Exhibit 10.1

 

EXECUTION COPY

 

 

AMENDED AND RESTATED

 

GOVERNANCE AGREEMENT

 

among

 

IAC/INTERACTIVECORP,

 

LIBERTY MEDIA CORPORATION,

 

and

 

BARRY DILLER

 

DATED AS OF AUGUST 9, 2005

 

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TABLE OF CONTENTS

 

 

 

ARTICLE I

 

 

 

 

TRANSFEREES

 

 

 

 

 

 

 

 

 

ARTICLE II

 

 

 

 

BOARD OF DIRECTORS AND RELATED MATTERS

 

 

 

 

 

 

 

Section 2.01.

 

Board of Directors

 

 

Section 2.02.

 

Management of the Business

 

 

Section 2.03.

 

Contingent Matters

 

 

Section 2.04.

 

Notice of Events

 

 

 

 

 

 

 

 

 

ARTICLE III

 

 

 

 

PREEMPTIVE RIGHTS

 

 

 

 

 

 

 

Section 3.01.

 

Liberty Preemptive Rights

 

 

Section 3.02.

 

Investment Agreement

 

 

 

 

 

 

 

 

 

ARTICLE IV

 

 

 

 

REPRESENTATIONS AND WARRANTIES

 

 

 

 

 

 

 

Section 4.01.

 

Representations and Warranties of the Company

 

 

Section 4.02.

 

Representations and Warranties of the Stockholders

 

 

 

 

 

 

 

 

 

ARTICLE V

 

 

 

 

DEFINITIONS

 

 

 

 

 

 

 

Section 5.01.

 

“2001 Governance Agreement”

 

 

Section 5.02.

 

“Affiliate”

 

 

Section 5.03.

 

“Amended and Restated Stockholders Agreement”

 

 

Section 5.04.

 

“BDTV Entities”

 

 

Section 5.05.

 

“Beneficial Ownership”

 

 

Section 5.06.

 

“CEO”

 

 

Section 5.07.

 

“CEO Termination Date”

 

 

Section 5.08.

 

“Commission”

 

 

Section 5.09.

 

“Company”

 

 

Section 5.10.

 

“Company Common Shares”

 

 

Section 5.11.

 

“Company Class B Stock”

 

 

Section 5.12.

 

“Company Common Stock”

 

 

Section 5.13.

 

“Consenting Party”

 

 

Section 5.14.

 

“Demand Registration”

 

 

Section 5.15.

 

“Disabled”

 

 

Section 5.16.

 

“EBITDA”

 

 

Section 5.17.

 

“Equity Securities”

 

 

Section 5.18.

 

“Exchange Act”

 

 

 

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Section 5.19.

 

“Excluded Issuance”

 

 

Section 5.20.

 

“Fair Market Value”

 

 

Section 5.21.

 

“IAC”

 

 

Section 5.22.

 

“Issue Price”

 

 

Section 5.23.

 

“Liberty Director”

 

 

Section 5.24.

 

“Liberty Holdco”

 

 

Section 5.25.

 

“Ownership Percentage”

 

 

Section 5.26.

 

“Permitted Transferee”

 

 

Section 5.27.

 

“Person”

 

 

Section 5.28.

 

“Sale Transaction”

 

 

Section 5.29.

 

“Securities Act”

 

 

Section 5.30.

 

“Stockholders”

 

 

Section 5.31.

 

“Stockholders Group”

 

 

Section 5.32.

 

“Subsidiary”

 

 

Section 5.33.

 

“Third Party Transferee”

 

 

Section 5.34.

 

“Total Debt”

 

 

Section 5.35.

 

“Total Debt Ratio”

 

 

Section 5.36.

 

“Total Equity Securities”

 

 

Section 5.37.

 

“Transfer”

 

 

Section 5.38.

 

“Voting Securities”

 

 

 

 

 

 

 

 

 

ARTICLE VI

 

 

 

 

MISCELLANEOUS

 

 

 

 

 

 

 

Section 6.01.

 

Notices

 

 

Section 6.02.

 

Amendments; No Waivers

 

 

Section 6.03.

 

Successors And Assigns

 

 

Section 6.04.

 

Governing Law; Consent To Jurisdiction

 

 

Section 6.05.

 

Counterparts

 

 

Section 6.06.

 

Specific Performance

 

 

Section 6.07.

 

Registration Rights

 

 

Section 6.08.

 

Termination

 

 

Section 6.09.

 

Severability

 

 

Section 6.10.

 

Cooperation

 

 

Section 6.11.

 

Adjustment Of Share Numbers

 

 

Section 6.12.

 

Effective Time

 

 

Section 6.13.

 

Entire Agreement

 

 

Section 6.14.

 

Interpretation

 

 

Section 6.15.

 

Headings

 

 

 

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EXECUTION COPY

 

Amended and Restated Governance Agreement

 

Amended and Restated Governance Agreement, dated as of August 9, 2005, among
IAC/InterActiveCorp, a Delaware corporation (“IAC,” or the “Company”), Liberty
Media Corporation, for itself and on behalf of the members of its Stockholder
Group (“Liberty”) and Mr. Barry Diller (“Mr. Diller”) for himself and on behalf
of the members of his Stockholder Group.

 

WHEREAS, the parties hereto have agreed that the Company, Liberty and Mr. Diller
shall enter into this Agreement in order to amend and restate in its entirety
the respective rights and obligations of the parties set forth in the Amended
and Restated Governance Agreement, dated as of December 16, 2001 (the “2001
Governance Agreement”).

 

WHEREAS, the Company, Liberty and Mr. Diller desire to establish in this
Agreement certain provisions concerning Liberty’s and Mr. Diller’s relationships
with the Company.

 

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants and
agreements contained herein, and intending to be legally bound hereby, the
Company, Liberty and Mr. Diller hereby agree as follows:

 

ARTICLE I

 

TRANSFEREES

 

No Third Party Transferee shall have any rights or obligations under this
Agreement, except as specifically provided for in this Agreement and except that
if such Third Party Transferee shall acquire Beneficial Ownership of more than
5% of the outstanding Total Equity Securities upon consummation of any Transfer
or series of related Transfers from a Stockholder, to the extent such
Stockholder has the right to Transfer a Demand Registration and assigns such
right in connection with a Transfer, such Third Party Transferee shall have the
right to initiate one or more Demand Registrations pursuant to Section 6.07 or
any registration rights agreement that replaces or supersedes Section 6.07 (and
shall be entitled to such other rights that a Stockholder would have applicable
to such Demand Registration), subject to the obligations of such Stockholder
applicable to such demand (and the number of Demand Registrations to which such
Stockholder is entitled under Section 6.07 hereof shall be correspondingly
decreased).

 

ARTICLE II

 

BOARD OF DIRECTORS AND RELATED MATTERS

 

SECTION 2.01.                             BOARD OF DIRECTORS.

 

(A)                                  LIBERTY SHALL HAVE THE RIGHT TO NOMINATE UP
TO TWO LIBERTY DIRECTORS SO LONG AS LIBERTY BENEFICIALLY OWNS AT LEAST
33,651,963 EQUITY SECURITIES (SO LONG AS THE OWNERSHIP PERCENTAGE OF LIBERTY IS
AT LEAST EQUAL TO 15% OF THE TOTAL EQUITY SECURITIES.  LIBERTY SHALL HAVE THE
RIGHT TO NOMINATE ONE LIBERTY DIRECTOR SO LONG AS LIBERTY BENEFICIALLY OWNS AT
LEAST 22,434,642 EQUITY SECURITIES (SO LONG AS LIBERTY’S OWNERSHIP PERCENTAGE IS
AT LEAST EQUAL TO 5% OF THE TOTAL EQUITY SECURITIES).

 

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(B)                                 THE COMPANY SHALL CAUSE EACH LIBERTY
DIRECTOR TO BE INCLUDED IN THE SLATE OF NOMINEES RECOMMENDED BY THE BOARD OF
DIRECTORS TO THE COMPANY’S STOCKHOLDERS FOR ELECTION AS DIRECTORS AT EACH ANNUAL
MEETING OF THE STOCKHOLDERS OF THE COMPANY AND SHALL USE ALL REASONABLE EFFORTS
TO CAUSE THE ELECTION OF EACH LIBERTY DIRECTOR, INCLUDING SOLICITING PROXIES IN
FAVOR OF THE ELECTION OF SUCH PERSONS.

 

(C)                                  WITHIN A REASONABLE TIME PRIOR TO THE
FILING WITH THE COMMISSION OF ITS PROXY STATEMENT OR INFORMATION STATEMENT WITH
RESPECT TO EACH MEETING OF STOCKHOLDERS AT WHICH DIRECTORS ARE TO BE ELECTED,
THE COMPANY SHALL, TO THE EXTENT LIBERTY IS ENTITLED TO REPRESENTATION ON THE
COMPANY’S BOARD OF DIRECTORS IN ACCORDANCE WITH THIS AGREEMENT, PROVIDE LIBERTY
WITH THE OPPORTUNITY TO REVIEW AND COMMENT ON THE INFORMATION CONTAINED IN SUCH
PROXY OR INFORMATION STATEMENT APPLICABLE TO THE DIRECTOR NOMINEES DESIGNATED BY
LIBERTY.

