Document:

Exhibit 10.8

 

REGISTRATION
RIGHTS AGREEMENT

 

This
REGISTRATION RIGHTS AGREEMENT dated as of August 20, 2008 (the “Agreement”)
is entered into by and among Interval Acquisition Corp., a Delaware corporation
(the “Company”), the guarantors  listed in
Schedule 1 hereto (the “Guarantors”) and the Noteholders listed on the
signature pages annexed hereto (the “Exchanging Noteholders”).

 

The Company,
the Exchanging Noteholders and IAC/InterActiveCorp (“IAC”) are parties to the
Notes Exchange and Consent Agreement dated July 17, 2008 (the “Exchange
Agreement”), which provides for the exchange by IAC of $300,000,000 aggregate
principal amount of the Company’s 9.5% Senior Notes due 2016 (the “Securities”)
issued by the Company to IAC for certain of the 7% Senior Notes due 2013 issued
by IAC held by the Exchanging Noteholders, as set forth in the Exchange
Agreement (the “Exchange”).  The
Securities will be guaranteed on an unsecured senior basis by each of the
Guarantors.  As an inducement to the Exchanging
Noteholders to enter into the Exchange Agreement, the Company and the
Guarantors have agreed to provide to the Exchanging Noteholders and their
direct and indirect transferees the registration rights set forth in this
Agreement.  The execution and delivery of
this Agreement is a condition to the closing under the Exchange Agreement.

 

In
consideration of the foregoing, the parties hereto agree as follows:

 

1.                                       Definitions.  As used in this Agreement, the following
terms shall have the following meanings:

 

“Additional
Guarantor” shall mean any subsidiary of the Company that executes a Subsidiary
Guarantee under the Indenture after the date of this Agreement.

 

“Affiliate”
shall mean with respect to any Person, any other Person directly or indirectly
controlling, controlled by, or under common control with, such Person; for purposes
of this definition, “control” shall mean the possession, directly or
indirectly, of the power to direct or cause the direction of the management and
policies of a Person, whether through the ownership of voting securities or
otherwise.

 

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

 

“Company”
shall have the meaning set forth in the preamble and shall also include the
Company’s successors.

 

“Exchange Act”
shall mean the Securities Exchange Act of 1934, as amended from time to time.

 

“Exchange
Agreement” shall have the meaning set forth in the preamble.

 

“Exchange
Dates” shall have the meaning set forth in Section 2(b)(ii) hereof.

 

 

“Exchange
Offer” shall mean the exchange offer by the Company and the Guarantors of
Exchange Securities for Registrable Securities pursuant to Section 2(b) hereof.

 

“Exchange
Offer Registration” shall mean a registration under the Securities Act effected
pursuant to Section 2(b) hereof.

 

“Exchange
Offer Registration Statement” shall mean an exchange offer registration
statement on Form S-4 (or, if applicable, on another appropriate form) and
all amendments and supplements to such registration statement, in each case
including the Prospectus contained therein or deemed a part thereof, all
exhibits thereto and any document incorporated by reference therein.

 

“Exchange
Securities” shall mean senior notes issued by the Company and guaranteed by the
Guarantors under the Indenture containing terms identical to the Securities
(except that the Exchange Securities will not be subject to restrictions on
transfer or to any increase in annual interest rate for failure to comply with
this Agreement) which may be offered to Holders of Securities in exchange for
Securities pursuant to the Exchange Offer.

 

“Exchanging
Noteholders” shall have the meaning set forth in the preamble.

 

“Filing Target
Date” shall have the meaning set forth in Section 2(a) hereof.

 

“Freely
Tradable” shall mean, with respect to a Security, a Security that at any time
of determination, if it were not held by an Affiliate of the Company, may be
resold to the public in accordance with Rule 144 under the Securities Act
or any successor provision thereof (“Rule 144”) without regard to volume,
manner of sale or any other restrictions contained in Rule 144 (other than
the holding period requirement in paragraph (d)(1)(ii) of Rule 144 so
long as such holding period requirement is satisfied at such time of
determination).

 

“Free Writing
Prospectus” means each free writing prospectus (as defined in Rule 405
under the Securities Act) prepared by or on behalf of the Company or used or referred
to by the Company in connection with the sale of the Securities or the Exchange
Securities.

 

“Guarantors”
shall have the meaning set forth in the preamble and shall also include any
Guarantor’s successors and any Additional Guarantors.

 

“Holders”
shall mean the Exchanging Noteholders, for so long as they own any Registrable
Securities, and each of their successors, assigns and direct and indirect transferees
who become owners of Registrable Securities under the Indenture.

 

“Indemnified
Person” shall have the meaning set forth in Section 4(c) hereof.

 

“Indemnifying
Person” shall have the meaning set forth in Section 4(c) hereof.

 

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“Indenture”
shall mean the Indenture relating to the Securities dated as of August 19,
2008 among the Company, the Guarantors and the Bank of New York Mellon, as
trustee, and as the same may be amended from time to time in accordance with
the terms thereof.

 

“Inspector”
shall have the meaning set forth in Section 3(a)(xiii) hereof.

 

“Issuer Information”
shall have the meaning set forth in Section 4(a) hereof.

 

“Majority
Holders” shall mean the Holders of a majority of the aggregate principal amount
of the outstanding Registrable Securities; provided that
whenever the consent or approval of Holders of a specified percentage of
Registrable Securities is required hereunder, any Registrable Securities owned
directly or indirectly by the Company or any of its Affiliates shall not be
counted in determining whether such consent or approval was given by the
Holders of such required percentage or amount.

 

“Person” shall
mean an individual, partnership, limited liability company, corporation, trust
or unincorporated organization, or a government or agency or political subdivision
thereof.

 

“Prospectus”
shall mean the prospectus included in, or, pursuant to the rules and
regulations of the Securities Act, deemed a part of, a Registration Statement,
including any preliminary prospectus, and any such prospectus as amended or
supplemented by any prospectus supplement, including a prospectus supplement
with respect to the terms of the offering of any portion of the Registrable
Securities covered by a Shelf Registration Statement, and by all other
amendments and supplements to such prospectus, and in each case including any
document incorporated by reference therein.

 

“Registrable
Securities” shall mean the Securities; provided that
the Securities shall cease to be Registrable Securities on the earliest to
occur of (i) the date on which a Registration Statement with respect to
such Securities has become effective under the Securities Act and either (a) such
Securities have been exchanged or disposed of pursuant to such Registration
Statement or (b), in the case of an Exchange Offer, such Securities were not
tendered by the Holder thereof who was entitled to participate in the Exchange
Offer, (ii) the date on which such Securities cease to be outstanding
under the Indenture, or (iii) the date on which such Securities are Freely
Tradable.

 

“Registration
Expenses” shall mean any and all expenses incident to performance of or
compliance by the Company and the Guarantors with this Agreement, including
without limitation:  (i) all SEC,
stock exchange or Financial Industry Regulatory Authority (“FINRA”)
registration and filing fees, (ii) all fees and expenses incurred in connection
with compliance with state securities or blue sky laws (including reasonable
fees and disbursements of one counsel for all Holders as a group in connection
with blue sky qualification of any Exchange Securities or Registrable
Securities), (iii) all expenses of any Persons in preparing or assisting
in preparing, word processing, printing and distributing any Registration
Statement, any Prospectus and any amendments or supplements thereto, any
underwriting agreements, securities sales agreements or other similar agreements

 

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and any other documents relating to the performance of and compliance
with this Agreement, (iv) all rating agency fees, (v) all fees and
disbursements relating to the qualification of the Indenture under applicable
securities laws, (vi) the fees and disbursements of the Trustee and its
counsel, (vii) the fees and disbursements of counsel for the Company and
the Guarantors and, in the case of a Shelf Registration Statement, the
reasonable fees and disbursements of one counsel for the Holders as a group
(which counsel shall be selected by the Majority Holders) and (viii) the
fees and disbursements of the independent public accountants of the Company and
the Guarantors, including the expenses of any special audits or “comfort”
letters required by or incident to the performance of and compliance with this
Agreement, but excluding fees and expenses of counsel to the Underwriters
(other than fees and expenses set forth in clause (ii) above) or the
Holders and underwriting discounts and commissions, brokerage commissions and
transfer taxes, if any, relating to the sale or disposition of Registrable Securities
by a Holder.

 

“Registration
Statement” shall mean any registration statement of the Company and the
Guarantors that covers any of the Exchange Securities or Registrable Securities
pursuant to the provisions of this Agreement and all amendments and supplements
to any such registration statement, including post-effective amendments, in
each case including the Prospectus contained therein or deemed a part thereof,
all exhibits thereto and any document incorporated by reference therein.

 

“SEC” shall
mean the United States Securities and Exchange Commission.

 

“Securities”
shall have the meaning set forth in the preamble.

 

“Securities
Act” shall mean the Securities Act of 1933, as amended from time to time.

 

“Shelf
Effectiveness Period” shall have the meaning set forth in Section 2(a) hereof.

 

“Shelf
Registration” shall mean a registration effected pursuant to Section 2(a) hereof.

 

“Shelf
Registration Statement” shall mean a “shelf” registration statement of the Company
and the Guarantors that covers all or a portion of the Registrable Securities
(but no other securities unless approved by a majority of the Holders whose
Registrable Securities are to be covered by such Shelf Registration Statement)
on an appropriate form under Rule 415 under the Securities Act, or any
similar rule that may be adopted by the SEC, and all amendments and
supplements to such registration statement, including post-effective
amendments, in each case including the Prospectus contained therein or deemed a
part thereof, all exhibits thereto and any document incorporated by reference
therein.

 

“Subsidiary
Guarantees” shall mean the guarantees of the Securities and Exchange Securities
by the Guarantors under the Indenture.

 

“Staff” shall
mean the staff of the SEC.

 

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“Target Registration
Date” shall have the meaning set forth in Section 2(d) hereof.

 

“Trust
Indenture Act” shall mean the Trust Indenture Act of 1939, as amended from time
to time.

 

“Trustee”
shall mean the trustee with respect to the Securities under the Indenture.

 

“Underwriter”
shall have the meaning set forth in Section 3(e) hereof.

 

“Underwritten
Offering” shall mean an offering in which Registrable Securities are sold to an
Underwriter for reoffering to the public.

 

2.                                       Registration
Under the Securities Act.

 

(a)                                 Unless
the Company and the Guarantors elect to file an Exchange Offer Registration
Statement pursuant to Section 2(b) hereof, the Company and the
Guarantors shall use their reasonable best efforts to cause to be filed, within
45 days after the consummation of the Exchange (the “Filing Target Date”), a
Shelf Registration Statement providing for the sale of all the Registrable
Securities by the Holders thereof and to have such Shelf Registration Statement
declared effective by the SEC as promptly as practicable thereafter and in any
event by the 90th day following such filing date.

 

If the Company and the Guarantors elect to file a Shelf Registration
Statement under this Section 2(a) in lieu of an Exchange Offer
Registration Statement, the Company and the Guarantors agree to use their
reasonable best efforts to keep the Shelf Registration Statement continuously
effective and usable for the sale of Securities until no Securities covered by
such Shelf Registration Statement constitute Registrable Securities (the “Shelf
Effectiveness Period”).  The Company and
the Guarantors further agree to supplement or amend the Shelf Registration
Statement and the related Prospectus if required by the rules, regulations or
instructions applicable to the registration form used by the Company for such
Shelf Registration Statement or by the Securities Act or by any other rules and
regulations thereunder or if reasonably requested by a Holder of Registrable
Securities listed in the Shelf Registration Statement and the related Prospectus
with respect to information relating to such Holder, and to use their
reasonable best efforts to cause any such amendment to become effective, if
required, and such Shelf Registration Statement and Prospectus to become usable
as soon as thereafter practicable.  The
Company and the Guarantors agree to furnish to the Holders of Registrable
Securities listed in the Shelf Registration Statement and the related
Prospectus copies of any such supplement or amendment promptly after its being
used or filed with the SEC.

