice of the creation, renewal, extension or accrual of any of the Obligations, Time Warner Obligations and/or Historic TW Obligations and notice of or proof of reliance by the Administrative Agent or any Lender upon this Guarantee or acceptance of this Guarantee; the Obligations, and any of them, shall conclusively be deemed to have been created, contracted or incurred, or renewed, extended, amended or waived, in reliance upon this Guarantee; and all dealings between Borrower or any of the Guarantors, on the one hand, and the Administrative Agent and the Lenders, on the other, shall likewise be conclusively presumed to have been had or consummated in reliance upon this Guarantee.  Each Guarantor waives diligence, presentment, protest, demand for payment and notice of default or nonpayment to or upon Borrower or any Guarantor with respect to the Obligations, Time Warner Obligations or Historic TW Obligations.  This Guarantee shall be construed as a continuing, absolute and unconditional guarantee of payment and performance and not of collection without regard to (a) the validity, regularity or enforceability of the Credit Agreement or any other Credit Document, any of the Obligations, Time Warner Obligations or Historic TW Obligations or any other collateral security therefor or guarantee or right of offset with respect thereto at any time or from time to time held by the Administrative Agent or any Lender, (b) any defense, setoff or counterclaim (other than a defense of payment or performance) which may at any time be available to or be asserted by Borrower or any other Person against the Administrative Agent or any Lender, (c) whether or not any of the Obligations, Time Warner Obligations or Historic TW Obligations  are from time to time reduced, or extinguished (other than pursuant to Section 2(e) above), whether or not recovery may be or hereafter become barred by any statute of limitations or otherwise, and despite any arrangement or composition entered into in connection with any bankruptcy or other proceeding or (d) any other circumstance whatsoever (with or without notice to or knowledge of Borrower or any Guarantor) which constitutes, or might be construed to constitute, an equitable or legal discharge of Borrower from the Obligations, of Time Warner from the Time Warner Obligations or of Historic TW from the Historic TW Obligations, or of such Guarantor under this Guarantee, in bankruptcy or in any other instance.  When making a demand hereunder or otherwise pursuing its rights and remedies hereunder against any Guarantor, the Administrative Agent and any Lender may, but shall be under no obligation to, make a similar demand on or otherwise pursue such rights and remedies as it may have against Borrower, any other Guarantor or any other Person or against any collateral security or guarantee for the Obligations, Time Warner Obligations or Historic TW Obligations or any right of offset with respect thereto, and any failure by the Administrative Agent or any Lender to make any such demand, to pursue such other rights or remedies or to collect any payments from Borrower, any such other Guarantor or any such other Person or to realize upon any such collateral security or guarantee or to exercise any such right of offset, or any release of Borrower, any such other Guarantor or any such other Person or of any such collateral security, guarantee or right of offset, shall not relieve any Guarantor of any liability hereunder, and shall not impair or affect the rights and remedies, whether express, implied or available as a matter of law, of the Administrative Agent or any Lender against any Guarantor.  For the purposes hereof “demand” shall include the commencement and continuance of any legal proceedings.

 

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8.  Reinstatement.  This Guarantee shall continue to be effective, or be reinstated, as the case may be, if at any time payment, or any part thereof, of any of the Obligations, Time Warner Obligations or Historic TW Obligations is rescinded or must otherwise be restored or returned by the Administrative Agent or any Lender upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of Borrower or any Guarantor or upon or as a result of the appointment of a receiver, intervenor or conservator of, or trustee or similar officer for, Borrower or any Guarantor or any substantial part of Borrower’s or any Guarantor’s property, or otherwise, all as though such payments had not been made.

9.  Payments.  Each Guarantor hereby agrees that payments hereunder will be paid to the Administrative Agent without setoff or counterclaim in the applicable Currency at the office of the Administrative Agent as designated by the Administrative Agent.

10.  Representations and Warranties.  To induce the Administrative Agent and the Lenders to enter into the Credit Agreement and to induce the Lenders to make their respective extensions of credit to the Borrower thereunder, each Subsidiary Guarantor hereby represents and warrants to the Administrative Agent and each Lender that the representations and warranties set forth in Article III of the Credit Agreement as they relate to such Subsidiary Guarantor or to the Credit Documents to which such Subsidiary Guarantor is a party, each of which is hereby incorporated herein by reference, are true and correct as of the date hereof, and the Administrative Agent and each Lender shall be entitled to rely on each of them as if they were fully set forth herein (it being understood that any representation or warranty set forth in Article III of the Credit Agreement that is qualified by a reference to Time Warner and its Subsidiaries or Restricted Subsidiaries taken as a whole shall not be deemed to apply to the Subsidiary Guarantor individually).