 

(D)                                 IN THE EVENT THAT A VACANCY IS CREATED AT
ANY TIME BY THE DEATH, DISABILITY, RETIREMENT, RESIGNATION OR REMOVAL (WITH OR
WITHOUT CAUSE) OF ANY LIBERTY DIRECTOR, LIBERTY SHALL HAVE THE RIGHT TO
DESIGNATE A REPLACEMENT LIBERTY DIRECTOR TO FILL SUCH VACANCY, AND THE COMPANY
AGREES TO USE ITS BEST EFFORTS TO CAUSE SUCH VACANCY TO BE FILLED WITH THE
REPLACEMENT LIBERTY DIRECTOR SO DESIGNATED. UPON THE WRITTEN REQUEST OF LIBERTY,
EACH STOCKHOLDER SHALL VOTE (AND CAUSE EACH OF THE MEMBERS OF ITS STOCKHOLDER
GROUP TO VOTE, IF APPLICABLE), OR ACT BY WRITTEN CONSENT WITH RESPECT TO, ALL
EQUITY SECURITIES BENEFICIALLY OWNED BY IT AND OTHERWISE TAKE OR CAUSE TO BE
TAKEN ALL ACTIONS NECESSARY TO REMOVE THE DIRECTOR DESIGNATED BY LIBERTY AND TO
ELECT ANY REPLACEMENT DIRECTOR DESIGNATED BY LIBERTY AS PROVIDED IN THE FIRST
SENTENCE OF THIS SECTION 2.01(D).  THE PARTIES HERETO HEREBY ACKNOWLEDGE THAT AS
OF THE DATE OF THIS AGREEMENT THERE EXIST TWO VACANCIES WITH RESPECT TO WHICH
LIBERTY HAS THE RIGHT TO DESIGNATE LIBERTY DIRECTORS IN ACCORDANCE WITH THE
TERMS OF THIS AGREEMENT AND THAT, UPON LIBERTY’S DESIGNATION OF LIBERTY
DIRECTORS TO FILL SUCH VACANCIES, THE COMPANY WILL USE ITS BEST EFFORTS TO CAUSE
SUCH VACANCIES TO BE FILLED WITHIN A REASONABLE PERIOD OF TIME BY SUCH LIBERTY
DIRECTORS SO DESIGNATED.

 

SECTION 2.02.                             MANAGEMENT OF THE BUSINESS.  EXCEPT AS
INDICATED IN SECTION 2.03 BELOW OR AS REQUIRED BY DELAWARE LAW OR THE
CERTIFICATE OF INCORPORATION OF THE COMPANY AND THE BY-LAWS AND THE AGREEMENTS
CONTEMPLATED THEREBY, MR. DILLER, SO LONG AS HE IS CEO AND HAS NOT BECOME
DISABLED, WILL CONTINUE TO HAVE FULL AUTHORITY TO OPERATE THE DAY-TO-DAY
BUSINESS AFFAIRS OF THE COMPANY TO THE SAME EXTENT AS PRIOR TO THE DATE HEREOF. 
THE COMPANY SHALL USE ITS REASONABLE BEST EFFORTS TO CAUSE ONE LIBERTY DIRECTOR
DESIGNATED BY LIBERTY FOR SUCH PURPOSE TO BE APPOINTED AS A MEMBER OF A
COMMITTEE OF THE BOARD OF DIRECTORS AND, TO THE EXTENT SUCH PERSON QUALIFIES
UNDER APPLICABLE LAW (INCLUDING STOCK EXCHANGE OR NASDAQ REQUIREMENTS, AS
APPLICABLE, AND TAX LAWS) AND SECTION 16(B) UNDER THE EXCHANGE ACT OR OTHER
SIMILAR REQUIREMENTS, ALL COMMITTEES AND SUBCOMMITTEES OF THE BOARD OF DIRECTORS
THAT MAKE DETERMINATIONS RELATING TO THE COMPENSATION OF EXECUTIVES OF THE
COMPANY.

 

SECTION 2.03.                             CONTINGENT MATTERS.  SO LONG AS
LIBERTY OR MR. DILLER BENEFICIALLY OWNS, IN THE CASE OF LIBERTY, AT LEAST
29,912,856 EQUITY SECURITIES (INCLUDING ALL EQUITY SECURITIES HELD BY THE BDTV
ENTITIES) (SO LONG AS SUCH OWNERSHIP PERCENTAGE EQUALS AT LEAST 5% OF THE TOTAL
EQUITY SECURITIES), OR, IN THE CASE OF MR. DILLER, AT LEAST FIVE MILLION COMPANY
COMMON SHARES WITH RESPECT TO WHICH HE HAS A PECUNIARY INTEREST AND THE CEO
TERMINATION DATE (AS DEFINED IN THE AMENDED AND RESTATED STOCKHOLDERS AGREEMENT
AND NOT AS DEFINED IN THIS AGREEMENT) HAS NOT OCCURRED AND MR. DILLER HAS NOT
BECOME DISABLED, NEITHER THE COMPANY NOR ANY SUBSIDIARY

 

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SHALL TAKE ANY OF THE FOLLOWING ACTIONS (ANY SUCH ACTION, A “CONTINGENT MATTER”)
WITHOUT THE PRIOR APPROVAL OF MR. DILLER AND/OR LIBERTY, WHICHEVER (OR BOTH)
SATISFY THE FOREGOING BENEFICIAL OWNERSHIP REQUIREMENTS:

 

(A)                                  ANY TRANSACTION NOT IN THE ORDINARY COURSE
OF BUSINESS, LAUNCHING NEW OR ADDITIONAL CHANNELS OR ENGAGING IN ANY NEW FIELD
OF BUSINESS, IN ANY CASE, THAT WILL RESULT IN, OR WILL HAVE A REASONABLE
LIKELIHOOD OF RESULTING IN, LIBERTY OR MR. DILLER OR ANY AFFILIATE THEREOF BEING
REQUIRED UNDER LAW TO DIVEST ITSELF OF ALL OR ANY PART OF ITS BENEFICIAL
OWNERSHIP OF COMPANY COMMON SHARES, OR INTERESTS THEREIN, OR ANY OTHER MATERIAL
ASSETS OF SUCH PERSON, OR THAT WILL RENDER SUCH PERSON’S CONTINUED OWNERSHIP OF
SUCH SECURITIES, SHARES, INTERESTS OR ASSETS ILLEGAL OR SUBJECT TO THE
IMPOSITION OF A FINE OR PENALTY OR THAT WILL IMPOSE MATERIAL ADDITIONAL
RESTRICTIONS OR LIMITATIONS ON SUCH PERSON’S FULL RIGHTS OF OWNERSHIP
(INCLUDING, WITHOUT LIMITATION, VOTING) THEREOF OR THEREIN.  THIS CONTINGENT
MATTER WILL BE APPLIED BASED ONLY ON THE BENEFICIAL OWNERSHIP OF COMPANY COMMON
SHARES, INTERESTS THEREIN OR OTHER MATERIAL ASSETS OF LIBERTY OR MR. DILLER OR
ANY AFFILIATE THEREOF AS OF THE DATE HEREOF; OR

 

(B)                                 IF THE TOTAL DEBT RATIO CONTINUOUSLY EQUALS
OR EXCEEDS 4:1 OVER A TWELVE-MONTH PERIOD, THEN, FOR SO LONG AS THE TOTAL DEBT
RATIO CONTINUES TO EQUAL OR EXCEED 4:1:

 

(I)                                     ANY ACQUISITION OR DISPOSITION
(INCLUDING PLEDGES), DIRECTLY OR INDIRECTLY, BY THE COMPANY OR ANY OF ITS
SUBSIDIARIES OF ANY ASSETS (INCLUDING DEBT AND/OR EQUITY SECURITIES) OR BUSINESS
(BY MERGER, CONSOLIDATION OR OTHERWISE), THE GRANT OR ISSUANCE OF ANY DEBT OR
EQUITY SECURITIES OF THE COMPANY OR ANY OF ITS SUBSIDIARIES (OTHER THAN, IN THE
CASE OF ANY OF THE FOREGOING, AS CONTEMPLATED BY SECTION 3.01 OF THIS
AGREEMENT), THE REDEMPTION, REPURCHASE OR REACQUISITION OF ANY DEBT OR EQUITY
SECURITIES OF THE COMPANY OR ANY OF ITS SUBSIDIARIES, BY THE COMPANY OR ANY SUCH
SUBSIDIARY, OR THE INCURRENCE OF ANY INDEBTEDNESS, OR ANY COMBINATION OF THE
FOREGOING, IN ANY SUCH CASE, IN ONE TRANSACTION OR A SERIES OF TRANSACTIONS IN A
SIX-MONTH PERIOD, WITH A VALUE OF 10% OR MORE OF THE MARKET VALUE OF THE TOTAL
EQUITY SECURITIES AT THE TIME OF SUCH TRANSACTION, PROVIDED THAT THE PREPAYMENT,
REDEMPTION, REPURCHASE OR CONVERSION OF PREPAYABLE, CALLABLE, REDEEMABLE OR
CONVERTIBLE SECURITIES IN ACCORDANCE WITH THE TERMS THEREOF SHALL NOT BE A
TRANSACTION SUBJECT TO THIS PARAGRAPH;

 

(II)                                  VOLUNTARILY COMMENCING ANY LIQUIDATION,
DISSOLUTION OR WINDING UP OF THE COMPANY OR ANY MATERIAL SUBSIDIARY;

 

(III)                               ANY MATERIAL AMENDMENTS TO THE CERTIFICATE
OF INCORPORATION OR BYLAWS OF THE COMPANY (INCLUDING THE ISSUANCE OF PREFERRED
STOCK PURSUANT TO THE “BLANK CHECK” AUTHORIZATION IN THE CERTIFICATE OF
INCORPORATION, HAVING SUPER VOTING RIGHTS (MORE THAN 1 VOTE PER SHARE) OR
ENTITLED TO VOTE AS A CLASS ON ANY MATTER (EXCEPT TO THE EXTENT SUCH CLASS VOTE
IS REQUIRED BY DELAWARE LAW OR TO THE EXTENT THE HOLDER OF SUCH PREFERRED STOCK
MAY HAVE THE RIGHT TO ELECT DIRECTORS UPON THE OCCURRENCE OF A DEFAULT IN
PAYMENT OF DIVIDENDS OR REDEMPTION PRICE));

 

(IV)                              ENGAGEMENT BY THE COMPANY IN ANY LINE OF
BUSINESS OTHER THAN MEDIA, COMMUNICATIONS AND ENTERTAINMENT PRODUCTS, SERVICES
AND PROGRAMMING,

 

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AND ELECTRONIC RETAILING AND COMMERCE, OR OTHER BUSINESSES ENGAGED IN BY THE
COMPANY AS OF THE DATE OF DETERMINATION OF THE TOTAL DEBT RATIO;

 

(V)                                 ADOPTING ANY STOCKHOLDER RIGHTS PLAN (OR ANY
OTHER PLAN OR ARRANGEMENT THAT COULD REASONABLY BE EXPECTED TO DISADVANTAGE ANY
STOCKHOLDER ON THE BASIS OF THE SIZE OR VOTING POWER OF ITS SHAREHOLDING) THAT
WOULD ADVERSELY AFFECT LIBERTY OR MR. DILLER; AND

 

(VI)                              ENTERING INTO ANY AGREEMENT WITH ANY HOLDER OF
EQUITY SECURITIES IN SUCH STOCKHOLDER’S CAPACITY AS SUCH, WHICH GRANTS SUCH
STOCKHOLDER APPROVAL RIGHTS SIMILAR IN TYPE AND MAGNITUDE TO THOSE SET FORTH IN
THIS SECTION 2.03.

