Document:

exv10w6

Exhibit 10.6

Execution Copy

THIRD AMENDED AND RESTATED

SECURITYHOLDERS AGREEMENT

          This
THIRD AMENDED AND RESTATED SECURITYHOLDERS AGREEMENT is dated
as of February 18, 2011 by
and among Diamond Resorts Parent, LLC, a Nevada limited liability company (the “Company”),
Soros Strategic Partners LP, a Delaware limited partnership (“Soros”), DRP Holdco, LLC, a
Delaware limited liability company (“Guggenheim”), each person identified as a “New
Purchaser” on the signature pages hereto (each, a “New Purchaser,” and collectively, the “New
Purchasers”) and Cloobeck Diamond Parent, LLC, a Nevada limited liability company
(“CDP”).

          WHEREAS, the Company, Soros, Guggenheim and CDP entered into that certain Second Amended and
Restated Securityholders Agreement, dated as of August 13, 2010 (the “Original Agreement”);

          WHEREAS, Section 11 of the Original Agreement provides that the Original Agreement may be
amended upon the prior written consent of (i) the Company, (ii) the Majority Common Holders and
(iii) the Majority Guggenheim Holders; and

          WHEREAS, the undersigned, being (i) the Company, (ii) the Majority Common Holders and (iii)
the Majority Guggenheim Holders, desire to amend and restate the Original Agreement on the terms
and conditions set forth herein.

          NOW, THEREFORE, in consideration of the mutual covenants contained herein and other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties
hereby agree as follows:

          1.
Definitions. As used herein, the following terms shall have the following meanings:

          “Acceptance Period” shall have the meaning set forth in Section
7(a).

          “Affiliate” means, when used with reference to a specified Person, any Person that
directly or indirectly controls or is controlled by or is under common control with the specified
Person. As used in this definition, “control” (including, with its correlative meanings,
“controlled by” and “under common control with”) shall mean possession, directly or indirectly, of
power to direct or cause the direction of management or policies (whether through ownership of
securities or partnership or other ownership interests, by contract or otherwise). With respect to
any Person who is an individual, “Affiliates” shall also include, without limitation, any member of such individual’s
Family Group.

          “Agreement” means this Third Amended and Restated Securityholders Agreement,
including the joinder attached hereto as Exhibit A, as may be amended, modified or waived
from time to time in accordance with its terms.

          “Approved Company Sale” shall have the meaning set forth in Section
3(a).

          “Board” means the Company’s board of managers.

 

 

          “CDP” has the meaning set forth in the Preamble to this Agreement.

          “CDP Common Unit Threshold” means the ownership by the CDP Investors of at least 10%
of the Common Units issued to the CDP Investors as of the date hereof.

          “CDP Investors” means CDP and any of its Permitted Transferees.

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

          “Common Percentage Interests” shall have the meaning ascribed to such term in the LLC
Agreement.

          “Common
Units” shall have the meaning ascribed to such term in the LLC
Agreement.

          “Company” has the meaning set forth in the Preamble to this Agreement.

          “Company’s
Notice of Intention to Sell” shall have the meaning set
forth in
Section 7(a).

          “Dispute” shall have the meaning set forth in Section 21.

          “DRC” means Diamond Resorts Corporation, a Maryland corporation.

          “EBITDA” shall have the meaning ascribed to such term in Senior Note Indenture.

          “Election
Period” shall have the meaning set forth in Section 2(a)(ii).

          “Equity Equivalents” shall have the meaning set forth in Section
7(a) hereof.

          “Equityholders” means collectively the New Purchase Investors, the CDP Investors, the
Other Investors, the Guggenheim Investors and the Soros Investors.

          “Equityholder
Units” means (i) all Units held, directly or indirectly, by the Equityholders, and (ii) all equity securities issued directly or indirectly with respect to any Units
referred to in clause (i) above by way of a unit or stock dividend or other distribution, or unit
or stock split, or in connection with a combination of units or shares, recapitalization, merger,
consolidation or other reorganization, including pursuant to a transaction of the type described in
Article 13 of the LLC Agreement.

          “Event of Default” has the meaning given such term in the Senior Note
Indenture.

          “Excluded Units” means any Units or other equity interests of the Company, whether now
authorized or not, and rights, options or warrants to purchase equity interests, and securities of
any type whatsoever that are, or may become, convertible into or exchangeable for equity interest
(such rights, options, warrants and convertible or
exchangeable securities are referred to herein as “Convertible Securities”), issued:
(i) to employees of the Company (excluding Stephen J. Cloobeck) pursuant to any unit option plan
or other equity incentive plan

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adopted by the Board, in an aggregate amount (together with all previous issuances to
employees, other than Stephen J. Cloobeck) not to exceed 10% of the Common Units, determined on a
fully-diluted basis, (ii) upon exercise, conversion or exchange of any Convertible Securities
pursuant to their terms, (iii) in connection with any acquisition by the Company of any shares of
capital stock or assets of any Person, or any merger or consolidation involving the Company or any
Subsidiary of the Company, (iv) pursuant to a Public Offering, (v) in connection with a stock split
or other subdivision of, or as a dividend or other distribution with respect to, the Company’s
Units or other equity interests, or (vi) in connection with strategic alliances, joint ventures,
third party credit arrangements or other partnering arrangements on behalf of the Company
authorized by the Board, including the members of the Board appointed by the Guggenheim
Common Member (as defined in the LLC Agreement).

          “Executive Officer” means the Chief Executive Officer, Chief Financial Officer, Chief
Information Officer, Chief Marketing Officer or other chief-level officer of the Company.

          “Fair Market Value” means the net equity value of the Company, as determined by mutual
agreement of the Company and the Investor exercising its Put, or failing such mutual agreement, by
an independent investment banking firm mutually agreed to by the Company and such Investor at the
Company’s expense; provided, that the determination of the fair market value shall assume
that the Company and its Subsidiaries are sold as a going concern and then liquidated and shall not
provide for any discounts based on illiquidity or restrictions on transfer of the applicable Common
Units or the fact that the Common Units being valued represent a minority interest in the Company.

          “Family
Group” means, with respect to any Person who is an individual, (i) such
Person’s spouse, former spouse, ancestors and descendants (whether natural or adopted), parents and
their descendants and any spouse of the foregoing persons
(collectively, “relatives”), (ii) the
trustee, fiduciary or personal representative of such Person and any trust solely for the benefit
of such Person and/or such Person’s relatives or (iii) any limited partnership, limited liability
company or corporation the governing instruments of which provide that such Person shall have the
exclusive, nontransferable power to direct the management and policies of such entity and of which
the sole owners of partnership interests, membership interests or any other equity interests are,
and will remain, limited to such Person and such Person’s relatives.

          “Guggenheim” has the meaning set forth in the Preamble to this Agreement.

          “Guggenheim Agreement” means that certain Securities Purchase Agreement, dated as of
June 17, 2010, by and between the Company and Guggenheim.

          “Guggenheim Common Unit Threshold” means the ownership by the Guggenheim Investors of
at least: (i) 5% of the total Common Percentage Interests (determined on a fully-diluted basis) or
(ii) 25% of the Common Units issued to the Guggenheim Investors as of the date hereof.

          “Guggenheim Entity” means any of (i) Guggenheim Capital, LLC and its Affiliates, (ii)
any Guggenheim Common Member and any of its equity holders who are Guggenheim Related Entities and
(iii) any Affiliates of any Guggenheim Common Member.

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          “Guggenheim Investors” means Guggenheim and any of its Permitted Transferees.

          “Guggenheim Related Entity” means an entity with a management or investment management
relationship with Guggenheim Capital, LLC or its Affiliates.

          “Guggenheim Units” means all Equityholder Units owned by any Guggenheim Investor.

          “Indebtedness” shall have the meaning ascribed to such term in the Senior Note
Indenture.

          “Investor” means any Soros Investor, any Guggenheim Investor or any New Purchaser
Investor.

          “Investor Units” means the Soros Units, the Guggenheim Units and the New Purchaser
Units.

          “Issue Date” means August 13, 2010.

          “Junior Securities” means all Equity Equivalents junior to the Preferred
Units.

          “LLC Agreement” means the Third Amended and Restated Operating Agreement of the
Company, dated as of the date hereof, as amended and/or restated from time to time.

          “Majority CDP Holders” means, at any time, the CDP Investors holding a majority of the
Common Units held by the CDP Investors.

          “Majority Common Holders” means, at any time, the holders of a majority of the Common
Units held by the Equityholders.

          “Majority Guggenheim Holders” means, at any time, the Guggenheim Investors holding a
majority of the Guggenheim Units.

          “Majority Preferred Holders” means, at any time, the holders of a majority of the
Preferred Units held by the Investors.

          “Management Agreement” means that certain Homeowner Association Oversight, Consulting
and Executive Management Services Agreement, dated as of December 31, 2010, by and between DRC and
Hospitality Management and Consulting Service, L.L.C., a Nevada limited liability company.

          “Material Subsidiary” shall have the meaning ascribed to such term in the LLC
Agreement.

          “Membership Interest” shall have the meaning ascribed to such term in the LLC
Agreement.

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          “New Purchaser” and “New Purchasers” shall have the meaning ascribed to those terms in
the preamble.

          “New Purchaser Investors” means the New Purchasers and any of their respective
Permitted Transferees.

          “New Purchaser Units” means all Equityholder Units owned by the New Purchaser
Investors.

          “Other Investor” means any Person (other than the CDP Investors and the Investors)
signatory to a joinder in the form attached hereto as Exhibit A and indicated as an “other
investor” in such joinder and any of their respective Permitted Transferees.

          “Participating
Equityholder” shall have the meaning set forth in Section 2(b)(i).

          “Permitted Transferee” has the meaning set forth in Section
2(c)(ii) hereof.

          “Person” means an individual, a partnership, a corporation, a limited liability
company, an association, a joint stock company, a trust, a joint venture, an unincorporated
organization, a governmental entity or any department, agency or political subdivision thereof or
any other entity or organization.

          “Polo Holdings” means Diamond Resorts Holdings, LLC.

          “Preferred Liquidation Amount” shall have the meaning ascribed to such term in the LLC
Agreement.

          “Preferred Members” shall have the meaning ascribed to such term in the LLC Agreement.

          “Preferred
Units” shall have the meaning ascribed to such term in  the LLC Agreement.

          “Principal Line of Business” means all business activities related to Timeshare
Opportunities, including, but not limited to, financing, development, sales, marketing, management
and maintenance of interval or fractional timeshare properties and the real estate incident
thereto, the acquisition and re-sale of such properties and the booking and reservation activities
related thereto; provided that, for the avoidance of doubt, “Principal Line of Business” shall not
include business activities related to hotels, condominiums, condo-hotels, apartment rental
complexes, commercial retail centers, office complexes, casinos, or other types of real estate /
hospitality developments or other activities not involving Timeshare Opportunities.
“Timeshare Opportunity” means any real estate development project or arrangement
which, at the time of entering into such opportunity, is required to be licensed under or is
regulated under any timeshare statute or regulation in any jurisdiction (regardless of whether such
jurisdiction is the jurisdiction in which the opportunity is located, sold or marketed), including,
without limitation, interval and fractional timeshares, whether conveyed via license, right to use,
fee simple title or points, and any timeshare club or exchange arrangement.

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          “Public Offering” means an underwritten public offering and sale of Units pursuant to
an effective registration statement under the Securities Act; provided that a Public Offering shall
not include an offering made in connection with a business acquisition or combination pursuant to a
registration statement on Form S-4 or any similar form, or an employee benefit plan pursuant to a
registration statement on Form S-8 or any similar form.

          “Put” has the meaning set forth in Section 2(a)(iii) hereof.

          “Qualified Public Offering” means any Public Offering providing aggregate gross
proceeds (before deducting underwriting discounts and expenses) to the Company and/or its
Equityholders of at least $100 million in such Public Offering and at an offering price
which represents a common equity valuation of Common Units (or Successor Stock, as defined in
the LLC Agreement) outstanding immediately prior to the issuance of Successor Stock in connection
with such offering of at least $500 million.

          “Recipient
Equityholder” shall have the meaning set forth in Section
2(b)(i).

          “Registration Rights Agreement” means that certain Amended and Restated Registration
Rights Agreement, dated as of the date hereof, by and among the Company and certain members of the
Company.

          “Sale of the Company” means (i) a transaction or series of transactions
(including by way of merger, consolidation, or sale of equity) the result of which is that the
holders of the Common Units immediately prior to such transaction(s) (on a fully diluted as if
converted basis) and their Affiliates are after giving effect to such transaction(s) no longer, in
the aggregate, the “beneficial owners” (as such term is defined in Rule 13d-3 and Rule 13d-5
promulgated under the Securities Act), directly or indirectly through one or more intermediaries,
of more than 50% of the Common Units (on a fully diluted basis as if converted basis), or (ii) the
sale, lease, transfer, conveyance or other disposition, in one or a series of related transactions,
of all or substantially all of the Company’s assets determined on a consolidated basis.

          “Sale Notice” shall have the meaning set forth in Section 2(a)(ii).

          “Securities Act” means the Securities Act of 1933, as amended.

          “Senior
Note Indenture” means the Indenture dated as of August 13, 2010 by and among
DRC, the Company, Polo Holdings, the Subsidiary Guarantors named therein and Wells Fargo Bank,
National Association, as trustee (as the same may be amended, restated, replaced or refinanced).

          “Senior Secured Notes” means DRC’s 12.0% Senior Secured
Notes due 2018, issued on or prior to August 13, 2010 pursuant to the Senior Note
Indenture.

          “Soros” has the meaning set forth in the Preamble to this Agreement.

          “Soros Investors” means Soros and any of its Permitted Transferees.

          “Soros Units” means all Equityholder Units owned by any Soros
Investor.

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          “Subsidiary” means, with respect to any Person, any corporation, partnership,
association or other business entity of which (i) if a corporation, a majority of the total voting
power of shares of stock entitled (without regard to the occurrence of any contingency) to vote in
the election of directors, managers or trustees thereof is at the time owned or controlled,
directly or indirectly, by that Person or one or more of the other Subsidiaries of that Person or a
combination thereof, or (ii) if a partnership, association or other business entity, a majority of
the partnership or other similar ownership interest thereof is at the time owned or controlled,
directly or indirectly, by any Person or one or more Subsidiaries of that Person or a combination
thereof. For purposes hereof, a Person or Persons shall be deemed to have a majority ownership
interest in a partnership, association or other business entity if such Person or Persons shall be
allocated a majority of partnership, association or other business entity gains or losses or shall
be or control the managing director or a general partner of such partnership, association or other
business entity.

          “Tax Distribution” shall have the meaning ascribed to such term in the LLC Agreement.

          “Tagging Investor” shall have the meaning set forth in Section
2(b)(i).