 

(b)                                In
lieu of the Shelf Registration Statement required by Section 2(a) hereof,
to the extent not prohibited by any applicable law or applicable
interpretations of the Staff and to the extent all of the Holders are entitled
to participate in an Exchange Offer, with respect to any Securities that are
Registrable Securities, the Company and the Guarantors may instead cause to be
filed an Exchange Offer Registration Statement covering an offer to the Holders
to exchange all the Registrable Securities for Exchange Securities.  If the Company and the Guarantors elect to
file an Exchange Offer Registration Statement pursuant to this Section 2(b),
the Company and the Guarantors shall use their reasonable best efforts to file
the Exchange Offer Registration 

 

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Statement on or before the Filing Target
Date, and to have the Exchange Offer Registration Statement declared effective
by the SEC by the 90th day following such filing date. The Company and the
Guarantors shall commence the Exchange Offer promptly after the Exchange Offer
Registration Statement is declared effective by the SEC and use their
reasonable best efforts to complete the Exchange Offer not later than 45 days
after such effective date.

 

If the Company
and the Guarantors elect to file the Exchange Offer Registration Statement
under this Section 2(b) in lieu of a Shelf Registration Statement,
the Company and the Guarantors shall commence the Exchange Offer by mailing the
related Prospectus, appropriate letters of transmittal and other accompanying
documents to each Holder stating, in addition to such other disclosures as are
required by applicable law, substantially the following:

 

(i)                                    that
the Exchange Offer is being made pursuant to this Agreement and that all
Registrable Securities validly tendered and not properly withdrawn will be
accepted for exchange;

 

(ii)                                 the
dates of acceptance for exchange (which shall be a period of at least 20
Business Days from the date such notice is mailed) (the “Exchange Dates”);

 

(iii)                              that
any Registrable Security not tendered will remain outstanding and continue to
accrue interest but will not retain any rights under this Agreement, except as
otherwise specified herein;

 

(iv)                             that
any Holder electing to have a Registrable Security exchanged pursuant to the
Exchange Offer will be required to (A) surrender such Registrable
Security, together with the appropriate letters of transmittal, to the
institution and at the address (located in the Borough of Manhattan, The City
of New York) and in the manner specified in the notice, or (B) effect such
exchange otherwise in compliance with the applicable procedures of the
depositary for such Registrable Security, in each case prior to the close of
business on the last Exchange Date; and

 

(v)                                that
any Holder will be entitled to withdraw its election, not later than the close
of business on the last Exchange Date, by (A) sending to the institution
and at the address (located in the Borough of Manhattan, The City of New York)
specified in the notice, a telegram, telex, facsimile transmission or letter
setting forth the name of such Holder, the principal amount of Registrable
Securities delivered for exchange and a statement that such Holder is
withdrawing its election to have such Securities exchanged or (B) effecting
such withdrawal in compliance with the applicable procedures of the depositary
for the Registrable Securities.

 

As a condition
to participating in the Exchange Offer, a Holder will be required to represent
to the Company and the Guarantors, in writing (which may be contained in the
applicable letter of transmittal) that (i) any Exchange Securities will be
acquired in the ordinary course of business of the Person receiving such
Exchange Securities, (ii) such Holder, nor, to the actual knowledge of
such Holder, any other Person receiving Exchange Securities from such Holder
has no arrangement or understanding with any Person to participate in the
distribution (within the meaning of the Securities Act) of the Exchange Securities
in violation of the provisions

 

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of the Securities Act, (iii) it is not
an Affiliate of the Company or any Guarantor or, if it is an Affiliate, it will
comply with the registration and prospectus delivery requirements of the Securities
Act to the extent applicable, and (iv) if such Holder is a broker-dealer
that will receive Exchange Securities for its own account in exchange for
Registrable Securities that were acquired as a result of market-making or other
trading activities, then such Holder will deliver a Prospectus (or, to the
extent permitted by law, make available a Prospectus to purchasers) in
connection with any resale of such Exchange Securities.

 

As soon as
practicable after the last Exchange Date, the Company and the Guarantors shall:

 

(i)                                    accept
for exchange Registrable Securities or portions thereof validly tendered and
not properly withdrawn pursuant to the Exchange Offer; and

 

(ii)                                 deliver,
or cause to be delivered, to the Trustee for cancellation all Registrable
Securities or portions thereof so accepted for exchange by the Company and
issue, and cause the Trustee to promptly authenticate and deliver to each
Holder, Exchange Securities equal in principal amount to the principal amount
of the Registrable Securities tendered by such Holder.

 

The Company
and the Guarantors shall use their reasonable best efforts to complete the
Exchange Offer as provided above and shall comply with the applicable
requirements of the Securities Act, the Exchange Act and other applicable laws
and regulations in connection with the Exchange Offer.  The Exchange Offer shall not be subject to
any conditions, other than (1) that the Exchange Offer does not violate
any applicable law or applicable interpretations of the Staff, (2) that no
action or proceeding shall have been instituted or threatened in any court or
by any governmental agency with respect to the Exchange Offer and no material
adverse development shall have occurred with respect to the Company and (3) that
all governmental approvals shall have been obtained that the Company deems
necessary for the consummation of the Exchange Offer.

 

(c)                                 The
Company and the Guarantors shall pay all Registration Expenses in connection
with any registration pursuant to Section 2(a) or Section 2(b) hereof.  Each Holder shall pay all underwriting
discounts and commissions, brokerage commissions and transfer taxes, if any,
relating to the sale or disposition of such Holder’s Registrable Securities
pursuant to the Shelf Registration Statement or the Exchange Offer Registration
Statement.

 

(d)                                A
Shelf Registration Statement pursuant to Section 2(a) hereof will not
be deemed to have become effective unless it has been declared effective by the
SEC or is automatically effective upon filing with the SEC as provided by Rule 462
under the Securities Act.  An Exchange
Offer Registration Statement pursuant to Section 2(b) hereof will not
be deemed to have become effective unless it has been declared effective by the
SEC.

 

In the event
that (i) a Shelf Registration Statement or an Exchange Offer Registration
Statement, as applicable, does not become effective on or prior to February 16,
2009, or (ii), in the case of a Shelf Registration Statement, the Shelf Registration
Statement becomes effective but ceases to be effective or the Prospectus
contained therein ceases to be usable at any time during

 

7

 

the Shelf Effectiveness Period, and such
failure to remain effective or usable exists for more than 60 days (whether or
not consecutive) (any event referred to in the foregoing clauses (i) or (ii) a
“Registration Default”), then, in each case, the interest rate on the
Registrable Securities will be increased by 0.25% per annum for the first
90-day period immediately following such Registration Default and (ii) an
additional 0.25% per annum with respect to each subsequent 90-day period, up to
a maximum of 1.00% per annum, in each case until the earlier of the date such
Registration Default is cured or the date on which no Securities constitute
Registrable Securities.

 

Notwithstanding
the foregoing, (1) the interest rate shall not increase because more than
one Registration Default has occurred and is pending simultaneously and (2) a
Holder whose Registrable Securities are excluded from a Shelf Registration
Statement as a result of its failure to provide the information required by Section 3(b) hereof
shall not be entitled to increased interest with respect to a Registration
Default that pertains to the Shelf Registration Statement.

 

(e)                                 Without
limiting the remedies available to the Holders, the Company and the Guarantors
acknowledge that any failure by the Company or the Guarantors to comply with
their obligations under Section 2(a) and Section 2(b) hereof
may result in material irreparable injury to the Holders for which there is no
adequate remedy at law, that it will not be possible to measure damages for
such injuries precisely and that, in the event of any such failure, the Holders
may obtain such relief as may be required to specifically enforce the Company’s
and the Guarantors’ obligations under Section 2(a) and Section 2(b) hereof.

 

(f)                                   The
Company represents, warrants and covenants that it (including its agents and
representatives) will not prepare, make, use, authorize, approve or refer to
any Free Writing Prospectus.

 

3.                                       Registration
Procedures.

 

(a)                                 In
connection with their obligations pursuant to Section 2(a) and Section 2(b) hereof,
the Company and the Guarantors shall as expeditiously as possible (provided, however, that the Company shall not be required to
take actions more promptly than required by Sections 2(a) and 2(b)):

 

(i)                                    prepare
and file with the SEC a Registration Statement on the appropriate form under
the Securities Act, which form (x) shall be selected by the Company and
the Guarantors, (y) shall, in the case of a Shelf Registration, be
available for the sale of the Registrable Securities by the Holders thereof and
(z) shall comply as to form in all material respects with the requirements
of the applicable form and include all financial statements required by the SEC
to be filed therewith; and use their reasonable best efforts to cause such
Registration Statement to become effective and remain effective for the applicable
period in accordance with Section 2 hereof;

 

(ii)                                 prepare
and file with the SEC such amendments and post-effective amendments to each
Registration Statement as may be necessary to keep such Registration Statement
effective for the applicable period in accordance with Section 2 hereof
and cause each Prospectus to be supplemented by any required prospectus
supplement and, as 

 

8

 

so supplemented, to be filed pursuant to Rule 424
under the Securities Act; and keep each Prospectus current during the period described
in Section 4(3) of and Rule 174 under the Securities Act that is
applicable to transactions by brokers or dealers with respect to the
Registrable Securities or Exchange Securities;

 

(iii)                              in
the case of a Shelf Registration, furnish to each Holder of Registrable
Securities listed in the Shelf Registration Statement and the related
Prospectus, to counsel for such Holders and to each Underwriter of an
Underwritten Offering of Registrable Securities, if any, without charge, as
many copies of each Prospectus or preliminary prospectus, and any amendment or
supplement thereto, as such Holder, counsel or Underwriter may reasonably request
in order to facilitate the sale or other disposition of the Registrable
Securities thereunder; and the Company and the Guarantors consent to the use of
such Prospectus, preliminary prospectus and any amendment or supplement thereto
in accordance with applicable law by each of the Holders of Registrable Securities
listed in the Shelf Registration Statement and the related Prospectus and any
such Underwriters in connection with the offering and sale of the Registrable
Securities covered by and in the manner described in such Prospectus,
preliminary prospectus or any amendment or supplement thereto in accordance
with applicable law;

 

(iv)                             use
their reasonable best efforts to register or qualify the Registrable Securities
under all applicable state securities or blue sky laws of such jurisdictions as
any Holder of Registrable Securities covered by a Registration Statement shall
reasonably request in writing by the time the applicable Registration Statement
becomes effective; cooperate with such Holders in connection with any filings
required to be made with FINRA; and do any and all other acts and things that
may be reasonably necessary or advisable to enable each Holder to complete the
disposition in each such jurisdiction of the Registrable Securities owned by
such Holder; provided that neither the Company
nor any Guarantor shall be required to (1) qualify as a foreign
corporation or other entity or as a dealer in securities in any such
jurisdiction where it would not otherwise be required to so qualify, (2) file
any general consent to service of process in any such jurisdiction or (3) subject
itself to taxation in any such jurisdiction if it is not so subject;

 

(v)                                in
the case of a Shelf Registration, notify each Holder of Registrable Securities
listed in the Shelf Registration Statement and the related Prospectus and
counsel for such Holders promptly and, if requested by any such Holder or
counsel, confirm such advice in writing (1) when the Shelf Registration
Statement has become effective, when any post-effective amendment thereto has
been filed and becomes effective and when any amendment or supplement to the
Prospectus has been filed, (2) of any request by the SEC or any state
securities authority for amendments and supplements to the Shelf Registration
Statement or Prospectus or for additional information after the Shelf
Registration Statement has become effective, (3) of the issuance by the
SEC or any state securities authority of any stop order suspending the
effectiveness of the Shelf Registration Statement or the initiation of any
proceedings for that purpose, including the receipt by the Company of any
notice of objection of the SEC to the use of the Shelf Registration Statement
or any post-effective amendment thereto pursuant to Rule 401(g)(2) under
the Securities Act, (4) if, between the applicable effective date of the
Shelf Registration Statement and the closing of any sale of Registrable
Securities covered thereby, the representations and 

 