 

SECTION 2.04.                             NOTICE OF EVENTS.  IN THE EVENT THAT
(A) THE COMPANY INTENDS TO ENGAGE IN A TRANSACTION OF A TYPE THAT IS DESCRIBED
IN SECTION 2.03, AND (B) THE COMPANY DOES NOT INTEND TO SEEK CONSENT FROM
LIBERTY AND/OR MR. DILLER, WHICHEVER (OR BOTH) ARE REQUIRED TO CONSENT TO A
CONTINGENT MATTER (A “CONSENTING PARTY”) DUE TO THE COMPANY’S GOOD FAITH BELIEF
THAT THE SPECIFIC PROVISIONS OF SECTION 2.03 DO NOT REQUIRE SUCH CONSENT BUT
THAT REASONABLE PEOPLE ACTING IN GOOD FAITH COULD DIFFER AS TO WHETHER CONSENT
IS REQUIRED PURSUANT TO SUCH SECTION, THE COMPANY SHALL NOTIFY THE CONSENTING
PARTIES AS TO THE MATERIAL TERMS OF THE TRANSACTION (INCLUDING THE COMPANY’S
ESTIMATE OF THE TIMING THEREOF) BY WRITTEN NOTICE (INCLUDING A STATEMENT OF THE
TOTAL DEBT RATIO) DELIVERED AS FAR IN ADVANCE OF ENGAGING IN SUCH TRANSACTION AS
IS REASONABLY PRACTICABLE UNLESS SUCH TRANSACTION WAS PREVIOUSLY PUBLICLY
DISCLOSED.

 

ARTICLE III

 

PREEMPTIVE RIGHTS

 

SECTION 3.01.                             LIBERTY PREEMPTIVE RIGHTS.  (A) IN THE
EVENT THAT AFTER THE DATE HEREOF, THE COMPANY ISSUES OR PROPOSES TO ISSUE (OTHER
THAN TO THE COMPANY AND ITS AFFILIATES OR LIBERTY AND ITS AFFILIATES, AND OTHER
THAN PURSUANT TO AN EXCLUDED ISSUANCE) ANY COMPANY COMMON SHARES (INCLUDING
COMPANY COMMON SHARES ISSUED UPON EXERCISE, CONVERSION OR EXCHANGE OF OPTIONS,
WARRANTS AND CONVERTIBLE SECURITIES (OTHER THAN SHARES OF COMPANY COMMON STOCK
ISSUED UPON CONVERSION OF SHARES OF COMPANY CLASS B STOCK) AND SUCH ISSUANCE,
TOGETHER WITH ANY PRIOR ISSUANCES AGGREGATING LESS THAN 1% WITH RESPECT TO WHICH
LIBERTY’S PREEMPTIVE RIGHT HAS NOT BECOME EXERCISABLE (INCLUDING ISSUANCES PRIOR
TO THE DATE HEREOF WHICH WOULD BE INCLUDED FOR PURPOSES OF CALCULATING THE 1%
THRESHOLD THAT HAVE NOT PREVIOUSLY BEEN TAKEN INTO ACCOUNT IN CONNECTION WITH
THE PREEMPTIVE RIGHT LAST PRECEDING THE DATE OF THIS AGREEMENT PURSUANT TO THE
2001 GOVERNANCE AGREEMENT), SHALL BE IN EXCESS OF 1% OF THE TOTAL NUMBER OF
COMPANY COMMON SHARES OUTSTANDING AFTER GIVING EFFECT TO SUCH ISSUANCE (AN
“ADDITIONAL ISSUANCE”), THE COMPANY SHALL GIVE WRITTEN NOTICE TO LIBERTY NOT
LATER THAN FIVE BUSINESS DAYS AFTER THE ISSUANCE, SPECIFYING THE NUMBER OF
COMPANY COMMON SHARES ISSUED OR TO BE ISSUED AND THE ISSUE PRICE (IF KNOWN) PER
SHARE.  LIBERTY SHALL HAVE THE RIGHT (BUT NOT THE OBLIGATION) TO PURCHASE OR
CAUSE ONE OR MORE OF THE LIBERTY HOLDCOS TO PURCHASE FOR CASH A NUMBER (BUT NOT
LESS THAN SUCH NUMBER) OF COMPANY COMMON SHARES (ALLOCATED BETWEEN COMPANY
COMMON STOCK AND COMPANY CLASS B STOCK IN THE SAME PROPORTION AS THE ISSUANCE OR
ISSUANCES GIVING RISE TO THE PREEMPTIVE RIGHT HEREUNDER, EXCEPT TO THE EXTENT
THAT LIBERTY OPTS TO RECEIVE COMPANY COMMON STOCK IN LIEU OF

 

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COMPANY CLASS B COMMON STOCK), SO THAT LIBERTY AND THE LIBERTY HOLDCOS SHALL
COLLECTIVELY MAINTAIN THE IDENTICAL PERCENTAGE EQUITY BENEFICIAL OWNERSHIP
INTEREST IN THE COMPANY THAT LIBERTY AND THE LIBERTY HOLDCOS COLLECTIVELY OWNED
IMMEDIATELY PRIOR TO THE NOTICE FROM THE COMPANY TO LIBERTY DESCRIBED IN THE
FIRST SENTENCE OF THIS PARAGRAPH (BUT NOT IN EXCESS OF 20.01% OF THE OUTSTANDING
TOTAL EQUITY SECURITIES) AFTER GIVING EFFECT TO SUCH ADDITIONAL ISSUANCE AND TO
SHARES OF COMPANY COMMON STOCK THAT ARE TO BE ISSUED TO LIBERTY AND THE LIBERTY
HOLDCOS PURSUANT TO THIS SECTION 3.01 BY SENDING AN IRREVOCABLE WRITTEN NOTICE
TO THE COMPANY NOT LATER THAN FIFTEEN BUSINESS DAYS AFTER RECEIPT OF SUCH NOTICE
(OR, IF LATER, TWO BUSINESS DAYS FOLLOWING THE DETERMINATION OF THE ISSUE PRICE)
FROM THE COMPANY THAT IT ELECTS TO PURCHASE OR TO CAUSE ONE OR MORE OF THE
LIBERTY HOLDCOS TO PURCHASE ALL OF SUCH COMPANY COMMON SHARES (THE “ADDITIONAL
SHARES”).  THE CLOSING OF THE PURCHASE OF ADDITIONAL SHARES SHALL BE THE LATER
OF TEN BUSINESS DAYS AFTER THE DELIVERY OF THE NOTICE OF ELECTION BY LIBERTY AND
FIVE BUSINESS DAYS AFTER RECEIPT OF ANY NECESSARY REGULATORY APPROVALS.

 

(B)                                 THE PURCHASE OR REDEMPTION OF ANY COMPANY
COMMON SHARES BY THE COMPANY OR ANY OF ITS AFFILIATES SHALL NOT RESULT IN AN
INCREASE IN THE PERCENTAGE OF COMPANY EQUITY THAT LIBERTY MAY BE ENTITLED TO
ACQUIRE PURSUANT TO THE PREEMPTIVE RIGHT IN PARAGRAPH 3.01(A) ABOVE.

 

SECTION 3.02.                             INVESTMENT AGREEMENT.  SECTION 1.7 AND
SECTION 1.8 OF THE INVESTMENT AGREEMENT SHALL BE OF NO FURTHER FORCE OR EFFECT
AND LIBERTY SHALL CEASE TO HAVE ANY PREEMPTIVE RIGHTS WITH RESPECT TO EQUITY
SECURITIES, EXCEPT AS OTHERWISE PROVIDED WITH RESPECT TO LIBERTY IN SECTION 3.01
OF THIS AGREEMENT.

 

ARTICLE IV

 

REPRESENTATIONS AND WARRANTIES

 

SECTION 4.01.                             REPRESENTATIONS AND WARRANTIES OF THE
COMPANY.  THE COMPANY REPRESENTS AND WARRANTS TO MR. DILLER AND LIBERTY THAT
(A) THE COMPANY IS A CORPORATION DULY ORGANIZED, VALIDLY EXISTING AND IN GOOD
STANDING UNDER THE LAWS OF THE STATE OF DELAWARE AND HAS THE CORPORATE POWER AND
AUTHORITY TO ENTER INTO THIS AGREEMENT AND TO CARRY OUT ITS OBLIGATIONS
HEREUNDER, (B) THE EXECUTION AND DELIVERY OF THIS AGREEMENT BY THE COMPANY AND
THE CONSUMMATION BY THE COMPANY OF THE TRANSACTIONS CONTEMPLATED HEREBY HAVE
BEEN DULY AUTHORIZED BY ALL NECESSARY CORPORATE ACTION ON THE PART OF THE
COMPANY AND NO OTHER CORPORATE PROCEEDINGS ON THE PART OF THE COMPANY ARE
NECESSARY TO AUTHORIZE THIS AGREEMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED
HEREBY, (C) THIS AGREEMENT HAS BEEN DULY EXECUTED AND DELIVERED BY THE COMPANY
AND CONSTITUTES A VALID AND BINDING OBLIGATION OF THE COMPANY, AND, ASSUMING
THIS AGREEMENT CONSTITUTES A VALID AND BINDING OBLIGATION OF EACH STOCKHOLDER,
IS ENFORCEABLE AGAINST THE COMPANY IN ACCORDANCE WITH ITS TERMS, (D) NEITHER THE
EXECUTION, DELIVERY OR PERFORMANCE OF THIS AGREEMENT BY THE COMPANY CONSTITUTES
A BREACH OR VIOLATION OF OR CONFLICTS WITH THE COMPANY’S CERTIFICATE OF
INCORPORATION OR BY-LAWS OR ANY MATERIAL AGREEMENT TO WHICH THE COMPANY IS A
PARTY AND (E) NONE OF SUCH MATERIAL AGREEMENTS WOULD IMPAIR IN ANY MATERIAL
RESPECT THE ABILITY OF THE COMPANY TO PERFORM ITS OBLIGATIONS HEREUNDER.