          “Transfer” means any direct or indirect sale, transfer, assignment, pledge or other
disposition or encumbrance, including, without limitation, a transfer of stock in a corporate
member.

          “Transferring
Equityholder” shall have the meaning set forth in Section 2(b)(i).

          “Transferring Investor” shall have the meaning set forth in Section 2(a)(i).

          “Transfer Notice” shall have the meaning set forth in Section 2(b)(i).

          “Transaction Agreements” shall mean the LLC Agreement, the Guggenheim Agreement and
the Registration Rights Agreement.

          “Units” means collectively the Preferred Units, the Common Units and any other equity
securities of the Company (or its successors) which are not limited to a fixed sum or percentage of
par value or stated value in respect of the rights of the holders thereof to participate in
dividends or other distributions or in the distribution of assets upon any voluntary or involuntary
liquidation, dissolution or winding up of the issuer of such securities, including any such type of
equity securities of any successor entity of the Company issued pursuant to a transaction of the
type described in Article 13 of the LLC Agreement.

          2. Restrictions on Transfer of Equityholder Units.

          (a) General Restrictions.

     (i) The Preferred Units may be Transferred, in whole or in part, only (A) with the
consent of the majority of the Board, to any Person; provided, that, unless waived
in writing by the Board, such transferee shall have complied with the requirements of
Section 2(c)(ii), (B) to the Company, pursuant to a redemption as set forth in
Section 11.5

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and 11.6 of the LLC Agreement or (C) pursuant to an Approved Company Sale (as
herein defined); provided, that the Transfer restrictions set forth in this Section
2(a)(i) shall not be applicable if (x) Stephen J. Cloobeck is no longer actively
involved in the day-to-day management of the Company, (y) an Event of Default shall have occurred
and be continuing with respect to the Senior Secured Notes and the holders thereof shall have
accelerated the Senior Secured Notes or shall have otherwise exercised any of their rights or
remedies thereunder, or (z) the Company shall have materially breached (and failed to cure within
30 days after receipt of written notice thereof, except with respect to breaches which are
incapable of being cured) any of the covenants set forth in Section 8 of this Agreement.

     (ii) The Common Units held by any Investor may be Transferred, in whole or in part, only (A)
with the consent of the majority of the Board, to any Person, which consent shall not be
unreasonably withheld, delayed or conditioned; provided, that to the extent that an Investor,
including any of its permitted transferees pursuant to
Section 2(c)(i), may hold
Preferred Units, the Board may withhold its consent for any reason or no reason; provided
further, that, unless waived in writing by the Board, such transferee shall have complied with the
requirements of Section 2(c)(ii), (B) pursuant to Section 2(b), to any Person;
provided, that unless waived in writing by the Board, such Person shall have complied with the
requirements of Section 2(c)(ii), (C) to the Company pursuant to the terms of this
Section 2(a)(ii), or (D) pursuant to an Approved Company Sale (as herein defined);
provided that if any Investor intends to Transfer any Common Units pursuant to Section
2(a)(ii)(A) or Section 2(a)(ii)(B), such Investor (the “Transferring Investor”)
shall deliver a written notice of such intention (a “Sale Notice”) to the Company including
a description of the proposed number of Common Units intended to be transferred. The Company may
submit an offer to purchase all (but not less than all) of the Common Units specified in the Sale
Notice. Any such offer shall be made by delivering written notice thereof (an “Offer
Notice”) to the Transferring Investor as soon as practical but in any event within ten (10)
business days after the delivery of the Sale Notice. Any such Offer Notice shall include the
proposed cash purchase price and other material terms of the proposed purchase. A proposed Offer
Notice shall be valid only if such notice contains firm and enforceable commitments from reputable
sources for the financing, provided, that if the Transferring Investors validly accepts any
proposed Offer Notice, then such proposed Offer Notice shall be deemed to be a valid Offer Notice.
The Offer Notice will constitute an irrevocable offer by the Company to acquire the Common Units
specified in the Offer Notice from the Transferring Investor at the price and on the terms
specified in the Offer Notice. If the Company elects to offer to purchase Common Units from the
Transferring Investor and the Transferring Investor accepts such offer, the transfer of such shares
shall be consummated as soon as practical after the delivery of the Offer
Notice to the Transferring Investor, but in any event within 30 days after delivery
of the Sale Notice (the “Election Period”). If the Transferring Investor has rejected any
such offer by the Company, then the Transferring Investor may, within six (6) months after the
expiration of the Election Period, Transfer such Common Units to one or more third parties at a
cash purchase price greater than the price specified in the Offer Notice and on other terms no more
favorable to the transferees thereof than the terms set forth in the Offer Notice. If the Company has not elected to offer to purchase the
Common Units being offered, then the Transferring Investor may, within six

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(6) months after the expiration of the Election Period, Transfer such Common Units to any
Person at any price and on any terms. Any Common Units not Transferred within such six (6) month
period shall be reoffered to the Company under this
Section 2(a)(ii) prior to any
subsequent Transfer; provided, further, that the restrictions and rights specified
in this Section 2(a)(ii) shall not be applicable if (x) Stephen J. Cloobeck is no longer
actively involved in the day-to-day management of the Company or (y) an Event of Default shall have
occurred and be continuing with respect to the Senior Secured Notes and the holders thereof shall
have accelerated the Senior Secured Notes or shall have otherwise exercised any of their rights or
remedies thereunder.

     (iii) Notwithstanding the right and restrictions set forth in Section 2(a)(ii) at
any time and from time to time after August 13, 2019, any Investor may require the Company to
repurchase all or any portion of its Common Units (the “Put”) for cash consideration,
payable within sixty (60) business days after the Company’s receipt of notice of exercise of the
Put, equal to the product of (A) the percentage of the common equity of the Company held by such
holder and (B) the Fair Market Value of the Company.

     (iv) Any CDP Investor may Transfer Equityholder Units (A) at any time after there are no
Preferred Units outstanding, to any Person (provided, that, unless waived in writing by the
Majority Common Holders (excluding the CDP Investors), such Person shall have complied with the
requirements of Section 2(b) and 2(c)(ii) as well as Article 11 of the Operating
Agreement) or (B) pursuant to an Approved Company Sale (as herein defined). Notwithstanding the
foregoing, any member of CDP may Transfer its membership interests in CDP at any time so long as
Stephen J. Cloobeck retains directly or through one or more trusts established for tax or estate
planning purposes, a majority of the voting and economic interests therein.

     (v) Any Other Investor may Transfer Equityholder Units only (A) with the prior consent or
approval of the Majority Common Holders and the Company, to any Person, provided, that, unless
waived in writing by the Majority Common Holders and the Company, such Person shall have complied
with the requirements of Section 2(c)(ii) or (B) pursuant to an Approved Company Sale (as
herein defined); provided, that any Transfer pursuant to Section 2(a)(iv)(A) shall
be made in accordance with Section 2(b).

     (b) Tag-Along Rights.

     (i) Subject to Section 2(c)(i), at least 15 business days prior to the Transfer by any
CDP Investor (to the extent that the CDP Investors constitute the Majority Common Holders) or any
Guggenheim Entity (to the extent that the Guggenheim Investors constitute the Majority Common
Holders), (the “Transferring Equityholder”) of any class or series of any type of
Equityholder Units to any Person(s) (other than pursuant to a Public Offering or pursuant to an
Approved Company Sale), the applicable Transferring Equityholder shall deliver a written notice
(the “Transfer Notice”) to (x) in the case where any CDP Investor is the Transferring
Equityholder, each of the Investors or (ii) in the case where any Guggenheim Investor is the
Transferring Equityholder, to each of the Soros Investors, the New Purchaser Investors and the CDP Investors (the
contemplated

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recipients of such notice being referred to as the “Recipient Equityholders”),
(with a copy of such notice to the Company), specifying in reasonable detail the identity of the
prospective transferee(s), the type, class or series, and the number of the Equityholder Units to
be Transferred, and the other material terms and conditions of such contemplated Transfer,
including the cash (or cash equivalent) purchase price therefor. Any Recipient Equityholder may
elect to participate in such contemplated Transfer by delivering written notice to the applicable
Transferring Equityholder within 15 business days after delivery of the applicable Transfer Notice.
If any Recipient Equityholder elects to participate in such Transfer, each Recipient Equityholder
who elects to participate (the “Tagging Investors”, and collectively with the applicable
Transferring Equityholder, the “Participating Equityholders”) shall be entitled to sell in
such contemplated Transfer, at the same price and on the same terms, up to a number of each class
or series of each type of Equityholder Units to be sold in such contemplated Transfer equal to the
product of (x) the quotient determined by dividing the percentage of such class or series of such
type of Equityholder Units owned by such Tagging Investor by the aggregate percentage of such class
or series of such type of Equityholder Units owned collectively by all of the Participating
Equityholders and (y) the aggregate number of such class or series of such type of Equityholder
Units to be sold in such contemplated Transfer. Each Tagging Investor shall pay its pro rata share
(based on the amount of consideration received) of the reasonable out-of-pocket expenses incurred
by the Participating Equityholders in connection with such Transfer and shall take all reasonably
necessary and desirable actions as reasonably directed by the applicable Transferring Equityholder
in connection with the consummation of such Transfer.

     (ii) Notwithstanding the foregoing, in connection with any Transfer under Section 2(b)(i), (i) no Equityholder will be required to grant any indemnification rights
except indemnification rights which constitute identical indemnification rights (pro rata based
upon the consideration received and not joint and several, other than any such obligations that
relate solely to a particular Equityholder, such as indemnification with respect to representations
and warranties or covenants made by such Stockholder, in respect of which only such Equityholder
shall be liable), (ii) no Equityholder shall be required to make any representation or warranty
that is not made by all other Equityholders and (iii) no Equityholder which is an institutional
investor or investment fund shall be required to enter into any restrictive covenant, including
without limitation, any non competition or non solicitation arrangement which survives the closing
of such Transfer.

     (c) Permitted Transfers.

     (i) The restrictions contained in Section 2(a) and 2(b) shall not apply with
respect to any Transfer of Equityholder Units by any Equityholder (A) in the case of an individual
Equityholder, pursuant to applicable laws of descent and distribution or, if such Transfer is made
for bona fide estate planning purposes (which bona fide estate planning purposes, if requested by
the Board, shall be verified by a legal opinion from counsel experienced in such matters), then to
any member of such Equityholder’s Family Group, (B) in the case of a non-individual Equityholder,
to or among its Affiliates, or to any of their lenders as collateral security, (C) in the case of a
Guggenheim Investor, a

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Transfer to or among any Guggenheim Entity, so long as Guggenheim Capital, LLC or
one of its Affiliates has the sole power to vote and exercise contractual rights with
respect to such transferred Units, (D) to any other Equityholder, or (E) in the case of a
New Purchaser, to any one or more of the following: (I) any direct or indirect member,
owner, partner, manager, officer or director of a New Purchaser, (II) any family member of
any Person in clause (I), (III) any trust, retirement or benefit plan, individual
retirement account or other entity formed or existing for the benefit of any Person(s) in
clause (I) or (II), or (IV) any philanthropic, charitable or non-profit organization or
foundation established in whole or in part by any Person(s) in clause (I) or (II);
provided, in each case, that any such transferee shall have complied with the
requirements of Section 2(c)(ii).

     (ii) Prior to any proposed transferee’s acquisition of Equityholder Units
pursuant to a Transfer permitted by Section 2(a)(i), 2(a)(ii) or
2(a)(iv), in each case, unless waived in writing by the Board, or pursuant to a
Transfer permitted by Section 2(c)(i), such proposed transferee must agree to take
such Equityholder Units subject to and to be fully bound by the terms of this Agreement
applicable to such Equityholder Units by executing a joinder to this Agreement
substantially in the form attached hereto as Exhibit A and delivering such executed
joinder to the Secretary of the Company prior to the effectiveness of such Transfer (unless
such Transfer is pursuant to applicable laws of descent and distribution, in which case,
such executed joinder shall be delivered to the Secretary of the Company as soon as
reasonably possible after such Transfer). All transferees acquiring Equityholder Units and
executing a joinder in compliance with this Section 2(c)(ii) are collectively
referred to herein as “Permitted Transferees”.

          (d) If any Equityholder Transfers Equityholder Units to an Affiliate and an event occurs which
causes such Affiliate to cease to be an Affiliate of such Equityholder unless, prior to such event,
such Affiliate Transfers such Equityholder Units back to such Equityholder or to another Affiliate
of such Equityholder (but only if such Equityholder or such Affiliate of such Equityholder has
complied with the provisions of Section 2(c) hereof), then, in each case, such event or
Transfer shall be deemed a Transfer of Equityholder Units subject to all of the restrictions on
Transfers of Equityholder Units set forth in this Agreement, including without limitation, this
Section 2.

          3. Approved Company Sale.

          (a) If the Majority Common Holders approve a Sale of the Company in which the sole
consideration for the Equityholder Units is cash (and only in such instance) (an “Approved
Company Sale”), then each holder of Equityholder Units will vote for, consent to and raise no
objections against the Approved Company Sale or the process. If the Approved Company Sale is
structured as a merger or consolidation, then each holder of Equityholder Units shall waive any
dissenters rights, appraisal rights or similar rights in connection with such merger or
consolidation. If the Approved Company Sale is structured as a Transfer of Equityholder Units, then
each holder of Equityholder
Units shall agree to sell all of his or its Equityholder Units and rights to acquire
Equityholder Units on the same terms and conditions, in all material respects, as applicable to the
respective types of Equityholder Units to be Transferred. Each holder of Equityholder Units shall
take all necessary or desirable actions in

11

 

connection with the consummation of an Approved Company Sale as requested by the Company,
including, without limitation, executing the applicable purchase agreement.

          (b) The foregoing obligations of the Equityholders with respect to an Approved Company Sale are
subject to the satisfaction of the following conditions: (i) such Approved Company Sale shall be a
bona fide Sale of the Company to a party which is not an Affiliate of either the Company or any
Equityholder, (ii) upon the consummation of such Approved Company Sale the aggregate consideration
payable upon consummation of such Approved Sale to all Equityholders in respect of their Equity
Equivalents (the “Aggregate Consideration”) shall be apportioned and distributed as between
the different classes or series of Equity Equivalents in accordance with the distribution
priorities set forth in Article 7 of the LLC Agreement as in effect immediately prior to such
Approved Company Sale, and as between holders of Equity Equivalents of a particular class or
series, ratably based on the Equity Equivalents of such class or series actually Transferred in the
Approved Company Sale (the “Distribution Priorities”) and (iii) each holder of then
currently exercisable or convertible rights to acquire Equity Equivalents shall be given an
opportunity to exercise such rights prior to the consummation of the Approved Company Sale and
participate in such sale as a holder of such class of Equity Equivalents.