9

 

warranties of the Company or any Guarantor
contained in any underwriting agreement, securities sales agreement or other
similar agreement, if any, relating to an offering of such Registrable
Securities cease to be true and correct in all material respects or if the
Company or any Guarantor receives any notification with respect to the
suspension of the qualification of the Registrable Securities for sale in any
jurisdiction or the initiation of any proceeding for such purpose, (5) of
the happening of any event during the period the Shelf Registration Statement
is effective that makes any statement made in such Shelf Registration Statement
or the related Prospectus untrue in any material respect or that requires the
making of any changes in such Shelf Registration Statement or Prospectus in
order to make the statements therein not misleading and (6) of any
determination by the Company or any Guarantor that a post-effective amendment
to the Shelf Registration Statement or any amendment or supplement to the
Prospectus would be appropriate;

 

(vi)                             use
their reasonable best efforts to obtain the withdrawal of any order suspending
the effectiveness of a Registration Statement or, in the case of a Shelf
Registration, the resolution of any objection of the SEC pursuant to Rule 401(g)(2),
including by filing an amendment to such Shelf Registration Statement on the
proper form, as promptly as practicable and provide prompt notice to each
Holder of the withdrawal of any such order or such resolution;

 

(vii)                          in the
case of a Shelf Registration, furnish to each Holder of Registrable Securities
listed in the Shelf Registration Statement and the related Prospectus, without
charge, at least one conformed copy of the Shelf Registration Statement and any
post-effective amendment thereto (without any documents incorporated therein by
reference or exhibits thereto, unless requested);

 

(viii)                       in the case
of a Shelf Registration, cooperate with the Holders of Registrable Securities
listed in the Shelf Registration Statement and the related Prospectus to facilitate
the timely preparation and delivery of certificates representing Registrable
Securities (if such Registrable Securities are certificated) to be sold and not
bearing any restrictive legends and enable such Registrable Securities to be
issued in such denominations and registered in such names (consistent with the
provisions of the Indenture) as such Holders may reasonably request at least
one Business Day prior to the closing of any sale of Registrable Securities;

 

(ix)                               in
the case of a Shelf Registration, upon the occurrence of any event contemplated
by Section 3(a)(v)(5) hereof, use their reasonable best efforts to prepare
and file with the SEC a supplement or post-effective amendment to such Shelf
Registration Statement or the related Prospectus or any document incorporated
therein by reference or file any other required document so that, as thereafter
delivered (or, to the extent permitted by law, made available) to purchasers of
the Registrable Securities, such Prospectus will not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements therein, in the light of the circumstances under which they were
made, not misleading; and the Company and the Guarantors shall notify the
Holders of Registrable Securities listed in the Shelf Registration Statement
and the related Prospectus to suspend use of the Prospectus as promptly as
practicable after the occurrence of such an event, and such Holders hereby
agree to suspend use of the Prospectus

 

10

 

until the Company and the Guarantors have
amended or supplemented the Prospectus to correct such misstatement or omission;

 

(x)                                  in
the case of a Shelf Registration, a reasonable time prior to the filing of the
Shelf Registration Statement, any Prospectus, any amendment to the Shelf Registration
Statement or amendment or supplement to a Prospectus (except any amendment or
supplement solely to add additional selling securityholders), provide copies of
such document to the Holders of Registrable Securities listed in the Shelf
Registration Statement and the related Prospectus and their counsel and make
such of the representatives of the Company and the Guarantors as shall be
reasonably requested by the Holders of Registrable Securities listed in the
Shelf Registration Statement and the related Prospectus or their counsel
available for discussion of such document; and the Company shall not, at any
time after initial filing of a Shelf Registration Statement, use or file any
Prospectus, any amendment of or supplement to the Shelf Registration Statement
or a Prospectus (except any amendment or supplement solely to add additional
selling securityholders), of which the Holders of Registrable Securities listed
in the Shelf Registration Statement and the related Prospectus and their
counsel shall not have previously been advised and furnished a copy or to which
the Holders of Registrable Securities listed in the Shelf Registration
Statement and the related Prospectus or their counsel shall object;

 

(xi)                               obtain
a CUSIP number for all Exchange Securities or Registrable Securities, as the
case may be, not later than the initial effective date of a Registration Statement;

 

(xii)                            cause
the Indenture to be qualified under the Trust Indenture Act in connection with
the registration of the Exchange Securities or Registrable Securities, as the
case may be; cooperate with the Trustee and the Holders to effect such changes
to the Indenture as may be required for the Indenture to be so qualified in
accordance with the terms of the Trust Indenture Act; and execute, and use
their reasonable best efforts to cause the Trustee to execute, all documents as
may be required to effect such changes and all other forms and documents
required to be filed with the SEC to enable the Indenture to be so qualified in
a timely manner;

 

(xiii)                         in the
case of a Shelf Registration, make available for inspection by a representative
of the Holders of the Registrable Securities listed in the Shelf Registration
Statement and the related Prospectus (an “Inspector”), any Underwriter
participating in any disposition pursuant to such Shelf Registration Statement,
any attorneys and accountants designated by a majority of the Holders of
Registrable Securities to be included in such Shelf Registration and any
attorneys and accountants designated by such Underwriter, at reasonable times
and in a reasonable manner, all pertinent financial and other records,
documents and properties of the Company and its subsidiaries, and cause the respective
officers, directors and employees of the Company and the Guarantors to supply
all information reasonably requested by any such Inspector, Underwriter,
attorney or accountant in connection with a Shelf Registration Statement; in
each case, as shall be reasonably necessary to enable them to exercise any
applicable due diligence responsibilities; provided that
if any such information is identified by the Company or any Guarantor as being
confidential or proprietary, each Person receiving such information shall take 

 

11

 

such actions as are reasonably necessary to
protect the confidentiality of such information to the extent such action is
otherwise not inconsistent with, an impairment of or in derogation of the
rights and interests of any Inspector, Holder or Underwriter);

 

(xiv)                        in the
case of a Shelf Registration, use their reasonable best efforts to cause all
Registrable Securities to be listed on any securities exchange or any automated
quotation system on which similar debt securities issued or guaranteed by the
Company or any Guarantor are then listed if requested by the Majority Holders,
to the extent such Registrable Securities satisfy applicable listing requirements;

 

(xv)                           if
reasonably requested by any Holder of Registrable Securities covered by a Shelf
Registration Statement, promptly include in a Prospectus supplement or
post-effective amendment such information with respect to such Holder as such
Holder reasonably requests to be included therein and make all required filings
of such Prospectus supplement or such post-effective amendment as soon as the
Company has received notification of the matters to be so included in such
filing;

 

(xvi)                        in the
case of a Shelf Registration, enter into such customary agreements and take all
such other actions in connection therewith (including those requested by the
Holders of a majority in principal amount of the Registrable Securities covered
by the Shelf Registration Statement) in order to expedite or facilitate the
disposition of such Registrable Securities including, but not limited to, an
Underwritten Offering and in such connection, (1) to the extent possible,
make such representations and warranties to the Holders listed in the Shelf
Registration Statement and the related Prospectus and any Underwriters of such
Registrable Securities with respect to the business of the Company and its
subsidiaries and the Registration Statement, Prospectus and documents
incorporated by reference or deemed incorporated by reference, if any, in each
case, in form, substance and scope as are customarily made by issuers to
underwriters in underwritten offerings and confirm the same if and when
requested, (2) obtain opinions of counsel to the Company and the
Guarantors (which counsel and opinions, in form, scope and substance, shall be
reasonably satisfactory to the selling Holders and such Underwriters and their
respective counsel) addressed to each selling Holder and Underwriter of
Registrable Securities, covering the matters customarily covered in opinions
requested in underwritten offerings, (3) obtain “comfort” letters from the
independent certified public accountants of the Company and the Guarantors
(and, if necessary, any other certified public accountant of any subsidiary of
the Company or any Guarantor, or of any business acquired by the Company or any
Guarantor for which financial statements and financial data are or are required
to be included in the Registration Statement) addressed to each selling Holder
(to the extent permitted by applicable professional standards) and Underwriter of
Registrable Securities, such letters to be in customary form and covering
matters of the type customarily covered in “comfort” letters in connection with
underwritten offerings, including but not limited to financial information
contained in any preliminary prospectus or Prospectus and (4) deliver such
documents and certificates as may be reasonably requested by the Holders of a
majority in principal amount of the Registrable Securities being sold or the
Underwriters, and which are customarily delivered in underwritten offerings, to
evidence the continued validity of the representations and warranties of the

 

12

 

Company and the Guarantors made pursuant to
clause (1) above and to evidence compliance with any customary conditions
contained in an underwriting agreement; and

 

(xvii)                     so long as
any Registrable Securities remain outstanding, cause each Additional Guarantor
upon the creation or acquisition by the Company of such Additional Guarantor,
to execute a counterpart to this Agreement in the form attached hereto as Annex
A and to deliver such counterpart to the Initial Purchasers no later than five
Business Days following the execution thereof.

 

(b)                                In
the case of a Shelf Registration Statement, the Company may require each Holder
of Registrable Securities to furnish to the Company such information regarding
such Holder and the proposed disposition by such Holder of such Registrable
Securities as the Company and the Guarantors may from time to time reasonably request
in writing. The Company may exclude from registration the Registrable
Securities of any Holder so long as such Holder fails to furnish such information
within a reasonable time after receiving such request.  Each Holder as to which any Shelf Registration
is being effected agrees to furnish promptly to the Company all information
required to be disclosed in order to make the information previously furnished
to the Company by such Holder not materially misleading.

 

(c)                                 In
the case of a Shelf Registration Statement, each Holder of Registrable
Securities covered in such Shelf Registration Statement agrees that, upon receipt
of any notice from the Company and the Guarantors of the happening of any event
of the kind described in Section 3(a)(v)(3) or 3(a)(v)(5) hereof,
such Holder will forthwith discontinue disposition of Registrable Securities
pursuant to the Shelf Registration Statement until such Holder’s receipt of the
copies of the supplemented or amended Prospectus contemplated by Section 3(a)(ix) hereof
and, if so directed by the Company and the Guarantors, such Holder will deliver
to the Company and the Guarantors all copies in its possession, other than
permanent file copies then in such Holder’s possession, of the Prospectus
covering such Registrable Securities that is current at the time of receipt of
such notice.

 

(d)                                If
the Company and the Guarantors shall give any notice to suspend the disposition
of Registrable Securities pursuant to a Shelf Registration Statement, the
Company and the Guarantors shall extend the period during which such Shelf
Registration Statement shall be maintained effective pursuant to this Agreement
by the number of days during the period from and including the date of the
giving of such notice to and including the date when the Holders of such
Registrable Securities shall have received copies of the supplemented or
amended Prospectus necessary to resume such dispositions. The Company and the
Guarantors may give any such notice only twice during any 365-day period and
any such suspensions shall not exceed 45 days for each suspension and there
shall not be more than two suspensions in effect during any 365-day period.

 

(e)                                 The
Holders of Registrable Securities covered by a Shelf Registration Statement who
desire to do so may sell such Registrable Securities in an Underwritten
Offering.  In any such Underwritten
Offering, the investment bank or investment banks and manager or managers (each
an “Underwriter”) that will administer the offering will be selected by the
Holders of a majority in principal amount of the Registrable Securities
included in such offering, provided that
such Underwriters shall be reasonably acceptable to the Company.

