Exhibit 10.52

 

EMPLOYMENT AND

PHANTOM STOCK AGREEMENT

 

THIS AGREEMENT made and entered into as of the 15th day of May, 2002 by and
between AFFINITY GROUP, INC., a Delaware corporation (“AGI”), CAMPING WORLD,
INC., a Kentucky corporation and a wholly-owned subsidiary of AGI (“Camping
World Holding”), CWI, INC., a Kentucky corporation and a wholly-owned subsidiary
of Camping World Holding (the “Company”), and MARK T. GILMAN (the “Executive”);

 

W I T N E S S E T H

 

WHEREAS, the Company proposes to employ the Executive in the operations of the
Company and the Company is desirous of affording Executive incentives, in the
form of phantom stock of the Company, in connection therewith;

 

NOW, THEREFORE, in consideration of the mutual covenants contained herein and
other good and valuable consideration, the Company and Executive hereby agree as
follows:

 

ARTICLE I

 

EMPLOYMENT

 

Section l.l.   Employment.  The Company hereby employs the Executive as the
President and Chief Executive Officer of the Company to perform such duties and
discharge such functions, consistent with the senior executive office held by
Executive, in and about the business and affairs of the Company, or one or more
of its subsidiaries, as the board of directors of the Company may from time to
time determine.  Executive agrees, during the term hereof, to diligently and in
good faith perform and discharge such duties and functions and Executive shall
devote all of his working time, energy and ability exclusively to the
performance of his duties hereunder.  Executive shall not directly or indirectly
engage or participate in the operations or management of, or render any services
to, any other businesses or enterprises, provided, however, Executive may from
time to time serve on the board of directors of charitable organizations as long
as such involvement does not have a materially adverse effect on the performance
by Executive of his duties hereunder.

 

Section l.2.  Basic Compensation.  The Company agrees to pay Executive a base
annual salary of $350,000.  Basic compensation payable under this section shall
be payable in accordance with such practices and procedures as are generally
applicable to other employees of the Company.

 

Section l.3.  Fringe Benefits.  While Executive is in the employ of the Company,
the Company agrees to provide to Executive such benefits as may be provided by
the Company from time to time to its similarly situated employees, including,
without limitation, those set forth on Exhibit A attached hereto.

 

Section 1.4.  Severance.  If the Company terminates the employment of the
Executive without Cause, the Company shall (i) make a lump sum severance payment
equal to twelve (12) months of the Executive’s current base compensation paid
pursuant to Section 1.2 hereof, and (ii) pay to the Executive the amount of the
bonus, if any, accrued to the date of such termination under section 1.5
hereof.  Such severance payment shall be made within thirty (30) days after the
determination of the amount of the accrued bonus calculated pursuant to the
provisions of section 1.5 hereof.  It is agreed that any termination

 

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of employment is without prejudice to any other remedy to which the Company may
be entitled, either by law, in equity or under this Agreement and without
prejudice to Executive’s Phantom Stock Interest.

 

The Company has the absolute right to terminate this Agreement, and the
employment of the Executive hereunder, for Cause without any further obligation
to the Executive in respect of severance payments to the Executive hereunder. 
For purposes of this Agreement, Cause shall mean:

 

(i)                                     the commission of a felony or a crime
involving moral turpitude or the commission of any other act or omission
involving dishonesty or fraud with respect to the Company;

 

(ii)                                  conduct which brings the Company into
public disgrace or disrepute;

 

(iii)                               gross negligence or willful gross misconduct
with respect to the Company;

 

(iv)                              breach of a fiduciary duty to the Company;

 

(v)                                 a breach of Article III of this Agreement;
or

 

(vi)                              Executive’s failure to cure a breach of any
term of this Agreement (other than Article III) within thirty (30) days after
receipt of written notice from the Company specifying the act or omission that
constitutes such breach.

 

The Executive shall not be entitled to severance under this section 1.4 if the
employment of the Executive is terminated for any of the following reasons:

 

(i)                                     the Executive terminates this Agreement
at any time;

 

(ii)                                  death of the Executive;

 

(iii)                               the Disability of the Executive.