          (c) The Company will bear the costs of any actual or proposed Approved Company Sale, which
costs will allocated pro rata to the holders of the Common Units. Costs incurred by the holders of
Equityholder Units on their own behalf will not be considered costs of the Approved Company Sale;
provided, that in the event the Approved Company Sale is consummated, the Company shall pay
the reasonable attorney’s fees and expenses of one counsel chosen by the Majority Common Holders in
connection with the Approved Company Sale.

          4. Financial Statements and Access to Information.

          (a) Financial Statements; Annual Budget; Other Information. The Company shall deliver
to (x) each Investor which holds Common Units representing at least 1% of the aggregate number of
outstanding Common Units of the Company or any number of Preferred Units and, (y) at such time when
the CDP Investors no longer constitute the Majority Common Holders, each CDP Investor (so long as
such CDP Investor holds Common Units representing at least 1% of the aggregate number
of outstanding Common Units of the Company):

     (i) within 30 days after the end of each monthly accounting period in each fiscal year
of the Company (other than any monthly accounting period ending on the last day of a fiscal
quarter of the Company), unaudited consolidated statements of income and cash flows of the
Company and its Subsidiaries for such monthly period (as well as unaudited consolidated
statements of income of the Company and its Subsidiaries for the period from the beginning
of the fiscal year to the end of such month) and unaudited consolidated balance sheets of
the Company and its Subsidiaries as of the end of such monthly period (and such financial
statements shall set forth in each case comparisons to the Company’s and its Subsidiaries’
corresponding period in the preceding fiscal year). Such financial statements shall be
prepared in accordance with generally accepted accounting principles, consistently
applied, subject to the absence of footnote disclosures and to normal year-end
adjustments;

12

 

     (ii) within 45 days after the end of each quarterly accounting period in each fiscal
year of the Company (other than any quarterly accounting period ending on the last day of a
fiscal year of the Company), unaudited consolidated statements of income and cash flows of
the Company and its Subsidiaries for such quarterly period (as well as unaudited
consolidated statements of income of the Company and its Subsidiaries for the period from
the beginning of the fiscal year to the end of such quarter) and unaudited consolidated
balance sheets of the Company and its Subsidiaries as of the end of such quarterly period
(and such financial statements shall set forth in each case comparisons to the Company’s
and its Subsidiaries’ corresponding period in the preceding fiscal year). Such financial
statements shall be prepared in accordance with generally accepted accounting principles,
consistently applied, subject to the absence of footnote disclosures and to normal year-end
adjustments;

     (iii) within 90 days after the end of each fiscal year of the Company, audited
consolidated statements of income and cash flows of the Company and its Subsidiaries for
such fiscal year, and audited consolidated balance sheets of the Company and its
Subsidiaries as of the end of such fiscal year (and such financial statements shall set
forth in each case comparisons to the Company’s and its Subsidiaries’ corresponding period
in the preceding fiscal year). Such financial statements shall be prepared in accordance
with generally accepted accounting principles, consistently applied;

     (iv) within 90 days after the end of each fiscal year of the Company, an annual budget
of the Company and its Subsidiaries (presented on a monthly basis) containing, among other
things, (i) pro forma financial statements for each fiscal quarter of the next fiscal year
of the Company and (ii) information regarding the aggregate compensation proposed to be
paid during such fiscal year to Executive Officers of the Company;

     (v) promptly following receipt by the Company, each audit response letter,
accountant’s management letter and other written report submitted to the Company by its
independent public accountants in connection with an annual or interim audit of the books
of the Company or any of its Subsidiaries;

     (vi) promptly after the commencement thereof, notice of all actions, suits, claims,
proceedings, investigations and inquiries that could materially and adversely affect the
Company or any of its Subsidiaries; and

     (vii) promptly, from time to time, such other information regarding the business,
prospects, financial condition, operations, property or affairs of the Company and its
Subsidiaries as any Investor or CDP Investor reasonably may request.

          (b) Access to Information. The Company shall permit (x) any Investor which holds
Common Units representing at least 5% of the aggregate number of outstanding Common Units
(including any Guggenheim Investor, so long as the Guggenheim Common Unit Threshold is met) or any
number of Preferred Units and (y) at such time when the CDP Investors no longer constitute the
Majority Common Holders, each CDP Investor (so long as
the CDP Common Unit Threshold is met); and each of their respective representatives
(including, without limitation, its legal counsel and accountants), during normal business hours
and such other times as any such

13

 

holder may reasonably request, to (i) visit and inspect any of the properties of the Company
and its Subsidiaries, (ii) examine the corporate, financial and similar type records, reports and
documents of the Company and its Subsidiaries, including, without limitation, all internal
management documents, reports of operations, reports of adverse developments, copies of any
management letters, communications with equityholders or directors, press releases and registration
statements, and make copies thereof or extracts therefrom and (iii) discuss the affairs, finances
and accounts of any such entities with any of the executive officers and or senior managers of the
Company or any of its Subsidiaries. Notwithstanding the foregoing, such access shall be arranged in
prior consultation with Stephen J. Cloobeck (or, if Stephen J. Cloobeck is no longer serving as an
officer of the Company, David F. Palmer or, if David F. Palmer is no longer serving as an officer
of the Company, then the Person then serving as President of the Company), except with respect to
communications with Stephen J. Cloobeck, David F. Palmer or any person appointed as Chief Financial
Officer after the date hereof.

          5. Legend.

          (a) The Equityholder Units shall initially be uncertificated. However, in the event that the
Company determines at a later date to issue certificates representing the Equityholder Units, each
certificate or instrument evidencing Equityholder Units and each certificate or instrument issued
in exchange for or upon the Transfer of any Equityholder Units (if such securities remain
Equityholder Units (as defined herein) after such Transfer) shall be stamped or otherwise imprinted
with a legend in substantially the following form:

“THE SECURITIES REPRESENTED BY THIS CERTIFICATE WERE ORIGINALLY ISSUED
ON _______, 20_ AND HAVE NOT BEEN REGISTERED UNDER THE UNITED STATES
SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR ANY STATE SECURITIES OR
BLUE SKY LAWS, AND MAY NOT BE SOLD, TRANSFERRED, PLEDGED OR OTHERWISE
DISPOSED OF IN THE ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
ACT OR AN EXEMPTION FROM REGISTRATION THEREUNDER. THE SECURITIES
REPRESENTED BY THIS CERTIFICATE ARE ALSO SUBJECT TO A THIRD AMENDED AND
RESTATED SECURITYHOLDERS AGREEMENT DATED AS OF FEBRUARY 18, 2011, AS MAY BE
AMENDED FROM TIME TO TIME BY AND AMONG THE ISSUER OF SUCH SECURITIES AND
CERTAIN OF THE ISSUER’S SECURITYHOLDERS. A COPY OF SUCH THIRD AMENDED AND
RESTATED SECURITYHOLDERS AGREEMENT WILL BE FURNISHED WITHOUT CHARGE BY THE
ISSUER TO THE HOLDER HEREOF UPON WRITTEN REQUEST.”

The legend set forth above regarding this Agreement shall be removed from the certificates
evidencing any securities which cease to be Equityholder Units. Upon the request of any
Equityholder, the Company shall remove the Securities Act portion of the legend set forth above

14

 

from the certificate or certificates for such Equityholder Units; provided that such
Equityholder Units are eligible (as reasonably determined by the Company) for sale pursuant to Rule
144(k) (or any similar rule or rules then in effect) under the Securities Act.

          (b) Unless waived by the Company, no Equityholder may Transfer any Equityholder Units (except
pursuant to an effective registration statement under the Securities Act) without first delivering
to the Company an opinion of counsel reasonably acceptable in form and substance to the Company
(which counsel will be reasonably acceptable to the Company) that registration under the Securities
Act is not required in connection with such Transfer. If such opinion of counsel reasonably
acceptable in form and substance to the Company further states that no subsequent Transfer of such Equityholder Units will
require registration under the Securities Act (including due to such Equityholder Units
being eligible for sale pursuant to Rule 144 (or any similar rule or rules then in effect) under
the Securities Act), the Company will promptly upon such Transfer deliver new certificates for such
securities (if such securities are certificated as of such time) which do not bear the Securities
Act portion of the legend set forth in Section 5(a).

          6. Transfers in Violation of Agreement. Any Transfer or attempted Transfer of any
Equityholder Units in violation of any provision of this Agreement or the LLC Agreement shall be
null and void, and the Company shall not record such Transfer on its books or treat any purported
transferee of such Equityholder Units as the owner of such securities for any purpose.

          7. Preemptive Rights.

          (a) If, at any time after the date hereof and prior to the consummation of a Qualified Public
Offering, the Company wishes to issue any Units or any options, warrants or other rights to acquire
Units or any notes or other Convertible Securities, other than Excluded Units (all such Units and
other rights and securities other than Excluded Units, collectively, the “Equity
Equivalents”), to any Person or Persons, the Company shall promptly deliver a notice of
intention to sell or otherwise issue (the “Company’s Notice of Intention to Sell”) to each
Member setting forth a description and the number of the Equity Equivalents and any other
securities proposed to be issued, the proposed purchase price and terms of sale, including the
identity of the prospective transferee(s). Upon receipt of the Company’s Notice of Intention to
Sell, each Member shall have the right to elect to purchase, at the price and on the terms stated
in the Company’s Notice of Intention to Sell, a number of the Equity Equivalents equal to the
product of (i) the percentage determined by dividing the number of Common Units then owned by such
Member by the number of vested Units then outstanding multiplied by (ii) the number of Equity
Equivalents proposed to be issued (as described in the applicable Company’s Notice of Intention to
Sell); provided that, notwithstanding anything contained herein to the contrary, if the
Company is issuing Equity Equivalents together as a unit with the issuance of any debt or other
equity securities of the Company or any of its Subsidiaries, then any Member who elects to purchase
such Equity Equivalents pursuant to this Section 7 must also purchase a corresponding
proportion of such other debt or equity securities, all at the proposed purchase price and on terms
of sale as specified in the applicable Company’s Notice of Intention to Sell. Such election shall
be made
by the electing Member by written notice to the Company within ten (10) business days after
receipt by such Member of the Company’s Notice of Intention to Sell (the “Acceptance
Period”).

15

 

          (b) To the extent an effective election to purchase has not been received from any Member
pursuant to subsection (a) above in respect of the Equity Equivalents proposed to be issued
pursuant to the applicable Company’s Notice of Intention to Sell, the Company may, at its election,
during a period of one hundred and eighty (180) days following the expiration of the applicable
Acceptance Period, issue and sell the remaining Equity Equivalents to be issued and sold to any
Person at a price and upon terms not more favorable to such Person than those stated in the
applicable Company’s Notice of Intention to Sell; provided, however, that failure by any
Member to exercise its option to purchase with respect to one issuance and sale of Equity
Equivalents shall not affect its option to purchase Equity Equivalents in any subsequent issuance
and sale. In the event the Company has not sold any Equity Equivalents covered by a Company’s
Notice of Intention to Sell within such one hundred and eighty (180) day period, the Company shall
not thereafter issue or sell such Equity Equivalents, without first
offering such Equity
Equivalents to each Member in the manner provided in this Section 7.

          (c) If any Member gives the Company notice, pursuant to the provisions of this Section
7, that such Member desires to purchase any Equity Equivalents, payment therefor shall be by
check or wire transfer of immediately available funds, against delivery of the securities (which
securities shall be issued free and clear of any liens or encumbrances) at the executive offices of
the Company no later than the last closing date fixed by the Company for the sale of the applicable
Equity Equivalents, which last closing date shall be no earlier than 15 business days after the
date the Company delivers the applicable Company’s Notice of Intention to Sell. In the event that
any proposed sale is for a consideration other than cash, such Member may pay cash in lieu of all
(but not part) of such other consideration, in the amount determined reasonably and in good faith
by the Board to represent the fair value of such consideration other than cash.

          8. Protective Provisions.

          (a) For so long as the Preferred Liquidation Amount with respect to the Preferred Units held
by the Investors is at least $10,000,000 (or it is less than $10,000,000 as a result of partial
redemptions of the Preferred Units by the Company from the Investors), the Company shall, unless it
has received the prior written waiver of the Majority Preferred Holders:

     (i) pay and cause each of its Subsidiaries to pay all required Company-level taxes as
and when due and payable;

     (ii) maintain and cause each of its Subsidiaries to maintain insurance (in accordance
with past practice and industry standards);

     (iii) maintain and cause each of its Subsidiaries to maintain its existence, material
licenses and material permits in good standing;

     (iv) maintain and cause each of its Subsidiaries to maintain books and records, with
access provided to any Investor in accordance with Section 4(b);

     (v) comply and cause each of its Subsidiaries to comply with all applicable material
laws, rules and regulations and all of its material contractual obligations;

16

 

     (vi) retain an independent, nationally or regionally recognized accounting firm
acceptable to the Majority Preferred Holders as its auditor at all times (it being
acknowledged that BDO Seidman, LLP is acceptable to the Majority Preferred Holders);

     (vii) hold meetings of the Board on at least a quarterly basis;

     (viii) make Tax Distributions to the holders of Units as and when required under the
LLC Agreement (and the Company shall cause its direct and indirect Subsidiaries to make
distributions sufficient to satisfy such obligation); provided, however, that, so long as
the Senior Note Indenture is in effect and to the extent funded by distributions from DRC
and its Subsidiaries, the aggregate Tax Distributions since the Issue Date shall not
exceed the lesser of:

     (A) the aggregate amount since the Issue Date of the relevant tax (including
any penalties and interest) that DRC would owe if it were filing a separate tax
return (or a separate consolidated or combined return with its Subsidiaries that
are members of DRC’s consolidated or combined group), taking into account any
carryovers and carrybacks of tax attributes (such as net operating losses) of DRC
and such Subsidiaries from other taxable years; and

     (B) the aggregate amount of the relevant tax that the Equityholders actually
owe to the appropriate taxing authority after the date hereof;

provided, further, however, that any Tax Distributions received from the Company from
funds provided by DRC and its Subsidiaries shall be paid over to the appropriate taxing
authority within 30 days of receipt by the Equityholders of such Tax Distributions or
refunded to the Company (which refunded amounts shall be paid to DRC;

     (ix) within 90 days after the commencement of each fiscal year, approve the Company’s
business plan, which plan shall include an annual budget and which budget shall include the
aggregate compensation to be paid during such fiscal year to Executive Officers of the
Company (such plan and budget (including the aggregate compensation to be paid during such
fiscal year to Executive Officers of the Company) being approved by the Board, including at
least one of the Board members appointed by the Guggenheim Investors);

     (x) for so long as CDP or any of its Affiliates own any Membership Interest in the
Company, CDP shall cause Stephen J. Cloobeck to devote such time and attention
that is reasonable and appropriate to manage the business of the Company and its
Subsidiaries as conducted from time to time; and

     (xi) enforce the provisions of the LLC Agreement.