 

13

 

4.                                      Indemnification
and Contribution.

 

(a)                                 The Company and each
Guarantor, jointly and severally, agree to indemnify and hold harmless each
Holder, their respective Affiliates, directors and officers and each Person, if
any, who controls any Holder within the meaning of Section 15 of the
Securities Act or Section 20 of the Exchange Act, from and against any and
all losses, claims, damages and liabilities (including, without limitation,
legal fees and other expenses incurred in connection with any suit, action or
proceeding or any claim asserted, as such fees and expenses are incurred),
joint or several, that arise out of, or are based upon, (1) any untrue
statement or alleged untrue statement of a material fact contained in any
Registration Statement or any omission or alleged omission to state therein a
material fact required to be stated therein or necessary in order to make the
statements therein not misleading, or (2) any untrue statement or alleged
untrue statement of a material fact contained in any Prospectus, any Free
Writing Prospectus used in violation of this Agreement or any “issuer
information” (“Issuer Information”) filed or required to be filed pursuant to Rule 433(d) under
the Securities Act, or any omission or alleged omission to state therein a
material fact necessary in order to make the statements therein, in the light
of the circumstances under which they were made, not misleading, in each case
except insofar as such losses, claims, damages or liabilities arise out of, or
are based upon, any untrue statement or omission or alleged untrue statement or
omission made in reliance upon and in conformity with any information relating
to any Holder furnished to the Company in writing through any selling Holder,
respectively, expressly for use therein. 
In connection with any Underwritten Offering permitted by Section 3,
the Company and the  Guarantors, jointly and severally, will also
indemnify the Underwriters, if any, selling brokers, dealers and similar
securities industry professionals participating in the distribution, their
respective Affiliates and each Person who controls such Persons (within the
meaning of the Securities Act and the Exchange Act) to the same extent as
provided above with respect to the indemnification of the Holders, if requested
in connection with any Registration Statement, any Prospectus, any Free Writing
Prospectus or any Issuer Information for such Underwritten Offering.

 

(b)                                Each Holder agrees,
severally and not jointly, to indemnify and hold harmless the Company, the Guarantors
and the other selling Holders, the directors of the Company and the Guarantors,
each officer of the Company and the Guarantors who signed the Registration
Statement and each Person, if any, who controls the Company, the Guarantors and
any other selling Holder within the meaning of Section 15 of the Securities
Act or Section 20 of the Exchange Act to the same extent as the indemnity
set forth in paragraph (a) above, but only with respect to any losses,
claims, damages or liabilities that arise out of, or are based upon, any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with any information relating to such Holder furnished
to the Company in writing by such Holder expressly for use in any Registration
Statement and any Prospectus.

 

(c)                                 If
any suit, action, proceeding (including any governmental or regulatory
investigation), claim or demand shall be brought or asserted against any Person
in respect of which indemnification may be sought pursuant to either paragraph (a) or
(b) above, such Person (the “Indemnified Person”) shall promptly notify
the Person against whom such indemnification may be sought (the “Indemnifying
Person”) in writing; provided that
the failure to notify the Indemnifying Person shall not relieve it from any
liability that it may have under this Section 4 except to the extent that
it has been materially prejudiced (through the forfeiture of substantive rights
or 

 

14

 

defenses) by
such failure; and provided, further,
that the failure to notify the Indemnifying Person shall not relieve it from
any liability that it may have to an Indemnified Person otherwise than under
this Section 4.  If any such
proceeding shall be brought or asserted against an Indemnified Person and it
shall have notified the Indemnifying Person thereof, the Indemnifying Person
shall retain counsel reasonably satisfactory to the Indemnified Person to
represent the Indemnified Person and any others entitled to indemnification
pursuant to this Section 4 that the Indemnifying Person may designate in
such proceeding and shall pay the fees and expenses of such proceeding and
shall pay the fees and expenses of such counsel related to such proceeding, as
incurred.  In any such proceeding, any Indemnified
Person shall have the right to retain its own counsel, but the fees and
expenses of such counsel shall be at the expense of such Indemnified Person
unless (i) the Indemnifying Person and the Indemnified Person shall have
mutually agreed to the contrary; (ii) the Indemnifying Person has failed
within a reasonable time to retain counsel reasonably satisfactory to the
Indemnified Person; (iii) the Indemnified Person shall have reasonably concluded,
after consultation with counsel, that there may be legal defenses available to
it that are different from or in addition to those available to the
Indemnifying Person; or (iv) the named parties in any such proceeding
(including any impleaded parties) include both the Indemnifying Person and the
Indemnified Person and, in the opinion of counsel to the Indemnified Person,
representation of both parties by the same counsel would be inappropriate due
to actual or potential differing interests between them.  It is understood and agreed that the Indemnifying
Person shall not, in connection with any proceeding or related proceeding in
the same jurisdiction, be liable for the fees and expenses of more than one
separate firm (in addition to any local counsel) for all Indemnified Persons,
and that all such fees and expenses shall be reimbursed as they are incurred.  Any such separate firm (x) for any
Holder, its directors and officers and any control Persons of such Holder shall
be designated in writing by the Majority Holders and (y) in all other
cases shall be designated in writing by the Company.  The Indemnifying Person shall not be liable
for any settlement of any proceeding effected without its written consent, but
if settled with such consent or if there be a final judgment for the plaintiff,
the Indemnifying Person agrees to indemnify each Indemnified Person from and
against any loss or liability by reason of such settlement or judgment.  Notwithstanding the foregoing sentence, if at
any time an Indemnified Person shall have requested that an Indemnifying Person
reimburse the Indemnified Person for fees and expenses of counsel as
contemplated by this paragraph, the Indemnifying Person shall be liable for any
settlement of any proceeding effected without its written consent if (i) such
settlement is entered into more than 30 days after receipt by the Indemnifying
Person of such request and (ii) the Indemnifying Person shall not have reimbursed
the Indemnified Person in accordance with such request prior to the date of
such settlement.  No Indemnifying Person
shall, without the written consent of the Indemnified Person, effect any
settlement of any pending or threatened proceeding in respect of which any
Indemnified Person is or could have been a party and indemnification could have
been sought hereunder by such Indemnified Person, unless such settlement (A) includes
an unconditional release of such Indemnified Person, in form and substance reasonably
satisfactory to such Indemnified Person, from all liability on claims that are
the subject matter of such proceeding and (B) does not include any
statement as to or any admission of fault, culpability or a failure to act by
or on behalf of any Indemnified Person.

 

(d)                                If
the indemnification provided for in paragraphs (a) and (b) above is unavailable
to an Indemnified Person or insufficient in respect of any losses, claims,
damages or liabilities referred to therein, then each Indemnifying Person under
such paragraph, in lieu of indemnifying such Indemnified Person thereunder,
shall contribute to the amount paid or payable 

 

15

 

by such
Indemnified Person as a result of such losses, claims, damages or liabilities (i) in
such proportion as is appropriate to reflect the relative benefits received by
the Indemnifying Party,  on the one hand,
and by the Indemnified Party, on the other hand, from the offering of the Securities
or Exchange Securities or (ii) if the allocation provided by clause (i) is
not permitted by applicable law, in such proportion as is appropriate to
reflect not only the relative benefits referred to in clause (i) but also
the relative fault of the Indemnifying Party, on the one hand, and the
Indemnified Party, on the other hand, in connection with the statements or
omissions that resulted in such losses, claims, damages or liabilities, as well
as any other relevant equitable considerations. 
The relative fault of the Company and the Guarantors on the one hand and
the Holders, on the other hand, shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material fact
or the omission or alleged omission to state a material fact relates to
information supplied by the Company and the Guarantors or by the Holders, as
applicable, and the parties’ relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission.

 

(e)                                 The
Company, the Guarantors and the Holders agree that it would not be just and
equitable if contribution pursuant to this Section 4 were determined by pro rata allocation (even if the Holders were treated as one
entity for such purpose) or by any other method of allocation that does not
take account of the equitable considerations referred to in paragraph (d) above.  The amount paid or payable by an Indemnified
Person as a result of the losses, claims, damages and liabilities referred to
in paragraph (d) above shall be deemed to include, subject to the
limitations set forth above, any legal or other expenses reasonably incurred by
such Indemnified Person in connection with any such action or claim.  Notwithstanding the provisions of this Section 4,
in no event shall a Holder be required to contribute any amount in excess of
the amount by which the total price at which the Securities or Exchange Securities
sold by such Holder exceeds the amount of any damages that such Holder has
otherwise been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. 
No Person guilty of fraudulent misrepresentation (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 Holders’ obligations to contribute
pursuant to this Section 4 are several and not joint.

 

(f)                                   The
remedies provided for in this Section 4 are not exclusive and shall not
limit any rights or remedies that may otherwise be available to any Indemnified
Person at law or in equity.

 

(g)                                The
indemnity and contribution provisions contained in this Section 4 shall
remain operative and in full force and effect regardless of (i) any termination
of this Agreement, (ii) any investigation made by or on behalf of any
Holder or any Person controlling any Holder, or by or on behalf of the Company
or the Guarantors or the officers or directors of or any Person controlling the
Company or the Guarantors, (iii) acceptance of any of the Exchange
Securities and (iv) any sale of Registrable Securities pursuant to a Shelf
Registration Statement.

 

5.                                      General.

 

(a)                                 No Inconsistent Agreements. 
The Company and the Guarantors represent, warrant and agree that (i) the
rights granted to the Holders hereunder do not in any way conflict 

 

16

 

with and are
not inconsistent with the rights granted to the holders of any other
outstanding securities issued or guaranteed by the Company or any Guarantor
under any other agreement and (ii) neither the Company nor any Guarantor
has entered into, or on or after the date of this Agreement will enter into,
any agreement that is inconsistent with the rights granted to the Holders of
Registrable Securities in this Agreement or otherwise conflicts with the provisions
hereof.

 

(b)                                Amendments and Waivers.   The provisions of this Agreement, including
the provisions of this sentence, may not be amended, modified or supplemented,
and waivers or consents to departures from the provisions hereof may not be
given unless the Company and the Guarantors have obtained the written consent
of Holders of at least a majority in aggregate principal amount of the
outstanding Registrable Securities affected by such amendment, modification,
supplement, waiver or consent; provided that
no amendment, modification, supplement, waiver or consent to any departure from
the provisions of Section 4 hereof shall be effective as against any
Holder of Registrable Securities unless consented to in writing by such
Holder.  Any amendments, modifications,
supplements, waivers or consents pursuant to this Section 5(b) shall
be by a writing executed by each of the parties required by this Section 5(b) to
be party thereto.

 

(c)                                 Notices.  All notices
and other communications provided for or permitted hereunder shall be made in
writing by hand-delivery, registered first-class mail, telex, telecopier, or
any courier guaranteeing overnight delivery (i) if to a Holder, at the
most current address given by such Holder to the Company by means of a notice
given in accordance with the provisions of this Section 5(c); (ii) if
to the Company and the Guarantors, initially at the Company’s address set forth
in the Exchange Agreement and thereafter at such other address, notice of which
is given in accordance with the provisions of this Section 5(c); and (iii) to
such other persons at their respective addresses as provided in the Exchange
Agreement and thereafter at such other address, notice of which is given in
accordance with the provisions of this Section 5(c).  All such notices and communications shall be
deemed to have been duly given: at the time delivered by hand, if personally
delivered; five Business Days after being deposited in the mail, postage
prepaid, if mailed; when answered back, if telexed; when receipt is
acknowledged, if telecopied; and on the next Business Day if timely delivered
to an air courier guaranteeing overnight delivery.  Copies of all such notices, demands or other
communications shall be concurrently delivered by the Person giving the same to
the Trustee, at the address specified in the Indenture.

 

(d)                                Successors and Assigns. This Agreement shall inure to the
benefit of and be binding upon the successors, assigns and transferees of each
of the parties, including, without limitation and without the need for an
express assignment, subsequent Holders; provided that
nothing herein shall be deemed to permit any assignment, transfer or other
disposition of Registrable Securities in violation of the terms of the Exchange
Agreement or the Indenture.  If any
transferee of any Holder shall acquire Registrable Securities in any manner,
whether by operation of law or otherwise, such Registrable Securities shall be
held subject to all the terms of this Agreement, and by taking and holding such
Registrable Securities such Person shall be conclusively deemed to have agreed
to be bound by and to perform all of the terms and provisions of this Agreement
and such Person shall be entitled to receive the benefits hereof.

 

(e)                                 Counterparts. This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall 

 

17

 

be deemed to
be an original and all of which taken together shall constitute one and the
same agreement.

 

(f)                                   Headings.  The
headings in this Agreement are for convenience of reference only, are not a
part of this Agreement and shall not limit or otherwise affect the meaning
hereof.

 

(g)                                Governing Law.  This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York.