 

SECTION 4.02.                             REPRESENTATIONS AND WARRANTIES OF THE
STOCKHOLDERS.  EACH STOCKHOLDER, SEVERALLY AS TO ITSELF (AND, IN THE CASE OF
MR. DILLER, AS APPLICABLE), REPRESENTS AND WARRANTS TO THE

 

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COMPANY AND THE OTHER STOCKHOLDER THAT (A) IT IS A CORPORATION DULY ORGANIZED,
VALIDLY EXISTING AND IN GOOD STANDING UNDER THE LAWS OF ITS JURISDICTION OF
ORGANIZATION AND HE OR IT, AS THE CASE MAY BE, HAS THE POWER AND AUTHORITY
(CORPORATE OR OTHERWISE) TO ENTER INTO THIS AGREEMENT AND TO CARRY OUT HIS OR
ITS OBLIGATIONS HEREUNDER, (B) THE EXECUTION AND DELIVERY OF THIS AGREEMENT BY
SUCH STOCKHOLDER AND THE CONSUMMATION BY SUCH STOCKHOLDER OF THE TRANSACTIONS
CONTEMPLATED HEREBY HAVE BEEN DULY AUTHORIZED BY ALL NECESSARY ACTION ON THE
PART OF SUCH STOCKHOLDER AND NO OTHER PROCEEDINGS ON THE PART OF SUCH
STOCKHOLDER ARE NECESSARY TO AUTHORIZE THIS AGREEMENT OR ANY OF THE TRANSACTIONS
CONTEMPLATED HEREBY, (C) THIS AGREEMENT HAS BEEN DULY EXECUTED AND DELIVERED BY
SUCH STOCKHOLDER AND CONSTITUTES A VALID AND BINDING OBLIGATION OF SUCH
STOCKHOLDER, AND, ASSUMING THIS AGREEMENT CONSTITUTES A VALID AND BINDING
OBLIGATION OF THE COMPANY, IS ENFORCEABLE AGAINST SUCH STOCKHOLDER IN ACCORDANCE
WITH ITS TERMS, (D) NEITHER THE EXECUTION, DELIVERY OR PERFORMANCE OF THIS
AGREEMENT BY SUCH STOCKHOLDER CONSTITUTES A BREACH OR VIOLATION OF OR CONFLICTS
WITH ITS CERTIFICATE OF INCORPORATION OR BY-LAWS (OR SIMILAR GOVERNING
DOCUMENTS) OR ANY MATERIAL AGREEMENT TO WHICH SUCH STOCKHOLDER IS A PARTY AND
(E) NONE OF SUCH MATERIAL AGREEMENTS WOULD IMPAIR IN ANY MATERIAL RESPECT THE
ABILITY OF SUCH STOCKHOLDER TO PERFORM ITS OBLIGATIONS HEREUNDER.

 

ARTICLE V

 

DEFINITIONS

 

For purposes of this Agreement, the following terms shall have the following
meanings:

 

SECTION 5.01.                             “2001 GOVERNANCE AGREEMENT” SHALL HAVE
THE MEANING SET FORTH IN THE RECITALS TO THIS AGREEMENT.

 

SECTION 5.02.                             “AFFILIATE” SHALL HAVE THE MEANING SET
FORTH IN RULE 12B-2 UNDER THE EXCHANGE ACT (AS IN EFFECT ON THE DATE OF THIS
AGREEMENT).  FOR PURPOSES OF THIS DEFINITION, (I) NATURAL PERSONS SHALL NOT BE
DEEMED TO BE AFFILIATES OF EACH OTHER, (II) NONE OF MR. DILLER, LIBERTY OR ANY
OF THEIR RESPECTIVE AFFILIATES SHALL BE DEEMED TO BE AN AFFILIATE OF THE COMPANY
OR ITS AFFILIATES, (III) NONE OF THE COMPANY, LIBERTY OR ANY OF THEIR RESPECTIVE
AFFILIATES SHALL BE DEEMED TO BE AN AFFILIATE OF MR. DILLER OR HIS AFFILIATES,
(IV) NONE OF THE COMPANY, MR. DILLER OR ANY OF THEIR RESPECTIVE AFFILIATES SHALL
BE DEEMED TO BE AN AFFILIATE OF LIBERTY OR ITS AFFILIATES, AND (V) THE COMPANY
SHALL NOT BE DEEMED TO BE AN AFFILIATE OF EXPEDIA, INC. BASED UPON THE COMMON
CONTROL OF THE COMPANY AND EXPEDIA, INC. BY THE STOCKHOLDERS.

 

SECTION 5.03.                             “AMENDED AND RESTATED STOCKHOLDERS
AGREEMENT” SHALL MEAN THE STOCKHOLDERS AGREEMENT DATED AS OF THE DATE HEREOF
BETWEEN LIBERTY AND MR. DILLER.

 

SECTION 5.04.                             “BDTV ENTITIES” SHALL HAVE THE MEANING
SPECIFIED IN THE AMENDED AND RESTATED STOCKHOLDERS AGREEMENT.

 

SECTION 5.05.                             “BENEFICIAL OWNERSHIP” OR
“BENEFICIALLY OWN” SHALL HAVE THE MEANING GIVEN SUCH TERM IN RULE 13D-3 UNDER
THE EXCHANGE ACT AND A PERSON’S BENEFICIAL OWNERSHIP OF COMPANY COMMON SHARES
SHALL BE CALCULATED IN ACCORDANCE WITH THE PROVISIONS OF SUCH RULE; PROVIDED,
HOWEVER, THAT FOR PURPOSES OF BENEFICIAL OWNERSHIP, (A) A PERSON SHALL BE DEEMED
TO BE THE BENEFICIAL OWNER OF ANY EQUITY SECURITIES WHICH MAY BE ACQUIRED BY
SUCH PERSON

 

6

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(DISREGARDING ANY LEGAL IMPEDIMENTS TO SUCH BENEFICIAL OWNERSHIP), WHETHER
WITHIN 60 DAYS OR THEREAFTER, UPON THE CONVERSION, EXCHANGE OR EXERCISE OF ANY
WARRANTS, OPTIONS (WHICH OPTIONS HELD BY MR. DILLER SHALL BE DEEMED TO BE
EXERCISABLE), RIGHTS OR OTHER SECURITIES ISSUED BY THE COMPANY OR ANY SUBSIDIARY
THEREOF, (B) NO PERSON SHALL BE DEEMED TO BENEFICIALLY OWN ANY EQUITY SECURITIES
SOLELY AS A RESULT OF SUCH PERSON’S EXECUTION OF THIS AGREEMENT (INCLUDING BY
VIRTUE OF HOLDING A PROXY WITH RESPECT TO ANY EQUITY SECURITIES), OR THE AMENDED
AND RESTATED STOCKHOLDERS AGREEMENT, OR WITH RESPECT TO WHICH SUCH PERSON DOES
NOT HAVE A PECUNIARY INTEREST, AND (C) LIBERTY SHALL BE DEEMED TO BE THE
BENEFICIAL OWNER OF ALL OF THE COMPANY COMMON SHARES HELD BY EACH BDTV ENTITY.

 

SECTION 5.06.                             “CEO” SHALL MEAN THE CHIEF EXECUTIVE
OFFICER OF THE COMPANY OR ANY SUCCESSOR ENTITY.

 

SECTION 5.07.                             “CEO TERMINATION DATE”  SHALL MEAN THE
DATE THAT MR. DILLER NO LONGER SERVES AS CEO.

 

SECTION 5.08.                             “COMMISSION” SHALL MEAN THE SECURITIES
AND EXCHANGE COMMISSION.

 

SECTION 5.09.                             “COMPANY” SHALL HAVE THE MEANING SET
FORTH IN THE RECITALS TO THIS AGREEMENT.

 

SECTION 5.10.                             “COMPANY COMMON SHARES” SHALL MEAN
SHARES OF COMPANY COMMON STOCK AND COMPANY CLASS B STOCK.

 

SECTION 5.11.                             “COMPANY CLASS B STOCK” SHALL MEAN
CLASS B COMMON STOCK, $0.001 PAR VALUE PER SHARE, OF THE COMPANY.

 

SECTION 5.12.                             “COMPANY COMMON STOCK” SHALL MEAN
COMMON STOCK, $0.001 PAR VALUE PER SHARE, OF THE COMPANY.

 

SECTION 5.13.                             “CONSENTING PARTY” SHALL HAVE THE
MEANING SET FORTH IN SECTION 2.03 OF THIS AGREEMENT.

 

SECTION 5.14.                             “DEMAND REGISTRATION” SHALL HAVE THE
MEANING SET FORTH IN SECTION 6.07(B) OF THIS AGREEMENT.

 

SECTION 5.15.                             “DISABLED” SHALL MEAN THE DISABILITY
OF MR. DILLER AFTER THE EXPIRATION OF MORE THAN 180 CONSECUTIVE DAYS AFTER ITS
COMMENCEMENT WHICH IS DETERMINED TO BE TOTAL AND PERMANENT BY A PHYSICIAN
SELECTED BY LIBERTY AND REASONABLY ACCEPTABLE TO MR. DILLER, HIS SPOUSE OR A
PERSONAL REPRESENTATIVE DESIGNATED BY MR. DILLER; PROVIDED THAT MR. DILLER SHALL
BE DEEMED TO BE DISABLED ONLY FOLLOWING THE EXPIRATION OF 90 DAYS FOLLOWING
RECEIPT OF A WRITTEN NOTICE FROM THE COMPANY AND SUCH PHYSICIAN SPECIFYING THAT
A DISABILITY HAS OCCURRED IF WITHIN SUCH 90-DAY PERIOD HE FAILS TO RETURN TO
MANAGING THE BUSINESS AFFAIRS OF THE COMPANY.  TOTAL DISABILITY SHALL MEAN
MENTAL OR PHYSICAL INCAPACITY THAT PREVENTS MR. DILLER FROM MANAGING THE
BUSINESS AFFAIRS OF THE COMPANY.