          (b) For so long as the Preferred Liquidation Amount with respect to the Preferred Units held
by the Investors is at least $10,000,000 (or it is less than $10,000,000 as a result of partial
redemptions of the Preferred Units by the Company from the Investors), the
Company shall not, unless it has received the prior written consent of the Majority Preferred
Holders:

17

 

     (i) expand the Board to greater than seven (7) members;

     (ii) alter or change the rights, preferences or obligations of the Preferred Units, including,
without limitation, by creating or reclassifying any class or series of equity securities of the
Company or any of its Subsidiaries on parity with or having preference over the Preferred Units;

     (iii) repurchase or redeem any Junior Securities prior to the redemption of all of the
Preferred Units; provided, that the Company may, without the consent of the Majority
Preferred Holders, repurchase or redeem Junior Securities held by any employee of the Company or
any of its Subsidiaries in the event of such employee’s death, retirement or termination of
employment to the extent permitted under the Senior Secured Notes;

     (iv) make any distributions on any Junior Securities except for Tax Distributions as and when
required under the LLC Agreement (and the Company shall cause its direct and indirect Subsidiaries
to make distributions sufficient to satisfy such obligation, subject to the limitations, if any,
set forth in Section 8(a)(viii));

     (v) amend or modify the LLC Agreement, this Agreement or the Company’s certificate of
formation;

     (vi) merge or consolidate or permit any of its Subsidiaries to merge or consolidate with or
into any Person which requires a capital infusion by the Company in excess of $10,000,000;

     (vii) liquidate, wind up or sell, or permit any of its Subsidiaries to liquidate, wind up or
sell, all or substantially all of its assets (on a consolidated basis);

     (viii) incur Indebtedness in excess of any limitations on Indebtedness set forth in the Senior
Note Indenture;

     (ix) issue any Equity Equivalents senior to or pari passu with the Preferred Units;

     (x) make any change to the Principal Line of Business conducted by the Company and its
Subsidiaries;

     (xi) enter into or amend any transactions or permit any of its Subsidiaries to enter into or
amend any transactions with any Affiliate, with Stephen J. Cloobeck or with any family member of
Stephen J. Cloobeck other than (i) on terms and conditions at least as favorable to the
Company or its Subsidiaries as would be obtained through an arm’s-length negotiation with an
independent party, (ii) settlement of claims made by Richard Cloobeck; or (iii) ordinary course
employment arrangements approved by the Board; provided, however, that the approval of the Majority
Preferred Holders shall not be required for any transaction for which all or substantially all of
the amounts payable to such Affiliate are directly reimbursable by one or more homeowners’
associations or

18

 

similar entities for which the Company performs management services pursuant to the Management
Agreement or any similar management services agreement;

     (xii) modify the Company’s business plan or diverge from the Company’s annual budget, in each
case in any material respect, or change the Company’s auditors or accountants;

     (xiii) amend the Management Agreement in any material respect, or enter into or materially
amend or permit any of its Subsidiaries to enter into or materially amend any management services
agreement with any Affiliate of the Company, other than as approved by the Majority Preferred
Holders as of the date hereof;

     (xiv) other than in connection with an Approved Company Sale or as contemplated by this
Agreement, permit any Equityholder to directly or indirectly sell any Junior Securities;

     (xv) consummate or permit any of its Subsidiaries to consummate a reorganization or
recapitalization of the Company or any of its Subsidiaries or effect any other change in the
capital structure of the Company or any of its Subsidiaries;

     (xvi) acquire, or permit any of its Subsidiaries to acquire, any interest in any Person or
business (whether by a purchase of assets, purchase of equity, merger or otherwise), or enter into
any joint venture, other than as expressly contemplated by, and within the parameters established
by, the annual business plan;

     (xvii) create, incur or assume, or permit any of its Subsidiaries to create, incur or assume,
any lien or encumbrance of any kind upon the assets of the Company or any of its Subsidiaries which
is not permitted under the Senior Note Indenture;

     (xviii) grant options or issue Equity Equivalents to any employee of the Company or any of its
Subsidiaries other than pursuant to equity incentive plans approved by the Board which shall not
exceed in the aggregate since the date hereof 10% of the Common Units of the Company on a fully
diluted basis at the time of such Issuance;

     (xix) permit any of the Company’s Subsidiaries to issue any equity securities or Convertible
Securities to any Person other than the Company or any of the Company’s Subsidiaries, or permit any
other transaction to occur which would result in any direct or indirect Subsidiary of the Company
not being a direct or indirect wholly-owned Subsidiary of the Company;

     (xx) file, or permit any of the Company’s Subsidiaries to file, any registration statement
with the Securities and Exchange Commission with respect to the registration of an offering or sale
of any equity securities that does not constitute a Qualified Public Offering;

     (xxi) directly or indirectly transfer, sell, assign, pledge, hypothecate, or otherwise dispose
of, any warrants to purchase common stock of DRC; or

19

 

     (xxii) agree to do any of the foregoing.

          (c) For so long as the Guggenheim Common Unit Threshold is met, the Company shall comply with
the following covenants, unless it has received the prior written consent of the Majority
Guggenheim Holders:

     (i) The Company shall not, nor permit any of the Company’s Subsidiaries to, issue any
debt securities to any Person other than: (A) with respect to the Subsidiaries, to the
Company; (B) to third party financing sources (subject to the other provisions of
Section 8(b)) who are not Affiliates of any Equityholder; (C) to the Equityholders
so long as each Investor is offered an opportunity to participate in such offering as if it
was an offering of Units by the Company subject to the preemptive rights of Section
7; or (D) in connection with restructuring (including increasing) existing Indebtedness
of the Company and its Subsidiaries, which Indebtedness is secured by or related to assets
being acquired by the Company or any Subsidiary of the Company (whether pursuant to an
acquisition of assets or stock, or merger or consolidation, or whether pursuant to the
provisions of the United States Bankruptcy Code or similar foreign bankruptcy regulations
in connection with the bankruptcy of a non-Affiliated third party).

     (ii) The Company shall not permit any of its Subsidiaries to issue any equity
securities or Convertible Securities, other than Excluded Units, to any Person other than
the Company or any of the Company’s Subsidiaries, or permit any other transaction to occur
which would result in any direct or indirect Subsidiary of the Company not being a direct
or indirect wholly-owned Subsidiary of the Company;

     (iii) The Company shall make Tax Distributions to the holders of Units as and when
required under the LLC Agreement (and the Company shall cause its direct and indirect
Subsidiaries to make distributions sufficient to satisfy such obligation); provided,
however, that, so long as the Senior Note Indenture is in effect and to the extent funded
by distributions from DRC and its Subsidiaries, the aggregate Tax Distributions since the
Issue Date shall not exceed the lesser of:

     (A) the aggregate amount since the Issue Date of the relevant tax (including
any penalties and interest) that DRC would owe if it were filing a separate tax
return (or a separate consolidated or combined return with its Subsidiaries that
are members of DRC’s consolidated or combined group), taking into account any
carryovers and carrybacks of tax attributes (such as net operating losses) of DRC
and such Subsidiaries from other taxable years; and

     (B) the aggregate amount of the relevant tax that the Equityholders actually
owe to the appropriate taxing authority after the date hereof;

provided, further, however, that any Tax Distributions received from the Company from funds
provided by DRC and its Subsidiaries shall be paid over to the appropriate taxing authority
within 30 days of receipt by the Equityholders of such Tax Distributions or refunded to the
Company (which refunded amounts shall be paid to DRC);

20

 

     (iv) The Company shall maintain and cause each of its Subsidiaries to maintain its
existence, material licenses and material permits in good standing;

     (v) The Company shall comply and cause each of its Subsidiaries to comply with all
applicable material laws, rules and regulations and all of its material contractual
obligations;

     (vi) The Company shall pay and cause each of its Subsidiaries to pay all required
Company-level taxes as and when due and payable;

     (vii) Neither the Company nor any of its Subsidiaries shall become a party to any
agreement which, by its terms: (1) expressly restricts the Company’s performance of this
Agreement or any other Transaction Document or (2) imposes any non-competition or other
restrictive covenant obligation on Investor or any of their Affiliates without such
Investor’s prior written consent;

     (viii) The Company shall maintain and cause each of its Subsidiaries to maintain
insurance (in accordance with past practice and industry standards);

     (ix) The Company shall hold meetings of the Board on at least a quarterly basis; or

     (x) agree to do any of the foregoing.

          9. Director and Officer Liability Insurance. The
Company (or one of its
Subsidiaries) will maintain director and officer liability insurance coverage in amounts
customary in the industry.

          10. Use of Investors’ Name. Each of the parties hereto agrees that neither it nor any
of its employees, directors, officers, agents or representatives will directly or indirectly use or
refer in writing to the name of either Investor or any derivation thereof, for any purpose
whatsoever (including, without limitation, in any filing with any governmental authority, any press
release, any public announcement or statement or in any interview or other discussion with any
reporter or other member of the media), without the prior written consent of such Investor with
respect to each such use or reference.

          11. Amendment and Waiver. No modification, amendment or, except as otherwise provided
in Section 8 hereof, waiver of any provision of this Agreement shall be effective against the
Equityholders or the Company unless such modification or amendment is approved in writing by (i)
the Company; (ii) the Majority Common Holders; (iii) the Majority Guggenheim Holders; and
(iv) the Majority Preferred Holders; and any modification or amendment to which such
written consent is obtained will be binding upon the Company and each Equityholder;
provided, however, that if any
modification, amendment or waiver of any provision of this Agreement that would materially and
adversely affect the rights, interests or obligations of any New Purchaser hereunder in a manner
differently than other Equityholders holding the same class or series of Units, then such
modification, amendment or waiver shall not be effective against such New Purchaser without such
New Purchaser’s written consent with respect thereto. No waiver of any provision of this Agreement
shall be effective against the

21

 

Company unless such waiver is approved in writing by the Company. The failure of any
party to enforce any of the provisions of this Agreement shall in no way be construed as a waiver
of such provisions and shall not affect the right of such party thereafter to enforce each and
every provision of this Agreement in accordance with its terms. Each Equityholder shall remain a
party to this Agreement only so long as such person is the holder of record of Equityholder Units.

          12. Severability. Whenever possible, each provision of this Agreement shall be
interpreted in such manner as to be effective and valid under applicable law, but if any provision
of this Agreement is held to be invalid, illegal or unenforceable in any respect under any
applicable law or rule in any jurisdiction, such invalidity, illegality or unenforceability
shall not affect any other provision or any other jurisdiction, but this Agreement shall be
reformed, construed and enforced in such jurisdiction as if such invalid, illegal or unenforceable
provision had never been contained herein.

          13. Entire Agreement. Except as otherwise expressly set forth herein, this document
embodies the complete agreement and understanding among the parties hereto with respect to the
subject matter hereof and supersedes and preempts any prior understandings, agreements or
representations by or among the parties, written or oral, which may have related to the subject
matter hereof in any way (including, but not limited to, the Original Agreement).

          14. Termination. This Agreement will automatically terminate and be of no further
force or effect immediately after the consummation of an Approved Company Sale or a Qualified
Public Offering.

          15. Successors and Assigns. Except as otherwise provided herein, this Agreement shall
bind and inure to the benefit of and be enforceable by the Company and its successors and assigns,
including any corporation which is a successor to the Company, and the Equityholders and any
subsequent holders of Equityholder Units and the respective successors, heirs and assigns of each
of them, so long as they hold Equityholder Units.

          16. Counterparts; Facsimile. This Agreement may be executed in separate counterparts
(each of which may be transmitted via facsimile) each of which shall be an original and all of
which taken together shall constitute one and the same agreement.

          17. Remedies. The parties hereto shall be entitled to enforce their rights under this
Agreement specifically to recover damages by reason of any breach of any provision of this
Agreement and to exercise all other rights existing in their favor. The parties hereto agree and
acknowledge that money damages may not be an adequate remedy for any breach of the provisions of
this Agreement and that the Company and any Equityholder may in his, her, or its sole discretion
apply to any court of law or equity of competent jurisdiction for specific performance and/or
injunctive relief (without posting a bond or other security) in order to enforce or prevent any
violation of the provisions of this Agreement.

          18. Notices. All notices, demands or other communications to be given or delivered
under or by reason of the provisions of this Agreement will be in writing and will be deemed to
have been given when delivered if delivered personally, sent via a nationally

22

 

recognized overnight courier, or sent via facsimile to the recipient, or if sent by certified
or registered mail, return receipt requested, will be deemed to have been given two business days
thereafter. Such notices, demands and other communications shall be sent to any Equityholder at
such holder’s last address on the records of the Company, and to the Company at the address
indicated below:

To the Company:

Diamond Resorts Parent, LLC

10600 West Charleston Boulevard

Las Vegas, NY 89135

Attention: Stephen J. Cloobeck and David F. Palmer

Facsimile: (702) 798-8840

with a copy, which shall not constitute notice, to:

Katten Muchin Rosenman LLP

525 West Monroe Street

Suite 1900

Chicago, IL 60661

Attention: Howard S. Lanznar

Facsimile: (312) 902-1061

To CDP:

                                                            

                                                            

                                                            

                                                            

With a copy, which shall not constitute notice, to:

Katten Muchin Rosenman LLP

525 West Monroe Street

Suite 1900

Chicago, IL 60661 
Attention: Howard S. Lanznar

Facsimile: (312) 902-1061

To Soros:

Soros Strategic Partners LP 
c/o Soros Fund Management LLC

23

 

888 Seventh Avenue, 33rd Floor

New York, NY 10106

Attention: Leonard Potter, Maryann Canfield

and Waldemar Szlezak

Facsimile: (646) 731-5754

with a copy, which shall not constitute notice, to:

Proskauer Rose

1585 Broadway

New York, NY 10036-8299

Attention: Steven L. Lichtenfeld

Facsimile: (212) 969-2900

To Guggenheim:

DRP Holdco, LLC

135 East 57th Street

6th Floor

New York, NY 10022

Attention: Kaitlin Trinh

Facsimile: (212) 644-8396

with copies, which shall not constitute notice, to:

Guggenheim Partners

100 Wilshire Boulevard — Suite 500

Santa Monica, California 90401

Attention: Zachary D. Warren

Facsimile: (310) 576-1271

and

Guggenheim Investment Management, LLC

135 East 57th Street

New York, New York 10022

Attention: William Hagner

Facsimile: (212) 644-8396

and

Sidley Austin LLP

One South Dearborn

Chicago, IL 60603

Attention: Richard W. Astle
 Facsimile: (312) 853-7036

24

 

To New Purchasers:

Silver Rock Financial LLC

1250 Fourth Street

Santa Monica, CA 90401

Attention: General Counsel

Facsimile: (310) 570-4599

With a copy, which shall not constitute notice, to:

Maron & Sandler

1250 Fourth Street

Santa Monica, CA 90401

Attention: David Kyman

Facsimile: (310) 570-4901

or such other address, telecopy number or to the attention of such other person as the
recipient party shall have specified by prior written notice to the sending party.