 

Section 1.5.  Bonus.  Executive shall be entitled to earn a bonus based upon the
Company’s Operating Profit.  The bonus shall be an amount equal to one and
one-half percent (1.5%) of the Company’s Operating Profit for each year during
the term hereof.  The bonus shall be payable on a quarterly basis in arrears for
each calendar quarter during the term hereof.  The bonus for any partial quarter
during the term hereof shall be prorated based on the number of days within such
quarter falling within the term hereof.  The bonus for the first three quarters
of each calendar year shall be calculated based upon the annualized budget for
the Company for the calendar year in which such quarters fall and the bonus for
each such quarter shall be paid to Executive at the end of the first bi-weekly
payroll period following the end of such quarter.  The bonus for the fourth
quarter of each calendar year shall be equal to (a) one and one-half percent
(1.5%) of the Company’s actual Operating Profit for the calendar year then
ended, less (b) the aggregate amount of the bonus paid to Executive for the
first three quarters of the calendar year then ended.  The bonus for the fourth
quarter of each calendar year shall be paid to Executive on or before March 15
of the following year.

 

Section l.6.  Term.  The term of this Agreement shall commence on the date of
this Agreement and continue through the fifth anniversary of the date of this
Agreement provided, however, that Executive shall have the continuing option to
immediately terminate the employment provided by section l.l hereof by giving
two (2) weeks’ notice thereof to the Company and the Company shall have the
continuing option to immediately terminate the employment provided by section
l.l hereof by giving written notice thereof to Executive which notice may be
effective immediately.  Upon any such termination, all of the rights and
obligations set forth in this Article I shall terminate provided, however, that
the Company shall pay to Executive the severance, if any, payable under section
1.4 hereof and no termination of Executive under

 

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any circumstance shall prejudice Executive’s right to the Phantom Stock Interest
provided under Article II of this Agreement.

 

ARTICLE II

 

PHANTOM STOCK INTEREST

 

Section 2.l.  Award of Phantom Stock Interest.  The Company hereby awards the
Phantom Stock Interest to the Executive.

 

Section 2.2.  Payment of Phantom Stock Interest.  The Company shall pay, and
Executive shall be entitled to receive, the value of the Phantom Stock Interest,
which shall be paid as follows:

 

(a)          in the event of a Sale, at the same time and in the same form of
consideration (on the same proportionate basis) as is paid to the seller in the
Sale;

 

(b)         in the case of an Offering, (i) at the election of the Executive, in
the form of registered stock issued in the Offering as long as, in the opinion
of the underwriters in the Offering, such issuance to the Executive would not
have an adverse impact on the Offering, or (ii) if it is determined that such
issuance to Executive would have an adverse impact on the Offering or if the
Executive does not elect to receive registered securities, then in cash as
described in subsection (c) below;

 

(c)          in the case of a Private Placement, an Offering described in
subsection (b)(ii) above, or in the case of the occurrence of any other
Determination Date, in cash as follows:

 

(i)                                     One-third (1/3) thereof within thirty
(30) days of the determination of such cash value in accordance with the
provisions of section 4.3 hereof, and

 

(ii)                                  One-third (1/3) thereof on the first
anniversary of the Determination Date, and

 

(iii)                               One-third (1/3) thereof on the second
anniversary of the Determination Date.

 

Section 2.3.  Beneficiary.  Executive may designate (by filing with the Company
a written beneficiary designation form in form reasonably acceptable to the
Company) one or more primary beneficiaries or contingent beneficiaries to
receive all or a specified part of the cash value of the Phantom Stock Interest
which, at the time of Executive’s death, may remain unpaid under this Agreement
and Executive may change or revoke any such designation from time to time. No
such designation, change or revocation shall be effective unless executed by
Executive and accepted by the Company during Executive’s lifetime.  Each such
designation, change or revocation shall be effective under this Agreement until
changed or revoked in the manner specified herein.  No such change or revocation
shall require the consent of any beneficiary theretofore designated by
Executive.  If Executive fails to designate a beneficiary, or designates a
beneficiary and thereafter revokes such designation without naming another
beneficiary, or designates one or more beneficiaries and all such beneficiaries
so designated fail to survive Executive, then the beneficiary of the Phantom
Stock Interest, or the part thereof as to which Executive’s designation fails,
as the case may be, shall be the representative of Executive’s estate.  Unless
Executive has otherwise specified in the beneficiary designation, the
beneficiary or beneficiaries designated by Executive shall become fixed as of
Executive’s death so that, if a beneficiary survives Executive but dies before
the receipt of all payments due such beneficiary, such remaining payments shall
be payable to the representative of such beneficiary’s estate.

