Document:

Exhibit 10.36

 

PRIVILEGED AND CONFIDENTIAL

EXECUTED VERSION

 

EMPLOYMENT AGREEMENT

 

This EMPLOYMENT AGREEMENT (“Agreement”) is entered into by and
between Hermes Acquisition Corp. (“Employer”)
and Michael Crowley (“Employee”)
as of September 30, 2008.  This
Agreement will become effective as of the closing of that merger (the “Merger”)
contemplated by the Agreement and Plan of Merger by and among Willis Group
Holdings Limited, Employer and Hilb Rogal & Hobbs Company (“HRH”),
dated as of June 7, 2008, as amended (the “Merger Agreement”) (the
date on which the Merger is consummated shall also be the “Effective Date”
of this Agreement).  Notwithstanding
anything herein to the contrary, if for any reason the Merger does not become
effective, this Agreement shall not become effective.

 

WHEREAS, on October 15,
2005, Employee entered into an employment agreement with HRH, which was
subsequently amended on July 17, 2007 (the “Prior Employment Agreement”);

 

WHEREAS, in addition
to the Prior Employment Agreement, Employee entered into a change of control
employment agreement with HRH dated October 15, 2005, as amended and
restated by that “Amended and Restated Change of Control Employment Agreement”
dated as of the 30th day of July, 2008 (the “COC Agreement”), which included
a provision that allowed Employee to resign his employment for Good Reason (as “Good
Reason” is defined in the COC Agreement);

 

WHEREAS, pursuant to
the Merger Agreement, HRH will merge with Employer and, upon the closing of the
Merger (the “Closing”), Employer shall become the surviving corporation;

 

WHEREAS, immediately
after the Closing, Employer acknowledges that Employee shall have the basis to
resign his employment with HRH for Good Reason and Employer acknowledges that,
upon the Closing, Employee shall be treated as if he has resigned his
employment for Good Reason for purposes of the COC Agreement (subject to the
other particular terms and conditions of this Agreement);

 

WHEREAS, Employer
wishes to continue to employ Employee beyond the Closing and Employee desires
to continue in the employ of Employer beyond the Closing pursuant to the terms
and conditions set forth in this Agreement;

 

WHEREAS, as of the
Effective Date and, except as otherwise specifically set forth below, this
Agreement supersedes and replaces the Prior Employment Agreement and the COC
Agreement in all respects; and

 

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

 

 

1.             Recitals;
Employment; Position.  The Recitals
set forth above constitute operative provisions hereof and are deemed
incorporated in the operative text of this Agreement. Employer hereby agrees to
continue to employ Employee in the position of “President” and Employee hereby
agrees to continue to serve as an employee and to act in such capacity for
Employer, all in accordance with and subject to the terms and conditions of
this Agreement. The period from the Effective Date through December 31,
2009 shall be referred to herein as the “First Period” and the period
from January 1, 2010 through December 31, 2010 shall be referred to
herein as the “Second Period.”

 

2.             Responsibilities
and Place of Performance.  Employee
shall report to and be subject to the direction of Donald Bailey, in his
capacity as “Chairman and CEO” of Employer (the “Reporting Person”, and
in the event Mr. Bailey for any reason ceases to be “Chairman and CEO” of
Employer, the Reporting Person will be understood to refer to any person who
may be the successor to Donald Bailey in the position of “Chairman and CEO” of
Employer).  Employee shall perform and
discharge such duties and responsibilities as the Reporting Person may from
time to time reasonably assign to Employee, consistent with Employee’s title
and position.  Subject to the foregoing,
Employee understands and acknowledges that such duties shall be subject to
revision and modification from time to time by the Reporting Person.  In addition to his responsibilities as
President of Employer, Employee shall serve as a member of that group of senior
executives who are recognized by Employer and its parent companies as the “Executive
Committee” within Willis Group (for purposes hereof, “Willis Group”
refers to Employer and its affiliated companies).  Employee shall devote Employee’s full
business time, attention, skill and best efforts to the faithful performance of
Employee’s duties herein, and shall perform the duties and carry out the
responsibilities assigned to Employee in a diligent, trustworthy and
businesslike manner for the purpose of advancing Employer’s legitimate business
interests. Employee agrees that while employed by Employer, Employee will not
engage in any outside business activities that conflict with his obligations
under this Agreement.  As further
described in paragraph 3.f. below, the principal places where such services are
to be performed are New York, New York and Richmond, Virginia; provided, however, that Employee agrees to travel to other
offices of Employer and its clients as may be reasonably necessary or customary
to perform his duties.

 

3.             Compensation
and Benefits.

 

a. Base Salary.  Employer shall pay to Employee a base salary
at the rate of $45,833.33 per month, which is equivalent to $550,000 per year,
less all applicable withholdings (the “Base Salary”).  The Base Salary will be distributed in
accordance with the customary payroll practices of Employer.  While this Agreement is in effect, the Base
Salary shall be subject to annual review and may be modified (but not
decreased, unless otherwise mutually agreed by the parties) in accordance with
Employer’s normal compensation and benefits administration procedures.

 

b. Annual Incentive Plan.  With respect to each calendar year ending
while Employee is employed (ending with the calendar year ending on December 31,
2010), Employee will participate in Employer’s Annual Incentive Plan, as
amended from time to time (the “AIP”) under which Employee will be
eligible to receive an annual bonus payment (the “Annual Bonus”) on the
same basis and terms and conditions (except as provided in this Agreement) as
other members of the Executive Committee who are regularly employed and reside
within the 

 

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United States are eligible to receive an annual bonus.  The actual amount of any Annual Bonus awarded
to Employee under the AIP shall rest in the discretion of Employer; provided that Employee’s Annual Bonus (i) may be made,
in whole or in part, in the form of (A) an equity award (including, but
not limited to, restricted stock units of Willis Group Holdings Limited common
stock — any and or all of which may be a form of deferred compensation and/or
subject to a vesting schedule, as such terms will be described in the equity
award agreement) and/or (B) a cash payment that is subject to a repayment
obligation under such circumstances as Employer may specify, which equity award
and cash payment shall in all events be structured and documented in a manner
that complies with Section 409A of the Internal Revenue Code of 1986, as
amended (the “Code”) or an exception thereunder and shall be consistent
with the terms of this Agreement, and (ii) shall be determined on a basis,
and except as otherwise provided in this Agreement, have terms and conditions
(including the ratio of cash to equity awards and the terms of any cash and/or
equity awards), that are no less favorable than the annual bonus determination,
and terms and conditions, applicable to other members of the Executive
Committee who are regularly employed and reside within the United States.  Any cash portion of Employee’s Annual Bonus
shall be paid no later than two and a half months after the end of the calendar
year for which the Annual Bonus is awarded. 
Whether Employee shall receive any Annual Bonus for or in connection
with any calendar year following year 2010 shall rest in the sole discretion of
Employer.  When determining the amount of
any such Annual Bonus with regard to the 2008 calendar year, Employer will take
into consideration, among other things, the amount of time Employee was
employed by Employer during such calendar year. 
Except as may be otherwise specifically provided in paragraph 6 of this
Agreement, Employee must be employed by Employer on December 31 of the
applicable bonus year (but need not be employed on the bonus distribution date)
in order to receive an Annual Bonus payment. 
In the event Employee’s employment terminates for any reason after December 31
of any calendar year and prior to the bonus distribution date applicable to
similarly situated executives of Employer, Employee shall receive the Annual
Bonus (determined as set forth above) in cash for any such prior year on the
bonus distribution date applicable to similarly situated executives of Employer
and in no event later than March 15 of the calendar year following the end
of the calendar year for which the Annual Bonus is awarded.  In no event shall Employee be entitled to an
Annual Bonus under this paragraph 3.b. for a particular calendar year that
would be duplicative of an Annual Bonus payment for the same calendar year
payable under paragraph 6 of this Agreement.

 

c. Equity Participation. 
Subject to the occurrence of the Closing and provided Employee first
signs this Agreement, Employee will be invited to participate in the Willis
Partners Plan (the “WPP”) subject to the terms of the Willis Group
Holdings Limited 2008 Share Purchase and Option Plan (the “Plan”), as
may be amended from time to time.  In
connection with Employee’s participation in the Plan and subject to the terms
of the WPP and the Plan, Employee will be granted an option to purchase 50,000
shares of common stock of Willis Group Holdings Limited (“Shares”) on
the first trading date, as permitted by Willis Group Holdings Limited’s dealing
in securities policy, following the announcement of the third quarter results
for 2008 of Willis Group Holdings Limited, at a per Share purchase price equal
to the closing market price of the Shares on the New York Stock Exchange on the
date of grant (the “Option”).  The
Option grant is subject to Employee’s execution of (i) this Agreement, (ii) an
“Agreement of Restrictive Covenants and Other Obligations”, the form of which
is attached as Exhibit A hereto and (iii) a definitive Option
Agreement reflecting the terms of this Agreement.  Subject to the other terms and conditions of
the Plan and the Option Agreement, the Option shall vest and become 

 

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exercisable, provided the performance conditions as set forth in the
Option Agreement are achieved, as follows: 
(i) 50% as of the third anniversary of the date of the grant; (ii) 25%
as of the fourth anniversary of the date of the grant; and (iii) 25% as of
the fifth anniversary of the date of the grant; provided,
however, that if Employee’s employment is terminated for any reason
other than for “Cause” (as defined below in this Agreement) prior to December 31,
2010, the Board of Directors of Willis Group Holdings Limited may, in its sole
discretion, waive the performance condition requirements and vest 1/3
(one-third) of the Option as of the date of the termination of Employee’s
employment.  Any vested portion of the
Option shall be immediately exercisable and remain exercisable for the then
remaining portion of the original full term. 
This paragraph 3.c. shall survive the expiration of this Agreement and
the Employee’s termination, notwithstanding anything contained herein to the
contrary.