          19. Governing Law. This Agreement shall be governed by and construed in accordance
with the laws of the state of Nevada, without giving effect to any rules, principles or provisions
of choice of law or conflict of laws.

          20. Descriptive Headings. The descriptive headings of this Agreement are inserted for
convenience only and do not constitute a part of this Agreement.

          21. Dispute Resolution. The parties hereto shall, and shall cause their respective
Affiliates to, resolve any dispute, controversy or claim arising out of or in connection with this
Agreement and any transactions contemplated hereby (a
“Dispute”) in accordance with the following
procedures: within 30 business days after any party has served written notice on the other party,
such Dispute shall be submitted to the Las Vegas, Nevada office of JAMS for mediation. The
mediation shall take place in Nevada. Notwithstanding anything contained in this Agreement to the
contrary, in no event will any party be obligated to participate in any mediation for more than 30
business days.

          22. Waiver of Jury Trial. EACH PARTY TO THIS AGREEMENT HEREBY WAIVES, TO THE EXTENT
PERMITTED BY APPLICABLE LAW, TRIAL BY JURY IN ANY LITIGATION IN ANY COURT WITH RESPECT TO, IN
CONNECTION WITH, OR ARISING OUT OF THIS AGREEMENT OR ANY ANCILLARY AGREEMENT OR THE VALIDITY,
PROTECTION, INTERPRETATION, COLLECTION OR ENFORCEMENT THEREOF.

          23. Venue; Submission to Jurisdiction. ANY AND ALL SUITS, LEGAL ACTIONS OR PROCEEDINGS
ARISING OUT OF THIS AGREEMENT SHALL BE BROUGHT ONLY IN A STATE OR FEDERAL COURT IN OR FOR
CLARK COUNTY, NEVADA AND EACH PARTY TO THIS AGREEMENT HEREBY SUBMITS TO AND ACCEPTS THE
EXCLUSIVE JURISDICTION OF SUCH COURTS FOR THE

25

 

PURPOSE OF SUCH SUITS, LEGAL ACTIONS OR PROCEEDINGS. TO THE FULLEST EXTENT PERMITTED BY LAW,
EACH PARTY HERETO HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH HE OR IT MAY NOW OR HEREAFTER HAVE
TO THE LAYING OF VENUE OR ANY SUCH SUIT, LEGAL ACTION OR PROCEEDING IN SUCH COURT AND HEREBY
FURTHER WAIVES ANY CLAIM THAT ANY SUIT, LEGAL ACTION OR PROCEEDING BROUGHT IN SUCH COURT HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM.

          24. No Strict Construction. The parties hereto have participated jointly in the
negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if drafted
jointly by the parties hereto, and no presumption or burden of proof
shall arise favoring or disfavoring any party by virtue of the authorship of any of the provisions
of this Agreement.

          25. Issuance by the Company of Additional or Units. The parties hereto hereby
acknowledge that, after the date hereof, the Company may issue additional Units to certain Persons
(the “New Members”) in accordance with the terms of this Agreement. In connection with any
such issuance, the parties hereto agree that, with the prior written consent of the Majority
Preferred Holders and the Majority Common Holders, the Company may grant (but shall be under no
obligation to grant) such New Members rights substantially similar to the rights granted to the
Other Investors hereunder (provided that, if such grant is made, each such New Member is also
subject to the obligations of the Other Investors hereunder) by causing each such New Member to
execute a joinder to this Agreement substantially in the form of
Exhibit A hereto.

          26. Time of the Essence; Computation of Time. Time is of the essence for each and
every provision of this Agreement. Whenever the last day for the exercise of any privilege or the
discharge or any duty hereunder shall fall upon a Saturday, Sunday, or any date on which commercial
banks in the State of New York are authorized to be closed, the party having such privilege or duty
may exercise such privilege or discharge such duty on the next succeeding day which is a regular
business day.

* * * * *

26

 

Execution Copy

          IN WITNESS WHEREOF, the parties hereto have executed this Third Amended and
Restated Securityholders Agreement as of the date first above written.

	 	 	 	 	 
	 	COMPANY:

DIAMOND RESORTS PARENT, LLC

 	 
	 	By:  	/s/ David F. Palmer
 	 
	 	 	Name:  	David F. Palmer 	 
	 	 	Title:  	Chief Financial Officer 	 
	 
	 	SOROS:

SOROS STRATEGIC PARTNERS LP

 	 
	 	By:  	 	 
	 	 	Name:  	David Taylor 	 
	 	 	Title:  	Attorney-in-Fact 	 
	 
	 	CDP:

CLOOBECK DIAMOND PARENT, LLC

 	 
	 	By:  	/s/ Stephen J. Cloobeck
 	 
	 	 	Name:  	Stephen J. Cloobeck 	 
	 	 	Title:  	Sole Manager 	 
	 
	 	GUGGENHEIM:

DRP HOLDCO, LLC

 	 
	 	By:  	/s/ Zachary D. Warren 	 
	 	 	Name:  	Zachary D. Warren 	 
	 	 	Title:  	Authorized Person 	 

 

 

	 	 	 	 	 
	 	NEW PURCHASERS:

SILVER ROCK FINANCIAL LLC

 	 
	 	By:  	/s/ Ralph Finerman
 	 
	 	 	Ralph Finerman 	 
	 	  	Its: Manager 	 
	 
	 	IN-FP1 LLC

 	 
	 	By:  	/s/ Ralph Finerman
 	 
	 	 	Ralph Finerman 	 
	 	  	Its: Manager 	 
	 
	 	BDIF LLC

 	 
	 	By:  	/s/ Ralph Finerman
 	 
	 	 	Ralph Finerman 	 
	 	  	Its: Manager 	 
	 
	 	CM-NP LLC

 	 
	 	By:  	/s/ Ralph Finerman
 	 
	 	 	Ralph Finerman 	 
	 	  	Its: Manager 	 

28

 

	 	 	 	 	 

EXHIBIT A

FORM OF JOINDER TO

THIRD AMENDED AND RESTATED SECURITYHOLDERS AGREEMENT

          THIS JOINDER to the Third Amended and Restated Securityholders Agreement, dated as of
February 18, 2011, by and among Diamond Resorts Parent, LLC, a Nevada limited liability company
(the “Company”) and certain securityholders of the Company (the “Agreement”), is
made and entered into as of _______ by and between the Company and ________________(“Holder”). Capitalized
terms used herein but not otherwise defined shall have the meanings set forth in the Agreement.

          WHEREAS, Holder has acquired certain [Preferred/Common] Units from _____________ and the
Agreement and/or the Company require Holder, as a holder of such [Preferred/Common]
Units, to become a party to the Agreement, and Holder agrees to do so in accordance with the
terms hereof.

          NOW, THEREFORE, in consideration of the mutual covenants contained herein and other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties
to this Joinder hereby agree as follows:

               (A) Agreement to be Bound. Holder hereby agrees that upon execution of this Joinder,
it shall become a party to the Agreement and shall be fully bound by, and subject to, all of the
covenants, terms and conditions of the Agreement as though an original party thereto and shall be
deemed a [CDP Investor/Other Investor/Soros Investor/Guggenheim Investor/New Purchaser
Investor] and an Equityholder for all purposes thereof. In addition, Holder hereby agrees
that all Units held by Holder shall be deemed Equityholder Units for all purposes of the Agreement.

               (B) Successors and Assigns. Except as otherwise provided herein, this Joinder shall
bind and inure to the benefit of and be enforceable by the Company and its successors, heirs and
assigns and Holder and any subsequent holders of Equityholder Units and the respective successors,
heirs and assigns of each of them, so long as they hold any Equityholder Units.

               (C) Counterparts. This Joinder may be executed in separate counterparts each of which
shall be an original and all of which taken together shall constitute one and the same agreement.

               (D) Notices. For purposes of Section 20 of the Agreement, all notices, demands or
other communications to the Holder shall be directed to:

[Name]

[Address]

29

 

               (E) Governing Law. This Joinder shall be governed by and construed in
accordance with the laws of the State of Nevada, without giving effect to any rules, principles or
provisions of choice of law or conflict of laws.

               (F) Descriptive Headings. The descriptive headings of this Joinder are inserted for
convenience only and do not constitute a part of this Joinder.

* * * * *

30

 

Execution Copy

          IN WITNESS WHEREOF, the parties hereto have executed this Joinder to the Third Amended
and Restated Securityholders Agreement as of the date set forth in the introductory paragraph
hereof.

	 	 	 	 	 
	 	DIAMOND RESORTS PARENT, LLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	[HOLDER]

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:exv10w7

Exhibit 10.7

Execution Version

AMENDED AND RESTATED 

REGISTRATION RIGHTS AGREEMENT

          This AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT is dated as of June 17, 2010 by
and among Diamond Resorts Parent, LLC, a Nevada limited liability company (the “Company”),
Soros Strategic Partners LP, a Delaware limited partnership (“Soros”), DRP Holdco, LLC, a
Delaware limited liability company (“Guggenheim”), and Cloobeck Diamond Parent, LLC, a
Nevada limited liability company (“CDP”).

          WHEREAS, the Company, Soros and CDP entered into that certain Registration Rights Agreement,
dated as of April 26, 2007 (the “Original Agreement”);

          WHEREAS, Section 11(b) of the Original Agreement provides that the Original Agreement may be
amended upon the prior written consent of (i) the Company, (ii) the holders of at least a majority
of the CDP Registrable Securities, and (iii) the holders of at least a majority of the Soros
Registrable Securities; and

          WHEREAS, the undersigned, being (i) the Company, (ii) the holders of at least a majority of
the CDP Registrable Securities, (iii) the holders of at least a majority of the Soros Registrable
Securities, and (iv) Guggenheim, desire to amend and restate the Original Agreement to, among other
things, provide registration rights to Guggenheim, on the terms and conditions set forth herein.

          NOW, THEREFORE, in consideration of the mutual covenants contained herein and other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties
to this Agreement hereby agree as follows:

          1. Definitions. As used herein, the following terms shall have the following meanings.

          “CDP Registrable Securities” means (i) all Common Units acquired by, or issued or
issuable to CDP on or after April 26, 2007, and (ii) all equity securities issued or issuable
directly or indirectly with respect to any Common Units described in clause (i) above by way of a
unit or stock dividend or unit or stock split or in connection with a combination of units or
shares, recapitalization, merger, consolidation or other reorganization. As to any particular CDP
Registrable Securities, such securities shall cease to be CDP Registrable Securities when they have
been registered under the Securities Act, sold to the public in compliance with Rule 144 or sold in
a private transaction in which the transferor’s rights under this Agreement are not assigned.

          “Common Units” shall have the meaning ascribed to such term in the LLC Agreement, but
shall also include any Successor Stock, as defined in Article 13 of the LLC Agreement.

          “Exchange
Act” means the Securities Exchange Act of 1934, as amended, and the rules
and regulations of the SEC promulgated thereunder.

 

 

          “Guggenheim Registrable Securities” means (i) all Common Units acquired by, or issued
or issuable to Guggenheim on or after the date hereof, and (ii) all equity securities issued or
issuable directly or indirectly with respect to any Common Units described in clause (i) above by
way of a unit or stock dividend or unit or stock split or in connection with a combination of units
or shares, recapitalization, merger, consolidation or other reorganization. As to any particular
Guggenheim Registrable Securities, such securities shall cease to be Guggenheim Registrable
Securities when they have been registered under the Securities Act, sold to the public in
compliance with Rule 144 or sold in a private transaction in which the transferor’s rights under
this Agreement are not assigned.

          “Investors” means Soros and Guggenheim. “Investor” means Soros or Guggenheim.

          “Investor Registrable Securities” means, collectively, the Soros Registrable
Securities and the Guggenheim Registrable Securities.

          “LLC Agreement” means the Amended and Restated Operating Agreement of the Company,
dated as of the date hereof, as amended and/or restated from time to time.

          “Person” means an individual, a partnership, a corporation, a limited liability
company, an association, a joint stock company, a trust, a joint venture, an unincorporated
organization, a bank, a trust company, a land trust, a business trust, a governmental entity or any
department, agency or political subdivision thereof or any other entity or organization, whether or
not it is a legal entity.

          “Preferred Units” shall have the meaning ascribed to such term in the LLC Agreement.

          “Public Offering” means an underwritten public offering and sale of Common Units or
any other type of equity securities that, if held by CDP or an Investor, would constitute
Registrable Securities, pursuant to an effective registration statement under the Securities Act;
provided that a Public Offering shall not include an offering made in connection with a business
acquisition or combination pursuant to a registration statement on Form S-4 or any similar form, or
an employee benefit plan pursuant to a registration statement on Form S-8 or any similar form.

          “Registrable Securities” means, collectively, the CDP Registrable Securities and the
Investor Registrable Securities.

          “Registration Expenses” means all expenses (other than underwriting discounts and
commissions) incident to the Company’s performance of or compliance with this Agreement, including
without limitation all registration and filing fees, fees and expenses of compliance with
securities or blue sky laws, printing and distributing expenses, messenger and delivery expenses,
fees and expenses of custodians, internal expenses (including all salaries and expenses of its
officers and employees performing legal or accounting duties), the expense of any annual audit or
quarterly review, the expense of any liability insurance and the expenses and fees for listing the
securities to be registered on each securities exchange on which similar securities issued by the
Company are then listed or on the NASD automated quotation system,

2

 

and fees and disbursements of counsel for the Company and the underwriters and all independent
certified public accountants and other Persons retained by the Company.

          “Rule 144” means Rule 144 under the Securities Act (or any similar rule then in
force).

          “SEC” means the Securities and Exchange Commission.

          “Securities Act” means the Securities Act of 1933, as amended, and the rules and
regulations of the SEC promulgated thereunder.

          “Soros Registrable Securities” means (i) all Common Units acquired by, or issued or
issuable to Soros on or after April 26, 2007, and (ii) all equity securities issued or issuable
directly or indirectly with respect to any Common Units described in clause (i) above by way of a
unit or stock dividend or unit or stock split or in connection with a combination of units or
shares, recapitalization, merger, consolidation or other reorganization. As to any particular Soros
Registrable Securities, such securities shall cease to be Soros Registrable Securities when they
have been registered under the Securities Act, sold to the public in compliance with Rule 144 or
sold in a private transaction in which the transferor’s rights under this Agreement are not
assigned.

          2. Demand Registrations.

     (a) Requests for Registration.