 

SECTION 5.16.                             “EBITDA” SHALL MEAN, FOR ANY PERIOD,
FOR THE COMPANY AND ITS SUBSIDIARIES, ON A COMBINED CONSOLIDATED BASIS: NET
INCOME PLUS (TO THE EXTENT REFLECTED IN THE

 

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DETERMINATION OF NET INCOME) (I) PROVISION FOR INCOME TAXES, (II) MINORITY
INTEREST, (III) INTEREST INCOME AND EXPENSE, (IV) DEPRECIATION AND AMORTIZATION,
(V) AMORTIZATION OF CABLE DISTRIBUTION FEES, AND (VI) AMORTIZATION OF NON-CASH
DISTRIBUTION AND MARKETING EXPENSE AND NON-CASH COMPENSATION EXPENSE.

 

SECTION 5.17.                             “EQUITY SECURITIES” SHALL MEAN THE
EQUITY SECURITIES OF THE COMPANY CALCULATED ON A COMPANY COMMON STOCK EQUIVALENT
BASIS, INCLUDING THE COMPANY COMMON SHARES AND THOSE SHARES ISSUABLE UPON
EXERCISE, CONVERSION OR REDEMPTION OF OTHER SECURITIES OF THE COMPANY NOT
OTHERWISE INCLUDED IN THIS DEFINITION.

 

SECTION 5.18.                             “EXCHANGE ACT” SHALL MEAN THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED, AND THE RULES AND REGULATIONS OF
THE COMMISSION PROMULGATED THEREUNDER.

 

SECTION 5.19.                             “EXCLUDED ISSUANCE” SHALL MEAN ANY
ISSUANCE OF COMPANY COMMON SHARES (I) IN A SALE TRANSACTION, OR (II) WHICH IS
“RESTRICTED STOCK” OR THE OWNERSHIP OF WHICH IS OTHERWISE SUBJECT TO FORFEITURE
(“RESTRICTED STOCK”), PROVIDED THAT FOR PURPOSES OF THIS DEFINITION AND
SECTION 3.01 OF THIS AGREEMENT ANY STOCK COVERED BY THE PROVISIONS OF CLAUSE
(II) SHALL BE DEEMED TO HAVE BEEN ISSUED FOR PURPOSES OF SECTION 3.01 OF THIS
AGREEMENT ON THE DATE (THE “LAPSE DATE”) THE RESTRICTIONS ON SUCH STOCK LAPSE OR
ON WHICH THE STOCK IS NO LONGER SUBJECT TO FORFEITURE.

 

SECTION 5.20.                             “FAIR MARKET VALUE” FOR A SECURITY
PUBLICLY TRADED IN THE OVER-THE-COUNTER MARKET (ON EITHER NASDAQ-NMS OR NASDAQ)
OR ON A RECOGNIZED EXCHANGE SHALL BE THE AVERAGE CLOSING PRICE OF SUCH SECURITY
FOR THE THREE TRADING DAYS ENDING ON THE APPLICABLE DAY (OR, IF SUCH DAY IS NOT
A TRADING DAY, THE TRADING DAY IMMEDIATELY PRECEDING THE APPLICABLE DAY), AND
FOR ALL OTHER SECURITIES OR PROPERTY “FAIR MARKET VALUE” SHALL BE DETERMINED, BY
A NATIONALLY RECOGNIZED INVESTMENT BANKING FIRM WHICH HAS NOT BEEN ENGAGED BY
THE COMPANY OR LIBERTY OR THEIR RESPECTIVE AFFILIATES (INCLUDING, WITH RESPECT
TO THE COMPANY, FOR SO LONG AS MR. DILLER IS CHAIRMAN OF THE BOARD OF
EXPEDIA, INC., EXPEDIA, INC.) FOR THE PRIOR THREE YEARS, SELECTED BY (I) THE
COMPANY AND (II) LIBERTY; PROVIDED THAT, IF THE COMPANY AND LIBERTY CANNOT AGREE
ON SUCH AN INVESTMENT BANKING FIRM WITHIN 10 BUSINESS DAYS, SUCH INVESTMENT
BANKING FIRM SHALL BE SELECTED BY A PANEL DESIGNATED IN ACCORDANCE WITH THE
RULES OF THE AMERICAN ARBITRATION ASSOCIATION.  THE FEES, COSTS AND EXPENSES OF
THE AMERICAN ARBITRATION ASSOCIATION AND THE INVESTMENT BANKING FIRM SO SELECTED
SHALL BE BORNE EQUALLY BY THE COMPANY AND LIBERTY.

 

SECTION 5.21.                             “IAC” SHALL HAVE THE MEANING SET FORTH
IN THE RECITALS TO THIS AGREEMENT.

 

SECTION 5.22.                             “ISSUE PRICE” SHALL MEAN THE PRICE PER
SHARE EQUAL TO (I) IN CONNECTION WITH AN UNDERWRITTEN OFFERING OF COMPANY COMMON
SHARES, THE INITIAL PRICE AT WHICH THE STOCK IS OFFERED TO THE PUBLIC OR OTHER
INVESTORS, (II) IN CONNECTION WITH OTHER SALES OF COMPANY COMMON SHARES FOR
CASH, THE CASH PRICE PAID FOR SUCH STOCK, (III) IN CONNECTION WITH THE DEEMED
ISSUANCES OF RESTRICTED STOCK, THE FAIR MARKET VALUE OF THE STOCK ON THE LAPSE
DATE (AS DEFINED IN THE DEFINITION OF “EXCLUDED ISSUANCE” ABOVE), (IV) IN
CONNECTION WITH THE ISSUANCE OF COMPANY COMMON SHARES AS CONSIDERATION IN AN
ACQUISITION BY THE COMPANY, THE AVERAGE OF THE FAIR MARKET VALUE OF THE STOCK
FOR THE FIVE TRADING DAYS ENDING ON THE THIRD TRADING DAY IMMEDIATELY PRECEDING
(A) THE DATE UPON WHICH DEFINITIVE AGREEMENTS WITH RESPECT TO SUCH ACQUISITION
WERE ENTERED INTO IF THE NUMBER OF COMPANY COMMON SHARES ISSUABLE IN SUCH
TRANSACTION IS FIXED ON

 

8

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THAT DATE, OR (B) SUCH LATER DATE ON WHICH THE CONSIDERATION, OR REMAINING
PORTION THEREOF, ISSUABLE IN SUCH TRANSACTION BECOMES FIXED, (V) IN CONNECTION
WITH A COMPENSATORY ISSUANCE OF SHARES OF COMPANY COMMON STOCK, THE FAIR MARKET
VALUE OF THE COMPANY COMMON STOCK, AND (VI) IN ALL OTHER CASES, INCLUDING,
WITHOUT LIMITATION, IN CONNECTION WITH THE ISSUANCE OF COMPANY COMMON SHARES
PURSUANT TO AN OPTION, WARRANT OR CONVERTIBLE SECURITY (OTHER THAN IN CONNECTION
WITH ISSUANCES DESCRIBED IN CLAUSE (V) ABOVE), THE FAIR MARKET VALUE OF THE
COMPANY COMMON SHARES ON THE DATE OF ISSUANCE.

 

SECTION 5.23.                             “LIBERTY DIRECTOR” SHALL MEAN (A) ANY
EXECUTIVE OFFICER OR DIRECTOR OF LIBERTY DESIGNATED BY LIBERTY TO SERVE ON THE
COMPANY’S BOARD OF DIRECTORS, PROVIDED THAT THE COMPANY’S BOARD OF DIRECTORS IS
NOT UNABLE, IN THE EXERCISE OF ITS FIDUCIARY RESPONSIBILITIES, TO RECOMMEND THAT
THE COMPANY’S STOCKHOLDERS ELECT SUCH INDIVIDUAL TO SERVE ON THE COMPANY’S
 BOARD OF DIRECTORS, OR (B) ANY OTHER PERSON DESIGNATED BY LIBERTY WHO IS
REASONABLY ACCEPTABLE TO THE COMPANY.

 

SECTION 5.24.                             “LIBERTY HOLDCO” SHALL MEAN ANY
HOLDING COMPANY WHOLLY OWNED BY LIBERTY AND REASONABLY ACCEPTABLE TO THE
COMPANY, FORMED SOLELY FOR THE PURPOSE OF ACQUIRING AND HOLDING AN EQUITY
INTEREST IN THE COMPANY.

 

SECTION 5.25.                             “OWNERSHIP PERCENTAGE” MEANS, WITH
RESPECT TO ANY STOCKHOLDER, AT ANY TIME, THE RATIO, EXPRESSED AS A PERCENTAGE,
OF (I) THE EQUITY SECURITIES BENEFICIALLY OWNED BY SUCH STOCKHOLDER
(DISREGARDING ANY LEGAL IMPEDIMENTS TO SUCH BENEFICIAL OWNERSHIP) AND ITS
AFFILIATES TO (II) THE SUM OF (X) THE TOTAL EQUITY SECURITIES AND (Y) WITH
RESPECT TO SUCH STOCKHOLDER, ANY COMPANY COMMON SHARES INCLUDED IN CLAUSE
(I) THAT ARE ISSUABLE UPON CONVERSION, EXCHANGE OR EXERCISE OF EQUITY SECURITIES
THAT ARE NOT INCLUDED IN CLAUSE (X).

 

SECTION 5.26.                             “PERMITTED TRANSFEREE” SHALL MEAN
LIBERTY OR MR. DILLER AND THE MEMBERS OF THEIR RESPECTIVE STOCKHOLDER GROUPS.