 

d. General Benefit Plans. 
While employed by Employer, Employee will be allowed to participate in
those employee benefit plans and programs that are generally made available by
Employer and its parent company, Willis North America Inc., to other members of
the Executive Committee who are regularly employed and reside within the United
States (the “Peer Executives”) and shall continue to participate in the
HRH Supplemental Executive Retirement Plan to the extent the plan remains in
effect following the Effective Date. 
Such plans and programs will include medical coverage and a 401(k) retirement
plan, and may also include, without limitation, dental coverage plan, life
insurance, disability insurance. 
Employee’s participation in such plans and programs will be allowed in
accordance with and subject to the normal terms and conditions of such plans
and programs as applied to the Peer Executives, as such plans and programs
(including, but not limited to, any and all benefit plan documents) may be
amended or terminated from time to time. 
Notwithstanding the foregoing, Employee’s participation in such plans
and programs will take into account, and shall be administered in accordance
with and subject to, the terms and conditions of Section 5.14(b) of
the Merger Agreement.

 

e. Expenses.  Subject to
and in accordance with its normal policies and procedures applicable to the
Peer Executives, as may be amended from time to time, Employer will pay or
reimburse Employee for business expenses reasonably incurred by Employee in
connection with the performance of Employee’s duties under this Agreement.  Further provided that Employee shall comply
with Employer’s usual expense policies and procedures as generally apply to the
Peer Executives, including meeting the obligation on the part of Employee to
provide to Employer with reasonable documentation of expenses reasonably
incurred by Employee in connection with the performance of Employee’s duties
under this Agreement (required documentation may include, but will not
necessarily be limited to receipts and other documentation acceptable to
Employer and as may be required by the Internal Revenue Service to qualify as
ordinary and necessary business expenses under the Code).

 

f. Office Location; Travel to New York; Tax Gross Up.  Employee will be expected to travel
frequently to Employer’s New York, New York office in order to perform the
duties expected of Employee under this Agreement; however, Employee’s primary
office will be located in Richmond, Virginia (such travel to New York being referred
to in this Agreement as “New York Business Trips”).  While Employee is employed under this
Agreement, Employer will reimburse Employee’s reasonable transportation
expenses associated with the New York Business Trips, subject to Employee’s
compliance with Employer’s expense procedures as 

 

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applicable to the Peer Executives. 
If, by virtue of performing services for Employer as its Employee in the
State of New York (or any state other than the State of Virginia), Employee
incurs state or local tax liabilities in excess of the state and local tax
liabilities that Employee would have incurred if his employment services were
performed exclusively in the State of Virginia (“Additional State/Local
Taxes”), then Employer will provide Employee with an additional payment (a “Gross-Up
Payment”) in an amount such that after payment by Employee of all taxes
(including any income taxes and any interest or penalties imposed with respect
to any such taxes (other than any interest or penalties which are imposed as a
consequence of Employee’s failure to timely comply with (i) tax filing
deadlines or (ii) tax payment deadlines (in each case, other than due to
Employer’s failure to satisfy the obligations hereunder)) imposed upon the
Gross-Up Payment, Employee retains an amount of the Gross-Up Payment equal to
such Additional State/Local Taxes (and any interest or penalties imposed with
respect to such taxes, other than any interest or penalties which are imposed
as a consequence of Employee’s failure to timely comply with (i) tax
filing deadlines or (ii) tax payment deadlines (in each case, other than
due to Employer’s failure to satisfy the obligations hereunder)); it being
intended that while Employee is employed under this Agreement, Employee’s state
and local income tax liabilities will not be greater than what such liabilities
would have been if Employee’s employment services had been performed
exclusively in the State of Virginia.  If
Employee receives a Gross-Up Payment as contemplated in this paragraph,
Employer reserves the right to review Employee’s applicable New York State
income tax return(s) (and any other applicable state and local income tax
returns) prior to any filing thereof, and Employee will provide such tax
returns for Employer’ review, as and when requested by Employer.  Provided further for the avoidance of doubt,
Employer’s obligation to provide a Gross-Up Payment on Additional State/Local
Taxes shall (i) only apply to Additional State/Local Taxes, if any, that
Employee incurs by virtue of performing services for Employer as its employee
in the State of New York (or any state other than the State of Virginia) and (ii) survive
any termination of this Agreement.  Any
Gross-Up Payment provided under this paragraph will be paid to Employee as soon
as reasonably practicable following the end of the calendar year to which the
Gross-Up Payment relates, but in no event shall such payment be provided later
than the last day of the calendar year following the calendar year in which
Employee remits the related taxes.  If,
after such remittance, Employee becomes entitled to receive any refund from the
applicable taxing authority with respect to the Gross-Up Payments, Employee
shall promptly notify Employer of any such refund (including any applicable
interest) and pay to Employer the amount of such refund received.

 

g. Accommodations in New York. 
Through, but not following, December 31, 2010 (and subject in all
respects to the various terms and provisions of paragraph 6 below regarding
termination of this Agreement), Employer  will
provide Employee with use of a furnished one-bedroom apartment in the financial
district of New York, New York (i.e., downtown Manhattan, within reasonable
proximity of Employer’s New York City office location).  Use of such apartment will be provided in
order to facilitate Employee’s New York Business Trips and will only be
provided while Employee is employed by Employer.  As a condition to the use of such apartment,
Employee must abide by such reasonable policies, procedures and rules as
Employer may designate from time-to-time in connection with use of such
property.  If and to the extent the
provision of such apartment to Employee constitutes taxable income of any sort
to Employee under the Code or other applicable tax law (such taxable income
being referred to below as “Constructive Accommodation Income”),
Employer will provide Employee with a Gross-Up 

 

5

 

Payment in an amount such that, after payment by Employee of any and
all federal, state and local income taxes (and any interest or penalties
imposed with respect to such taxes, other than any interest or penalties which
are imposed as a consequence of Employee’s failure to timely comply with (i) tax
filing deadlines or (ii) tax payment deadlines (in each case, other than
due to Employer’s failure to satisfy the obligations hereunder) imposed upon
the Gross-Up Payment, Employee retains an amount of the Gross-Up Payment equal
to any such additional federal, state or local income tax liabilities on the
Constructive Accommodation Income; it being intended that while Employee is
employed under this Agreement, the provision of the accommodations in New York
to Employee shall not result in any additional income tax liability to
Employee.  Provided further for the
avoidance of doubt, Employer’s obligation to provide a Gross-Up Payment under
this paragraph shall (i) only apply to federal, state or local income tax
liabilities on the Constructive Accommodation Income, if any, which Employee
realizes by virtue of performing services for Employer as its employee in the
State of New York and (ii) survive any termination of this Agreement.  Any Gross-Up Payment provided under this
paragraph will be paid to Employee as soon as reasonably practicable following
the end of the calendar year to which the Gross-Up Payment relates, but in no
event shall such payment be provided later than the last day of the calendar
year following the calendar year in which Employee remits the related
taxes.  If, after such remittance,
Employee becomes entitled to receive any refund from the applicable taxing
authority with respect to the Gross-Up Payments, Employee shall promptly notify
Employer of any such refund (including any applicable interest) and pay to
Employer the amount of such refund received.

 

h. Vacation.  Employee
will accrue four weeks of vacation per year, in accordance with and subject to
the vacation accrual policy applicable to the Peer Executives.

 

4.     Confidential Information and Work for Hire.

 

a.             Employer
shall provide Employee with access to nonpublic information of Employer/Willis
to the extent reasonably necessary to the performance of Employee’s job
duties.  Employee acknowledges that all
non-public information (including, but not limited to, information regarding
Employer’s clients), owned or possessed by Employer/Willis (collectively, “Confidential
Information”) constitutes a valuable, special and unique asset of the
business of Employer/Willis.  Employee
shall not, during or after the period of Employee’s employment with Employer (i) disclose,
in whole or in part, such Confidential Information to any third party without
the consent of Employer or (ii) use any such Confidential Information for
Employee’s own purposes or for the benefit of any third party.  These restrictions shall not apply to any
information in the public domain provided that Employee was not responsible,
directly or indirectly, for such information entering the public domain without
Employer’s consent.  Upon termination of
Employee’s employment hereunder, Employee shall promptly return to Employer all
Employer/Willis materials, information and other property (including all files,
computer discs and manuals) as may then be in Employee’s possession or
control.  For purposes of this Agreement,
all references to “Employer/Willis” shall be understood to refer to
Employer and/or Employer’s parent companies and its other affiliates, as well
as their successors and assigns.

 

b.             Any
work prepared by Employee as an employee of Employer including written and/or
electronic reports and other documents and materials shall be “work for hire”
and shall be the exclusive property of Employer.  If, and to the extent that, any rights to
such work do not vest 

 

6

 

in Employer automatically, by operation of law, Employee shall be
deemed to hereby unconditionally and irrevocably assign to Employer all rights
to such work and Employee shall cooperate fully with Employer’s efforts to
establish and protect its rights to such work.

 

5.             Employee  Loyalty; Non-solicitation.

 

a.  Employee understands that
Employee owes a duty of loyalty to Employer and, while in Employer’s employ,
shall devote Employee’s entire business time and best good faith efforts to the
furtherance of Employer’s legitimate business interests.  All business activity participated in by
Employee as an employee of Employer shall be undertaken solely for the benefit
of Employer.  Employee shall have no
right to share in any commission or fee resulting from such business activity
other than the compensation set forth in this Agreement.

 

b.  While this Agreement is in
effect and for a period of two years following termination of Employee’s
employment with Employer, Employee shall not, within the “Territories”
described below:

 

(i)  directly or indirectly solicit, accept, or perform, other
than on Employer’s behalf, insurance brokerage, insurance agency, risk
management, claims administration, consulting or other principal business
engaged in by Employer/Willis from or with respect to (A) clients of
Employer/Willis with whom Employee had business contact or provided services
to, either alone or with others, while employed by either Employer or any
affiliate of Employer and, further provided, such clients were clients of
Employer/Willis either on the date of termination of Employee’s employment with
Employer or within twelve (12) months prior to such termination (the “Restricted
Clients”) and (B) active prospective clients of Employer/Willis with
whom Employee had business contacts regarding the business of Employer/Willis
within six (6) months prior to termination of Employee’s employment with
Employer (the “Restricted Prospects”); or

 

(ii)  directly or indirectly (A) solicit any employee of
Employer/Willis with whom Employee had business contact while employed by
either Employer or an affiliate of Employer (“Protected Employees”) to
work for Employee or any third party, including any competitor (whether an
individual or a competing company) of Employer/Willis or (B) induce any
such employee of Employer/Willis to leave the employ of Employer/Willis.