 

(h)                                WAIVER OF RIGHT TO TRIAL BY JURY. 
EACH PARTY HERETO HEREBY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW,
ANY RIGHT IT MAY HAVE TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT
OF OR RELATING TO THIS AGREEMENT WHETHER NOW EXISTING OR HEREAFTER ARISING, AND
WHETHER SOUNDING IN CONTRACT, TORT OR OTHER THEORY.  EACH PARTY HERETO (a) CERTIFIES THAT NO
REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK
TO ENFORCE THE FOREGOING WAIVER AND (b) ACKNOWLEDGES THAT IT AND THE OTHER
PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER
THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION.

 

(i)                                    Entire Agreement; Severability.  This Agreement contains the entire agreement
between the parties relating to the subject matter hereof and supersedes all
oral statements and prior writings with respect thereto.  If any term, provision, covenant or
restriction contained in this Agreement is held by a court of competent
jurisdiction to be invalid, void or unenforceable or against public policy, the
remainder of the terms, provisions, covenants and restrictions contained herein
shall remain in full force and effect and shall in no way be affected, impaired
or invalidated.  The Company, the
Guarantors and the Holders shall endeavor in good faith negotiations to replace
the invalid, void or unenforceable provisions with valid provisions the
economic effect of which becomes as close as possible to that of the invalid,
void or unenforceable provisions.

 

18

 

IN WITNESS
WHEREOF, the parties have executed this Agreement as of the date first written
above.

 

	
   

  	
  INTERVAL
  ACQUISITION CORP.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Craig M.
  Nash

  
	
   

  	
   

  	
  Name:

  	
  Craig M.
  Nash

  
	
   

  	
   

  	
  Title:

  	
  President
  and Chief Executive

  Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  INTERVAL
  LEISURE GROUP, INC.,

  
	
   

  	
  WORLDEX
  CORPORATION,

  
	
   

  	
  as
  Guarantors

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Craig M.
  Nash

  
	
   

  	
   

  	
  Name:

  	
  Craig M.
  Nash

  
	
   

  	
   

  	
  Title:

  	
  President
  and Chief Executive

  Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  IIC HOLDINGS, INCORPORATED,

  
	
   

  	
  INTERVAL
  EUROPEAN HOLDINGS

  LIMITED,

  
	
   

  	
  INTERVAL HOLDINGS, INC.,

  
	
   

  	
  INTERVAL
  INTERNATIONAL

  HOLDINGS, INC.,

  
	
   

  	
  INTERVAL
  INTERNATIONAL

  OVERSEAS HOLDINGS, INC.,

  
	
   

  	
  INTERVAL
  SOFTWARE SERVICES,

  LLC,

  
	
   

  	
  INTERVAL
  VACATION EXCHANGE,

  INC.,

  
	
   

  	
  XYZII, INC.,

  
	
   

  	
  as Guarantors

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Craig M.
  Nash

  
	
   

  	
   

  	
  Name: 

  	
  Craig M.
  Nash

  
	
   

  	
   

  	
  Title:

  	
  President

  

 

 

	
   

  	
  INTERVAL
  INTERNATIONAL, INC.,

  
	
   

  	
  INTERVAL
  RESORT & FINANCIAL

  SERVICES, INC.,

  
	
   

  	
  REP
  HOLDINGS, LTD.,

  
	
   

  	
  VACATION
  HOLDINGS HAWAII, INC.,

  
	
   

  	
  WORLDWIDE
  VACATION & TRAVEL,

  INC.,

  
	
   

  	
  as Guarantors

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Craig M.
  Nash

  
	
   

  	
   

  	
  Name: 

  	
  Craig M.
  Nash

  
	
   

  	
   

  	
  Title:

  	
  Chief
  Executive Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  MERAGON
  FINANCIAL SERVICES,

  INC.,

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gregory
  Sheperd

  
	
   

  	
   

  	
  Name: 

  	
  Gregory
  Sheperd

  
	
   

  	
   

  	
  Title:

  	
  President

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  MERIDIAN
  FINANCIAL SERVICES,

  INC.,

  
	
   

  	
  as Guarantor

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jeanette
  E. Marbert

  
	
   

  	
   

  	
  Name: 

  	
  Jeanette E.
  Marbert

  
	
   

  	
   

  	
  Title:

  	
  Executive
  Vice President

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  RESORTQUEST HAWAII, LLC,

  
	
   

  	
  RESORTQUEST
  REAL ESTATE OF

  HAWAII, LLC,

  
	
   

  	
  RQI HOLDINGS, LLC,

  
	
   

  	
  as Guarantors

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ John A.
  Galea

  
	
   

  	
   

  	
  Name: 

  	
  John A.
  Galea

  
	
   

  	
   

  	
  Title:

  	
  Manager

  

 

 

 

Signature of or on behalf
of Exchanging Noteholder:

 

	
  Company Name:

  	
  Deutsch Bank
  AG London

  
	
   

  	
   

  
	
  Signature:

  	
  /s/
  Athanassios Diplas

  
	
   

  	
   

  
	
  Name of Signing
  Person:

  	
  Athanassios
  Diplas

  
	
   

  	
   

  
	
  Title of Signing
  Person:

  	
  Managing
  Director

  
	
   

  	
   

  
	
  Dated:

  	
  August 19,
  2008

  
	
   

  	
   

  
	
  Signature:

  	
  /s/ Muqu Karim

  
	
   

  	
   

  
	
  Name of Signing
  Person:

  	
  Muqu Karim

  
	
   

  	
   

  
	
  Title of Signing
  Person:

  	
  Director

  
	
   

  	
   

  
	
  Dated:

  	
  August 19,
  2008

  

 

 

 

 

Signature of or on behalf
of Exchanging Noteholder:

 

	
  Company Name:

  	
  Citigroup
  Global Markets Inc.

  
	
   

  	
   

  
	
  Signature:

  	
  /s/ Harry
  Mamaysky

  
	
   

  	
   

  
	
  Name of Signing
  Person:

  	
  Harry Mamaysky

  
	
   

  	
   

  
	
  Title of Signing
  Person:

  	
  Managing
  Director

  
	
   

  	
   

  
	
  Dated:

  	
  August 19,
  2008

  

 

 

 

 

 

Signature of or on behalf
of Exchanging Noteholder:

 

	
  Company Name:

  	
  Claren Road
  Credit Opportunities Master Fund, Ltd. by Claren Road Asset Management, LLC
  as investment manager

  
	
   

  	
   

  
	
  Signature:

  	
  /s/ Albert
  Marino

  
	
   

  	
   

  
	
  Name of Signing
  Person:

  	
  Albert Marino

  
	
   

  	
   

  
	
  Title of Signing
  Person:

  	
  Member

  
	
   

  	
   

  
	
  Dated:

  	
  August 18,
  2008

  

 

 

 

 

 

 

Signature of or on behalf
of Exchanging Noteholder:

 

	
  Company Name:

  	
  Claren Road
  Credit Master Fund, Ltd. by Claren Road Asset Management, LLC as investment
  manager

  
	
   

  	
   

  
	
  Signature:

  	
  /s/ Albert
  Marino

  
	
   

  	
   

  
	
  Name of Signing
  Person:

  	
  Albert Marino

  
	
   

  	
   

  
	
  Title of Signing
  Person:

  	
  Member

  
	
   

  	
   

  
	
  Dated:

  	
  August 18,
  2008

  

 

 

 

 

 

Signature of or on behalf
of Exchanging Noteholder:

 

	
  Company Name:

  	
  GPC LXIV LLC
  by Claren Road Asset Management, LLC as investment manager

  
	
   

  	
   

  
	
  Signature:

  	
  /s/ Albert
  Marino

  
	
   

  	
   

  
	
  Name of Signing
  Person:

  	
  Albert Marino

  
	
   

  	
   

  
	
  Title of Signing
  Person:

  	
  Member

  
	
   

  	
   

  
	
  Dated:

  	
  August 18,
  2008

  

 

 

 

 

 

Signature of or on behalf
of Exchanging Noteholder:

 

	
  Company Name:

  	
  The Toronto
  Dominion Bank

  
	
   

  	
   

  
	
  Signature:

  	
  /s/ Elaine
  Wong

  
	
   

  	
   

  
	
  Name of Signing
  Person:

  	
  Elaine Wong

  
	
   

  	
   

  
	
  Title of Signing
  Person:

  	
  VP,
  International Fixed Income

  
	
   

  	
   

  
	
  Dated:

  	
  August 18,
  2008

  

 

 

 

 

 

Signature of or on behalf
of Exchanging Noteholder:

 

	
  Company Name:

  	
  Global Credit
  Strategies Desk of UBS Securities LLC

  
	
   

  	
   

  
	
  Signature:

  	
  /s/ Robert Del
  Grande

  
	
   

  	
   

  
	
  Name of Signing
  Person:

  	
  Robert Del
  Grande

  
	
   

  	
   

  
	
  Title of Signing
  Person:

  	
  Executive
  Director

  
	
   

  	
   

  
	
  Dated:

  	
  August 18,
  2008

  
	
   

  	
   

  
	
  Signature:

  	
  /s/ Marie-Anne
  Clark

  
	
   

  	
   

  
	
  Name of Signing
  Person:

  	
  Marie-Anne
  Clark

  
	
   

  	
   

  
	
  Title of Signing
  Person:

  	
  Executive
  Director and Counsel

  
	
   

  	
   

  
	
  Dated:

  	
  August 18,
  2008

  

 

 

 

 

 

Signature of or on behalf
of Exchanging Noteholder:

 

	
  Company Name:

  	
  Marathon
  Special Opportunity Master Fund, Ltd.

  
	
   

  	
   

  
	
  Signature:

  	
  /s/ Andrew
  Rabinowitz

  
	
   

  	
   

  
	
  Name of Signing
  Person:

  	
  Andrew
  Rabinowitz

  
	
   

  	
   

  
	
  Title of Signing
  Person:

  	
  Chief
  Operating Officer

  
	
   

  	
   

  
	
  Dated:

  	
  August 18,
  2008Exhibit 10.9

EMPLOYMENT
AGREEMENT

 

THIS EMPLOYMENT AGREEMENT (“Agreement”) is entered into by and
between William L. Harvey (“Executive”)
and Interval Leisure Group, Inc., a Delaware corporation (the “Company”), as of the 25th day of
August, 2008.

 

WHEREAS,
IAC/InterActiveCorp. has caused the Company to become a separate public entity
(the “Spin-Off”);

 

WHEREAS, the Company
desires to establish its right to the services of Executive for a period
beginning on his date of hire, June 30, 2008 (the “Effective
Date”), in the capacity described below, on the terms and
conditions hereinafter set forth, and Executive is willing to accept such
employment on such terms and conditions.

 

NOW, THEREFORE, in
consideration of the mutual agreements hereinafter set forth, Executive and the
Company have agreed and do hereby agree as follows:

 

1A.          EMPLOYMENT.  During the Term (as defined below), the
Company shall employ Executive, and Executive shall be employed, as Chief
Financial Officer of the Company.  During
Executive’s employment with the Company, Executive shall do and perform all
services and acts necessary or advisable to fulfill the duties and
responsibilities as are commensurate and consistent with Executive’s position
and shall render such services on the terms set forth herein.  During Executive’s employment with the
Company, Executive shall report directly to the Chief Executive Officer of the
Company (the “CEO”).  Executive shall have such powers and duties
with respect to the Company as may reasonably be assigned to Executive by the
CEO, to the extent consistent with Executive’s position.  Executive agrees to devote all of Executive’s
working time, attention and efforts to the Company and to perform the duties of
Executive’s position in accordance with the Company’s policies as in effect
from time to time.  Executive may (i) serve
as a director or member of a committee or organization involving no actual or
potential conflict of interest with the Company and its subsidiaries and
affiliates; (ii) deliver lectures and fulfill speaking engagements; (iii) engage
in charitable and community activities; and (iv) invest his personal
assets in such form or manner that will not violate this Agreement or require
services on the part of Executive in the operation or affairs of the companies
in which those investments are made; provided the activities described
in clauses (i), (ii), (iii) or (iv) do not materially affect or
interfere with the performance of Executive’s duties and obligations to the
Company or conflict with such policies as may be adopted from time to time by
the Board of Directors of the Company (the “Board”). 
Executive’s principal place of employment shall be the Company’s offices
located in Miami, Florida.

