Bermuda-based Central European Media Enterprises Ltd. (CME), which broadcasts in central and eastern Europe, said on Friday it has entered into an agreement with bondholders allowing it to get out of default.

The Hamilton, Bermuda-based company said its agreement is with more than 60 percent of the holders of its 8.125 percent and 9.375 percent senior notes maturing in 2004.

The dollar-denominated notes have a face value of $100 million and the Deutsche mark-denominated notes have a face value of 140 million marks ($60 million).

Under the agreement, CME said it will make an August 15, 2000 interest payment it had missed. At the same time, CME plans to restructure the notes on or before January 15, 2001.

If the restructuring is successful, the bondholders will exchange their notes for pro rata shares of $100 million in cash, 25 percent of CME's equity, and four-year warrants for five percent of CME's equity.

The August 15 interest payment will be credited against the $100 million cash payment, CME said.

"We believe the restructuring, when implemented, should significantly improve our pursuit of exciting growth opportunities in our markets and enhance our ability to attract new outside investment,'' said Fred Klinkhammer, CME's chief executive, in the company's official statement.

Credit rating agency Standard & Poor's on September 15 cut CME's corporate credit and senior unsecured debt ratings to D,or default, after the 30-day grace period for the August 15 interest payment expired. Nasdaq delisted CME earlier this year.