 

For purposes of this paragraph 5.b., “Territories” shall refer
to those counties where the Restricted Clients, Restricted Prospects or
Protected Employees of Employer/Willis are present and available for
solicitation.

 

6.             Term
and Termination.  This Agreement
shall commence upon the Effective Date and Employee’s employment hereunder
shall continue thereafter until this Agreement (and, correspondingly, Employee’s
employment) is terminated in accordance with the provisions below:

 

a.    During the First Period: 
During the First Period, subject to the other terms and conditions
below, the following shall apply:  (i) Employer
may terminate this Agreement 

 

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at any time upon the occurrence of Cause (for
purposes of this Agreement, “Cause” shall be defined as set forth below); (ii) Employer
may terminate this Agreement without Cause upon 15 days’ prior written notice
to Employee of the termination of this Agreement; and (iii) Employee may
terminate this Agreement upon Employee’s 15 days’ prior written notice to
Employer of employment resignation. 
Further provided as follows:

 

(1)  Termination by Employer for Cause or by Employee upon
Resignation: If during the First Period, (A) Employer terminates this
Agreement for Cause or (B) Employee terminates this Agreement upon 15 days’
prior written notice to Employer of employment resignation, then Employee shall
thereafter only be entitled under this Agreement to receive the following
payments and/or benefits:  (i) any
accrued, but, as of employment termination, unpaid, Base Salary due with
respect to service provided prior to employment termination (referred to in
this Agreement as “Accrued But Unpaid Salary”) payable in accordance
with Employer’s normal compensation payment practices; (ii) any unpaid
Annual Bonus for a calendar year completed as of the date of termination as
provided in paragraph 3.b. above (“Unpaid Bonus”); (iii) any
accrued and vested pension benefits or other vested benefits (including any
vested rights in respect of equity or equity-based awards), subject to the
normal terms and conditions of the applicable benefit plan documents (referred
to in this Agreement as “Accrued Benefits”); and (iv) any
compensation deferred by Employee prior to employment termination which is
otherwise subject to distribution to Employee upon “separation from service”,
as such term is defined under Section 409A of the Code (“Section 409A”)
and the treasury regulations promulgated thereunder (the date of such
separation from service, the “Date of Separation”, and the first
business day of the seventh month following Employee’s Date of Separation, the “Delayed
Payment Date”), and in accordance with and subject to the usual terms and
conditions of any applicable deferred compensation plan (referred to in this
Agreement as “Deferred Compensation”).

 

(2)  Termination by Employer without Cause upon 15 Days’
Prior Written Notice:  If during the
First Period, Employer terminates this Agreement without Cause upon 15 days’
prior written notice to Employee of termination of this Agreement, then
Employee shall thereafter only be entitled under this Agreement to
receive:  (A) a lump sum cash
payment equal in amount to the aggregate amount of the Base Salary payments
which Employee would have received following the date of employment termination
(i.e., at Employee’s Base Salary level as of the date of employment termination)
had Employee’s employment with Employer continued until, but not beyond, December 31,
2010 (referred to in this Agreement as the “Severance Payment”), to be
paid within 30 days of the date of termination, provided
that, to the extent Employee is a “specified employee” within the meaning of Section 409A
(as determined in accordance with the methodology established by
Employer/Willis) (a “Specified Employee”), the portion of the Severance
Payment equal to one year of Base Salary (at the level in effect on the date of
termination) shall instead be paid on the Delayed Payment Date; (B) the
following payments and/or benefits:  (i) any
Accrued But Unpaid Salary payable

 

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in
accordance with Employer’s normal compensation payment practices; (ii) any
Unpaid Bonus as may be payable as provided in paragraph 3.b. above; (iii) any
Accrued Benefits; and (iv) any Deferred Compensation payable as provided
under paragraph 6.a.(1)(iv) above; (C) (i) to the extent that as
of the termination date any Annual Bonus for a completed calendar year has then
been previously distributed in restricted cash, any repayment requirement with
respect thereto shall immediately lapse and (ii) to the extent that any
Annual Bonus for a completed calendar year has then been previously distributed
in the form of an equity award, such equity award shall vest in full and be
settled as of the date of employment termination and no longer be subject to
forfeiture, provided that to the extent any such
award is “non-qualified deferred compensation” within the meaning of Section 409A
and Employee is a Specified Employee, such awards will be settled on the
Delayed Payment Date; and (D) to the extent the date of termination of
employment occurs prior to the date on which Employer determines the Annual
Bonus for calendar year 2009, a lump sum cash payment equal to $337,080 times
two, to be paid within 30 days of the date of termination.

 

b.               During the Second Period:  During the Second Period, the following shall
apply:  (i) Employer may terminate
this Agreement at any time upon the occurrence of Cause; (ii) Employer may
terminate this Agreement without Cause by providing Employee with 15 days’
prior written notice of employment termination; and (iii) Employee may
terminate this Agreement by providing Employer with 15 days’ prior written
notice of employment resignation. 
Further provided as follows:

 

(1) Termination
by Employer for Cause:  If Employer
terminates this Agreement for Cause during the Second Period, then Employee
shall thereafter only be entitled under this Agreement to receive the following
payments and/or benefits:  (A) any
Accrued But Unpaid Salary, payable in accordance with Employer’s normal
compensation payment practices; (B) any Unpaid Bonus payable as provided
in paragraph 3.b. above; (C) any Accrued Benefits; and (D) any
Deferred Compensation payable as provided under paragraph 6.a.(1)(iv) above.

 

(2) Termination
by Employer without Cause upon 15 Days’ Prior Written Notice:  If during the Second Period Employer
terminates this Agreement without Cause upon 15 days’ prior written notice to
Employee, then Employee shall thereafter only be entitled under this Agreement
to receive the following payments and/or benefits: (A) the Severance
Payment, to be paid within 30 days of the Date of Separation, provided that to the extent Employee is a Specified
Employee, the Severance Payment shall instead be paid on the Delayed Payment
Date; (B) the following payments and/or benefits:  (i) any Accrued But Unpaid Salary
payable in accordance with Employer’s normal compensation payment practices; (ii) any
Unpaid Bonus as may be payable as provided in paragraph 3.b. above; (iii) any
Accrued Benefits; and (iv) any Deferred Compensation payable as provided
under paragraph 6.a.(1)(iv) above; (C) (i) to the extent that as
of the termination date any Annual Bonus for a completed calendar year has then
been previously distributed in restricted cash, any repayment requirement with respect
thereto shall immediately lapse and (ii) to the extent that any Annual
Bonus for a 

 

9

 

completed
calendar year has then been previously distributed in the form of an equity
award, such equity award shall vest in full and be settled as of the date of
employment termination and no longer be subject to forfeiture, provided that to the extent any such award is “non-qualified
deferred compensation” within the meaning of Section 409A and Employee is
a Specified Employee, such award will be settled on the Delayed Payment Date;
and (D) a lump sum cash payment equal to $337,080, to be paid within 30
days of the date of termination.

 

(3) Termination
by Employee upon 15 Days’ Prior Written Notice:  If Employee terminates this Agreement during
the Second Period upon 15 calendar days’ prior written notice to Employer of
employment resignation for any or no reason, then Employee shall thereafter
only be entitled under this Agreement to receive: (A) the Severance Payment,
to be paid within 30 days of the Date of Separation, provided that,
to the extent Employee is a Specified Employee, the Severance Payment shall
instead be paid on the Delayed Payment Date; (B) the following payments
and/or benefits: (i) any Accrued But Unpaid Salary payable in accordance
with Employer’s normal compensation payment practices; (ii) any Unpaid
Bonus as may be payable as provided in paragraph 3.b. above; (iii) any
Accrued Benefits; and (iv) any Deferred Compensation payable as provided under
paragraph 6.a.(1)(iv) above; (C) (i) to the extent that as of
the termination date any Annual Bonus for a completed calendar year has then
been previously distributed in restricted cash, any repayment requirement with
respect thereto shall immediately lapse and (ii) to the extent that any
Annual Bonus for a completed calendar year has then been previously distributed
in the form of an equity award, such equity award shall vest in full and be
settled as of the date of employment termination and no longer be subject to
forfeiture, provided that to the extent any such
award is “non-qualified deferred compensation” within the meaning of Section 409A
and Employee is a Specified Employee, such award will be settled on the Delayed
Payment Date; and (D) a lump sum cash payment equal to $337,080, to be
paid within 30 days of the date of termination.

 

c.              Following December 31,
2010:  Effective as of January 1,
2011 (and at all times thereafter):  (i) Employer
may terminate this Agreement at any time upon the occurrence of Cause; (ii) Employer
may terminate this Agreement without Cause by providing Employee with 15 days’
prior written notice of employment termination; and (iii) Employee may
terminate this Agreement upon providing Employer with 15 days’ prior written
notice of employment resignation. 
Further provided that following employment termination pursuant to this
paragraph 6.c. Employee shall thereafter only be entitled under this Agreement
to receive the following payments and/or benefits: (A) any Accrued But
Unpaid Salary, payable in accordance with Employer’s normal compensation
payment practices; (B) any Unpaid Bonus as may be payable as provided in
paragraph 3.b. above; (C) any Accrued Benefits; and (D) any Deferred
Compensation payable as provided under paragraph 6.a.(1)(iv) above.

 

d.              Death;
Disability. This Agreement will automatically terminate upon
Employee’s death or Employee’s disability (as disability  is defined in Employer’s Long Term
Disability Benefits Plan).  Further
provided as follows:

 

10

 

(1) Death:  In the event of termination of this Agreement
due to Employee’s death and to the extent permitted by applicable law, Employee’s
estate shall thereafter receive the following payments and/or benefits: (i) any
Accrued But Unpaid Salary payable in accordance with Employer’s normal
compensation payment practices; (ii) any Unpaid Bonus as may be payable as
provided in paragraph 3.b. above; (iii) any Accrued Benefits which
Employee’s estate may be eligible to receive, including any death benefits
(subject in all respects to the terms and conditions within any applicable
benefit plan documents concerning benefit administration following an employee’s
death); and (iv) any Deferred Compensation payable as provided under
paragraph 6.a.(1)(iv) above.  Aside
from this payments and benefits described in the preceding sentence, Employee’s
estate shall receive no other payments or benefits under this Agreement
following termination of this Agreement due to Employee’s death.