 

Section 2.4.   Benefits Not Transferable.  Neither Executive nor any beneficiary
hereunder shall have any trans­ferable interest in the payments due hereunder
nor any right to anticipate, alienate, dispose of, pledge or encumber the same
prior to actual receipt thereof, nor shall the same be subject to attachment,

 

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garnishment, execution following judgment or other legal process instituted by
creditors of Executive or any such beneficiary provided that the unpaid cash
value of Executive’s Phantom Stock Interest and any payments due hereunder shall
at all times be subject to set-off for debts owed by the Executive to the
Company or its affiliates.

 

Section 2.5.  Nature of the Company’s Obligation.  The Company shall maintain a
record of the Phantom Stock Interest but the Company shall not be required to
segregate any funds or other assets to be used for the payment of benefits under
this Agreement and no such record shall be considered as evidence of the
creation of a trust fund, an escrow or any other segregation of assets for the
benefit of Executive or any beneficiary of Executive.  The obligation of the
Company to make the payments described in this Agreement is an unsecured
contractual obligation of the Company only, and neither Executive nor any
beneficiary of Executive shall have any beneficial or preferred interest by way
of trust, escrow, lien or otherwise in and to any specific assets or funds. 
Executive specifically acknowledges that the Phantom Stock Interest to be
awarded pursuant to the terms of this Agreement are not securities in the
Company and do not create any right in the equity or capital of the Company or
any of its affiliates.  Executive and each beneficiary of Executive shall look
solely to the general credit of the Company for satisfaction of any obligations
due or to become due under this Agreement, it being expressly acknowledged by
the Executive that the obligations of the Company hereunder are junior and
subordinate in right of payment to the obligations of the Company to its or
AGI’s lenders.  If the Company should, in its sole discretion, earmark or set
aside any funds or other assets to pay benefits hereunder, the same shall,
nevertheless, remain and be regarded as part of the general assets of the
Company subject to the claims of its general creditors (and shall not be
considered to be held in a fiduciary capacity for the benefit of Executive or
any beneficiary hereunder), and neither Executive nor any beneficiary of
Executive shall have any legal, beneficial, security or other property interest
therein.  Upon delivery by the Company to Executive of the consideration as
provided in section 2.2, the rights and obligations of the Company and Executive
under this Article II shall terminate and Executive shall have no other or
further rights under this Article or in respect hereof.

 

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ARTICLE III

 

COVENANT NOT TO COMPETE

 

Section 3.l.  Covenant Not to Compete.  Executive hereby covenants that, for a
period of eighteen (18) months next following the Determination Date (or such
shorter period for which the Company continues to be owned or operated by the
Parent or its affiliates), Executive shall not be engaged or interested in any
business which competes, directly or indirectly, with the retail, publication or
membership businesses of the Company or any subsidiary of the Company (whether
as a proprietor, partner with another, shareholder (other than as a less than 5%
shareholder in a publicly-traded company), agent or consultant of, employee of
or lender to, another) in the recreational vehicle, camping, outdoor living or
other markets then served by the Company or such subsidiary, except as a
proprietor, partner, shareholder, employee or consultant in or to the Company or
any entity controlled by, controlling or under common control with the Company,
provided that if the employment of Executive is terminated by the Company
without Cause, the preceding covenant shall not apply (without affecting the
obligations hereinafter contained in this section 3.l in respect of disclosures
or solicitations by Executive) unless the Executive shall have been paid
severance pursuant to section 1.4 hereof.  Executive agrees that he will not at
any time disclose to any person or other entity who or which is, or reasonably
may be expected to be, in competition with the Company or its affiliates, any
confidential information or trade secrets of the Company, any subsidiary of the
Company or any of their respective affiliates, the contents of any customer
lists of the Company, any subsidiary of the Company or any of their respective
affiliates or the general needs of the customers or other contracting parties
with the Company, any subsidiary of the Company or any of their respective
affiliates, provided, however, the foregoing shall not prevent Executive from
responding to the request of a governmental agency or pursuant to a court order
or as otherwise required by law.  For a period of one (1) year following the
Determination Date, Executive agrees not to offer employment to, not to discuss
the nature of any prospective employment opportunities with, and not to
otherwise solicit any employee of the Company or such subsidiary (or any person
who was an employee of the Company or such subsidiary within 180 days of the
Determination Date) on his own behalf, on behalf of any employer of the
Executive, on behalf of any entity with which the Executive is acting as a
consultant or with which the Executive is then otherwise affiliated.