     (i) At any time after an initial Public Offering, the holder(s) of a majority of the
Investor Registrable Securities may request registration under the Securities Act of all or
any portion of their Registrable Securities on Form S-1 or any similar
long-form registration (a
“Long-Form Registration”), or on Form S-2 or S-3
or any similar short-form registration (a “Short-Form Registration”) if such a
short form is available.

     (ii) All registrations requested pursuant to this Section 2(a) are referred to herein
as “Demand Registrations”. Each request for a Demand Registration (a “Demand
Request”) shall specify the approximate number of Registrable Securities requested to be
registered, the anticipated method or methods of distribution and the anticipated per share
price range for such offering. Within ten (10) days after receipt of any such Demand
Request, the Company will give written notice of such requested registration (which shall
specify the intended method of disposition of such Registrable Securities) to all other
holders of Registrable Securities (a “Company Notice”) and the Company will include
(subject to the provisions of this Agreement) in such registration, all Registrable
Securities with respect to which the Company has received written requests for inclusion
therein within thirty (30) days after the delivery of such Company Notice; provided that any
such other holder may withdraw its request for inclusion at any time prior to executing the
underwriting agreement or, if none, prior to the applicable registration statement becoming
effective.

          (b) Long-Form Registrations. The holders of a majority of the Investor
Registrable Securities shall be entitled to initiate three
(3) Long-Form Registrations;
provided

3

 

that any such Long-Form Registration must include the registration of Registrable
Securities which yield at least $10,000,000 of net proceeds to the sellers of such Registrable
Securities; provided further, that if any registration is withdrawn at the request of the holders
of a majority of the Investor Registrable Securities after such registration was initiated
hereunder, such registration shall count as a Long-Form Registration notwithstanding such
withdrawal. The Company will pay all Registration Expenses in connection with any registration
initiated as a Long-Form Registration whether or not it has become effective.

          (c) Short-Form Registrations. The holders of a majority of the Investor Registrable
Securities shall be entitled to initiate unlimited Short-Form Registrations; provided that any such
Short-Form Registration must include the registration of Registrable Securities which yield at
least $5,000,000 of net proceeds to the sellers of such Registrable Securities. Demand
Registrations by holders of a majority of the Investor Registrable Securities will be Short-Form
Registrations whenever the Company is permitted to use any applicable short form. After the Company
has become subject to the reporting requirements of the Exchange Act, the Company will use its
reasonable best efforts to make Short-Form Registrations on Form S-3 available for the sale of
Investor Registrable Securities. The Company will pay all Registration Expenses in connection with
any registration initiated as a Short-Form Registration by the holders of a majority of the
Investor Registrable Securities whether or not it has become effective.

          (d) Priority on Demand Registrations. If a Demand Registration is an underwritten
offering and the managing underwriters advise the Company that, in their opinion, inclusion of the
number of Investor Registrable Securities and, if permitted hereunder, other securities, requested
to be included in such offering exceeds the number of Registrable Securities and other securities,
if any, which can be sold in an orderly manner in such offering within a price range acceptable to
holder(s) of a majority of the Registrable Securities initiating such Demand Registration pursuant
to Section 2(a) and without adversely affecting the marketability of the offering, then the Company
will include in such Demand Registration (A) first, the number of Investor Registrable Securities
requested to be included in such Demand Registration, pro rata from among the holders of such
Investor Registrable Securities according to the number of Registrable Securities requested by them
to be so included, and (B) second, any other securities of the Company requested to be included in
such registration, in such manner as the Company may determine.

          (e) Restrictions on Demand Registrations.

     (i) The Company will not be obligated to file any registration statement
with respect to any Demand Registration within 180 days after (A) the effective date of a
previous Demand Registration, (B) the date any previously requested Demand Registration was
withdrawn at the request of the holders of a majority of the Investor Registrable
Securities, or (C) the effective date of a previous registration statement filed by the
Company covering a firm commitment Public Offering; provided, that in any registration
statement described in clauses (A) and (C), there were included in such
registration statement not less than 80% of the number of Investor Registrable Securities
requested to be included.

4

 

     (ii) The Company may postpone for up to 90 days the filing or the effectiveness of a
registration statement for a Demand Registration if the Company determines that such Demand
Registration would reasonably be expected to have a material adverse effect on any proposal
or plan by the Company or any of its subsidiaries to engage in any acquisition of assets
(other than in the ordinary course of business) or any merger, consolidation, tender offer,
reorganization or similar transaction; provided that in such event the holders of
Registrable Securities initiating such Demand Registration pursuant to Section 2(a) will be
entitled to withdraw such request and, if such request is withdrawn, such Demand
Registration will not count as one of the permitted Demand Registrations hereunder and the
Company will pay all Registration Expenses in connection with such requested registration.
The Company may use the provisions of this clause (ii) to delay a Demand
Registration initiated by holders of Investor Registrable Securities only once during any
twelve-month period.

          (f) Selection of Underwriters. If a requested registration pursuant to this Section 2
involves an underwritten offering, the underwriter or underwriters thereof shall be selected by the
holders of at least a majority of Investor Registrable Securities as to which registration has been
requested and shall be acceptable to the Company; provided, that the Company shall not unreasonably
withhold its acceptance of any proposed underwriters.

          3. Piggyback Registrations.

          (a) Right to Piggyback. Whenever the Company proposes to register any of its Common
Units under the Securities Act for its own account or for the account of any holder of Common Units
(other than pursuant to a Demand Registration (in which case, the ability of a holder of
Registrable Securities to participate in such Demand Registration shall be governed by Section 2
hereof, including Section 2(a)(ii) hereof)), other than pursuant to a registration statement on Form
S-4 or S-8 or any similar or successor form, other than in connection with a registration the
primary purpose of which is to register debt securities (i.e., in connection with a
so-called “equity kicker”), and other than in connection with an initial Public Offering) (a
“Piggyback Registration”), the Company will give prompt written notice to all holders of
Registrable Securities of its intention to effect such a registration and of such holders’ rights
under this Section 3(a). Upon the written request of any holder of Registrable Securities (which
request shall specify the Registrable Securities intended to be disposed of by such holder and the
intended method of disposition thereof), the Company shall include in such registration (subject to
the provisions of this Agreement) all Registrable Securities requested to be registered pursuant to
this Section 3(a), subject to Section 3(b) below, with respect to which the Company has received
written requests for inclusion therein within thirty (30) days after the receipt of the Company’s
notice; provided that any such other holder may withdraw its request for inclusion at any time
prior to executing the underwriting agreement or, if none, prior to the applicable registration
statement becoming effective.

          (b) Priority on Primary Registrations. If a Piggyback Registration is in part an
underwritten primary registration on behalf of the Company and the managing underwriters advise the
Company that in their opinion the number of securities requested to be included in such
registration exceeds the number which can be sold in an orderly manner in such offering within a
price range acceptable to the Company and without adversely affecting the

5

 

marketability of the offering, then the Company will include in such registration (i)
first, the securities the Company proposes to sell, (ii) second, up to 50% of the Investor
Registrable Securities requested to be included in such registration, (iii) third, the Registrable
Securities requested to be included in such registration, pro rata from among the holders of such
Registrable Securities according to the number of Registrable Securities requested by them to be so
included, and (iv) fourth, any other securities requested to be included in such registration, in
such manner as the Company may determine.

          ( c) Priority on Secondary Registrations. If a Piggyback Registration is an
underwritten secondary registration on behalf of holders of the Company’s securities, and the
managing underwriters advise the Company that in their opinion the number of securities requested
to be included in such registration exceeds the number which can be sold in an orderly manner in
such offering within a price range acceptable to the holders initially requesting such registration
and without adversely affecting the marketability of the offering, then the Company will include in
such registration (i) first, up to 50% of the Investor Registrable Securities requested to be
included in such registration, (ii) second, the Registrable Securities requested to be included in
such registration, pro rata from among the holders of such Registrable Securities according to the
number of Registrable Securities requested by them to be so included, and (iii) third, any other
securities requested to be included in such registration, in such manner as the Company may
determine

          (d) Registration Expenses. The Company will pay all Registration Expenses in
connection with any Piggyback Registration whether or not such Piggyback Registration has become
effective.

          4. Holdback Agreements.

          (a) Each holder of Registrable Securities hereby agrees (i) not to effect any sale or
distribution of Common Units, or any securities convertible into or exchangeable or exercisable for
Common Units, during the seven (7) days prior to and the 180-day period beginning on the
effective date of an initial Public Offering (except as part of such initial Public Offering),
unless the underwriters managing such initial Public Offering otherwise agree (which agreement
shall be equally applicable to all holders of Registrable Securities) and (ii) to execute and
deliver any reasonable agreement which is consistent with the provisions of clause (i) of this
Section 4(a) and which may be required by the underwriters managing such initial Public Offering.

          (b) The Company will not effect any sale or distribution of Common Units, or any securities
convertible into or exchangeable or exercisable for Common Units, during the seven days prior to
and during the 180-day period beginning on the effective date of an initial Public Offering (except
as part of such initial Public Offering), unless the underwriters managing such initial Public
Offering otherwise agree (which agreement shall be equally applicable to all holders of Registrable
Securities).

          5. Registration Procedures. Whenever the holders of Registrable Securities have
requested that any Registrable Securities be registered pursuant to this Agreement, the Company
will use its best efforts to effect the registration and the sale of such Registrable

6

 

Securities in accordance with the intended method of disposition thereof, and pursuant
thereto the Company will as expeditiously as possible:

          (a) prepare and file with the SEC a registration statement with respect to such Registrable
Securities and use its best efforts to cause such registration statement to become effective
(provided that before filing a registration statement or prospectus or any amendments or
supplements thereto, the Company will furnish to the counsel selected pursuant to Section 6(b)
below copies of all such documents proposed to be filed, which documents will be subject to the
prompt review and reasonable comment of such counsel), and upon filing such documents, the Company
shall promptly notify in writing such counsel of the receipt by the Company of any written comments
by the SEC with respect to such registration statement or prospectus or any amendment or supplement
thereto or any written request by the SEC for the amending or supplementing thereof or for
additional information with respect thereto;

          (b) notify each holder of Registrable Securities of the effectiveness of each registration
statement filed hereunder and prepare and file with the SEC such amendments and supplements to such
registration statement and the prospectus used in connection therewith as may be necessary to keep
such registration statement effective for a period of not less than 180 days or, if such
registration statement relates to an underwritten offering, such longer period as, in the opinion
of counsel for the underwriters, a prospectus is required by law to be delivered in connection with
sales of Registrable Securities by any underwriter or dealer or such shorter period as will
terminate when all of the securities covered by such registration statement have been disposed of
in accordance with the intended methods of disposition by the seller or sellers thereof as set
forth in such registration statement (but in any event not before the expiration of any longer
period required under the Securities Act), and comply with the provisions of the Securities Act
with respect to the disposition of all securities covered by such registration statement during
such period in accordance with the intended methods of disposition by the sellers thereof set forth
in such registration statement and cause the prospectus to be supplemented by any required
prospectus supplement, and as so supplemented to be filed pursuant to Rule 424 under the Securities
Act;

          (c) furnish to each seller of Registrable Securities such number of copies of such
registration statement, each amendment and supplement thereto, the prospectus included in such
registration statement (including each preliminary prospectus) and such other documents as such
seller may reasonably request in order to facilitate the disposition of the Registrable Securities
owned by such seller;

          (d) use its best efforts to register or qualify such Registrable Securities under such other
securities or blue sky laws of such jurisdictions in the United States of America as any seller
reasonably requests and do any and all other acts and things which may be reasonably necessary or
advisable to enable such seller to consummate the disposition in such jurisdictions of the
Registrable Securities owned by such seller (provided that the Company will not be required to (i)
qualify generally to do business in any jurisdiction where it would not otherwise be required to
qualify but for this subsection, (ii) subject itself to taxation in any such jurisdiction in any
jurisdiction where it is not so subject or (iii) consent to
general service of process (i.e., service of process which is not limited solely to securities law violations)
in any such jurisdiction in any jurisdiction where it is not so subject);

7

 

          (e) promptly notify each seller of such Registrable Securities, at any time when a
prospectus relating thereto is required to be delivered under the Securities Act, upon discovery
that, or upon the discovery of the happening of any event as a result of which the prospectus
included in such registration statement contains an untrue statement of a material fact or omits
any fact necessary to make the statements therein not misleading in light of the circumstances
under which they were made, and, at the request of any such seller, the Company will, as soon as
reasonably practicable, file and furnish to all sellers a supplement or amendment to such
prospectus so that, as thereafter delivered to the purchasers of such Registrable Securities, such
prospectus will not contain an untrue statement of a material fact or omit to state any fact
necessary to make the statements therein not misleading in light of the circumstances under which
they were made;

          (f) cause all such Registrable Securities to be listed on each securities exchange on which
similar securities issued by the Company are then listed and, if not so listed, to be listed on the
Nasdaq National Market System (“Nasdaq Market”) and, if listed on the Nasdaq Market, use
its best efforts to secure designation of all such Registrable Securities covered by such
registration statement as a Nasdaq “National Market System security” within the meaning of Rule 11Aa2-1 under the Exchange Act or, failing that, to secure Nasdaq Market authorization for such
Registrable Securities and, without limiting the generality of the foregoing, to arrange for at
least two (2) market makers to register as such with respect to such Registrable Securities with
the National Association of Securities Dealers;

          (g) provide a transfer agent and registrar for all such Registrable Securities not later than
the effective date of such registration statement;

          (h) enter into such customary agreements (including underwriting agreements in customary form)
and take all such other customary actions as the holders of a majority of the Registrable
Securities being sold or the underwriters, if any, reasonably request in order to expedite or
facilitate the disposition of such Registrable Securities (including, without limitation, effecting
a split or a combination of stock or units); provided that no holder of Registrable Securities
shall have any indemnification or contribution obligations inconsistent with Section 7 hereof;

          (i) make available for inspection upon reasonable notice during the Company’s regular business
hours by any underwriter participating in any disposition pursuant to such registration statement
and any attorney, accountant or other agent retained by any such underwriter, all financial and
other records, pertinent corporate documents and properties of the Company, and cause the Company’s
officers, directors, employees and independent accountants to supply all information and
participate in due diligence sessions reasonably requested by any such underwriter, attorney,
accountant or agent in connection with such registration statement;

          (j) otherwise use its best efforts to comply with all applicable rules and regulations of the
SEC, and make available to its security holders, as soon as reasonably practicable, an earnings
statement covering the period of at least twelve (12) months beginning with the first day of the
Company’s first full calendar quarter after the effective date of the registration statement, which
earnings statement shall satisfy the provisions of Section 11(a) of the Securities Act and Rule 158
promulgated thereunder;

8

 

          (k) use reasonable best efforts to prevent the issuance of any stop order (“Stop
Order”) suspending the effectiveness of a registration statement, or of any order suspending or
preventing the use of any related prospectus or suspending the qualification of any securities
included in such registration statement for sale in any jurisdiction, and, in the event of such
issuance, the Company shall immediately notify the holders of Registrable Securities included in
such registration statement of the receipt by the Company of such notification and shall use its
best efforts promptly to obtain the withdrawal of such order;

          (l) use its best efforts to cause such Registrable Securities covered by such registration
statement to be registered with or approved by such other governmental agencies or authorities as
may be necessary to enable the sellers thereof to consummate the disposition of such Registrable
Securities, and cooperate and assist with any filings to be made with the NASD;

          (m) obtain one or more “cold comfort” letters, dated the effective date of such registration
statement (and, if such registration includes an underwritten public offering, dated the date of
the closing under the underwriting agreement), signed by the Company’s independent public
accountants in customary form and covering such matters of the type customarily covered by “cold
comfort” letters as the managing underwriter may reasonably expect and reasonably satisfactory to
the holders of a majority of the Registrable Securities being sold reasonably request; and

          (n) provide a legal opinion of the Company’s outside counsel, dated the effective date of such
registration statement (and, if such registration includes an underwritten public offering, dated
the date of the closing under the underwriting agreement) in customary form and covering such
matters of the type customarily covered by legal opinions of such nature if requested by the
managing underwriter.