 

(2) Disability:  In the event of termination of this Agreement
due to Employee’s disability, then, Employee shall thereafter only be entitled
under this Agreement to receive the following payments and/or benefits:  (i) any Accrued But Unpaid Salary
payable in accordance with Employer’s normal compensation payment practices; (ii) any
Unpaid Bonus as may be payable as provided in paragraph 3.b. above; (iii) any
Accrued Benefits, including any disability benefits; and (iv) any Deferred
Compensation payable as provided under paragraph 6.a.(1)(iv) above.

 

e.  Surviving Provisions.  Paragraphs 3.b., 3.c., 3.f., 3.g., 4, 5, 6,
7, 8, 10 and 11 of this Agreement shall survive any termination of this
Agreement and any termination of Employee’s employment, and nothing contained
in this paragraph 6 shall reduce Employee’s rights to the Surviving Obligations
under the COC Agreement (as defined below). 
In addition, following termination of this Agreement, Employer shall
remain subject to those specific Gross Up Payment obligations, if any, as and
to the extent set forth in paragraphs 3.f., 3.g. and 7 of this Agreement.

 

f.  Cause Definition.  For purposes of this Agreement, “Cause” shall
mean (i) Employee’s continued failure to adequately perform his material
duties with respect to Employer/Willis (other than due to illness or
disability, as disability is defined in Employer’s Long Term Disability
Benefits Plan) after having been provided reasonable notice by the Reporting
Person of such alleged failure in writing specifying any such failure in
reasonable detail and, if such failure is capable of being corrected and/or
cured, a period of at least thirty (30) days after Employee’s receipt of such
notice to cure and/or correct such performance failure, (ii) willful misconduct
by Employee in connection with Employee’s employment which is materially
injurious to Employer/Willis (willful misconduct shall be understood to
include, but not be limited to, any breach of the duty of loyalty owed by
Employee to Employer/Willis), (iii) conviction of any criminal act (other
than road traffic violations not involving imprisonment or revocation of
driving privileges by a governmental authority), (iv) any breach of
Employee’s restrictive covenants as provided in this Agreement, or any other
non-compete agreement and/or confidentiality agreement entered into by Employee
with either Employer or an affiliated company of Employer (other than an
insubstantial, inadvertent and non-recurring breach), or (v) any material
violation of any material written Employer/Willis policy applicable to Employee
after reasonable notice by the Reporting 

 

11

 

Person
of such alleged violation in writing to Employee specifying any such violation
in reasonable detail and, if such violation is capable of being corrected
and/or cured, a period of at least thirty (30) days after Employee’s receipt of
such notice to cure and/or correct such alleged violation.

 

7.               Change of Control Employment
Agreement:  Employee
shall receive an amount in cash equal to the amounts determined under Section 6(b)(i) of
the COC Agreement (which amount equals $2,971,492, assuming for purposes of the
“Pro-Rata Bonus” (as defined in the COC Agreement) that the Closing
occurs on October 1, 2008) as if the Employee terminated his employment
for Good Reason immediately following the Closing (the “COC Agreement
Payment”).  The COC Agreement Payment
shall be paid in a lump sum in cash on the later of (i) the date that is
seven business days following the Effective Date or (ii) January 2,
2009; provided that, if the Closing occurs
prior to January 1, 2009 and Employee’s employment with Employer
terminates for any reason prior to January 1, 2009 and as of the date of
such termination Employee is not a Specified Employee, the COC Agreement
Payment shall be paid no later than 30 days after such date of termination; provided, further, that, if the Closing occurs prior to January 1,
2009 and Employee’s employment with Employer terminates for any reason prior to
January 1, 2009 and as of the date of such termination Employee is a
Specified Employee, the COC Agreement Payment shall be paid on the Delayed
Payment Date.  Further provided that,
notwithstanding anything to the contrary contained in paragraph 6 hereof, if
Employee’s employment hereunder terminates for any reason or no reason prior to
October 1, 2011, Employer shall, as successor to HRH following the Merger,
provide Employee with any amounts and/or benefits required to be provided under
Sections 6(b)(ii), (iii) and (iv) of the COC Agreement, in accordance
with the terms of the COC Agreement, (subject to and including any provisions
within the COC Agreement relating to Section 409A); provided,
that the welfare benefits under Section 6(b)(ii) of the COC Agreement
shall be provided to Employee at a level that is no less favorable than the
benefits being provided to Employee as of immediately prior to the date of
termination.  In addition,
notwithstanding anything contained herein to the contrary, Employer shall also
have the rights and responsibilities of the “Company” (as such term is defined
in the COC Agreement) set forth in Section 8 (entitled “Full Settlement”)
and Section 9 (entitled “Certain Additional Payments by the Company”)
of the COC Agreement; provided, however,
that (i) Employee’s right to legal fees under Section 8 of the COC
Agreement shall be limited to claims relating to the COC Agreement and the
Surviving Obligations under the COC Agreement (as defined below); and (ii) for
purposes of clarity, Employee’s right to a Section 280G gross-up payment
under Section 9 of the COC Agreement shall apply to (x) any payments
and/or benefits provided to Employee pursuant to the COC Agreement, (y) any
payments and/or benefits provided to Employee pursuant to any other plan,
program or arrangement of HRH or its subsidiaries in effect prior to the
Effective Date, which payments and/or benefits are triggered by the Merger or a
termination of employment following the Merger, including without limitation, with
respect to the accelerated vesting of any rights or benefits under any HRH
equity incentive plan, and (z) any payments and/or benefits under this
Agreement, including without limitation the payment or provision of the
Surviving Obligations under the COC Agreement, that would be deemed to be “parachute
payments” (as defined in Section 280G(b)(2) of the Code) in relation
to the Merger.  Any Section 280G
gross-up payments 

 

12

 

shall be paid in accordance with Section 9 of the COC Agreement.
The obligations to make the payments and provide the benefits under the COC
Agreement as described in this paragraph 7 are referred to herein as the “Surviving
Obligations under the COC Agreement”, and the Surviving Obligations under
the COC Agreement shall survive termination of this Agreement (and the
corresponding termination of Employee’s employment with Employer) and shall not
be limited by paragraph 6 of this Agreement. 
Employee shall also remain bound by the terms of Section 10(a) of
the COC Agreement (i.e., that paragraph which is captioned “Confidential
Information”).  Except as set forth
in this paragraph 7, following the Effective Date, Employee and Employer shall
have no further rights or obligations under the COC Agreement.  For the avoidance of doubt, it is further
provided that the payment by Employer and/or any of its affiliates of the COC
Agreement Payment shall fully and finally satisfy the payment obligation of
Employer and/or its affiliates regarding amounts determined under Section 6(b)(i) of
the COC Agreement.

 

8.                                       Mandatory
Binding Arbitration.  Except for
a claim beginning with a request for injunctive relief brought by Employer or
Employee or a claim relating to the Surviving Obligations under the COC Agreement,
Employer and Employee agree that any dispute arising either under this
Agreement or from the employment relationship shall be resolved by arbitration;
it is understood that disputes arising either under this Agreement or from the
employment relationship shall be understood to include, but not be limited to,
any and all disputes concerning any claim by Employee against Employer/Willis
concerning or relating to (i) alleged illegal discrimination against
Employee in the terms and conditions of employment (including but not limited
to any claim of alleged illegal discrimination on the basis of race, color,
religion, sex, gender, national origin, age, physical disability and/or mental
disability), (ii) alleged public policy violations, (iii) alleged wrongful
employment termination and/or (iv) any other disputes arising from or in
connection with the employment relationship. 
Except with respect to a claim relating to the Surviving Obligations
under the COC Agreement, each party expressly waives any right, whether
pursuant to any applicable federal, state, or local statute, to a jury trial
and/or to have a court of law determine rights and award damages with respect
to any such dispute.  The party invoking
arbitration shall notify the other party in writing (the “Written Notice”).  The parties shall exercise their best
efforts, in good faith, to agree upon selection of a single arbitrator.  If the parties are unable to agree upon
selection of a single arbitrator, they shall so notify the American Arbitration
Association (“AAA”) or another agreed upon arbitration administrator and
request that the arbitration provider work with the parties to select a single
arbitrator.  The arbitration shall be (i) conducted
in accordance with the AAA’s National Rules for the Resolution of
Employment Disputes, (ii) held at a location reasonably convenient to that
office of Employer at which Employee had most recently been assigned and (iii) completed
within six (6) months (or within such other time as the parties may
mutually agree) of the receipt of Written Notice by the party being notified.
The arbitrator shall have no authority to assess punitive or exemplary damages
as to any dispute arising out of or concerning the provisions of this Agreement
or otherwise arising out of the employment relationship, except as and unless
such damages are expressly authorized by otherwise applicable and controlling
statutes. The arbitrator’s decision shall be final and binding and enforceable
in any court of competent jurisdiction. 
Except with respect to a claim relating to the Surviving Obligations
under the COC Agreement (for which Section 8 of the COC Agreement shall
control), to the extent permitted by applicable law, each party shall bear its
own costs, including attorneys’ fees, and share all costs 

 

13

 

of the arbitration equally. 
Nothing provided herein shall interfere with either party’s right to
seek or receive damages or costs as may be allowed by applicable statutory
law.  To the extent required by Section 409A,
any reimbursement under this paragraph shall be made no later than December 31
of the calendar year following the year during which the applicable expense is
incurred.

 

9.                                       Representations
and Warranties.  Employee
represents and warrants:

 

a.  except as specifically provided by Employee
to Employer in writing, Employee is not subject to either an agreement with any
former employer or otherwise or any court order, judgment or decree which
places restrictions on Employee’s business activities and that if employee is
subject to any of the foregoing, Employee will, by the earlier of the
commencement date of employment or execution of the Agreement, provide Employer
with a copy of such agreement, order, judgment, or decree; and

 

b.  Employee has reviewed and will abide by the
Employer/Willis Code of Ethics.