 

Section 3.2.  Remedies.  Recognizing that a breach of the covenant contained in
section 3.1 would cause the Company irreparable injury and the damages at law
would be difficult to ascertain, Executive consents to the granting of equitable
relief by way of a restraining order or temporary or permanent injunction by any
court of competent jurisdiction to prohibit the breach or enforce the
performance of the covenants contained in section 3.l.  The invalidity or
unenforceability of any provision of this Article or the application thereof to
any person or circumstance shall not affect or impair the validity or
enforceability of any other provision or the application of the first provision
to any other person or circumstance.  Any provision of this Article that might
otherwise be invalid or unenforceable because of contravention of any applicable
law, statute or governmental regulation shall be deemed to be amended to the
extent necessary to remove the cause of such invalidation or unenforceability
and such provision as so amended shall remain in full force and effect as a part
hereof.

 

ARTICLE IV

 

DEFINITIONS AND GENERAL PROVISIONS

 

Section 4.l.  Definitions.  As used in this Agreement, the following terms shall
have the respective meanings set forth below:

 

Accounting Period:  If the Determination Date falls on December 15th through
December 31st, inclusive, the Fiscal Year of the Company in which the
Determination Date falls; if the Determination Date falls on January 1st through
June 14th, inclusive, the Fiscal Year of the Company endingimmediately

 

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prior to the date on which the Determination Date falls; if the Determination
Date falls on June 15th through December 14th, inclusive, the Rolling Four
Fiscal Quarters ending immediately prior to the date on which the Determination
Date falls.

 

Base Cost:  The Company Value as of June 30, 2002, calculated as the remainder
of (x) the sum of (i) the Formula Operating Asset Value and (ii) Current Assets
minus (y) Liabilities.

 

Company Value:  (a) If the Determination Date is occasioned by the sale of all
or substantially all of the Operating Assets of the Company, the remainder of
(x) the sum of (i) the net pre-tax consideration received in the sale of all or
substantially all of the Operating Assets, (ii) Current Assets and (iii) the
fair market value on the Determination Date of the assets of the Company, if
any, not included in the sale, minus (y) the sum of (i) the Base Cost, (ii)
Operating Liabilities not assumed by the purchaser or transferee and (iii)
Liabilities other than Operating Liabilities.  If any of such consideration
shall have been paid in notes or other securities, the Company shall, by
resolution of its board of directors, establish a fair market value therefore,
which value shall be conclusively binding upon the parties hereto and, in
establishing the value of debt securities, in addition to such other
considerations as the board of directors of the Company may deem relevant, the
amounts payable thereunder shall be discounted to their present value on the
basis of such discount rate as is deemed appropriate by the board of directors.

 

(b) If the Determination Date is occasioned by a Private Placement by the
Company or by Camping World Holding or the sale of more than 51% of the equity
interests in the Company or Camping World Holding, Company Value shall be the
remainder of (x) the Full Company Consideration received in such Private
Placement or sale of equity interests minus (y) the sum of (i) the Base Cost and
(ii) any Liabilities required to be paid or satisfied at the time of closing
such Private Placement or sale and any liabilities retained directly or
indirectly by the shareholder of the issuer in such Private Placement or the
seller after such sale.

 

(c) If the Determination Date is occasioned by an Offering of shares of the
common stock of the Company or Camping World Holding, the Company Value shall be
the remainder of the market capitalization of the Company or Camping World
Holding, as the case may be, at the time of such Offering minus (y) the sum of
(i) the Base Cost and (ii) any Liabilities required to be paid or satisfied at
the time of closing such Offering and any liabilities retained directly or
indirectly by the shareholders after the Offering.