11.  Authority of Administrative Agent.  Each Guarantor acknowledges that the rights and responsibilities of the Administrative Agent under this Guarantee with respect to any action taken by the Administrative Agent or the exercise or non-exercise by the Administrative Agent of any option, right, request, judgment or other right or remedy provided for herein or resulting or arising out of this Guarantee shall, as between the Administrative Agent and the Lenders, be governed by the Credit Agreement and by such other agreements with respect thereto as may exist from time to time among them, but, as between the Administrative Agent and any or all of the Guarantors, the Administrative Agent shall be conclusively presumed to be acting as agent for the Lenders with full and valid authority so to act or refrain from acting, and no Guarantor shall be under any obligation, or entitlement, to make any inquiry respecting such authority.

12.  Notices.  All notices, requests and demands to or upon the Administrative Agent, any Lender or any Guarantor shall be effected in the manner provided in Section 9.01 of the Credit Agreement; any such notice, request or demand to or upon any Guarantor shall be addressed to such Guarantor at its notice address set forth on Schedule 1 hereto.

 

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13.  Severability.  Any provision of this Guarantee which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall not invalidate or render unenforceable such provision in any other jurisdiction.

14.  Integration.  This Guarantee and the other Credit Documents represent the agreement of each Guarantor with respect to the subject matter hereof and there are no promises or representations by any Guarantor, the Administrative Agent or any Lender relative to the subject matter hereof not reflected herein or in the other Credit Documents.

15.  Amendments in Writing.  None of the terms or provisions of this Guarantee may be waived, amended, supplemented or otherwise modified except by a written instrument executed by the applicable Guarantor and the Administrative Agent; provided that any right, power or privilege of the Administrative Agent or the Lenders arising under this Guarantee may be waived by the Administrative Agent and the Lenders in a letter or agreement executed by the Administrative Agent; provided further that no such amendment or waiver shall release any Guarantor from its obligations hereunder without the written consent of each Lender.

16. Release of Subsidiary Guarantors.  Any term or provision of any Credit Document to the contrary notwithstanding, a Subsidiary Guarantor shall be automatically released from its obligations under this Guarantee, and the guarantee of such Subsidiary Guarantor shall be automatically released, upon receipt by the Administrative Agent of a certificate of a Responsible Officer of Time Warner certifying that such Subsidiary Guarantor has no outstanding Indebtedness For Borrowed Money as of the date of such certificate, other than any other guarantee of Indebtedness For Borrowed Money that will be released concurrently with the release of such guarantee.  In connection with any such release, the Administrative Agent shall execute and deliver to Time Warner or the applicable Subsidiary Guarantor, at Time Warner’s expense, all documents and shall take all such actions as are reasonably requested by Time Warner to evidence such release and to effect the release of such Subsidiary Guarantor’s guarantees and other obligations contained in the Guarantee.  The execution and delivery of documents pursuant to this Section shall be without recourse to or representation or warranty by the Administrative Agent.

17.  No Waiver; Cumulative Remedies.  Neither the Administrative Agent nor any Lender shall by any act (except by a written instrument pursuant to Section 15 hereof), delay, indulgence, omission or otherwise be deemed to have waived any right or remedy hereunder or to have acquiesced in any Default or Event of Default or in any breach of any of the terms and conditions hereof.  No failure to exercise, nor any delay in exercising, on the part of the Administrative Agent or any Lender, any right, power or privilege hereunder shall operate as a waiver thereof.  No single or partial exercise of any right, power or privilege hereunder shall preclude any other or further exercise thereof or the exercise of any other right, power or privilege.  A waiver by the Administrative Agent or any Lender of any right or remedy hereunder on any one occasion shall not be construed as a bar to any right or remedy which the Administrative Agent or such Lender would otherwise have on any future occasion.  The rights and remedies herein provided are cumulative, may be exercised singly or concurrently and are not exclusive of any other rights or remedies provided by law.