 

10.                                 Section 409A.  This Agreement is intended to comply with the
requirements of Section 409A or an exemption thereto and shall in all
respects be administered in accordance with Section 409A.  Notwithstanding anything in the Agreement to
the contrary, the following shall apply with respect to any amounts or benefits
that are subject to Section 409A: (i) distributions upon termination
of employment may only be made upon a “separation from service” as determined
under Section 409A and (ii) each payment under this Agreement shall
be treated as a separate payment for purposes of Section 409A.  In no event may Employee, 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 and (i) shall be
paid or provided within the time period permitted under Section 409A, (ii) the
amount or benefit that Employer is obligated to pay or provide in any given
calendar year shall not affect the amount or benefit that Employer is obligated
to pay in any other calendar year and (iii) Employee’s right to have
Employer pay or provide the amount or benefit may not be liquidated or
exchanged for any other benefit.  If
Employee dies following his termination of employment and prior to the payment
of any amounts delayed on account of Section 409A, such amounts shall be
paid to the personal representative of Employee’s estate within thirty (30)
days after the date of Employee’s death. Any tax gross-up payments, including a
Gross-Up Payment, shall in all events be paid no later than the end of Employee’s
taxable year next following Employee’s taxable year in which the applicable
taxes (and any income or other related taxes or interest or penalties thereon)
are remitted to the Internal Revenue Service or any other applicable taxing
authority. 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 Agreement such that it complies (in a
manner that attempts to minimize the economic impact of such amendment on Employee
and Employer) within the time period permitted by the applicable Treasury
Regulations.

 

11.                                 Miscellaneous.  This Agreement sets forth the entire
agreement between the parties hereto relating to the subject matter hereof and
is intended to supplant and supersede any other prior or contemporaneous
agreements between Employer and Employee regarding the subject 

 

14

 

matter
hereof (including, but not necessarily limited to, the Prior Employment
Agreement); provided, however, this Agreement shall
be in addition to and not in lieu of the following: (i) the Surviving
Obligations under the COC Agreement (to the extent contemplated and described
in paragraph 7 above); (ii) Employee’s surviving obligations under Section 10(a) of
the COC Agreement; (iii) the  “Agreement
of Restrictive Covenants and Other Obligations” and the “Option Agreement”
referenced above in paragraph 3.c.; and (iv) any other written agreement
related to any share purchase and/or option plan as may have been, or may be,
entered into by Employee with (a) Employer and/or (b) a parent or
other affiliated company of HRH, Employer or any of their affiliated companies
(any such agreement as contemplated in this item (iv), if any, shall be
governed in all respects by that agreement’s own terms and conditions except as
otherwise provided in paragraph 3.c. with respect to the Option).  This Agreement may only be modified by a
written instrument signed by both parties. 
If any term of this Agreement is rendered invalid or unenforceable by
judicial, legislative or administrative action, the remaining provisions hereof
shall remain in full force and effect and shall in no way be affected, impaired
or invalidated.  Except for notices by
Employer to Employee which Employer chooses to hand deliver to Employee, any
notices given pursuant to this Agreement shall be sent by first class U.S.
postal service or overnight courier service to the addresses set forth below
(or, to the then current address of a party, with both parties agreeing to
promptly provide the other party with written notice of any change in address).
This Agreement shall be governed by the laws of the State of New York, without
giving effect to that state’s conflicts of law principles.  Employer shall be entitled to withhold from
any payment due to Employee hereunder any amounts required to be withheld by
any applicable tax laws or regulations. 
The waiver by either party of any breach of this Agreement shall not
operate or be construed as a waiver of that party’s rights upon any subsequent
breach. This Agreement shall inure to the benefit of and be binding upon and
enforceable against the heirs, legal representatives and assigns of Employee
and the successors and assigns of Employer. Employee enters into this Agreement
freely and voluntarily, under no duress, after having had sufficient time and
opportunity to review and discuss it, at Employee’s discretion, with
professional advisors of Employee’s choice. Employee acknowledges and agrees
that (i) the consideration provided to Employee by Employer under this
Agreement (including, but not limited to, as set forth in paragraph 3) is
sufficient to support covenants made by Employee to Employer within this
Agreement and (ii) following Employee’s execution of this Agreement,
Employee will at no time challenge the sufficiency and/or adequacy of the
consideration provided in exchange for the various covenants provided by
Employee to Employer within this Agreement. 
Monetary damages may not be an adequate remedy for Employee’s breach of
paragraphs 4 or 5 of this Agreement and Employer may, in addition to recovering
legal damages (including lost commissions and fees), proceed in equity to
enjoin Employee from violating any of the provisions. Upon the commencement by
Employee of employment with any third party, during the two (2) year
period following termination of employment hereunder, Employee shall promptly
inform such new employer of the substance of paragraphs 4 and 5 of this
Agreement.

 

15

 

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

 

EMPLOYER:

Hermes Acquisition Corp

One
World Financial Center

200
Liberty Street, 7th Floor

New
York, New York 10281

 

 

	
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  Exhibit 10.13    
    

 
    AMENDED AND RESTATED
  TREE.COM, INC.
  2008 STOCK AND ANNUAL INCENTIVE PLAN    
    

 Section 1. Purpose; Definition  

        The purpose of this Plan is (a) to give the Company a competitive advantage in attracting, retaining and motivating officers,
employees, directors and/or consultants and to provide the Company and its Subsidiaries and Affiliates with a stock and incentive plan providing incentives directly linked to stockholder value and
(b) to assume and govern other awards pursuant to the adjustment of awards granted under any IAC Long Term Incentive Plan (as defined in the Employee Matters Agreement) in accordance with the
terms of the Employee Matters Agreement ("Adjusted Awards"). Certain terms used herein have definitions given to them in the first place in which they
are used. In addition, for purposes of this Plan, the following terms are defined as set forth below: 

        (a)   "Affiliate" means a corporation or other entity controlled by, controlling or under common control with, the Company. 

        (b)   "Applicable Exchange" means Nasdaq or such other securities exchange as may at the applicable time be the principal
market for the Common Stock. 

        (c)   "Award" means an Option, Stock Appreciation Right, Restricted Stock, Restricted Stock Unit, or other stock-based award
granted or assumed pursuant to the terms of this Plan, including Adjusted Awards. 

        (d)   "Award Agreement" means a written or electronic document or agreement setting forth the terms and conditions of a
specific Award. 

        (e)   "Beneficial Ownership" shall have the meaning given in Rule 13d-3 promulgated under the Exchange Act. 

        (f)    "Board" means the Board of Directors of the Company. 

        (g)   "Bonus Award" means a bonus award made pursuant to Section 9. 

        (h)   "Cause" means, unless otherwise provided in an Award Agreement, (i) "Cause" as defined in any Individual Agreement
to which the applicable Participant is a party, or (ii) if there is no such Individual Agreement or if it does not define Cause: (A) the willful or gross neglect by a Participant of his
employment duties; (B) the plea of guilty or nolo contendere to, or conviction for, the commission of a felony offense by a Participant;
(C) a material breach by a Participant of a fiduciary duty owed to the Company or any of its subsidiaries; (D) a material breach by a Participant of any nondisclosure,
non-solicitation or non-competition obligation owed to the Company or any of its Affiliates; or (E) before a Change in Control, such other events as shall be determined
by the Committee and set forth in a Participant's Award Agreement. Notwithstanding the general rule of Section 2(c), following a Change in Control, any determination by the Committee as to
whether "Cause" exists shall be subject to de novo review. 

        (i)    "Change in Control" has the meaning set forth in Section 10(c). 

        (j)    "Code" means the Internal Revenue Code of 1986, as amended from time to time, and any successor thereto, the Treasury
Regulations thereunder and other relevant interpretive guidance issued by the Internal Revenue Service or the Treasury Department. Reference to any specific section of the Code shall be deemed to
include such regulations and guidance, as well as any successor provision of the Code. 

        (k)   "Commission" means the Securities and Exchange Commission or any successor agency. 

        (l)    "Committee" has the meaning set forth in Section 2(a). 

        (m)  "Common Stock" means common stock, par value $0.01 per share, of the Company. 

 

        (n)   "Company" means Tree.com, Inc., a Delaware corporation, or its successor. 

        (o)   "Disability" means (i) "Disability" as defined in any Individual Agreement to which the Participant is a party, or
(ii) if there is no such Individual Agreement or it does not define "Disability," (A) permanent and total disability as determined under the Company's long-term disability
plan applicable to the Participant, or (B) if there is no such plan applicable to the Participant or the Committee determines otherwise in an applicable Award Agreement, "Disability" as
determined by the Committee. Notwithstanding the above, with respect to an Incentive Stock Option, Disability shall mean Permanent and Total Disability as defined in Section 22(e)(3) of the
Code and, with respect to each Award that constitutes a "nonqualified deferred compensation plan" within the meaning of Section 409A of the Code, the foregoing definition shall apply for
purposes of vesting of such Award, provided that such Award shall not be settled until the earliest of: (i) the Participant's "disability" within the meaning of Section 409A of the Code,
or (ii) the Participant's "separation from service" within the meaning of Section 409A of the Code and (iii) the date such Award would otherwise be settled pursuant to the terms
of the Award Agreement. 

        (p)   "Disaffiliation" means a Subsidiary's or Affiliate's ceasing to be a Subsidiary or Affiliate for any reason (including,
without limitation, as a result of a public offering, or a spinoff or sale by the Company, of the stock of the Subsidiary or Affiliate) or a sale of a division of the Company and its Affiliates. 

        (q)   "EBITA" means for any period, operating profit (loss) plus (i) amortization, including goodwill impairment,
(ii) amortization of non-cash distribution and marketing expense and non-cash compensation expense, (iii) restructuring charges, (iv) non-cash
write-downs of assets or goodwill, (v) charges relating to disposal of lines of business, (vi) litigation settlement amounts and (vii) costs incurred for proposed and completed
acquisitions. 

        (r)   "EBITDA" means for any period, operating profit (loss) plus (i) depreciation and amortization, including goodwill
impairment, (ii) amortization of non-cash distribution and marketing expense and non-cash compensation expense, (iii) restructuring charges,
(iv) non-cash write-downs of assets or goodwill, (v) charges relating to disposal of lines of business, (vi) litigation settlement amounts and (vii) costs
incurred for proposed and completed acquisitions. 