 

(d) If the Determination Date is occasioned by an event other than an event
described in any of the foregoing three paragraphs, Company Value shall be the
remainder of (x) the sum of (i) the Formula Operating Asset Value and (ii)
Current Assets minus (y) the sum of (i) Base Cost and (ii) Liabilities other
than Operating Liabilities provided, however, that if any event of the type
described in any of the foregoing three paragraphs is consummated within one
hundred eighty (180) days after the Determination Date, Company Value shall be
determined as if the Determination Date had been occasioned by such event.

 

Current Assets:  The sum of (x) cash, investments, marketable securities,
prepaid items and inventory as reflected on the books and records of the Company
and its subsidiaries on a consolidated basis; (y) the market value of notes
receivable of the Company; and (z) the accounts receivable of the Company
subject to such allowance for bad or doubtful accounts receivable as is
reflected on the books of the Company, all as determined in accordance with
generally accepted accounting principles.  Current Assets and Liabilities shall
be determined as of the last day of the Accounting Period.  Current Assets shall
not include any assets relating to or arising from the operation of the “MVP”
insurance program.

 

Determination Date:  The date of the first of the following events to occur: (i)
termination of the Executive’s employment, whether by death or otherwise, (ii) a
closing of a Sale, (iii) an Offering, (iv) a Private Placement, or (v) the fifth
anniversary of the date of this Agreement.

 

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Disability:  The physical or mental incapacity of Executive for a period of more
than sixty (60) consecutive days, the determination of which by the board of
directors of the Company shall be conclusive on the parties hereto.

 

Fiscal Quarter:  The fiscal quarter of the Company ending on the last day of the
calendar quarter.

 

Fiscal Year:  The fiscal year of the Company as the case may be, ending on the
last day of the calendar year.

 

Formula Operating Asset Value:  The product of eight (8) and Operating Profit of
the Company for the Accounting Period.

 

Full Company Consideration:  In connection with a Private Placement by the
Company or by Camping World Holding or the sale of more than 51% of the equity
interests in the Company or Camping World Holding, Full Company Consideration is
intended to represent the amount that would have been paid if the Private
Placement or equity sale resulted in the purchaser acquiring 100% of the shares
of common stock of the subject entity.  Therefore, in connection with a Private
Placement by the Company or by Camping World Holding or the sale of equity
interests in the Company or Camping World Holding, in either case involving the
purchaser acquiring 100% of the shares of common stock of the Company or Camping
World Holding, Full Company Consideration shall be equal to the net pre-tax
consideration received in such Private Placement or sale.  In connection with a
Private Placement by the Company or by Camping World Holding or the sale of
equity interests in the Company or Camping World Holding, in either case
involving more than 51% but less than 100% of the shares of common stock of the
Company or Camping World Holding, Full Company Consideration shall be equal to
(x) the net pre-tax consideration received in such Private Placement or sale of
equity interests divided by (y) the decimal equivalent of the percentage of
equity interests in the Company or Camping World Holding issued in such Private
Placement or sold in such sale.  As an example, if 75% of the shares of common
stock of the Company are sold for $60 million, Full Company Consideration shall
be determined by dividing $60 million by .75, resulting in Full Company
Consideration of $80 million.

 

Liabilities:  All obligations (whether absolute, accrued or contingent, choate
or inchoate) of the Company and/or its subsidiaries which are required to appear
on financial statements prepared in accordance with generally accepted
accounting principles consistently applied provided that

 

(i)                                     if the Determination Date is occasioned
by a Sale, the obligation of the Company, Camping World Holding, AGI, or the
Parent, as the case may be, for the payment of federal and state income taxes,
if any, arising from the Sale (net of the tax benefits, if any, arising from
payments in respect of this Agreement or any similar agreement) shall be
considered a liability whether or not such liability is required to be reflected
as a liability in accordance with generally accepted accounting principles;
provided, however, that in determining the amount, if any, to be included in
Liabilities under this subsection (i), (x) if the Determination Date is
occasioned by the sale of more than 51% of the equity interests in the Parent or
in AGI, the amount to be included in Liabilities under this subsection (i) shall
be determined as if the sale had been a sale of the equity interests in the
Company and the selling price for such equity interests had been the Company
Value as determined under subsection (d) of the definition of Company Value, and
(y) in the event the Sale is of less than 100% of the equity interests in
Camping World Holding or in the Company, the amount included in Liabilities
under this subsection (i) shall be determined as if the Sale had been a Sale of
100% of the equity interests of the applicable entity;