 

SECTION 5.27.                             “PERSON” SHALL MEAN ANY INDIVIDUAL,
PARTNERSHIP, JOINT VENTURE, CORPORATION, LIMITED LIABILITY COMPANY, TRUST,
UNINCORPORATED ORGANIZATION, GOVERNMENT OR DEPARTMENT OR AGENCY OF A GOVERNMENT.

 

SECTION 5.28.                             “SALE TRANSACTION” SHALL MEAN THE
CONSUMMATION OF A MERGER, CONSOLIDATION OR AMALGAMATION BETWEEN THE COMPANY AND
ANOTHER ENTITY (OTHER THAN AN AFFILIATE OF THE COMPANY) IN WHICH THE COMPANY IS
ACQUIRED BY SUCH OTHER ENTITY OR A PERSON WHO CONTROLS SUCH ENTITY, OR A SALE OF
ALL OR SUBSTANTIALLY ALL OF THE ASSETS OF THE COMPANY TO ANOTHER ENTITY, OTHER
THAN A SUBSIDIARY OF THE COMPANY.

 

SECTION 5.29.                             “SECURITIES ACT” SHALL MEAN THE
SECURITIES ACT OF 1933, AS AMENDED, AND THE RULES AND REGULATIONS OF THE
COMMISSION PROMULGATED THEREUNDER.

 

SECTION 5.30.                             “STOCKHOLDERS” SHALL MEAN LIBERTY AND
MR. DILLER.

 

SECTION 5.31.                             “STOCKHOLDER GROUP” SHALL MEAN (A) IN
RESPECT OF LIBERTY, THE LIBERTY STOCKHOLDER GROUP (AS DEFINED IN THE AMENDED AND
RESTATED STOCKHOLDERS AGREEMENT) AND (B) IN RESPECT OF MR. DILLER, THE DILLER
STOCKHOLDER GROUP (AS DEFINED IN THE AMENDED AND RESTATED STOCKHOLDERS
AGREEMENT).

 

9

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SECTION 5.32.                             “SUBSIDIARY” SHALL MEAN, AS TO ANY
PERSON, ANY CORPORATION OR OTHER PERSON AT LEAST A MAJORITY OF THE SHARES OF
STOCK OR OTHER OWNERSHIP INTERESTS OF WHICH HAVING GENERAL VOTING POWER UNDER
ORDINARY CIRCUMSTANCES TO ELECT A MAJORITY OF THE BOARD OF DIRECTORS OR SIMILAR
GOVERNING BODY OF SUCH CORPORATION OR OTHER ENTITY (IRRESPECTIVE OF WHETHER OR
NOT AT THE TIME STOCK OF ANY OTHER CLASS OR CLASSES SHALL HAVE OR MIGHT HAVE
VOTING POWER BY REASON OF THE HAPPENING OF ANY CONTINGENCY) IS, AT THE TIME AS
OF WHICH THE DETERMINATION IS BEING MADE, OWNED BY SUCH PERSON, OR ONE OR MORE
OF ITS SUBSIDIARIES OR BY SUCH PERSON AND ONE OR MORE OF ITS SUBSIDIARIES.

 

SECTION 5.33.                             “THIRD PARTY TRANSFEREE” SHALL HAVE
THE MEANING ASCRIBED TO SUCH TERM IN THE AMENDED AND RESTATED STOCKHOLDERS
AGREEMENT.

 

SECTION 5.34.                             “TOTAL DEBT” SHALL MEAN ALL
OBLIGATIONS OF THE COMPANY AND ITS SUBSIDIARIES FOR MONEY BORROWED, AT SUCH TIME
(INCLUDING ALL LONG-TERM SENIOR AND SUBORDINATED INDEBTEDNESS, ALL SHORT-TERM
INDEBTEDNESS, THE STATED AMOUNT OF ALL LETTERS OF CREDIT ISSUED FOR THE ACCOUNT
OF THE COMPANY OR ANY OF ITS SUBSIDIARIES AND (WITHOUT DUPLICATION) ALL
UNREIMBURSED DRAWS THEREUNDER (BUT EXCLUDING TRADE LETTERS OF CREDIT)), NET OF
CASH (OTHER THAN WORKING CAPITAL) OR CASH EQUIVALENT SECURITIES, AS SHOWN ON THE
CONSOLIDATED QUARTERLY OR ANNUAL FINANCIAL STATEMENTS, INCLUDING THE NOTES
THERETO, OF THE COMPANY AND ITS SUBSIDIARIES INCLUDED IN THE COMPANY’S FILINGS
UNDER THE EXCHANGE ACT FOR SUCH PERIOD, DETERMINED IN ACCORDANCE WITH GAAP,
PROVIDED, HOWEVER, THAT TOTAL DEBT SHALL NOT INCLUDE HEDGING, PLEDGING,
SECURITIZATION OR SIMILAR TRANSACTIONS INVOLVING SECURITIES OWNED BY THE COMPANY
OR ITS SUBSIDIARIES TO MONETIZE THE UNDERLYING SECURITIES, TO THE EXTENT SUCH
SECURITIES ARE THE SOLE MEANS OF SATISFYING SUCH OBLIGATIONS AND OTHERWISE THE
FAIR VALUE THEREOF.

 

SECTION 5.35.                             “TOTAL DEBT RATIO” SHALL MEAN, AT ANY
TIME, THE RATIO OF (I) TOTAL DEBT OF THE COMPANY AND ITS SUBSIDIARIES ON A
COMBINED CONSOLIDATED BASIS AS OF SUCH TIME TO (II) EBITDA FOR THE FOUR FISCAL
QUARTER PERIOD ENDING AS OF THE LAST DAY OF THE MOST RECENTLY ENDED FISCAL
QUARTER AS OF SUCH TIME.

 

SECTION 5.36.                             “TOTAL EQUITY SECURITIES” AT ANY TIME
SHALL MEAN, SUBJECT TO THE NEXT SENTENCE, THE TOTAL NUMBER OF THE COMPANY’S
OUTSTANDING EQUITY SECURITIES CALCULATED ON A COMPANY COMMON STOCK EQUIVALENT
BASIS.  ANY EQUITY SECURITIES BENEFICIALLY OWNED BY A PERSON THAT ARE NOT
OUTSTANDING VOTING SECURITIES BUT THAT, UPON EXERCISE, CONVERSION OR EXCHANGE,
WOULD BECOME VOTING SECURITIES, SHALL BE DEEMED TO BE OUTSTANDING FOR THE
PURPOSE OF COMPUTING TOTAL EQUITY SECURITIES AND THE PERCENTAGE OF EQUITY
SECURITIES OWNED BY SUCH  PERSON BUT SHALL NOT BE DEEMED TO BE OUTSTANDING FOR
THE PURPOSE OF COMPUTING TOTAL EQUITY SECURITIES AND THE PERCENTAGE OF THE
EQUITY SECURITIES OWNED BY ANY OTHER PERSON.

 

SECTION 5.37.                             “TRANSFER” SHALL MEAN, DIRECTLY OR
INDIRECTLY, TO SELL, TRANSFER, ASSIGN, PLEDGE, ENCUMBER, HYPOTHECATE OR
SIMILARLY DISPOSE OF, EITHER VOLUNTARILY OR INVOLUNTARILY, OR TO ENTER INTO ANY
CONTRACT, OPTION OR OTHER ARRANGEMENT OR UNDERSTANDING WITH RESPECT TO THE SALE,
TRANSFER, ASSIGNMENT, PLEDGE, ENCUMBRANCE, HYPOTHECATION OR SIMILAR DISPOSITION
OF, ANY COMPANY COMMON SHARES BENEFICIALLY OWNED BY SUCH STOCKHOLDER OR ANY
INTEREST IN ANY COMPANY COMMON SHARES BENEFICIALLY OWNED BY SUCH STOCKHOLDER,
PROVIDED, HOWEVER, THAT, A MERGER OR CONSOLIDATION IN WHICH A STOCKHOLDER IS A
CONSTITUENT CORPORATION SHALL NOT BE DEEMED TO BE THE TRANSFER OF ANY COMPANY
COMMON SHARES BENEFICIALLY OWNED BY SUCH STOCKHOLDER

 

10

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(PROVIDED, THAT A SIGNIFICANT PURPOSE OF ANY SUCH TRANSACTION IS NOT TO AVOID
THE PROVISIONS OF THIS AGREEMENT).  FOR PURPOSES OF THIS AGREEMENT, THE
CONVERSION OF COMPANY CLASS B STOCK INTO COMPANY COMMON STOCK SHALL NOT BE
DEEMED TO BE A TRANSFER.

 

SECTION 5.38.                             “VOTING SECURITIES” SHALL MEAN AT ANY
PARTICULAR TIME THE SHARES OF ANY CLASS OF CAPITAL STOCK OF THE COMPANY WHICH
ARE THEN ENTITLED TO VOTE GENERALLY IN THE ELECTION OF DIRECTORS.

 

ARTICLE VI

 

MISCELLANEOUS

 

SECTION 6.01.                             NOTICES.  ALL NOTICES, REQUESTS AND
OTHER COMMUNICATIONS TO ANY PARTY HEREUNDER SHALL BE IN WRITING (INCLUDING
TELECOPY) AND SHALL BE GIVEN, IF TO LIBERTY MEDIA CORPORATION, TO:

 

Liberty Media Corporation
12300 Liberty Boulevard
Englewood, Colorado 80112
Attention:  General Counsel
Facsimile:  (720) 875-5382

 

with a copy to:

 

Baker Botts L.L.P.
30 Rockefeller Plaza
44th Floor
New York, New York 10112
Attention:  Frederick H.  McGrath
Facsimile:  (212) 408-2501

 

if to Mr. Diller, to:

 

Barry Diller
Chairman and Chief Executive Officer
IAC/InterActiveCorp
Carnegie Hall Tower
152 West 57th Street
New York, New York 10019
Facsimile:  (212) 632-9642

 

with a copy to:

 

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IAC/InterActiveCorp
Carnegie Hall Tower
152 West 57th Street
New York, New York 10019
Attention:  General Counsel
Facsimile:  (212) 632-9642

 

with a copy to:

 

Wachtell, Lipton, Rosen & Katz
51 West 52nd Street
New York, New York 10019
Attention:  Pamela S. Seymon

 Andrew J. Nussbaum

Facsimile:  (212) 403-2000

 

if to the Company, to:

 

IAC/InterActiveCorp
Carnegie Hall Tower
152 West 57th Street
New York, New York 10019
Attention:  General Counsel
Facsimile:  (212) 632-9642

 

with a copy to:

 

Wachtell, Lipton, Rosen & Katz
51 West 52nd Street
New York, New York 10019
Attention:  Pamela S.  Seymon

 Andrew J. Nussbaum

Facsimile:  (212) 403-2000

 

or such address or facsimile number as such party may hereafter specify for the
purpose by notice to the other parties hereto.  Each such notice, request or
other communication shall be effective when delivered personally, telegraphed,
or telecopied, or, if mailed, five business days after the date of the mailing.