        (s)   "Eligible Individuals" means directors, officers, employees and consultants of the Company or any of its Subsidiaries or
Affiliates, and prospective employees and consultants who have accepted offers of employment or consultancy from the Company or its Subsidiaries or Affiliates. 

        (t)    "Employee Matters Agreement" means the Employee Matters Agreement by and among IAC, Ticketmaster, Interval Leisure
Group, Inc., HSN, Inc. and Tree.com, Inc. 

        (u)   "Exchange Act" means the Securities Exchange Act of 1934, as amended from time to time, and any successor thereto. 

        (v)   "Fair Market Value" means, unless otherwise determined by the Committee, the closing price of a share of Common Stock on
the Applicable Exchange on the date of measurement, or if Shares were not traded on the Applicable Exchange on such measurement date, then on the next preceding date on which Shares were traded, all
as reported by such source as the Committee may select. If the Common Stock is not listed on a national securities exchange, Fair Market Value shall be determined by the Committee in its good faith
discretion, taking into account, to the extent appropriate, the requirements of Section 409A of the Code. 

        (w)  "Free-Standing SAR" has the meaning set forth in Section 5(b). 

        (x)   "Grant Date" means (i) the date on which the Committee by resolution selects an Eligible Individual to receive a
grant of an Award and determines the number of Shares to be subject to such Award or the formula for earning a number of shares or cash amount, (ii) such later date as the 

2

 

Committee
shall provide in such resolution or (iii) the initial date on which an Adjusted Award was granted under the IAC Long Term Incentive Plan. 

        (y)   "Group" shall have the meaning given in Section 13(d)(3) and 14(d)(2) of the Exchange Act. 

        (z)   "IAC" means IAC/InterActiveCorp, a Delaware corporation. 

        (aa) "Incentive Stock Option" means any Option that is designated in the applicable Award Agreement as an "incentive stock
option" within the meaning of Section 422 of the Code, and that in fact so qualifies. 

        (bb) "Individual Agreement" means an employment, consulting or similar agreement between a Participant and the Company or one
of its Subsidiaries or Affiliates. 

        (cc) "Nasdaq" means the National Association of Securities Dealers Inc. Automated Quotation System. 

        (dd) "Nonqualified Option" means any Option that is not an Incentive Stock Option. 

        (ee) "Option" means an Award granted under Section 5. 

        (ff)  "Participant" means an Eligible Individual to whom an Award is or has been granted. 

        (gg) "Performance Goals" means the performance goals established by the Committee in connection with the grant of Restricted
Stock, Restricted Stock Units or Bonus Awards or other stock-based awards. In the case of Qualified-Performance Based Awards, (i) such goals shall be based on the attainment of one or any
combination of the following: specified levels of earnings per share from continuing operations, net profit after tax, EBITDA, EBITA, gross profit, cash generation, unit volume, market share, sales,
asset quality, earnings per share, operating income, revenues, return on assets, return on operating assets, return on equity, profits, total stockholder return (measured in terms of stock price
appreciation and/or dividend growth), cost saving levels, marketing-spending efficiency, core non-interest income, change in working capital, return on capital, and/or stock price, with
respect to the Company or any Subsidiary, Affiliate, division or department of the Company and (ii) such Performance Goals shall be set by the Committee within the time period prescribed by
Section 162(m) of the Code and related regulations. Such Performance Goals also may be based upon the attaining of specified levels of Company, Subsidiary, Affiliate or divisional performance
under one or more of the measures described above relative to the performance of other entities, divisions or subsidiaries. 

        (hh) "Plan" means this Tree.com, Inc. 2008 Stock and Annual Incentive Plan, as set forth herein and as hereafter
amended from time to time. 

        (ii)   "Plan Year" means the calendar year or, with respect to Bonus Awards, the Company's fiscal year if different. 

        (jj)   "Qualified Performance-Based Award" means an Award intended to qualify for the Section 162(m) Exemption, as
provided in Section 11. 

        (kk) "Restricted Stock" means an Award granted under Section 6. 

        (ll)   "Restricted Stock Units" means an Award granted under Section 7. 

        (mm)  "Resulting Voting Power" shall mean the outstanding combined voting power of the then outstanding voting securities
entitled to vote generally in the election of directors (or equivalent governing body, if applicable) of the entity resulting from a Business Combination (including, without limitation, an entity
which as a result of such transaction owns the Company or all or substantially all of the Company's assets either directly or through one or more subsidiaries). 

        (nn) "Retirement" means retirement from active employment with the Company, a Subsidiary or Affiliate at or after the
Participant's attainment of age 65. 

3

 

        (oo) "Section 162(m) Exemption" means the exemption from the limitation on deductibility imposed by
Section 162(m) of the Code that is set forth in Section 162(m)(4)(C) of the Code. 

        (pp) "Separation" has the meaning set forth in the Employee Matters Agreement. 

        (qq) "Share" means a share of Common Stock. 

        (rr)  "Specified Employee" shall mean any individual who is a "key employee" (as defined in Section 416(i) of the Code
without regard to paragraph (5) thereof) with respect to the Company and its Affiliates, as determined by the Company (or the Affiliate, in the event that the Affiliate and the Company are not
considered a single employer under Sections 414(b) or 414(c) of the Code) in accordance with its uniform policy with respect to all arrangements subject to Section 409A of the Code,
based upon the twelve (12) month period ending on each December 31st. All individuals who are determined to be key employees under Section 416(i)(1)(A)(i), (ii) or
(iii) of the Code (without regard to paragraph (5) thereof) on December 31st shall be treated as Specified Employees for purposes of the Plan during the twelve
(12) month period that begins on the following April 1st. 

        (ss)  "Stock Appreciation Right" has the meaning set forth in Section 5(b). 

        (tt)  "Subsidiary" means any corporation, partnership, joint venture, limited liability company or other entity during any
period in which at least a 50% voting or profits interest is owned, directly or indirectly, by the Company or any successor to the Company. 

        (uu) "Tandem SAR" has the meaning set forth in Section 5(b). 

        (vv) "Term" means the maximum period during which an Option or Stock Appreciation Right may remain outstanding, subject to
earlier termination upon Termination of Employment or otherwise, as specified in the applicable Award Agreement. 

        (ww)  "Termination of Employment" means the termination of the applicable Participant's employment with, or performance of
services for, the Company and any of its Subsidiaries or Affiliates. Unless otherwise determined by the Committee, if a Participant's employment with, or membership on a board of directors of the
Company and its Affiliates terminates but such Participant continues to provide services to the Company and its Affiliates in a non-employee director capacity or as an employee, as
applicable, such change in status shall not be deemed a Termination of Employment. A Participant employed by, or performing services for, a Subsidiary or an Affiliate or a division of the Company and
its Affiliates shall be deemed to incur a Termination of Employment if, as a result of a Disaffiliation, such Subsidiary, Affiliate, or division ceases to be a Subsidiary, Affiliate or division, as
the case may be, and the Participant does not immediately thereafter become an employee of (or service provider for), or member of the board of directors of, the Company or another Subsidiary or
Affiliate. Temporary absences from employment because of illness, vacation or leave of absence and transfers among the Company and its Subsidiaries and Affiliates shall not be considered Terminations
of Employment. Notwithstanding the foregoing, with respect to any Award that constitutes a "nonqualified deferred compensation plan" within the meaning of Section 409A of the Code, "Termination
of Employment" shall mean a "separation from service" as defined under Section 409A of the Code. For the avoidance of doubt, the Separation shall not constitute a Termination of Employment for
purposes of any Adjusted Award. 

 Section 2. Administration  

        (a)   Committee.    The Plan shall be administered by the Compensation Committee of the Board or such other committee
of the Board as the Board may from time to time designate (the "Committee"), which shall be composed of not less than two directors, and shall be
appointed by and serve at the pleasure of the Board. The Committee shall, subject to Section 11, have plenary authority to grant Awards pursuant to the terms of the Plan to Eligible
Individuals. Among other things, the Committee 

4

 

shall
have the authority, subject to the terms and conditions of the Plan and the Employee Matters Agreement (including the original terms of the grant of the Adjusted
Award): 

	(i)
	to
select the Eligible Individuals to whom Awards may from time to time be granted;

	(ii)
	to
determine whether and to what extent Incentive Stock Options, Nonqualified Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units,
other stock-based awards, or any combination thereof, are to be granted hereunder;

	(iii)
	to
determine the number of Shares to be covered by each Award granted hereunder;

	(iv)
	to
determine the terms and conditions of each Award granted hereunder, based on such factors as the Committee shall determine;

	(v)
	subject
to Section 12, to modify, amend or adjust the terms and conditions of any Award;

	(vi)
	to
adopt, alter and repeal such administrative rules, guidelines and practices governing the Plan as it shall from time to time deem advisable;

	(vii)
	subject
to Section 11, to accelerate the vesting or lapse of restrictions of any outstanding Award, based in each case on such considerations as
the Committee in its sole discretion determines;

	(viii)
	to
interpret the terms and provisions of the Plan and any Award issued under the Plan (and any agreement relating thereto);

	(ix)
	to
establish any "blackout" period that the Committee in its sole discretion deems necessary or advisable;

	(x)
	to
determine whether, to what extent, and under what circumstances cash, Shares, and other property and other amounts payable with respect to an Award under
this Plan shall be deferred either automatically or at the election of the Participant;

	(xi)
	to
decide all other matters that must be determined in connection with an Award; and

	(xii)
	to
otherwise administer the Plan. 

        (b)   Procedures.

	(i)
	The
Committee may act only by a majority of its members then in office, except that the Committee may, except to the extent prohibited by applicable law or
the listing standards of the Applicable Exchange and subject to Section 11, allocate all or any portion of its responsibilities and powers to any one or more of its members and may delegate all
or any part of its responsibilities and powers to any person or persons selected by it.

	(ii)
	Subject
to Section 11(c), any authority granted to the Committee may also be exercised by the full Board. To the extent that any permitted action
taken by the Board conflicts with action taken by the Committee, the Board action shall control. 