 

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18.  Section Headings.  The section headings used in this Guarantee are for convenience of reference only and are not to affect the construction hereof or be taken into consideration in the interpretation hereof.

19.  Successors and Assigns.  This Guarantee shall be binding upon the successors and assigns of each Guarantor and shall inure to the benefit of the Administrative Agent and the Lenders and their successors and assigns; provided that no Guarantor may assign, transfer or delegate any of its rights or obligations under this Guarantee without the prior written consent of the Administrative Agent.

20.  Enforcement Expenses; Indemnity.  (a)  Each Guarantor agrees, jointly and severally, to pay or reimburse each Lender and the Administrative Agent for all its costs and expenses incurred in collecting against such Guarantor under this Guarantee or otherwise enforcing or protecting any rights under this Guarantee and the other Credit Documents to which such Guarantor is a party, including, without limitation, the reasonable fees, charges and disbursements of any counsel for the Lenders and the Administrative Agent, as and to the extent provided in Section 9.03 of the Credit Agreement.

(b)  Time Warner shall indemnify the Administrative Agent and each Lender, and each Related Party of any of the foregoing Persons (each such Person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related expenses, including the reasonable fees, charges and disbursements of any counsel for any Indemnitee, incurred by or asserted against any Indemnitee arising out of, in connection with, or as a result of (i) the execution or delivery of any Credit Documents or any agreement or instrument contemplated thereby, the performance by the parties hereto of their respective obligations hereunder or the consummation of the Transactions or any other transactions contemplated hereby or by the Credit Agreement, (ii) any Loan or the use of, or the proposed use of, the proceeds therefrom, (iii) any actual or alleged presence or release of Hazardous Materials on or from any property owned or operated by any Guarantor, or any Environmental Liability related in any way to any Guarantor, or (iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory and regardless of whether any Indemnitee is a party thereto; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses resulted from the gross negligence or willful misconduct of such Indemnitee (or a Related Party of such Indemnitee).

21. Appointment of Time Warner as Agent. Each of Historic TW, TBS and HBO hereby irrevocably appoints Time Warner to act on its behalf as agent (in such capacity the “Agent”) under the Reimbursement Agreement and the other Reimbursement Documents (as defined in the Reimbursement Agreement) and authorizes the Agent to take such actions on its behalf, and exercise such rights and remedies on its behalf, as Time Warner deems necessary under the Reimbursement Agreement and other Reimbursement Documents. Time Warner hereby accepts such appointment to so act as Agent on behalf of each of Historic TW, TBS and HBO.  For the avoidance of doubt, this Section shall not affect in any manner the obligations of the Guarantors under this Guarantee or the rights and remedies of the Administrative Agent and the Lenders under this Guarantee.

 

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22.  Counterparts.  This Guarantee may be executed by one or more of the Guarantors on any number of separate counterparts (including by facsimile or electronic transmission), and all of said counterparts taken together shall be deemed to constitute one and the same instrument.

23.  Acknowledgements.

Each Guarantor hereby acknowledges that:

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

25.  Jurisdiction; Consent to Service of Process.  (a)  Each Guarantor hereby irrevocably and unconditionally submits, for itself and its property, to the exclusive jurisdiction of the Supreme Court of the State of New York sitting in New York County and of the United States District Court of the Southern District of New York, and any appellate court from any thereof, in any action or proceeding arising out of or relating to this Guarantee, or for recognition or enforcement of any judgment, and each Guarantor hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding shall be heard and determined in such New York State court or, to the extent permitted by law, in such Federal court.  Each Guarantor agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.

 

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26.  WAIVER OF JURY TRIAL.  EACH GUARANTOR HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO THIS GUARANTEE OR ANY OTHER CREDIT DOCUMENT (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY).

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IN WITNESS WHEREOF, the undersigned has caused this Guarantee to be duly executed and delivered by its duly authorized officer as of the day and year first above written.

	TIME WARNER INC.
	By:
		Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
		Title: Senior Vice President & Treasurer
	HISTORIC TW INC.
	By:
		Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
		Title: Senior Vice President & Treasurer
	▇▇▇▇▇▇ BROADCASTING SYSTEM, INC.
	By:
		Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
		Title: Senior Vice President & Assistant Treasurer
	HOME BOX OFFICE, INC.
	By:
		Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
		Title: Senior Vice President & Assistant Treasurer

 

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SCHEDULE 1

 

Addresses for Notices