 

SECTION 6.02.                             AMENDMENTS; NO WAIVERS.  (A) ANY
PROVISION OF THIS AGREEMENT MAY BE AMENDED OR WAIVED IF, AND ONLY IF, SUCH
AMENDMENT OR WAIVER IS IN WRITING AND SIGNED, IN THE CASE OF AN AMENDMENT, BY
THE PARTY WHOSE RIGHTS OR OBLIGATIONS HEREUNDER ARE AFFECTED BY SUCH AMENDMENT,
OR IN THE CASE OF A WAIVER, BY THE PARTY OR PARTIES AGAINST WHOM THE WAIVER IS
TO BE EFFECTIVE.  ANY AMENDMENT OR WAIVER BY THE COMPANY SHALL BE AUTHORIZED BY
A MAJORITY OF THE BOARD OF DIRECTORS (EXCLUDING FOR THIS PURPOSE ANY DIRECTOR
WHO IS A LIBERTY DIRECTOR AS PROVIDED FOR IN THIS AGREEMENT).

 

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(B)                                 NO FAILURE OR DELAY BY ANY PARTY IN
EXERCISING ANY RIGHT, POWER OR PRIVILEGE HEREUNDER SHALL OPERATE AS A WAIVER
THEREOF NOR SHALL ANY SINGLE OR PARTIAL EXERCISE THEREOF PRECLUDE ANY OTHER OR
FURTHER EXERCISE THEREOF OR THE EXERCISE OF ANY OTHER RIGHT, POWER OR
PRIVILEGE.  THE RIGHTS AND REMEDIES HEREIN PROVIDED SHALL BE CUMULATIVE AND NOT
EXCLUSIVE OF ANY RIGHTS OR REMEDIES PROVIDED BY LAW.

 

SECTION 6.03.                             SUCCESSORS AND ASSIGNS.  EXCEPT AS
PROVIDED IN ARTICLE I, NEITHER THIS AGREEMENT NOR ANY OF THE RIGHTS OR
OBLIGATIONS UNDER THIS AGREEMENT SHALL BE ASSIGNED, IN WHOLE OR IN PART (EXCEPT
BY OPERATION OF LAW PURSUANT TO A MERGER OF LIBERTY WITH ANOTHER PERSON A
SIGNIFICANT PURPOSE OF WHICH IS NOT TO AVOID THE PROVISIONS OF THIS AGREEMENT),
BY ANY PARTY WITHOUT THE PRIOR WRITTEN CONSENT OF THE OTHER PARTIES HERETO. 
SUBJECT TO THE FOREGOING, THE PROVISIONS OF THIS AGREEMENT SHALL BE BINDING UPON
AND INURE TO THE BENEFIT OF THE PARTIES HERETO AND THEIR RESPECTIVE SUCCESSORS
AND PERMITTED ASSIGNS.

 

SECTION 6.04.                             GOVERNING LAW; CONSENT TO
JURISDICTION.  THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED
BY THE INTERNAL LAWS OF THE STATE OF DELAWARE, WITHOUT GIVING EFFECT TO THE
PRINCIPLES OF CONFLICTS OF LAWS.  EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY
AND UNCONDITIONALLY CONSENTS TO SUBMIT TO THE NON-EXCLUSIVE JURISDICTION OF THE
COURTS OF THE STATE OF DELAWARE, FOR ANY ACTION, PROCEEDING OR INVESTIGATION IN
ANY COURT OR BEFORE ANY GOVERNMENTAL AUTHORITY (“LITIGATION”) ARISING OUT OF OR
RELATING TO THIS AGREEMENT AND THE TRANSACTIONS CONTEMPLATED HEREBY AND FURTHER
AGREES THAT SERVICE OF ANY PROCESS, SUMMONS, NOTICE OR DOCUMENT BY U.S. MAIL TO
ITS RESPECTIVE ADDRESS SET FORTH IN THIS AGREEMENT SHALL BE EFFECTIVE SERVICE OF
PROCESS FOR ANY LITIGATION BROUGHT AGAINST IT IN ANY SUCH COURT.  EACH OF THE
PARTIES HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY OBJECTION TO
THE LAYING OF VENUE OF ANY LITIGATION ARISING OUT OF THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY IN THE COURTS OF THE STATE OF DELAWARE, AND
HEREBY FURTHER IRREVOCABLY AND UNCONDITIONALLY WAIVES AND AGREES NOT TO PLEAD OR
CLAIM IN ANY SUCH COURT THAT ANY SUCH LITIGATION BROUGHT IN ANY SUCH COURT HAS
BEEN BROUGHT IN AN INCONVENIENT FORUM.  EACH OF THE PARTIES IRREVOCABLY AND
UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY
AND ALL RIGHTS TO TRIAL BY JURY IN CONNECTION WITH ANY LITIGATION ARISING OUT OF
OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

 

SECTION 6.05.                             COUNTERPARTS .  THIS AGREEMENT MAY BE
SIGNED IN ANY NUMBER OF COUNTERPARTS, EACH OF WHICH SHALL BE AN ORIGINAL, WITH
THE SAME EFFECT AS IF THE SIGNATURES THERETO AND HERETO WERE UPON THE SAME
INSTRUMENT.

 

SECTION 6.06.                             SPECIFIC PERFORMANCE.  THE COMPANY,
MR. DILLER AND LIBERTY EACH ACKNOWLEDGES AND AGREES THAT THE PARTIES’ RESPECTIVE
REMEDIES AT LAW FOR A  BREACH OR THREATENED BREACH OF ANY OF THE PROVISIONS OF
THIS AGREEMENT WOULD BE INADEQUATE AND, IN RECOGNITION OF THAT FACT, AGREES
THAT, IN THE EVENT OF A BREACH OR THREATENED BREACH BY THE COMPANY OR LIBERTY OF
THE PROVISIONS OF THIS AGREEMENT, IN ADDITION TO ANY REMEDIES AT LAW,
MR. DILLER, LIBERTY AND THE COMPANY, RESPECTIVELY, WITHOUT POSTING ANY BOND
SHALL BE ENTITLED TO OBTAIN EQUITABLE RELIEF IN THE FORM OF SPECIFIC
PERFORMANCE, A TEMPORARY RESTRAINING ORDER, A TEMPORARY OR PERMANENT INJUNCTION
OR ANY OTHER EQUITABLE REMEDY WHICH MAY THEN BE AVAILABLE.

 

SECTION 6.07.                             REGISTRATION RIGHTS.  (A) LIBERTY AND
MR. DILLER SHALL BE ENTITLED TO CUSTOMARY REGISTRATION RIGHTS RELATING TO
COMPANY COMMON STOCK OWNED BY THEM AS OF THE DATE

 

13

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HEREOF OR ACQUIRED FROM THE COMPANY (INCLUDING UPON CONVERSION OF COMPANY
CLASS B STOCK) IN THE FUTURE (INCLUDING THE ABILITY TO TRANSFER REGISTRATION
RIGHTS AS SET FORTH IN THIS AGREEMENT IN CONNECTION WITH THE SALE OR OTHER
DISPOSITION OF COMPANY COMMON STOCK).

 