        (c)   Discretion of Committee.    Subject to Section 1(h), any determination made by the Committee or by an
appropriately delegated officer pursuant to delegated authority under the provisions of the Plan with respect to any Award shall be made in the sole discretion of the Committee or such delegate at the
time of the grant of the Award or, unless in contravention of any express term of the Plan, at any time thereafter. All decisions made by the Committee or any appropriately delegated officer pursuant
to the provisions of the Plan shall be final and binding on all persons, including the Company, Participants, and Eligible Individuals. 

        (d)   Award Agreements.    The terms and conditions of each Award, as determined by the Committee, shall be set forth
in an Award Agreement, which shall be delivered to the Participant 

5

 

receiving
such Award upon, or as promptly as is reasonably practicable following, the grant of such Award. The effectiveness of an Award shall not be subject to the Award Agreement's being signed by
the Company and/or the Participant receiving the Award unless specifically so provided in the Award Agreement. Award Agreements may be amended only in accordance with Section 12 hereof.
Notwithstanding any provision of the Plan or an Award Agreement to the contrary, in the event that any term of an Award Agreement conflicts with any provision of the Plan that specifically pertains to
Section 409A of the Code, the provision of the Plan shall govern. 

 Section 3. Common Stock Subject to Plan  

        (a)   Plan Maximums.    The maximum number of Shares that may be delivered pursuant to Awards under the Plan shall be
the sum of (a) the number of Shares that may be issuable upon exercise or vesting of the Adjusted Awards and (b) 2,200,000. The maximum number of Shares that may be granted pursuant to
Options intended to be Incentive Stock Options shall be 1,466,666 Shares. Shares subject to an Award under the Plan may be authorized and unissued Shares or may be treasury Shares. 

        (b)   Individual Limits.    No Participant may be granted Awards covering in excess of 1,466,666 Shares during the
term of the Plan; provided that Adjusted Awards shall not be subject to this limitation. 

        (c)   Rules for Calculating Shares Delivered.

	(i)
	With
respect to Awards other than Adjusted Awards, to the extent that any Award is forfeited, or any Option and the related Tandem SAR (if any) or
Free-Standing SAR terminates, expires or lapses without being exercised, or any Award is settled for cash, the Shares subject to such Awards not delivered as a result thereof shall again
be available for Awards under the Plan.

	(ii)
	With
respect to Awards other than Adjusted Awards, if the exercise price of any Option and/or the tax withholding obligations relating to any Award are
satisfied by delivering Shares to the Company (by either actual delivery or by attestation), only the number of Shares issued net of the Shares delivered or attested to shall be deemed delivered for
purposes of the limits set forth in Section 3(a). To the extent any Shares subject to an Award are withheld to satisfy the exercise price (in the case of an Option) and/or the tax withholding
obligations relating to such Award, such Shares shall not be deemed to have been delivered for purposes of the limits set forth in Section 3(a). 

        (d)   Adjustment Provision.    In the event of a merger, consolidation, acquisition of property or shares, stock
rights offering, liquidation, Disaffiliation, or similar event affecting the Company or any of its Subsidiaries (each, a "Corporate Transaction"), the
Committee or the Board may in its discretion make such substitutions or adjustments as it deems appropriate and equitable to (i) the aggregate number and kind of Shares or other securities
reserved for issuance and delivery under the Plan, (ii) the various maximum limitations set forth in Sections 3(a) and 3(b) upon certain types of Awards and upon the grants to
individuals of certain types of Awards, (iii) the number and kind of Shares or other securities subject to outstanding Awards; and (iv) the exercise price of outstanding Options and
Stock Appreciation Rights. In the event of a stock dividend, stock split, reverse stock split, separation, spinoff, reorganization, extraordinary dividend of cash or other property, share combination,
or recapitalization or similar event affecting the capital structure of the Company (each, a "Share Change"), the Committee or the Board shall make such
substitutions or adjustments as it deems appropriate and equitable to (i) the aggregate number and kind of Shares or other securities reserved for issuance and delivery under the Plan,
(ii) the various maximum limitations set forth in Sections 3(a) and 3(b) upon certain types of Awards and upon the grants to individuals of certain types of Awards, (iii) the
number and kind of Shares or other securities subject to outstanding Awards; and (iv) the exercise price of outstanding Options and Stock Appreciation Rights. In the case of Corporate 

6

 

Transactions,
such adjustments may include, without limitation, (1) the cancellation of outstanding Awards in exchange for payments of cash, property or a combination thereof having an
aggregate value equal to the value of such Awards, as determined by the Committee or the Board in its sole discretion (it being understood that in the case of a Corporate Transaction with respect to
which stockholders of Common Stock receive consideration other than publicly traded equity securities of the ultimate surviving entity, any such determination by the Committee that the value of an
Option or Stock Appreciation Right shall for this purpose be deemed to equal the excess, if any, of the value of the consideration being paid for each Share pursuant to such Corporate Transaction over
the exercise price of such Option or Stock Appreciation Right shall conclusively be deemed valid); (2) the substitution of other property (including, without limitation, cash or other
securities of the Company and securities of entities other than the Company) for the Shares subject to outstanding Awards; and (3) in connection with any Disaffiliation, arranging for the
assumption of Awards, or replacement of Awards with new awards based on other property or other securities (including, without limitation, other securities of the Company and securities of entities
other than the Company), by the affected Subsidiary, Affiliate, or division or by the entity that controls such Subsidiary, Affiliate, or division following such Disaffiliation (as well as any
corresponding adjustments to Awards that remain based upon Company securities). The Committee may adjust in its sole discretion the Performance Goals applicable to any Awards to reflect any Share
Change and any Corporate Transaction and any unusual or non-recurring events and other extraordinary items, impact of charges for restructurings, discontinued operations, and the
cumulative effects of accounting or tax changes, each as defined by generally accepted accounting principles or as identified in the Company's financial statements, notes to the financial statements,
management's discussion and analysis or the Company's other SEC filings, provided that in the case of Performance Goals applicable to any Qualified
Performance-Based Awards, such adjustment does not violate Section 162(m) of the Code. Any adjustment under this Section 3(d) need not be the same for all Participants. 

        (e)   Section 409A.    Notwithstanding the foregoing: (i) any adjustments made pursuant to
Section 3(d) to Awards that are considered "deferred compensation" within the meaning of Section 409A of the Code shall be made in compliance with the requirements of Section 409A
of the Code; (ii) any adjustments made pursuant to Section 3(d) to Awards that are not considered "deferred compensation" subject to Section 409A of the Code shall be made in such
a manner as to ensure that after such adjustment, the Awards either (A) continue not to be subject to Section 409A of the Code or (B) comply with the requirements of
Section 409A of the Code; and (iii) in any event, neither the Committee nor the Board shall have the authority to make any adjustments pursuant to Section 3(d) to the extent the
existence of such authority would cause an Award that is not intended to be subject to Section 409A of the Code at the Grant Date to be subject thereto as of the Grant Date. 

 Section 4. Eligibility  

        Awards may be granted under the Plan to Eligible Individuals and, with respect to Adjusted Awards, in accordance with the terms of the
Employee Matters Agreement; provided, however, that Incentive Stock Options may be granted only to
employees of the Company and its subsidiaries or parent corporation (within the meaning of Section 424(f) of the Code) and, with respect to Adjusted Awards that are intended to qualify as
incentive stock options within the meaning of Section 421 of the Code, in accordance with the terms of the Employee Matters Agreement. 

7

 

 Section 5. Options and Stock Appreciation Rights  

        With respect to Adjusted Awards, the provisions below will be applicable only to the extent that they are not inconsistent with the
Employee Matters Agreement and the terms of the Adjusted Award assumed under the Employee Matters Agreement: 

        (a)   Types of Options.    Options may be of two types: Incentive Stock Options and Non-qualified
Options. The Award Agreement for an Option shall indicate whether the Option is intended to be an Incentive Stock Option or a Nonqualified Option. 

        (b)   Types and Nature of Stock Appreciation Rights.    Stock Appreciation Rights may be "Tandem SARs," which are
granted in conjunction with an Option, or "Free-Standing SARs," which are not granted in conjunction with an Option. Upon the exercise of a Stock Appreciation Right, the Participant shall
be entitled to receive an amount in cash, Shares, or both, in value equal to the product of (i) the excess of the Fair Market Value of one Share over the exercise price of the applicable Stock
Appreciation Right, multiplied by (ii) the number of Shares in respect of which the Stock Appreciation Right has been exercised. The applicable Award Agreement shall specify whether such
payment is to be made in cash or Common Stock or both, or shall reserve to the Committee or the Participant the right to make that determination prior to or upon the exercise of the Stock Appreciation
Right. 

        (c)   Tandem SARs.    A Tandem SAR may be granted at the Grant Date of the related Option. A Tandem SAR shall be
exercisable only at such time or times and to the extent that the related Option is exercisable in accordance with the provisions of this Section 5, and shall have the same exercise price as
the related Option. A Tandem SAR shall terminate or be forfeited upon the exercise or forfeiture of the related Option, and the related Option shall terminate or be forfeited upon the exercise or
forfeiture of the Tandem SAR. 

        (d)   Exercise Price.    The exercise price per Share subject to an Option or Free-Standing SAR shall be
determined by the Committee and set forth in the applicable Award Agreement, and shall not be less than the Fair Market Value of a share of the Common Stock on the applicable Grant Date. In no event
may any Option or Free-Standing SAR granted under this Plan be amended, other than pursuant to Section 3(d), to decrease the exercise price thereof, be cancelled in conjunction with
the grant of any new Option or Free-Standing SAR with a lower exercise price or otherwise be subject to any action that would be treated, for accounting purposes, as a "repricing" of such
Option or Free-Standing SAR, unless such amendment, cancellation, or action is approved by the Company's stockholders. 

        (e)   Term.    The Term of each Option and each Free-Standing SAR shall be fixed by the Committee, but
shall not exceed ten years from the Grant Date. 

        (f)    Vesting and Exercisability.    Except as otherwise provided herein, Options and Free-Standing SARs
shall be exercisable at such time or times and subject to such terms and conditions as shall be determined by the Committee. If the Committee provides that any Option or Free-Standing SAR
will become exercisable only in installments, the Committee may at any time waive such installment exercise provisions, in whole or in part, based on such factors as the Committee may determine. In
addition, the Committee may at any time accelerate the exercisability of any Option or Free-Standing SAR. 