 

2A.          TERM.  The term of this Agreement shall begin on the
Effective Date and shall end on the fourth anniversary of the Effective Date
(such period, the “Initial Term”); provided,
that on the fourth anniversary of the Effective Date and on each anniversary
thereafter, the Initial Term shall automatically be extended for additional
one-year periods (the Initial Term as so extended, the “Term”)
unless either party provides the other party with a notice of termination at
least thirty (30) days before any such anniversary (the anniversary date on
which the Term terminates shall 

 

 

be referred to herein as the “Scheduled
Termination Date”). 
Notwithstanding the foregoing, the Executive’s employment hereunder may
be terminated during the Term prior to the Scheduled Termination Date.

 

Notwithstanding the termination of the Term, certain
terms and conditions herein may specify a greater period of effectiveness.  If Executive’s employment with IAC is
terminated prior to the date of the Spin-Off, this Agreement shall terminate
automatically and be null and void.

 

3A.          COMPENSATION.

 

(a)           BASE SALARY. 
During the period that Executive is employed with the Company hereunder,
the Company shall pay Executive an annual base salary of $325,000 (the “Base Salary”), payable in equal
biweekly installments (or, if different, in accordance with the Company’s
payroll practice as in effect from time to time).  During the Term, the Base
Salary will be reviewed annually and is subject to adjustment at the discretion
of the Board, but in no event shall the Company pay Executive a Base Salary
less than that set forth above during the period that Executive is employed
with the Company.  For all purposes
under this Agreement, the term “Base Salary” shall refer to the Base Salary as
in effect from time to time.

 

(b)           BONUS.  During the period that Executive is employed
with the Company hereunder, Executive shall be eligible to receive
discretionary annual bonuses, with a target annual bonus of 75% of Base Salary;
provided, that with respect to the Company’s 2008 fiscal year, Executive
will be eligible to receive an annual bonus on a pro-rated basis equal to the
product of (x) the annual Bonus which otherwise would have been earned by
Executive for the Company’s 2008 fiscal year absent pro-ration, times (y) a
fraction, the numerator of which is the number of days in the Company’s 2008
fiscal year that Executive was employed by the Company and its affiliates, and
the denominator of which is 365.  Any such annual bonus shall be paid not later
than March 15 of the calendar year immediately following the calendar year
with respect to which such annual bonus relates (unless Executive has elected
to defer receipt of such bonus pursuant to an arrangement that meets the
requirements of Section 409A (as defined below)).

 

(c)           GRANT OF RESTRICTED STOCK
UNITS.

 

(i)            As promptly as practicable, Executive shall be
granted, under and subject to the provisions of the Company Incentive Plan an
award of a number of Company RSUs determined by dividing $750,000 by the value
of a share of Company Common Stock utilized to convert IAC restricted stock
units into Company RSUs in the Spin-Off, rounded to the nearest whole number of
Company RSUs (the “Initial Equity Awards”).  Contingent upon satisfaction of one or more
of the performance conditions attached as Exhibit A hereto, which
performance conditions have been agreed upon by the Executive and the Company
and approved by the Compensation and Human Resources Committee of the Board of
Directors of IAC, the Annual Vesting Award shall vest and no longer be subject
to any restriction (in each case subject to the Executive’s continued
employment with the Company through the applicable vesting date):

 

2

 

 

	
  Vesting Date

  	
   

  	
  Percentage of Total Award Vesting

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  On the first anniversary of the Effective Date

  	
   

  	
  25%

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  On the second anniversary of the Effective Date

  	
   

  	
  25%

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  On the third anniversary of the Effective Date

  	
   

  	
  25%

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  On the fourth anniversary of the Effective Date

  	
   

  	
  25%

  	
   

  

 

(ii)           Other terms for the Annual Vesting Award will be set
forth in one or more Award Notices and related Terms and Conditions consistent
with the terms of this Agreement and otherwise in form and substance consistent
with Award Notices and Terms and Conditions historically used by IAC for equity
awards to its senior executives.

 

(d)           BENEFITS. 
From the Effective Date through the date of termination of Executive’s
employment with the Company for any reason, Executive shall be entitled to
participate in any welfare, health and life insurance and pension benefit and
incentive, perquisite and fringe benefit programs as may be adopted from time
to time by the Company on the same basis as that provided to similarly situated
employees of the Company.  Without
limiting the generality of the foregoing, Executive shall be entitled to the
following benefits:

 

(i)            Reimbursement
for Business Expenses.  During the
period that Executive is employed with the Company hereunder, the Company shall
reimburse Executive for all reasonable, necessary and documented expenses incurred
by Executive in performing Executive’s duties for the Company, on the same
basis as similarly situated employees and in accordance with the Company’s
policies as in effect from time to time.

 

(ii)           Vacation. 
During the period that Executive is employed with the Company hereunder,
Executive shall be entitled to paid vacation each year, in accordance with the
plans, policies, programs and practices of the Company applicable to similarly
situated employees of the Company generally.

 

4A.          NOTICES.  All
notices and other communications under this Agreement shall be in writing and
shall be given by first-class mail, certified or registered with return receipt
requested, or by hand delivery, or by overnight delivery by a nationally
recognized carrier, in each case to the applicable address set forth below, and
any such notice is deemed effectively given when received by the recipient (or
if receipt is refused by the recipient, when so refused):

 

	
   

  	
  If to the Company:

  	
   

  	
  Interval Leisure
  Group, Inc.

  
	
   

  	
   

  	
   

  	
  6262 Sunset Drive

  
	
   

  	
   

  	
   

  	
  Miami, Florida 33143

  
	
   

  	
   

  	
   

  	
  Attention: General Counsel

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  If
  to Executive:

  	
   

  	
  William
  L. Harvey

  
	
   

  	
   

  	
   

  	
  At the
  last address indicated in the Company’s records.

  

 

3

 

Either party may change such party’s address for
notices by notice duly given pursuant hereto.

 

5A.          GOVERNING LAW; JURISDICTION.  This Agreement and the legal relations thus
created between the parties hereto (including, without limitation, any dispute
arising out of or related to this Agreement) shall be governed by and construed
under and in accordance with the internal laws of the State of Florida without
reference to its principles of conflicts of laws.  Any dispute between the parties hereto arising
out of or related to this Agreement will be heard and determined before an
appropriate federal court located in the State of Florida in Miami-Dade County,
or, if not maintainable therein, then in an appropriate Florida state court
located in Miami-Dade County, and each party hereto submits itself and its
property to the non-exclusive jurisdiction of the foregoing courts with respect
to such disputes.

 

Each party hereto (i) agrees
that service of process may be made by mailing a copy of any relevant document
to the address of the party set forth above, (ii) waives to the fullest
extent permitted by law any objection which it may now or hereafter have to the
courts referred to above on the grounds of inconvenient forum or otherwise as
regards any dispute between the parties hereto arising out of or related to
this Agreement, (iii) waives to the fullest extent permitted by law any
objection which it may now or hereafter have to the laying of venue in the
courts referred to above as regards any dispute between the parties hereto
arising out of or related to this Agreement and (iv) agrees that a
judgment or order of any court referred to above in connection with any dispute
between the parties hereto arising out of or related to this Agreement is
conclusive and binding on it and may be enforced against it in the courts of
any other jurisdiction.

6A.          COUNTERPARTS.  This Agreement may be executed in several
counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.

 

7A.          STANDARD TERMS AND CONDITIONS.  Executive expressly understands and
acknowledges that the Standard Terms and Conditions attached hereto are
incorporated herein by reference, deemed a part of this Agreement and are
binding and enforceable provisions of this Agreement.  References to “this Agreement” or the use of
the term “hereof” shall refer to this Agreement and the Standard Terms and
Conditions attached hereto, taken as a whole.

 

8A.          SECTION 409A OF THE INTERNAL REVENUE CODE.   This Agreement is intended to comply with
the requirements of Section 409A of the of the Internal Revenue Code of
1986, as amended (the “Code”), and the rules and regulations issued
thereunder (“Section 409A”)  or an exemption and shall in all respects be
administered in accordance with Section 409A.    Notwithstanding anything in the Agreement
to the contrary, distributions upon termination of employment may only be made
upon a “separation from service” as determined under Section 409A.  Each payment under this Agreement shall be
treated as a separate payment for purposes of Section 409A.  In no event may Executive, directly or
indirectly, designate the calendar year of any payment to be made under this
Agreement.  All reimbursements and
in-kind benefits provided under this Agreement shall be made or provided in
accordance with the requirements of Section 409A.   In the event the parties determine that the
terms of this Agreement do not comply with Section 409A, they will
negotiate reasonably and in good faith to amend the terms of this 

 

4

 

Agreement such that it
complies (in a manner that attempts to minimize the economic impact of such
amendment on Executive and the Company) within the time period permitted by the
applicable Treasury Regulations.  In no
event shall the Company be required to pay Executive any “gross-up” or other
payment with respect to any taxes or penalties imposed under Section 409A
with respect to any benefit paid to Executive hereunder.

 

9A.          Notwithstanding
anything to the contrary herein, this Agreement shall become effective upon,
and subject to the occurrence of, the Effective Date.

 

IN
WITNESS WHEREOF, the Company has caused this Agreement to be executed and
delivered by its duly authorized officer and Executive has executed and
delivered this Agreement on August  25, 2008.

 

	
   

  	
  INTERVAL LEISURE GROUP, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Craig M. Nash

  
	
   

  	
  By: Craig M. Nash

  
	
   

  	
  Title: President and Chief Executive
  Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ William L. Harvey

  
	
   

  	
  WILLIAM L. HARVEY

  

 

5

 

STANDARD
TERMS AND CONDITIONS

 

1.                                       TERMINATION OF EXECUTIVE’S EMPLOYMENT.

 

(a)           DEATH.  In the event Executive’s employment hereunder
is terminated by reason of Executive’s death, the Company shall pay Executive’s
designated beneficiary or beneficiaries, within thirty (30) days of Executive’s
death in a lump sum in cash, (i) Executive’s Base Salary through the end
of the month in which death occurs and (ii) any other Accrued Obligations
(as defined in paragraph 1(f) below).

 

(b)           DISABILITY.  If, as a result of Executive’s incapacity due
to physical or mental illness (“Disability”),
Executive shall have been absent from the full-time performance of Executive’s
duties with the Company for a period of four (4) consecutive months and,
within thirty (30) days after written notice is provided to Executive by the
Company (in accordance with Section 4A hereof), Executive shall not have
returned to the full-time performance of Executive’s duties, Executive’s
employment under this Agreement may be terminated by the Company for
Disability.  During any period prior to
such termination during which Executive is absent from the full-time
performance of Executive’s duties with the Company due to Disability, the
Company shall continue to pay Executive’s Base Salary at the rate in effect at
the commencement of such period of Disability, offset by any amounts payable to
Executive under any disability insurance plan or policy provided by the
Company.  Upon termination of Executive’s
employment due to Disability, the Company shall pay Executive within thirty
(30) days of such termination (i) Executive’s Base Salary through the end
of the month in which termination occurs in a lump sum in cash, offset by any
amounts payable to Executive under any disability insurance plan or policy provided
by the Company; and (ii) any other Accrued Obligations (as defined in
paragraph 1(f) below).