          If any such registration or comparable statement refers to any holder by name or otherwise as
the holder of any securities of the Company and if in such holder’s sole and exclusive judgment,
such holder is or might be deemed to be an underwriter or a controlling person of the Company, such
holder shall have the right to (i) require the insertion therein of language, in form and substance
satisfactory to such holder and presented to the Company in writing and not inconsistent with the
rules and regulations of the SEC, to the effect that the holding by such holder of such securities
is not to be construed as a recommendation by such holder of the investment quality of the
Company’s securities covered thereby and that such holding does not imply that such holder will
assist in meeting any future financial requirements of the Company, or (ii) in the event that such
reference to such holder by name or otherwise is not required by the Securities Act or any similar
Federal statute then in force, require the deletion of the reference to such holder; provided, that
with respect to this clause (ii), if requested by the Company, such holder shall furnish to the
Company an opinion of counsel to such effect, which opinion and counsel shall be reasonably
satisfactory to the Company.

          6. Registration Expenses.

          (a) All expenses incident to the Company’s performance of or compliance with this Agreement,
including without limitation all Registration Expenses, will be borne by the Company.

9

 

          (b) In connection with each Demand Registration and each Piggyback Registration, the Company
will reimburse the holders of Registrable Securities included in such registration for the
reasonable fees and disbursements of one (1) counsel chosen by the holders of a
majority of the Registrable Securities initially requesting such registration (which counsel shall
be retained to represent all such holders). Holders of Registrable Securities shall bear all
underwriting discounts and selling commissions applicable to the sale of the Registrable Securities
sold by them and the fees and disbursements of more than one counsel to such holders.

          7. Indemnification.

          (a) By the Company. The Company agrees to, and will cause each of its subsidiaries to
agree to, indemnify, to the fullest extent permitted by law, each holder of Registrable Securities,
its officers, directors, members, employees, agents, stockholders and general and limited partners
and each Person who controls such holder (within the meaning of the Securities Act and Exchange
Act) against any and all losses, claims, damages, liabilities and expenses (or actions or
proceedings, whether commenced or threatened, in respect thereof), joint or several, arising out of
or based upon any untrue or alleged untrue statement of material fact contained in any registration
statement, reports required and other documents filed under the Exchange Act and incorporated by
reference into any registration statement to the extent so incorporated, prospectus or preliminary
prospectus or any amendment thereof or supplement thereto, together with any documents incorporated
therein by reference, or any omission or alleged omission of a material fact required to be stated
therein or necessary to make the statements therein not misleading, or any violation or alleged
violation by the Company or any of its subsidiaries of any federal, state, foreign or common law
rule or regulation and relating to action or inaction in connection with any such registration,
disclosure document or other document and shall reimburse such holder, officer, director, member,
employee, agent, stockholder, partner or controlling Person for any legal or other expenses,
including any amounts paid in any settlement effected with the consent of the Company, which
consent will not be unreasonably withheld or delayed, incurred by such holder, officer, director,
member, employee, agent, stockholder, partner or controlling Person in connection with the
investigation or defense of such loss, claim, damage, liability or expense, except insofar as the
same are caused by or contained in any information furnished in writing to the Company by such
holder expressly for use therein. In connection with an underwritten offering, the Company will
indemnify such underwriters, their officers, directors, agents and employees and each Person who
controls such underwriters (within the meaning of the Securities Act) to the same extent as
provided above with respect to the indemnification of the holders of Registrable Securities.

          (b) By the Holders. In connection with any registration statement in which a holder of
Registrable Securities is participating, each such holder will furnish to the Company in writing
such information and affidavits about such holder as the Company reasonably requests for use in
connection with any such registration statement or prospectus and, to the extent permitted by law,
will indemnify the Company, its directors and officers and each Person who controls the Company
(within the meaning of the Securities Act) and the other holders of Registrable Securities against
any losses, claims, damages, liabilities and expenses resulting from any untrue or alleged untrue
statement of material fact contained in the registration statement, prospectus or preliminary
prospectus or any amendment thereof or supplement thereto or any omission or alleged omission of a
material fact required to be stated therein or necessary to make

10

 

the statements therein not misleading, but only to the extent that such untrue statement or
omission is contained in any information or affidavit so furnished in writing by such holder which
authorizes its use in the applicable document; provided, that the obligation to indemnify will be
individual, not joint and several, for each holder and will be limited to the net amount of
proceeds received by such holder from the sale of Registrable Securities pursuant to such
registration statement.

          (c) Claim Procedures. Any Person entitled to indemnification hereunder will (i) give
prompt written notice to the indemnifying party of any claim with respect to which it seeks
indemnification (provided that the failure to give prompt notice will not impair any Person’s right
to indemnification hereunder to the extent such failure has not prejudiced the indemnifying party)
and (ii) unless in such indemnified party’s reasonable judgment a conflict of interest between such
indemnified and indemnifying parties may exist with respect to such claim, permit the indemnifying
party to assume the defense thereof, jointly with any other indemnifying party similarly notified
to the extent it may wish, with counsel reasonably satisfactory to the indemnified party. If such
defense is assumed, the indemnifying party will not be subject to any liability for any settlement
made by the indemnified party without its consent (but such consent will not be unreasonably
withheld or delayed) and the indemnifying party shall not, without the consent of the indemnified
party, consent to entry of any judgment or enter into any settlement which does not include as an
unconditional term thereof, a release from all liability in respect of such claim or litigation
provided by the claimant or plaintiff to such indemnified party. An indemnifying party who is not
entitled to, or elects not to, assume the defense of a claim will not be obligated to pay (i) the
fees and expenses of more than one counsel for all parties indemnified by such indemnifying party
with respect to such claim, unless in the reasonable judgment of any indemnified party a conflict
of interest may exist between such indemnified party and any other of such indemnified parties with
respect to such claim or (ii) any settlement made by any indemnified party without such
indemnifying party’s consent (but such consent will not be unreasonably withheld).

          (d) Contribution. If the indemnification provided for in this Section 7 is held by a
court of competent jurisdiction to be unavailable to an indemnified party with respect to any loss,
liability, claim, damage or expense referred to herein, then the indemnifying party, in lieu of
indemnifying such indemnified party hereunder, shall contribute to the amount paid or payable by
such indemnified party as a result of such loss, liability, claim, damage or expense in such
proportion as is appropriate to reflect the relative fault of the indemnifying party on the one
hand and of the indemnified party on the other in connection with the statements or omissions that
resulted in such loss, liability, claim, damage or expense, as well as any other relevant equitable
considerations. The relative fault of the indemnifying party and of the indemnified party shall be
determined by reference to, among other things, whether the untrue or alleged untrue statement of a
material fact or the omission to state a material fact relates to information supplied by the
indemnifying party or by the indemnified party and the parties’ relative intent, knowledge, access
to information, and opportunity to correct or prevent such statement or omission. The amount paid
or payable by a party as a result of the losses, claims, damages, liabilities and expenses referred
to above shall be deemed to include any legal or other fees or expenses reasonably incurred by such
party in connection with any investigation or proceeding. In no event shall any holder of
Registrable Securities be required to contribute an amount greater than the dollar amount of the
proceeds received by such holder of Registrable Securities with respect

11

 

to the sale of any Registrable Securities. The parties hereto agree that it would not be just
and equitable if contribution pursuant to this Section 7(d) were determined by pro rata allocation
or by any other method of allocation which does not take account of the equitable considerations
referred to in the immediately preceding paragraph. No person guilty of fraudulent
misrepresentations (within the meaning of Section 11(f) of the Securities Act) shall
be entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The contribution provided for in this Section 7(d) shall remain in full force
and effect regardless of any investigation made by or on behalf of any indemnified party.

          (e) Survival. The indemnification provided for under this Agreement will remain in
full force and effect regardless of any investigation made by or on behalf of the indemnified party
or any officer, agent or employee and each other Person who participates as an underwriter in the
offering or sale of such securities and each other Person, if any, who controls such indemnified
party (within the meaning of the Securities Act), and will survive the transfer of securities.

          8. Participation in Underwritten Registrations. No Person may participate in any
registration hereunder which is underwritten unless such Person (a) agrees to sell such Person’s
securities on the basis provided in any underwriting arrangements approved by the Person or Persons
entitled hereunder to approve such arrangements (including, without limitation, pursuant to the
terms of any over-allotment or “green shoe” option requested by the managing underwriter(s),
provided that no holder of Registrable Securities will be required to sell more than the number of
Registrable Securities that such holder has requested the Company to include in any registration),
(b) completes and executes all customary questionnaires, powers of attorney, indemnities,
underwriting agreements and other documents required under the terms of such underwriting
arrangements; provided, that no holder of Registrable Securities included in any underwritten
registration shall be required to make any representations or warranties to the Company or the
underwriters (other than representations and warranties regarding such holder, such holder’s
ownership and title to the Registrable Securities, such holder’s intended method of distribution,
and such other representations and warranties are customarily provided by selling shareholders in
underwritten offerings) or to undertake any indemnification or contribution obligations to the
Company or the underwriters with respect thereto, except as otherwise provided in Section 7,
and (c) complies with all applicable federal and state securities laws in connection with such
registration.

          9. Rule 144 Reporting. With a view to making available to
the holders of
Registrable Securities the benefits of certain rules and regulations of the SEC which may
permit the sale of the Registrable Securities to the public without registration, the Company
agrees at its expense to use its best efforts to:

          (a) make and keep current public information available, within the meaning of Rule 144, at all
times after it has become subject to the reporting requirements of the Exchange Act;

          (b) file with the SEC, in a timely manner, all reports and other documents required of the
Company under the Securities Act and Exchange Act (after it has become subject to such reporting
requirements); and

12

 

          (c) so long as any party hereto owns any Registrable Securities, furnish to such Person
forthwith upon request, a written statement by the Company as to its compliance with the reporting
requirements of said Rule 144 (at any time commencing 90 days after the effective date of the first
registration filed by the Company for an offering of its securities to the general public), the
Securities Act and the Exchange Act (at any time after it has become subject to such reporting
requirements); a copy of the most recent annual or quarterly report of the Company; and such other
reports and documents as such Person may reasonably request in availing itself of any rule or
regulation of the SEC allowing it to sell any such securities without registration.

          10. Notices. All notices, demands or other communications to be given or delivered
under or by reason of the provisions of this Agreement will be in writing and will be deemed to
have been given when delivered if delivered personally, sent via a nationally recognized overnight
courier, or sent via facsimile to the recipient, or if sent by certified or registered mail, return
receipt requested, will be deemed to have been given two (2) business days thereafter. Such
notices, demands and other communications shall be sent to any holder of Registrable Securities at
such holder’s last address on the records of the Company, and to the Company at the address
indicated below:

To the Company:

Diamond Resorts Parent, LLC 
10600
West Charleston Boulevard
 Las Vegas,
NV 89135

Attention: Stephen J. Cloobeck and David Palmer

Facsimile: (702) 798-8840

with a copy, which shall not constitute notice, to:

Katten Muchin Rosenman LLP

525 West Monroe Street 
Suite 1900
 Chicago, IL 60661

Attention: Howard S. Lanznar

Facsimile: (312) 902-1061

To Soros:

Soros Strategic Partners LP

c/o Soros Fund
Management LLC
 888 Seventh Avenue, 33rd Floor 
New York, NY
10106

Attention: Leonard Potter, Maryann Canfield

            and Waldemar Szlezak

Facsimile: (646) 731-5754

13

 

with a copy, which shall not constitute notice, to:

Proskauer Rose
 1585
Broadway

New York, NY 10036-8299 
Attention:
Steven L. Lichtenfeld

Facsimile: (212) 969-2900

To Guggenheim:

DRP Holdco, LLC
 135
East 57th Street
 6th Floor

New York, NY 10022

Attention: Kaitlin Trinh

Facsimile: (212) 644-8396

with copies, which shall not constitute notice, to:

Guggenheim Partners

100 Wilshire Boulevard — Suite
500
 Santa Monica, California 90401

Attention: Zachary D. Warren

Facsimile: (310) 576-1271

and

Guggenheim Investment Management, LLC
 135
East 57th Street

6th Floor 
New York, NY 10022

Attention: William Hagner

Facsimile: (212) 644-8396

or such other address, telecopy number or to the attention of such other person as the
recipient party shall have specified by prior written notice to the sending party.

          11. Miscellaneous.

          (a) Remedies. Any Person having rights under any provision of this Agreement will be
entitled to enforce such rights specifically to recover damages caused by reason of any breach of
any provision of this Agreement and to exercise all other rights granted by law. The parties hereto
agree and acknowledge that money damages may not be an adequate remedy for any breach of the
provisions of this Agreement and that any party may in its sole discretion apply to any court of
law or equity of competent jurisdiction (without posting any bond or other security) for specific
performance and for other injunctive relief in order to enforce or prevent violation of the
provisions of this Agreement.

14

 

          (b) Entire Agreement; Amendments and Waivers. This Agreement embodies the complete
agreement and understanding among the parties and supersedes and preempts any prior understandings,
agreements or representations by or among the parties, written or oral, which may have related to
the subject matter hereof in any way (including, but not limited to, the Original Agreement). The
provisions of this Agreement may be amended or waived only upon the prior written consent of (i)
the Company, (ii) the holders of a majority of the number of CDP Registrable Securities, and (iii)
the holders of a majority of the number of Investor Registrable Securities; and any amendment to
which such written consent is obtained will be binding upon the Company and all holders of
Registrable Securities.