(B)                                 IF REQUESTED BY A STOCKHOLDER, THE COMPANY
SHALL BE REQUIRED PROMPTLY TO CAUSE THE COMPANY COMMON STOCK OWNED BY SUCH
STOCKHOLDER OR ITS AFFILIATES TO BE REGISTERED UNDER THE SECURITIES ACT IN ORDER
TO PERMIT SUCH STOCKHOLDER OR SUCH AFFILIATE TO SELL SUCH SHARES IN ONE OR MORE
(BUT NOT MORE THAN (I) IN THE CASE OF LIBERTY, FOUR AND (II) IN THE CASE OF
MR. DILLER, THREE) REGISTERED PUBLIC OFFERINGS (EACH, A “DEMAND REGISTRATION”). 
EACH STOCKHOLDER SHALL ALSO BE ENTITLED TO CUSTOMARY PIGGYBACK REGISTRATION
RIGHTS.  IF THE AMOUNT OF SHARES SOUGHT TO BE REGISTERED BY A STOCKHOLDER AND
ITS AFFILIATES PURSUANT TO ANY DEMAND REGISTRATION IS REDUCED BY MORE THAN 25%
PURSUANT TO ANY UNDERWRITERS’ CUTBACK, THEN SUCH STOCKHOLDER MAY ELECT TO
REQUEST THE COMPANY TO WITHDRAW SUCH REGISTRATION, IN WHICH CASE, SUCH
REGISTRATION SHALL NOT COUNT AS ONE OF SUCH STOCKHOLDER’S DEMAND REGISTRATIONS.
IF A STOCKHOLDER REQUESTS THAT ANY DEMAND REGISTRATION BE AN UNDERWRITTEN
OFFERING, THEN SUCH STOCKHOLDER SHALL SELECT THE UNDERWRITER(S) TO ADMINISTER
THE OFFERING, PROVIDED THAT SUCH UNDERWRITER(S) SHALL BE REASONABLY SATISFACTORY
TO THE COMPANY.  IF A DEMAND REGISTRATION IS AN UNDERWRITTEN OFFERING AND THE
MANAGING UNDERWRITER ADVISES THE STOCKHOLDER INITIATING THE DEMAND REGISTRATION
IN WRITING THAT IN ITS OPINION THE TOTAL NUMBER OR DOLLAR AMOUNT OF SECURITIES
PROPOSED TO BE SOLD IN SUCH OFFERING IS SUCH AS TO MATERIALLY AND ADVERSELY
AFFECT THE SUCCESS OF SUCH OFFERING, THEN THE COMPANY WILL INCLUDE IN SUCH
REGISTRATION, FIRST, THE SECURITIES OF THE INITIATING STOCKHOLDER, AND,
THEREAFTER, ANY SECURITIES TO BE SOLD FOR THE ACCOUNT OF OTHERS WHO ARE
PARTICIPATING IN SUCH REGISTRATION (AS DETERMINED ON A FAIR AND EQUITABLE BASIS
BY THE COMPANY).  IN CONNECTION WITH ANY DEMAND REGISTRATION OR INCLUSION OF A
STOCKHOLDER’S OR ITS AFFILIATE’S SHARES IN A PIGGYBACK REGISTRATION, THE
COMPANY, SUCH STOCKHOLDER AND/OR ITS AFFILIATES SHALL ENTER INTO AN AGREEMENT
CONTAINING TERMS (INCLUDING REPRESENTATIONS, COVENANTS AND INDEMNITIES BY THE
COMPANY AND SUCH STOCKHOLDER), AND SHALL BE SUBJECT TO LIMITATIONS, CONDITIONS,
AND BLACKOUT PERIODS, CUSTOMARY FOR A SECONDARY OFFERING BY A SELLING
STOCKHOLDER.  THE COSTS OF THE REGISTRATION (OTHER THAN UNDERWRITING DISCOUNTS,
FEES AND COMMISSIONS) SHALL BE PAID BY THE COMPANY.  THE COMPANY SHALL NOT BE
REQUIRED TO REGISTER SUCH SHARES IF A STOCKHOLDER WOULD BE PERMITTED TO SELL THE
COMPANY COMMON STOCK IN THE QUANTITIES PROPOSED TO BE SOLD AT SUCH TIME IN ONE
TRANSACTION UNDER RULE 144 OF THE SECURITIES ACT OR UNDER ANOTHER COMPARABLE
EXEMPTION THEREFROM.

 

(C)                                  IF THE COMPANY AND A STOCKHOLDER CANNOT
AGREE AS TO WHAT CONSTITUTES CUSTOMARY TERMS WITHIN TEN DAYS OF SUCH
STOCKHOLDER’S REQUEST FOR REGISTRATION (WHETHER IN A DEMAND REGISTRATION OR A
PIGGYBACK REGISTRATION), THEN SUCH DETERMINATION SHALL BE MADE BY A LAW FIRM OF
NATIONAL REPUTATION MUTUALLY ACCEPTABLE TO THE COMPANY AND SUCH STOCKHOLDER.

 

SECTION 6.08.                             TERMINATION.  EXCEPT AS OTHERWISE
PROVIDED IN THIS AGREEMENT, THIS AGREEMENT SHALL TERMINATE (A) AS TO LIBERTY, AT
SUCH TIME THAT LIBERTY BENEFICIALLY OWNS EQUITY SECURITIES REPRESENTING LESS
THAN 5% OF THE TOTAL EQUITY SECURITIES AND (B) AS TO MR. DILLER, AT SUCH TIME
THAT THE CEO TERMINATION DATE HAS OCCURRED OR AT SUCH TIME AS HE BECOMES
DISABLED.  IN RESPECT OF “CONTINGENT MATTERS,” SUCH PROVISIONS SHALL TERMINATE
AS TO MR. DILLER AND LIBERTY AS SET FORTH THEREIN.

 

SECTION 6.09.                             SEVERABILITY.  IF ANY TERM, PROVISION,
COVENANT OR RESTRICTION OF THIS AGREEMENT IS HELD BY A COURT OF COMPETENT
JURISDICTION TO BE INVALID, VOID OR UNENFORCEABLE, THE

 

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REMAINDER OF THE TERMS, PROVISIONS, COVENANTS AND RESTRICTIONS OF THIS AGREEMENT
SHALL REMAIN IN FULL FORCE AND EFFECT AND SHALL IN NO WAY BE AFFECTED, IMPAIRED
OR INVALIDATED, PROVIDED THAT THE PARTIES HERETO SHALL NEGOTIATE IN GOOD FAITH
TO ATTEMPT TO PLACE THE PARTIES IN THE SAME POSITION AS THEY WOULD HAVE BEEN IN
HAD SUCH PROVISION NOT BEEN HELD TO BE INVALID, VOID OR UNENFORCEABLE.

 

SECTION 6.10.                             COOPERATION.  EACH OF LIBERTY AND
MR. DILLER COVENANTS AND AGREES WITH THE OTHER TO USE ITS REASONABLE BEST
EFFORTS TO CAUSE THE COMPANY TO FULFILL THE COMPANY’S OBLIGATIONS UNDER THIS
AGREEMENT.

 

SECTION 6.11.                             ADJUSTMENT OF SHARE NUMBERS AND
PRICES.  IF, AFTER THE EFFECTIVE TIME OF THIS AGREEMENT, THERE IS A SUBDIVISION,
SPLIT, STOCK DIVIDEND, COMBINATION, RECLASSIFICATION OR SIMILAR EVENT WITH
RESPECT TO ANY OF THE SHARES OF CAPITAL STOCK REFERRED TO IN THIS AGREEMENT,
THEN, IN ANY SUCH EVENT, THE NUMBERS AND TYPES OF SHARES OF SUCH CAPITAL STOCK
REFERRED TO IN THIS AGREEMENT AND, IF APPLICABLE, THE PRICES OF SUCH SHARES,
SHALL BE ADJUSTED TO THE NUMBER AND TYPES OF SHARES OF SUCH CAPITAL STOCK THAT A
HOLDER OF SUCH NUMBER OF SHARES OF SUCH CAPITAL STOCK WOULD OWN OR BE ENTITLED
TO RECEIVE AS A RESULT OF SUCH EVENT IF SUCH HOLDER HAD HELD SUCH NUMBER OF
SHARES IMMEDIATELY PRIOR TO THE RECORD DATE FOR, OR EFFECTIVENESS OF, SUCH EVENT
AND THE PRICES FOR SUCH SHARES SHALL BE SIMILARLY ADJUSTED.

 

SECTION 6.12.                             EFFECTIVE TIME.  THIS AGREEMENT SHALL
BECOME EFFECTIVE IMMEDIATELY FOLLOWING THE EFFECTIVE TIME OF THE COMPANY’S SPIN
OFF OF EXPEDIA, INC.

 

SECTION 6.13.                             ENTIRE AGREEMENT.  EXCEPT AS OTHERWISE
EXPRESSLY SET FORTH HEREIN, THIS AGREEMENT, THE AMENDED AND RESTATED
STOCKHOLDERS AGREEMENT, AND AS PROVIDED IN SECTION 5.1 OF THE AMENDED AND
RESTATED STOCKHOLDERS AGREEMENT, THE 1997 STOCKHOLDERS AGREEMENT EMBODY THE
COMPLETE AGREEMENT AND UNDERSTANDING AMONG THE PARTIES HERETO WITH RESPECT TO
THE SUBJECT MATTER HEREOF AND THEREOF AND SUPERSEDE AND PREEMPT ANY PRIOR
UNDERSTANDINGS, AGREEMENTS OR REPRESENTATIONS BY OR AMONG THE PARTIES, WRITTEN
OR ORAL, THAT MAY HAVE RELATED TO THE SUBJECT MATTER HEREOF IN ANY WAY
(INCLUDING, WITHOUT LIMITATION, EFFECTIVE UPON THE DATE HEREOF, ALL STOCKHOLDERS
AGREEMENTS RELATING TO THE COMPANY (OTHER THAN THE AMENDED AND RESTATED
STOCKHOLDERS AGREEMENT) BETWEEN LIBERTY AND MR. DILLER).  EFFECTIVE UPON THE
EFFECTIVE TIME OF THIS AGREEMENT, THE 2001 GOVERNANCE AGREEMENT SHALL TERMINATE
AND SHALL BE SUPERSEDED BY THIS AGREEMENT.

 

SECTION 6.14.                             INTERPRETATION.  REFERENCES IN THIS
AGREEMENT TO ARTICLES AND SECTIONS SHALL BE DEEMED TO BE REFERENCES TO ARTICLES
AND SECTIONS OF THIS AGREEMENT UNLESS THE CONTEXT SHALL OTHERWISE REQUIRE.  THE
WORDS “INCLUDE,” “INCLUDES” AND “INCLUDING” SHALL BE DEEMED TO BE FOLLOWED BY
THE PHRASE “WITHOUT LIMITATION.” THE WORDS “HEREOF,” “HEREIN” AND “HEREUNDER”
AND WORDS OF SIMILAR IMPORT WHEN USED IN THIS AGREEMENT SHALL REFER TO THIS
AGREEMENT AS A WHOLE AND NOT TO ANY PARTICULAR PROVISION OF SUCH AGREEMENT OR
INSTRUMENT.

 

Section 6.15.                             Headings.  The titles of Articles and
Sections of this Agreement are for convenience only and shall not be interpreted
to limit or otherwise affect the provisions of this Agreement.

 

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IN WITNESS WHEREOF, the parties hereto have caused this Amended and Restated
Governance Agreement to be duly executed as of the day and year first above
written.

 

 

IAC/INTERACTIVECORP

 

 

 

 

 

 

By

/s/ Gregory R. Blatt

 

 

 

Name:

Gregory R. Blatt

 

 

Title:

Executive Vice President

 

 

 

 

 

 

 

LIBERTY MEDIA CORPORATION

 

 

 

 

 

 

 

By

/s/ Authorized Representative

 

 

 

Name:

 

 

Title:

 

 

 

 

 

 

 

 

/s/ Barry Diller

 

 

 

BARRY DILLER

 

 

[SIGNATURE PAGE TO AMENDED AND RESTATED GOVERNANCE AGREEMENT]

 

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