 

(c)           TERMINATION
FOR CAUSE OR WITHOUT GOOD REASON. 
Upon the termination of Executive’s employment by the Company for Cause
(as defined below), or by Executive without Good Reason, the Company shall have
no further obligation hereunder, except for the payment of any Accrued
Obligations (as defined in paragraph 1(f) below).  As used herein, “Cause”
shall mean:  (i) the plea of guilty
or nolo contendere to, or conviction for, the commission of a felony offense by
Executive; provided, however, that after indictment, the Company
may suspend Executive from the rendition of services, but without limiting or
modifying in any other way the Company’s obligations under this Agreement; provided,
further, that Executive’s employment shall be immediately reinstated if
the indictment is dismissed or otherwise dropped and there are not otherwise
grounds to terminate Executive’s employment for Cause; (ii) a material
breach by Executive of a fiduciary duty owed to the Company; provided
that the CEO determines, in the CEO’s good faith discretion, that such material
breach undermines the CEO’s confidence in Executive’s fitness to continue in
his position, as evidenced in writing from the CEO; (iii) a material
breach by Executive of any of the covenants made by Executive in Section 3
hereof; provided, however, that in the event such material breach
is curable, Executive shall have failed to remedy such material breach within
ten (10) days of Executive having received a written demand for cure by
the CEO, which demand specifically identifies the manner in which the Company
believes that Executive has materially breached any 

 

 

of the covenants made by Executive in Section 3 hereof;
(iv) the willful or gross neglect by Executive of the material duties
required by this Agreement following receipt of written notice from the CEO
which specifically identifies the nature of such willful or gross neglect and a
reasonable opportunity to cure; or (v) a knowing and material violation by
Executive of any Company policy pertaining to ethics, wrongdoing or conflicts
of interest.

 

(d)           TERMINATION BY THE COMPANY OTHER THAN FOR
DEATH, DISABILITY OR CAUSE OR RESIGNATION BY EXECUTIVE FOR GOOD REASON.  If Executive’s employment hereunder is
terminated prior to the expiration of the Term by the Company for any reason
other than Executive’s death or Disability or for Cause, or if Executive
terminates his employment hereunder prior to the expiration of the Term for
Good Reason (any such termination, a “Qualifying Termination”),
then:

 

(i)            the Company shall continue to pay to
Executive the Base Salary for six months from the date of such termination, or,
if the Qualifying Termination occurs after the first anniversary of the
Effective Date, twelve months from the date of such termination (such period,
the “Severance Period”), payable in equal
biweekly installments (or, if different, in accordance with the Company’s
payroll practice as in effect from time to time) (the “Cash
Severance Payments”);

 

(ii)           the
Company shall pay Executive within thirty (30) days of the date of such
termination in a lump sum in cash any Accrued Obligations (as defined in
paragraph 1(f) below); and

 

(iii)          any
portion of the Initial Equity Awards that is outstanding and unvested at the
time of such termination but that would, but for a termination of employment,
have vested during the Severance Period shall vest as of the date of such
termination of employment;; provided, however, that any Company
RSUs that would vest under this provision but for the fact that outstanding
performance conditions have not been satisfied shall vest only if, and at such
point as, such performance conditions are satisfied.

 

Notwithstanding the preceding provisions of this Section 1(d), in
the event that Executive is a “specified employee” (within the meaning of
Section 409A) on the date of termination of Executive’s employment with
the Company and the Cash Severance Payments to be paid within the first six months
following such date (the “Initial Payment Period”)
exceed the amount referenced in Treas. Regs.
Section 1.409A-1(b)(9)(iii)(A) (the “Limit”),
then (i) any portion of the Cash Severance Payments that is payable during
the Initial Payment Period that does not exceed the Limit shall be paid at the
times set forth in Section 1(d)(i), (ii) any portion of the Cash
Severance Payments that exceeds the Limit (and would have been payable during
the Initial Payment Period but for the Limit) shall be paid, with Interest, on
the first business day of the first calendar month that begins after the
six-month anniversary of Executive’s “separation from service” (within the
meaning of Section 409A) and (iii) any portion of the Cash Severance
Payments that is payable after the Initial Payment Period shall be paid at the
times set forth in Section 1(d)(i). 
For purposes of this paragraph, Interest shall mean interest at the
applicable federal rate provided for in Section 7872(f)(2)(A) of the
Code, from the date on which payment would otherwise have been made but for any
required delay through the date of payment.

 

2

 

The payment to Executive of the severance benefits
described in this Section 1(d) (including any accelerated vesting)
shall be subject to Executive’s execution and non-revocation of a general
release of the Company and its affiliates, in a form substantially similar to
that used for similarly situated executives of the Company and its affiliates
within 60 days of the date of termination of Executive’s employment, and
Executive’s compliance with the restrictive covenants set forth in
Section 3 hereof (other than any non-compliance that is immaterial, does
not result in harm to the Company or its affiliates, and, if curable, is cured
by Executive promptly after receipt of notice thereof given by the
Company).  Executive acknowledges and
agrees that the severance benefits described in this
Section 1(d) constitute good and valuable consideration for such
release.

 

For purposes of this Agreement, “Good
Reason” shall mean the occurrence of any of the following
without Executive’s prior written consent: (A) a material change in the
geographic location at which Executive must perform his services; (B) the
Company materially diminishes Executive’s duties and responsibilities or
reporting relationships as set forth in Section 1A; or (C) the
Company breaches any material term or condition of this Agreement;  provided that in no event shall Executive’s
resignation be for “Good Reason” unless (x) an event or
circumstance set forth in clauses (A), (B) or (C) shall have occurred
and Executive provides the Company with written notice thereof within thirty
(30) days after Executive has knowledge of the occurrence or existence of such
event or circumstance, which notice specifically identifies the event or
circumstance that Executive believes constitutes Good Reason, (y) the
Company fails to correct the circumstance or event so identified within thirty
(30) days after the receipt of such notice, and (z) Executive resigns
within ninety (90) days after the date of delivery of the notice referred to in
clause (x) above.

 

(e)           NO
MITIGATION; OFFSET.  In the event of
termination of Executive’s employment pursuant to Section 1(d), Executive
shall not be obligated to seek other employment or take any actions to mitigate
the payments or continuation of benefits required under
Section 1(d) hereof.  If
Executive obtains other employment (whether or not comparable and whether or
not in the same geographic location) during the period of time in which the
Company is required to make Cash Severance Payments to Executive pursuant to
Section 1(d) above, the amount of any such remaining payments or
benefits to be provided to Executive shall be reduced by the amount of
compensation and benefits earned by Executive from such other employment
through the end of such period.  For
purposes of this Section 1(e), Executive shall have an obligation to
inform the Company regarding Executive’s employment status following
termination and during the period of time in which the Company is making Cash
Severance Payments to Executive as provided under Section 1(d) above.

 

(f)            ACCRUED
OBLIGATIONS.  As used in this
Agreement, “Accrued Obligations” shall
mean the sum of (i) any portion of Executive’s accrued but unpaid Base
Salary through the date of death or termination of employment for any reason,
as the case may be; (ii) any compensation previously earned but deferred
by Executive (together with any interest or earnings thereon) that has not yet
been paid, is not considered “deferred compensation” subject to
Section 409A and has not otherwise been deferred to a later date pursuant
to any deferred compensation arrangement of the Company to which Executive is a
party, if any (in which case, any such 

 

3

 

deferred compensation shall be paid in accordance with the terms of
such deferred compensation arrangement and shall not be deemed “Accrued
Obligations” pursuant to this Agreement); (iii) other than in the event of
Executive’s resignation without Good Reason or termination by the Company for
Cause (except as required by applicable law), any portion of Executive’s
accrued but unpaid vacation pay through the date of death or termination of
employment; (iv) any reimbursements that Executive is entitled to receive
under Section 3A(d)(i) of the Agreement; and (v) any vested
benefits or amounts that Executive is otherwise entitled to receive under any
plan, policy, practice or program of or any other contract or agreement with
the Company in accordance with the terms thereof (other than any such plan,
policy, practice or program of the Company that provides benefits in the nature
of severance or continuation pay).

 

2.                                       TREATMENT OF EXECUTIVE’S INITIAL EQUITY
AWARDS IN THE EVENT OF A CHANGE OF CONTROL OF THE COMPANY. 
In the event that, during the Term, there is consummated a Change of
Control (as defined in the Company Incentive Plan), any portion of the Initial
Equity Awards that is outstanding and unvested at the time of such Change of
Control which would have vested during the twenty-four (24) month period
following such Change of Control shall vest as of the date of such Change of
Control and the Initial Equity Awards shall otherwise continue to vest in
accordance with their terms.  In the
event any portion of the Initial Equity Awards remains unvested following such
Change of Control after application of the foregoing sentence, the agreements
effectuating the Change of Control shall provide for the assumption or
substitution of the unvested Initial Equity Awards by the successor entity
(unless the successor entity is the Company, in which case the unvested Initial
Equity Awards shall remain outstanding in accordance with their terms).  In no event shall any unvested portion of the
Initial Equity Awards be cancelled or forfeited without value in connection
with a Change of Control.

 

3.                                       CONFIDENTIAL INFORMATION;
NON-COMPETITION; NON-SOLICITATION; AND PROPRIETARY RIGHTS.

 

(a)           CONFIDENTIALITY.  Executive acknowledges that, while employed
by the Company, Executive will occupy a position of trust and confidence.  The Company, its subsidiaries and/or
affiliates shall provide Executive with “Confidential Information” as referred
to below.  Executive shall not, except as
may be required to perform Executive’s duties hereunder or as required by
applicable law, without limitation in time, communicate, divulge, disseminate,
disclose to others or otherwise use, whether directly or indirectly, any
Confidential Information regarding the Company and/or any of its subsidiaries
and/or affiliates.

 

“Confidential Information”
shall mean information about the Company or any of its subsidiaries or
affiliates, and their respective businesses, employees, consultants, contractors,
clients and customers that is not disclosed by the Company or any of its
subsidiaries or affiliates for financial reporting purposes or otherwise
generally made available to, or in the possession of, the public (other than by
Executive’s breach of the terms hereof) and that was learned or developed by
Executive in the course of employment by the Company or any of its subsidiaries
or affiliates, including (without limitation) any proprietary knowledge, trade
secrets, data, formulae, information and client and customer lists and all
papers, resumes, and records (including computer records) of the documents
containing such Confidential Information. 

 

4

 

Notwithstanding the foregoing provisions, if Executive is required to
disclose any such confidential or proprietary information pursuant to
applicable law or a subpoena or court order, Executive shall promptly notify
the Company in writing of any such requirement so that the Company may seek an
appropriate protective order or other appropriate remedy or waive compliance
with the provisions hereof.  Executive
shall reasonably cooperate with the Company to obtain such a protective order
or other remedy.  If such order or other
remedy is not obtained prior to the time Executive is required to make the
disclosure, or the Company waives compliance with the provisions hereof,
Executive shall be permitted to disclose only that portion of the confidential
or proprietary information which he is advised by counsel that he is legally
required to so disclose.  Executive
acknowledges that such Confidential Information is specialized, unique in
nature and of great value to the Company and its subsidiaries or affiliates,
and that such information gives the Company and its subsidiaries or affiliates
a competitive advantage.  Executive
agrees to deliver or return to the Company, at the Company’s request at any
time or upon termination or expiration of Executive’s employment or as soon
thereafter as possible, all documents, computer tapes and disks, records,
lists, data, drawings, prints, notes and written information (and all copies
thereof) furnished by the Company and its subsidiaries or affiliates or
prepared by Executive in the course of Executive’s employment by the Company
and its subsidiaries or affiliates.  As
used in this Agreement, “subsidiaries” and “affiliates” shall mean any company
controlled by, controlling or under common control with the Company.

 

(b)           NON-COMPETITION.  In consideration of this Agreement, and other
good and valuable consideration provided hereunder, the receipt and sufficiency
of which are hereby acknowledged by Executive, Executive hereby agrees and
covenants that, during Executive’s employment hereunder and for a period of
twenty-four (24) months thereafter (the “Restricted Period”),
Executive shall not, without the prior written consent of the Company, directly
or indirectly, engage in or become associated with a Competitive Activity.