 

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(ii)                                  the liability of the Company for deferred
revenues shall not be considered a liability whether or not such liabilities are
required to be reflected as a liability in accordance with generally accepted
accounting principles; and

 

(iii)                               the liability of the Company, Camping World
Holding, AGI, the Parent, or any subsidiary of the Company (x) in respect of
this Agreement or any similar agreement or (y) to purchase its equity securities
(or warrants for such securities), whether under a “put” agreement or otherwise,
shall not be considered a Liability for purposes hereof.

 

Liabilities shall be determined by the chief financial officer of the Company
(or the Independent Accountant) as provided in section 4.3 hereof.  Liabilities
shall include those intercompany Liabilities that have been allocated to the
Company in accordance with generally accepted accounting principles consistently
applied.

 

Offering:  An offering and sale of shares of the common stock of the Company,
Company World Holding, AGI or the Parent pursuant to a registration statement
under the United States Securities Act of 1933, as amended

 

Operating Assets:  The real and personal properties, tangible and intangible,
used in the regular ongoing operation of the Company and its subsidiaries, as
the case may be, which would be acquired by a purchaser of such entities (or the
assets thereof) in order to continue the uninterrupted operation of the business
thereof in substantially the manner as theretofore operated but excluding
therefrom cash, investments, marketable securities, accounts and notes
receivable, inventories, prepaid items and similar assets which would not
normally be acquired by a purchaser in an asset acquisition (or for which
special adjustment to the purchase price would be made).

 

Operating Liabilities:  Any Liability or other obligation (whether absolute,
accrued or contingent, choate or inchoate) which would be required to be assumed
by a buyer of all or substantially all of the assets of the Company and its
subsidiaries in order to continue, uninterrupted, the business operations of the
Company unless, in connection with such assumption, there would customarily be
made an adjustment to the purchase price for such liabilities.  Operating
Liabilities do not include (i) indebtedness for money borrowed or guarantees of
any such indebtedness, (ii) refinancings of indebtedness of the kind referred to
in clause (i) above, (iii) indebtedness in respect of any subscription
agreement, stock or warrant “put” or “call” agreement, phantom stock agreement
or similar obligation in respect of an equity or other interest in the Parent
measured by an increase in the equity value of the Parent, including, without
limitation, the obligations under this Agreement, and (iv) current payables.

 

Operating Profit:  With respect to any Accounting Period (i) the net income of
the Company derived from the ongoing business operations of such entity or
entities for such period plus (ii) interest, federal and state income taxes (or
any provision for such taxes), depreciation, amortization, financing costs and
management fees.  Operating Profit shall be determined on the accrual method of
accounting and in accordance with generally accepted accounting principles
consistently applied, provided that (i) in no event shall tradeout or barter
transactions or extraordinary items of revenue or expense (including revenue or
expense from non-operating investments, revenue or expense from the sale or
purchase of Operating Assets or entities or revenue or expense not derived from
business operations) be reflected in net income, (ii) amounts paid or received
in settlement of (or payment of judgments in respect of) litigation which did
not arise in the ordinary course of the business operations of such entity or
entities or any of their respective subsidiaries, shall not be reflected in net
income (it being understood that subsidiaries of the Company do have litigation,
such as the litigation in the Company, which shall be considered litigation in
the “ordinary course” of business operations) and (iii) revenue and expenses
relating to the “MVP” insurance program shall not be reflected in net income. If
there has occurred a Sale of Operating Assets within the Accounting Period and,
in such Sale, not all of the Operating Assets have been sold, provided that the
net proceeds of

 

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such Sale have been received by the Company prior to the date on which Current
Assets and Liabilities of the Company are calculated as herein provided, the net
income relating to such Operating Assets shall be deleted from the calculation
of Operating Profit.  If there has occurred a purchase of Operating Assets, the
income from which is reflected in the Accounting Period, and such Operating
Assets were not owned by the Company for the entire Accounting Period, the
Operating Profit with respect to such Operating Assets shall be included, on a
historical basis, as if the Company (or its subsidiaries) had owned such
Operating Assets for the entire Accounting Period.