          (c) Successors and Assigns. All covenants and agreements in this Agreement by or on
behalf of any of the parties hereto will bind and inure to the benefit of the respective successors
and assigns of the parties hereto whether so expressed or not, including any corporation which is a
successor to the Company.

          (d) Severability. Whenever possible, each provision of this Agreement will be
interpreted in such manner as to be effective and valid under applicable law, but if any provision
of this Agreement is held to be prohibited by or invalid under applicable law, such provision will
be ineffective only to the extent of such prohibition or invalidity, without invalidating the
remainder of this Agreement.

          (e) Counterparts; Facsimile. This Agreement may be executed simultaneously in two or
more counterparts (each of which may be transmitted via facsimile), any one of which need not
contain the signatures of more than one party, but all such counterparts taken together will
constitute one and the same Agreement.

          (f) Descriptive Headings. The descriptive headings of this Agreement are
inserted for convenience only and do not constitute a part of this Agreement.

          (g) GOVERNING LAW. ALL QUESTIONS CONCERNING THE CONSTRUCTION, VALIDITY AND
INTERPRETATION OF THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE DOMESTIC
LAWS OF THE STATE OF NEVADA WITHOUT GIVING EFFECT TO ANY CHOICE OF LAW OR CONFLICT OF LAW PROVISION
OR RULE (WHETHER OF THE STATE OF NEVADA OR ANY OTHER JURISDICTION) THAT WOULD CAUSE THE APPLICATION
OF THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF NEVADA.

          (h) WAIVER OF JURY TRIAL. EACH PARTY TO THIS AGREEMENT HEREBY WAIVES, TO THE EXTENT
PERMITTED BY APPLICABLE LAW, TRIAL BY JURY IN ANY LITIGATION IN ANY COURT WITH RESPECT TO, IN
CONNECTION WITH, OR ARISING OUT OF THIS AGREEMENT OR ANY ANCILLARY AGREEMENT OR THE VALIDITY,
PROTECTION, INTERPRETATION, COLLECTION OR ENFORCEMENT THEREOF.

          (i) Venue; Submission to Jurisdiction. ANY AND ALL SUITS, LEGAL ACTIONS
OR PROCEEDINGS ARISING OUT OF THIS AGREEMENT SHALL BE

15

 

BROUGHT ONLY IN A STATE OR FEDERAL COURT IN OR FOR CLARK COUNTY, NEVADA AND EACH PARTY TO
THIS AGREEMENT HEREBY SUBMITS TO AND ACCEPTS THE EXCLUSIVE JURISDICTION OF SUCH COURTS FOR THE
PURPOSE OF SUCH SUITS, LEGAL ACTIONS OR PROCEEDINGS. TO THE FULLEST EXTENT PERMITTED BY LAW, EACH
PARTY HERETO HEREBY IRREVOCABLY WAIVES ANY OBJECTION WHICH HE OR IT MAY NOW OR HEREAFTER HAVE TO
THE LAYING OF VENUE OR ANY SUCH SUIT, LEGAL ACTION OR PROCEEDING IN SUCH COURT AND HEREBY FURTHER
WAIVES ANY CLAIM THAT ANY SUIT, LEGAL ACTION OR PROCEEDING BROUGHT IN SUCH COURT HAS BEEN BROUGHT
IN AN INCONVENIENT FORUM.

          (j) Mandatory Mediation. The parties hereto shall, and shall cause their
respective Affiliates to, resolve any dispute, controversy or claim arising out of or in connection
with this Agreement and any transactions contemplated hereby (a “Dispute”) in accordance with the
following procedures: within thirty (30) business days after any party has served written notice on
the other party, such Dispute shall be submitted to the Las Vegas, Nevada office of JAMS for
mediation. The mediation shall take place in Nevada. Notwithstanding anything contained in this
Agreement to the contrary, in no event will any party be obligated to participate in any mediation
for more than 30 business days.

          (k) No Strict Construction. The parties hereto have participated jointly in the
negotiation and drafting of this Agreement. In the event an ambiguity or question of intent or
interpretation arises, this Agreement shall be construed as if drafted jointly by the parties
hereto, and no presumption or burden of proof shall arise favoring or disfavoring any party by
virtue of the authorship of any of the provisions of this Agreement.

          (l) Transfer. Prior to transferring any Registrable Securities (other than a transfer
pursuant to which such securities cease to be Registrable Securities) to any Person, the Person
transferring such Registrable Securities will cause the prospective transferee to execute and
deliver to the Company, a joinder to this Agreement substantially in the form of Exhibit A hereto
pursuant to which the prospective transferee agrees to be bound by this Agreement to the same
extent as the Person transferring such Registrable Securities with respect to the Registrable
Securities so transferred.

          (m) Issuance by the Company of Additional Common Units. The parties hereto hereby
acknowledge that, after the date hereof, the Company may issue additional Common Units to certain
Persons (the “New Members”). In connection with any such issuance, the parties hereto agree that
the Company may grant (but shall be under no obligation to grant) such New Members rights
substantially similar to the rights granted to the holders of CDP Registrable Securities hereunder
(provided that, if such grant is made, each such New Member is also subject to the obligations of
holders of CDP Registrable Securities hereunder) by causing each such New Member to execute a
joinder to this Agreement substantially in the form of Exhibit A hereto.

* * * * *

16

 

     IN WITNESS WHEREOF, the parties hereto have executed this Amended
and Restated Registration Rights Agreement as of the date first above
written.

	 	 	 	 	 
	 	

COMPANY:

DIAMOND RESORTS PARENT, LLC

 	 
	 	By:  	/s/ David F. Palmer
 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	SOROS:

SOROS STRATEGIC PARTNERS LP

 	 
	 	By:  	/s/ David Taylor
 	 
	 	 	Name:  	David Taylor 	 
	 	 	Title:  	Attorney-in-Fact 	 
	 
	 	CDP:

CLOOBECK DIAMOND PARENT, LLC

 	 
	 	By:  	/s/ Stephen J. Cloobeck
 	 
	 	 	Name:  	Stephen J. Cloobeck 	 
	 	 	Title:  	Sole Manager 	 

 

 

	 	 	 	 	 

	 	 	 	 	 
	 	

GUGGENHEIM:

DRP HOLDCO, LLC

 	 
	 	By:  	/s/ Zach Warren
 	 
	 	 	Name:  	Zach Warren 	 
	 	 	Title:  	Authorized Person 	 
	 

[Signature Page to this Amended and Restated Registration Rights Agreement]

 

 

EXHIBIT A

FORM OF JOINDER TO

AMENDED AND RESTATED REGISTRATION RIGHTS AGREEMENT

          THIS JOINDER to the Amended and Restated Registration Rights Agreement, dated as
of June _, 2010, by and among Diamond Resorts Parent, LLC, a Nevada limited liability company
(the “Company”), and certain securityholders of the Company (the “Agreement”), is made
and entered into as of ______ by and between
the Company and _________ (“Holder”). Capitalized
terms used herein but not otherwise defined shall have the meanings set forth in the
Agreement.

          WHEREAS,
Holder has acquired ____ [Common Units] from _______.

          NOW, THEREFORE, in consideration of the mutual covenants contained herein and other good
and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
parties to this Joinder hereby agree as follows:

          1. Agreement to be Bound. Holder hereby (i) acknowledges that it has received and
reviewed a complete copy of the Agreement and (ii) agrees that upon execution of this Joinder,
it shall become a party to the Agreement and shall be fully bound by, and subject to, all of
the covenants, terms and conditions of the Agreement as though an original party thereto. In
addition, Holder hereby agrees that all Common Units held by Holder shall be deemed [CDP
Registrable Securities/Soros Registrable Securities/Guggenheim Registrable Securities]
and Registrable Securities for all purposes of the Agreement.

          2. Successors and Assigns. Except as otherwise provided herein, this Joinder
shall bind and inure to the benefit of and be enforceable by the Company and its successors,
heirs and assigns and Holder and any subsequent holders of Registrable Securities and the
respective successors, heirs and assigns of each of them, so long as they hold any Registrable
Securities.

          3. Notices. For purposes of Section 10 of the Agreement, all notices, demands or
other communications to the Holder shall be directed to:

[Name]

[Address]

          4. Counterparts. This Joinder may be executed in separate counterparts
each of which shall be an original and all of which taken together shall constitute one and
the same agreement.

          5. Governing Law. This Joinder shall be governed by and construed in accordance
with the laws of the state of Delaware, without giving effect to any rules, principles or
provisions of choice of law or conflict of laws.

          6. Descriptive Headings. The descriptive headings of this Joinder are inserted
for convenience only and do not constitute a part of this Joinder.

 

 

          IN WITNESS WHEREOF, the parties hereto have executed this Joinder to the Amended and
Restated Registration Rights Agreement as of the date set forth in the introductory paragraph
hereof.

	 	 	 	 	 
	 	DIAMOND RESORTS PARENT, LLC

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	[HOLDER]

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 

 

 

	 	 	 	 	 

AMENDMENT TO

AMENDED AND RESTATED 

REGISTRATION RIGHTS AGREEMENT

     This Amendment (this “Amendment”) is made and entered into as of February 18, 2011, by
and among Diamond Resorts Parent, LLC, a Nevada limited liability company (the “Company”),
DRP Holdco, LLC, a Delaware limited liability company (“Guggenheim”), Cloobeck Diamond
Parent, LLC, a Nevada limited liability company (“CDP”) and and each of the Persons
identified as a New Purchaser on the signature pages hereto (each, a “New Purchaser,” and
collectively, the “New Purchasers”). Capitalized terms used but not otherwise defined
herein shall have the meanings ascribed to them in the Original Agreement.

     WHEREAS, Soros, Guggenheim, CDP and the Company are parties to that certain Amended and
Restated Registration Rights Agreement, dated as of June 17, 2010 (the “Original Agreement”);

     WHEREAS,
Section 11(b) of the Original Agreement provides that the Original Agreement may be
amended upon the prior written consent of (i) the Company, (ii) the holders of a majority of the
number of CDP Registrable Securities, and (iii) the holders of a majority of the number of Investor
Registrable Securities; and

     WHEREAS, the undersigned, being (i) the Company, (ii) the holders of at least a majority of
the CDP Registrable Securities, (iii) the holders of at least a majority of the Investor
Registrable Securities, and (iv) the New Purchasers, desire to amend the Original Agreement to,
among other things, provide registration rights to the New Purchasers, on the terms and conditions
set forth herein.

     NOW, THEREFORE, in consideration of the mutual covenants contained in this Amendment and other
good and valuable consideration, the receipt and sufficiency of which being hereby acknowledged,
the parties intending to be legally bound, hereby agree as follows:

	1.	 	The following definition shall be added to Section 1 of the Original Agreement:

““New Purchaser Registrable Securities” means (i) all Common Units acquired
by, or issued or issuable to the New Purchasers on or after February 18, 2011, and (ii)
all equity securities issued or issuable directly or indirectly with respect to any
Common Units described in clause (i) above by way of a unit or stock dividend or unit or
stock split or in connection with a combination of units or shares, recapitalization,
merger, consolidation or other reorganization. As to any particular New Purchaser
Registrable Securities, such securities shall cease to be New Purchaser Registrable
Securities when they have been registered under the Securities Act, sold to the public
in compliance with Rule 144 or sold in a private transaction in which the transferor’s
rights under this Agreement are not assigned.”

	2.	 	The following definitions set forth in Section 1 of the Original Agreement are hereby amended
and restated as follows:

 

 

““Investors” means Soros, Guggenheim and the New Purchasers. “Investor” means
any of Soros, Guggenheim or a New Purchaser.”

““Investor Registrable Securities” means, collectively, the Soros Registrable
Securities, the Guggenheim Registrable Securities and the New Purchaser Registrable
Securities.”

	3.	 	By execution of this Amendment, the New Purchasers hereby become parties to the Original
Agreement, as amended hereby.
	 
	4.	 	Except for the provisions of the Original Agreement amended hereby, all other provisions of
the Original Agreement shall remain in full force and effect.
	 
	5.	 	The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of
any right, power or remedy of any party hereto under the Original Agreement nor constitute a
waiver of any provision contained therein, except as specifically set forth herein.
	 
	6.	 	This Amendment shall be construed in accordance with and governed by the laws of the State of
Nevada applicable to contracts made and wholly to be performed in that State.
	 
	7.	 	All demands, notices, requests, consents and other communications required or permitted under
this Amendment shall be performed in the manner set forth in the Original Agreement; provided,
however, that the address for each New Purchaser is set forth opposite such New Purchaser’s
name on the signature pages hereto.
	 
	8.	 	This Amendment may be executed in any number of counterparts, each of which when so executed
and delivered shall be deemed an original, and such counterparts together shall constitute one
instrument.
	 
	9.	 	Upon execution by the undersigned, this Amendment shall be effective and binding upon the
Company and all holders of Registrable Securities.

* * *

 

 

     IN WITNESS WHEREOF, the parties hereto have executed this
Amendment to Amended and Restated Registration Rights Agreement as of the date
first above written.

	 	 	 	 	 
	COMPANY:

DIAMOND RESORTS, PARENT, LLC

 	 
	By:  	/s/
[ILLEGIBLE] 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 
	CDP:

CLOOBECK DIAMOND PARENT, LLC

 	 
	By:  	/s/ [ILLEGIBLE]	 
	 	Name:  	 	 
	 	Title:  	 	 
	 
	GUGGENHEIM:

DRP HOLDCO, LLC

 	 
	By:  	/s/
Zachary D. Warren 	 
	 	Name:  	Zachary D. Warren 	 
	 	Title:  	Authorized Person 	 
	 

 

 

	 	 	 	 	 

	 	 	 	 	 	 	 
	 	 	NEW
PURCHASERS:	 	 	 	 
	 	 
	 	 	SILVER ROCK FINANCIAL LLC	 	 	 	Notice Address:
	 	 
	By:

	 	/s/ Ralph Finerman
 

Ralph Finerman
	 	 
	 	1250 Fourth Street
Santa
Monica, CA 90401
	Its:

	 	Manager	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	IN–FP1 LLC
	 	 	 	Notice Address:
	 
	 	 	 	 	 	 
	By:

	 	/s/ Ralph Finerman
 

Ralph Finerman
	 	 	 	1250 Fourth Street
Santa
Monica, CA 90401
	Its:

	 	Manager	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	BDIF LLC
	 	 	 	Notice Address:
	 
	 	 	 	 	 	 
	By:

	 	/s/ Ralph Finerman
 

Ralph Finerman
	 	 	 	1250 Fourth Street
Santa
Monica, CA 90401
	Its:

	 	Manager	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	CM–NP LLC
	 	 	 	Notice Address:
	 
	 	 	 	 	 	 
	By:

	 	/s/ Ralph Finerman
 

Ralph Finerman
	 	 	 	1250 Fourth Street
Santa
Monica, CA 90401
	Its:

	 	Manager

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