 

For purposes of this Section 3(b), (i) a “Competitive Activity” means, any
business or other endeavor involving Similar Products if such business or
endeavor is in a country (including the United States) in which the Company (or
any of its businesses) (x) at the time of Executive’s termination provides
or planned to provide such Similar Products or (y) during Executive’s
employment provided, such Similar Products; (ii) “Similar
Products” means any products or services that are the same or
substantially similar to any of the types of products or services that the
Company and/or any other business for which Executive may, during the Term,
have direct or indirect responsibility hereunder provides or planned to provide
during Executive’s employment hereunder; and (iii) Executive shall be
considered to have become “associated with a Competitive Activity” if Executive
becomes directly or indirectly involved as an owner, principal, employee,
officer, director, independent contractor, representative, stockholder,
financial backer, agent, partner, member, advisor, lender, consultant or in any
other individual or representative capacity with any individual, partnership,
corporation or other organization that is engaged in a Competitive Activity.

 

Notwithstanding the foregoing, Executive may make and
retain investments during the Restricted Period, for investment purposes only,
in less than one percent (1%) of the outstanding capital stock of any
publicly-traded corporation engaged in a Competitive Activity if the stock of
such corporation is either listed on a national stock exchange or on the NASDAQ
National 

 

5

 

Market System if Executive is not otherwise affiliated with such
corporation.  Executive acknowledges that
Executive’s covenants under this Section 3(b) are a material inducement
to the Company’s entering into this Agreement.

 

(c)           NON-SOLICITATION
OF EMPLOYEES.  Executive recognizes
that he will possess Confidential Information about other employees,
consultants and contractors of the Company and its subsidiaries or affiliates
relating to their education, experience, skills, abilities, compensation and
benefits, and inter-personal relationships with suppliers to and customers of
the Company and its subsidiaries or affiliates. 
Executive recognizes that the information he will possess about these
other employees, consultants and contractors is not generally known, is of
substantial value to the Company and its subsidiaries or affiliates in
developing their respective businesses and in securing and retaining customers,
and will be acquired by Executive because of Executive’s business position with
the Company.  Executive agrees that,
during the Restricted Period, Executive will not, directly or indirectly,
solicit or recruit any employee of (i) the Company and/or (ii) its
subsidiaries and/or affiliates with whom Executive has had direct contact
during his employment hereunder, in all cases, for the purpose of being
employed by Executive or by any business, individual, partnership, firm,
corporation or other entity on whose behalf Executive is acting as an agent,
representative or employee and that Executive will not convey any such
Confidential Information or trade secrets about employees of the Company or any
of its subsidiaries or affiliates to any other person except within the scope
of Executive’s duties hereunder. 
Notwithstanding the foregoing, Executive is not precluded from
soliciting any individual who (i) responds to any public advertisement or
general solicitation or (ii) has been terminated by the Company prior to
the solicitation.

 

(d)           NON-SOLICITATION
OF CUSTOMERS.  During the Restricted
Period, Executive shall not solicit any customers of (i) the Company
and/or (ii) any of its subsidiaries or affiliates with whom Executive has
direct contact during his employment hereunder or encourage (regardless of who
initiates the contact) any such customers to use the facilities or services of
any competitor of (i) the Company and/or (ii) any of its subsidiaries
or affiliates with whom Executive has direct contact during his employment
hereunder.

 

(e)           NON-SOLICITATION
OF BUSINESS PARTNERS.  During the
Restricted Period, Executive shall not, without the prior written consent of
the Company, persuade or encourage any business partners or business affiliates
of (i) the Company and/or (ii) any of its subsidiaries and/or
affiliates with whom Executive has direct contact during his employment
hereunder, in each case, to cease doing business with the Company and/or any of
its subsidiaries and/or affiliates or to engage in any business competitive
with the Company and/or its subsidiaries and/or affiliates.

 

(f)            NONDISPARAGEMENT.  Executive hereby agrees and covenants that,
during Executive’s employment hereunder and for a period of thirty-six (36)
months thereafter, Executive shall not make any statement or perform any act
intended to advance the interest of any competitor of the Company and/or any of
its subsidiaries and/or affiliates in any way that will injure the interests of
the foregoing entities.

 

(g)           PROPRIETARY
RIGHTS; ASSIGNMENT.  All Employee
Developments 

 

6

 

(defined below) shall be considered works made for hire by Executive
for the Company or, as applicable, its subsidiaries or affiliates, and
Executive agrees that all rights of any kind in any Employee Developments
belong exclusively to the Company.  In
order to permit the Company to exploit such Employee Developments, Executive
shall promptly and fully report all such Employee Developments to the
Company.  Except in furtherance of his
obligations as an employee of the Company, Executive shall not use or reproduce
any portion of any record associated with any Employee Development without
prior written consent of the Company or, as applicable, its subsidiaries or
affiliates.  Executive agrees that in the
event actions of Executive are required to ensure that such rights belong to
the Company under applicable laws, Executive will cooperate and take whatever
such actions are reasonably requested by the Company, whether during or after
the Term, and without the need for separate or additional compensation.  “Employee Developments”
means any idea, know-how, discovery, invention, design, method, technique,
improvement, enhancement, development, computer program, machine, algorithm or
other work of authorship, in each case, (i) that (A) concerns or
relates to the actual or anticipated business, research or development
activities, or operations of the Company or any of its subsidiaries or
affiliates, or (B) results from or is suggested by any undertaking
assigned to Executive or work performed by Executive for or on behalf of the
Company or any of its subsidiaries or affiliates, whether created alone or with
others, during or after working hours, or (C) uses, incorporates or is
based on Company equipment, supplies, facilities, trade secrets or inventions
of any form or type, and (ii) that is developed, conceived or reduced to
practice during the period that Executive is employed with the Company.  All Confidential Information and all Employee
Developments are and shall remain the sole property of the Company or any of
its subsidiaries or affiliates. 
Executive shall acquire no proprietary interest in any Confidential
Information or Employee Developments developed or acquired during the
Term.  To the extent Executive may, by
operation of law or otherwise, acquire any right, title or interest in or to
any Confidential Information or Employee Development, Executive hereby assigns
and covenants to assign to the Company all such proprietary rights without the
need for a separate writing or additional compensation.  Executive shall, both during and after the
Term, upon the Company’s request, promptly execute, acknowledge, and deliver to
the Company all such assignments, confirmations of assignment, certificates,
and instruments, and shall promptly perform such other acts, as the Company may
from time to time in its discretion deem necessary or desirable to evidence,
establish, maintain, perfect, enforce or defend the Company’s rights in
Confidential Information and Employee Developments.

 

(h)           COMPLIANCE
WITH POLICIES AND PROCEDURES.  During
the period that Executive is employed with the Company hereunder, Executive
shall adhere to the policies and standards of professionalism set forth in the
Company’s Policies and Procedures applicable to all employees of the Company
and its subsidiaries and/or affiliates as they may exist from time to time.

 

(i)            SURVIVAL
OF PROVISIONS.  The obligations
contained in this Section 3 shall, to the extent provided in this Section 3,
survive the termination or expiration of Executive’s employment with the
Company and, as applicable, shall be fully enforceable thereafter in accordance
with the terms of this Agreement.  If it
is determined by a court of competent jurisdiction that any restriction in this
Section 3 is excessive in duration or scope or is unreasonable or
unenforceable under applicable law, it is the intention of the parties that
such 

 

7

 

restriction may be modified or amended by the court to render it
enforceable to the maximum extent permitted by applicable law.

 

4.                                       TERMINATION OF PRIOR AGREEMENTS. 
This Agreement constitutes the entire agreement between the parties and,
as of the Effective Date, terminates and supersedes any and all prior
agreements and understandings (whether written or oral) between the parties
with respect to the subject matter of this Agreement.  Executive acknowledges and agrees that
neither the Company nor anyone acting on its behalf has made, and is not
making, and in executing this Agreement, Executive has not relied upon, any
representations, promises or inducements except to the extent the same is
expressly set forth in this Agreement.

 

5.                                       ASSIGNMENT; SUCCESSORS. 
This Agreement is personal in its nature and none of the parties hereto
shall, without the consent of the other, assign or transfer this Agreement or
any rights or obligations hereunder; provided that  in the event of the merger, consolidation,
transfer, or sale of all or substantially all of the assets of the Company (a “Transaction”) with or to any other
individual or entity, this Agreement shall, subject to the provisions hereof,
be binding upon and inure to the benefit of such successor and such successor
shall discharge and perform all the promises, covenants, duties, and
obligations of the Company hereunder, and in the event of any such assignment
or Transaction, all references herein to the “Company” shall refer to the
Company’s assignee or successor hereunder.

 

6.                                       WITHHOLDING. 
The Company shall make such deductions and withhold such amounts from
each payment and benefit made or provided to Executive hereunder, as may be
required from time to time by applicable law, governmental regulation or order.

 

7.                                       HEADING REFERENCES. 
Section headings in this Agreement are included herein for
convenience of reference only and shall not constitute a part of this Agreement
for any other purpose.  References to
“this Agreement” or the use of the term “hereof” shall refer to these Standard
Terms and Conditions and the Employment Agreement attached hereto, taken as a
whole.

 

8.                                       REMEDIES FOR BREACH. 
Executive expressly agrees and understands that Executive will notify
the Company in writing of any alleged breach of this Agreement by the Company,
and the Company will have thirty (30) days from receipt of Executive’s notice
to cure any such breach.  Executive
expressly agrees and understands that in the event of any termination of
Executive’s employment by the Company during the Term, the Company’s
contractual obligations to Executive shall be fulfilled through compliance with
its obligations under Section 1 of the Standard Terms and Conditions and,
in the event of a termination of Executive’s employment by the Company
following a Change of Control, Section 2 of the Standard Terms and
Conditions.

 

                Executive
expressly agrees and understands that the remedy at law for any breach by
Executive of Section 3 of the Standard Terms and Conditions will be
inadequate and that damages flowing from such breach are not usually
susceptible to being measured in monetary terms.  Accordingly, it is acknowledged that, upon
Executive’s violation of any provision of such Section 3, the Company
shall be entitled to obtain from any court of competent jurisdiction 

 

8

 

immediate injunctive relief and obtain a temporary order restraining
any threatened or further breach as well as an equitable accounting of all
profits or benefits arising out of such violation.  Nothing shall be deemed to limit the
Company’s remedies at law or in equity for any breach by Executive of any of
the provisions of this Agreement, including Section 3, which may be
pursued by or available to the Company.

 

9.                                       WAIVER; MODIFICATION. 
Failure to insist upon strict compliance with any of the terms,
covenants, or conditions hereof shall not be deemed a waiver of such term,
covenant, or condition, nor shall any waiver or relinquishment of, or failure
to insist upon strict compliance with, any right or power hereunder at any one
or more times be deemed a waiver or relinquishment of such right or power at
any other time or times.  This Agreement
shall not be modified in any respect except by a writing executed by each party
hereto.

 

10.                                 SEVERABILITY. 
In the event that a court of competent jurisdiction determines that any
portion of this Agreement is in violation of any law or public policy, only the
portions of this Agreement that violate such law or public policy shall be
stricken.  All portions of this Agreement
that do not violate any statute or public policy shall continue in full force
and effect.  Further, any court order
striking any portion of this Agreement shall modify the stricken terms as
narrowly as possible to give as much effect as possible to the intentions of
the parties under this Agreement.

 

11.                                 INDEMNIFICATION. 
The Company shall indemnify and hold Executive harmless for acts and
omissions in Executive’s capacity as an officer, director or employee of the
Company and/or any of its subsidiaries to the maximum extent permitted under
applicable law, including the advancement of fees and expenses; provided,
however, that neither the Company, nor any of its subsidiaries or
affiliates shall indemnify Executive for any losses incurred by Executive as a result
of acts described in Section 1(c) of this Agreement.

 

[The Signature
Page Follows]

 

9

 

	
  ACKNOWLEDGED AND AGREED:

  	
   

  
	
   

  	
   

  
	
  Date: August 25, 2008

  	
   

  
	
   

  	
   

  
	
   

  	
  INTERVAL LEISURE GROUP, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Craig M. Nash

  
	
   

  	
  By:

  	
  Craig M. Nash

  
	
   

  	
  Title:

  	
  President and Chief Executive Officer

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ William L. Harvey

  
	
   

  	
  WILLIAM L. HARVEY

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