 

Parent:  Affinity Group Holding, Inc., a Delaware corporation, or such other
entity which holds in excess of eighty (80%) percent of the issued and
outstanding equity securities of AGI.

 

Phantom Stock Interest:  The equivalent value of the aggregate of (a) 12% of
Company Value up to and including $10 million of Company Value, plus (b) 13% of
Company Value in excess of $10 million up to and including $20 million of
Company Value, plus (c) 14% of Company Value in excess of $20 million up to and
including $30 million of Company Value, plus (d) 15% of Company Value in excess
of $30 million up to and including $40 million of Company Value, plus (e) 16% of
Company Value in excess of $40 million up to and including $50 million of
Company Value, plus (f) 17% of Company Value in excess of $50 million up to and
including $60 million of Company Value, plus (g) 18% of Company Value in excess
of $60 million up to and including $70 million of Company Value, plus (h) 19% of
Company Value in excess of $70 million up to and including $80 million of
Company Value, plus (i) 20% of Company Value in excess of $80 million . 
Attached hereto as Exhibit B is an example of the calculation of the Phantom
Stock Interest based upon the assumptions set forth therein.

 

Private Placement:  The issuance by the Company, the Parent, AGI, or Camping
World Holding, as the case may be, of shares of common stock of the issuing
entity in a private placement which results in the current owners of the issuing
entity owning less than 51% of the issuer after the transaction

 

Rolling Four Fiscal Quarters:  Four consecutive Fiscal Quarters.

 

Sale:  The sale of all or substantially all of the Operating Assets of the
Company, or the sale in one transaction (or a series of related transactions) of
more than 51% of the equity interests in the Parent, in AGI, in Camping World
Holding or in the Company (except, in any of the foregoing cases, to an entity
controlled by, controlling or under common control with the Parent).

 

Section 4.2.  Withholding Taxes.  The Company may withhold from any payment to
be made under this Agreement (and transmit to the proper taxing authority) such
amount as it may be required to withhold under any federal, state or other law.

 

Section 4.3.  Administration.  The Company and its executive officers shall have
full power to interpret, construe and administer this Agreement, including
authority to determine any dispute or claim with respect thereto.  The Company
shall give prompt written notice to Executive of the determination by the
Company of any matter provided herein, and, unless notice objecting to such
determination is given as provided herein, the determination of the Company in
any matter, made in good faith, shall be binding and conclusive upon Executive
and all other persons having any right or benefit hereunder.  Unless Executive
shall give notice to the Company objecting to the Company’s calculation of
Current Assets, Liabilities, Operating Liabilities or Operating Profit for any
period (or any other calculation to be determined for the purposes of this
Agreement) within thirty days after notice of the determination thereof by the
Company, such calculation shall conclusively be deemed to have been accepted by
the parties hereto.  The cash value of the Phantom Stock Interest shall be set
forth in a certificate of the chief financial officer of the Company, the
determination of which shall be made within one hundred fifty (150) days of the
Determination Date and shall be conclusive and binding upon the Executive
provided that, if the Executive shall disagree with the amount of the Current
Assets, Liabilities, Operating Liabilities or Operating Profit as determined by
the chief

 

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financial officer of the Company (written notice of which shall be given by the
Executive within thirty (30) days of the receipt of such determination by the
chief financial officer), Current Assets, Liabilities, Operating Liabilities or
Operating Profit shall be determined by the independent certified public
accountants of the Company or, if the Company has not then engaged a firm of
independent certified public accountants, any nationally recognized firm of
public accountants selected by the Company (the “Independent Accountant”).  The
Independent Accountant shall determine the Current Assets, Liabilities,
Operating Liabilities or Operating Profit of the Company within thirty (30) days
after its appointment and shall be instructed to deliver to the Company and the
Executive a written report of its determination of the amount of such Current
Assets, Liabilities, Operating Liabilities or Operating Profit.

 

The cost of the accounting services performed by the Independent Accountant
shall be borne by the Company (but the cost thereof shall be considered a
liability of the Company for purposes of determining Liabilities) unless the
amount of the Current Assets, Liabilities, Operating Liabilities or Operating
Profit as determined by the Independent Accountant is the same as the amount
determined by the Company’s chief financial officer (or is an amount which
results in a lower value for the Executive of the Phantom Stock Interest or the
bonus payable under section 1.5), in which event the entire cost of the services
of the Independent Accountant shall be borne by the Executive and shall be
deducted by the Company from the  Phantom Stock payment to be made pursuant to
section 2.2 hereof or the bonus payable under section 1.5, as the case may be.

 

Any of the obligations of the Company hereunder may be performed by an affiliate
of the Company and such performance by an affiliate shall be deemed to satisfy
any such obligation of the Company hereunder.

 

Section 4.4.  Notices.  All notices, requests and other communications from any
of the parties hereto to the other shall be in writing and shall be considered
to have been duly given or served when personally delivered to any individual
party, an executive officer of any corporate party, or on the first day after
the date of deposit with Federal Express for next day delivery, postage prepaid,
or on the third day after deposit in the United States mail, certified or
registered, return receipt requested, postage prepaid, or on the date of
telecopy, fax or similar telephonic transmission during normal business hours,
provided that the recipient has specifically acknowledged by telephone receipt
of such telecopy, fax or telephonic transmission; addressed, in all cases, to
the party at his or its address set forth below, or to such other address as
such party may hereafter designate by written notice to the other party:

 

(i)  If to the Company to:

 

2575 Vista Del Mar Drive

Ventura, CA  93001

Attn:  Stephen Adams

 

(ii)  If to Executive to:

 

Mark T. Gilman

1253 Harlequin Court NW

Silverdale, WA 98383

 

Section 4.5.  Binding Effect.  The provisions of this Agreement shall not give
Executive any rights to continue to be employed or otherwise retained by the
Company or any affiliate thereof.  Except as so provided, this Agreement shall
be binding upon and inure to the benefit of the parties hereto, the respective
successors and assigns of the Company and the beneficiaries, personal
representatives and heirs of Executive.

 

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Section 4.6.  Controlling Law.  This Agreement shall be construed, and the legal
relations between the parties determined, in accordance with the laws of the
state of Delaware.

 

Section 4.7.  Counterparts.  This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original without the
production of the others, but all of which together shall constitute one and the
same instrument.

 

Section 4.8.  Entire Agreement.  This Agreement, together with the letter
agreement dated as of the date hereof between AGI and the Executive, contains
the entire understanding of the parties with respect to the subject matter
hereof and may not be varied, modified or amended except by a writing signed by
the parties to be charged.  The making, execution and delivery of this Agreement
by the parties hereto have been induced by no representations, statements,
warranties or agreements of the other except those herein expressed.

 

Section 4.9.  Headings.  The division of this Agreement into sections and
paragraphs and the titles assigned thereto is only a matter of convenience for
reference and shall not define or limit any of the terms or provisions thereof.

 

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IN WITNESS WHEREOF, the individual party has hereunto set his hand and the
corporate party has caused these presents to be executed by a proper officer
thereunto duly authorized all as of the day and year first above written.

 

 

 

AFFINITY GROUP, INC.

 

 

 

 

 

 

 

 

 

 

 

By:

/s/ Mark J. Boggess

 

 

 

Mark J. Boggess

 

 

 

Its: Vice President and Chief Financial Officer

 

 

 

CAMPING WORLD, INC.

 

 

 

 

 

 

 

 

 

 

 

By:

/s/ Mark J. Boggess

 

 

 

Mark J. Boggess

 

 

 

Its: Vice President and Chief Financial Officer

 

 

 

CWI, INC.

 

 

 

 

 

 

 

 

 

 

 

By:

/s/ Mark J. Boggess

 

 

 

Mark J. Boggess

 

 

 

Its: Vice President and Chief Financial Officer

 

 

 

 

 

/s/ Mark T. Gilman

 

 

 

Mark T. Gilman

 

 

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