        (g)   Method of Exercise.    Subject to the provisions of this Section 5, Options and
Free-Standing SARs may be exercised, in whole or in part, at any time during the applicable Term by giving written notice of exercise to the Company or through the procedures established
with the Company's appointed third-party Option administrator specifying the number of Shares as to which the Option or Free-Standing SAR is being exercised;  provided, however, that, unless otherwise permitted by the Committee, any such exercise must be with
respect to a portion of the applicable Option or Free-Standing SAR relating to no less than the lesser of the number of Shares then subject to such Option or Free-Standing SAR
or 100 Shares. In the case of the exercise of an Option, such notice shall 

8

 

be
accompanied by payment in full of the purchase price (which shall equal the product of such number of Shares multiplied by the applicable exercise price) by certified or bank check or such other
instrument as the Company may accept. If approved by the Committee, payment, in full or in part, may also be made as follows: 

	(i)
	Payments
may be made in the form of unrestricted Shares (by delivery of such Shares or by attestation) of the same class as the Common Stock subject to the
Option already owned by the Participant (based on the Fair Market Value of the Common Stock on the date the Option is exercised); provided,  however, that,
in the case of an Incentive Stock Option, the right to make a payment in the form of already owned Shares of the same class as the Common
Stock subject to the Option may be authorized only at the time the Option is granted.

	(ii)
	To
the extent permitted by applicable law, payment may be made by delivering a properly executed exercise notice to the Company, together with a copy of
irrevocable instructions to a broker to deliver promptly to the Company the amount of sale or loan proceeds necessary to pay the purchase price, and, if requested, the amount of any federal, state,
local or foreign withholding taxes. To facilitate the foregoing, the Company may, to the extent permitted by applicable law, enter into agreements for coordinated procedures with one or more brokerage
firms. To the extent permitted by applicable law, the Committee may also provide for Company loans to be made for purposes of the exercise of Options.

	(iii)
	Payment
may be made by instructing the Company to withhold a number of Shares having a Fair Market Value (based on the Fair Market Value of the Common
Stock on the date the applicable Option is exercised) equal to the product of (A) the exercise price multiplied by (B) the number of Shares in respect of which the Option shall have been
exercised. 

        (h)   Delivery; Rights of Stockholders.    No Shares shall be delivered pursuant to the exercise of an Option until
the exercise price therefor has been fully paid and applicable taxes have been withheld. The applicable Participant shall have all of the rights of a stockholder of the Company holding the class or
series of Common Stock that is subject to the Option or Stock Appreciation Right (including, if applicable, the right to vote the applicable Shares and the right to receive dividends), when the
Participant (i) has given written notice of exercise, (ii) if requested, has given the representation described in Section 14(a), and (iii) in the case of an Option, has
paid in full for such Shares. 

        (i)    Terminations of Employment.    Subject to Section 10, a Participant's Options and Stock Appreciation
Rights shall be forfeited upon such Participant's Termination of Employment, except as set forth below: 

	(i)
	Upon
a Participant's Termination of Employment by reason of death, any Option or Stock Appreciation Right held by the Participant that was exercisable
immediately before the Termination of Employment may be exercised at any time until the earlier of (A) the first anniversary of the date of such death and (B) the expiration of the Term
thereof;

	(ii)
	Upon
a Participant's Termination of Employment by reason of Disability or Retirement, any Option or Stock Appreciation Right held by the Participant that
was exercisable immediately before the Termination of Employment may be exercised at any time until the earlier of (A) the first anniversary of such Termination of Employment and (B) the
expiration of the Term thereof;

	(iii)
	Upon
a Participant's Termination of Employment for Cause, any Option or Stock Appreciation Right held by the Participant shall be forfeited, effective as
of such Termination of Employment; 

9

 

	(iv)
	Upon
a Participant's Termination of Employment for any reason other than death, Disability, Retirement or for Cause, any Option or Stock Appreciation Right
held by the Participant that was exercisable immediately before the Termination of Employment may be exercised at any time until the earlier of (A) the 90th day following such
Termination of Employment and (B) expiration of the Term thereof; and

	(v)
	Notwithstanding
the above provisions of this Section 5(i), if a Participant dies after such Participant's Termination of Employment but while any
Option or Stock Appreciation Right remains exercisable as set forth above, such Option or Stock Appreciation Right may be exercised at any time until the later of (A) the earlier of
(1) the first anniversary of the date of such death and (2) expiration of the Term thereof and (B) the last date on which such Option or Stock Appreciation Right would have been
exercisable, absent this Section 5(i)(v). 

Notwithstanding
the foregoing, the Committee shall have the power, in its discretion, to apply different rules concerning the consequences of a Termination of Employment;  provided, however, that if such rules are less favorable to the Participant than those set forth above,
such rules are set forth in the applicable Award Agreement. If an Incentive Stock Option is exercised after the expiration of the exercise periods that apply for purposes of Section 422 of the
Code, such Option will thereafter be treated as a Nonqualified Option. 

        (j)    Nontransferability of Options and Stock Appreciation Rights.    No Option or Free-Standing SAR
shall be transferable by a Participant other than (i) by will or by the laws of descent and distribution, or (ii) in the case of a Nonqualified Option or Free-Standing SAR,
pursuant to a qualified domestic relations order or as otherwise expressly permitted by the Committee including, if so permitted, pursuant to a transfer to the Participant's family members or to a
charitable organization, whether directly or indirectly or by means of a trust or partnership or otherwise. For purposes of this Plan, unless otherwise determined by the Committee, "family member"
shall have the meaning given to such term in General Instructions A.1(a)(5) to Form S-8 under the Securities Act of 1933, as amended, and any successor thereto. A Tandem SAR
shall be transferable only with the related Option as permitted by the preceding sentence. Any Option or Stock Appreciation Right shall be exercisable, subject to the terms of this Plan, only by the
applicable Participant, the guardian or legal representative of such Participant, or any person to whom such Option or Stock Appreciation Right is permissibly transferred pursuant to this
Section 5(j), it being understood that the term "Participant" includes such guardian, legal representative and other transferee; provided,  however,
that the term "Termination of Employment" shall continue to refer to the Termination of Employment of the original Participant. 

 Section 6. Restricted Stock  

        With respect to Adjusted Awards, the provisions below will be applicable only to the extent that they are not inconsistent with the
Employee Matters Agreement and the terms of the Adjusted Award assumed under the Employee Matters Agreement: 

        (a)   Nature of Awards and Certificates.    Shares of Restricted Stock are actual Shares issued to a Participant, and
shall be evidenced in such manner as the Committee may deem appropriate, including book-entry registration or issuance of one or more stock certificates. Any certificate issued in respect
of Shares of Restricted Stock shall be registered in the name of the applicable Participant and, in the case of Restricted Stock, shall bear an appropriate legend referring to the terms, conditions,
and restrictions applicable to such Award, substantially in the following form: 

"The
transferability of this certificate and the shares of stock represented hereby are subject to the terms and conditions (including forfeiture) of the Tree.com, Inc. 2008 Stock and Annual
Incentive Plan and an Award Agreement. Copies of such Plan and Agreement are on file at the offices of Tree.com, Inc., 11115 Rushmore Drive, Charlotte, NC 28277." 

10

 

The
Committee may require that the certificates evidencing such shares be held in custody by the Company until the restrictions thereon shall have lapsed and that, as a condition of any Award of
Restricted Stock, the applicable Participant shall have delivered a stock power, endorsed in blank, relating to the Common Stock covered by such Award. 

        (b)   Terms and Conditions.    Shares of Restricted Stock shall be subject to the following terms and
conditions: 

	(i)
	The
Committee shall, prior to or at the time of grant, condition the vesting or transferability of an Award of Restricted Stock upon the continued service
of the applicable Participant or the attainment of Performance Goals, or the attainment of Performance Goals and the continued service of the applicable Participant. In the event that the Committee
conditions the grant or vesting of an Award of Restricted Stock upon the attainment of Performance Goals or the attainment of Performance Goals and the continued service of the applicable Participant,
the Committee may, prior to or at the time of grant, designate such an Award as a Qualified Performance-Based Award. The conditions for grant, vesting, or transferability and the other provisions of
Restricted Stock Awards (including without limitation any Performance Goals) need not be the same with respect to each Participant.

	(ii)
	Subject
to the provisions of the Plan and the applicable Award Agreement, during the period, if any, set by the Committee, commencing with the date of such
Restricted Stock Award for which such vesting restrictions apply and until the expiration of such vesting restrictions (the "Restriction Period"), the
Participant shall not be permitted to sell, assign, transfer, pledge or otherwise encumber Shares of Restricted Stock.

	(iii)
	Except
as provided in this Section 6 and in the applicable Award Agreement, the applicable Participant shall have, with respect to the Shares of
Restricted Stock, all of the rights of a stockholder of the Company holding the class or series of Common Stock that is the subject of the Restricted Stock, including, if applicable, the right to vote
the Shares and the right to receive any cash dividends. If so determined by the Committee in the applicable Award Agreement and subject to Section 14(e), (A) cash dividends on the class
or series of Common Stock that is the subject of the Restricted Stock Award shall be automatically deferred and reinvested in additional Restricted Stock, held subject to the vesting of the underlying
Restricted Stock, and (B) subject to any adjustment pursuant to Section 3(d), dividends payable in Common Stock shall be paid in the form of Restricted Stock of the same class as the
Common Stock with which such dividend was paid, held subject to the vesting of the underlying Restricted Stock.

	(iv)
	Except
as otherwise set forth in the applicable Award Agreement, upon a Participant's Termination of Employment for any reason during the Restriction
Period, all Shares of Restricted Stock still subject to restriction shall be forfeited by such Participant; provided,  however, that subject to
Section 11(b), the Committee shall have the discretion to waive, in whole or in part, any or all remaining restrictions
with respect to any or all of such Participant's Shares of Restricted Stock.

	(v)
	If
and when any applicable Performance Goals are satisfied and the Restriction Period expires without a prior forfeiture of the Shares of Restricted Stock
for which legended certificates have been issued, unlegended certificates for such Shares shall be delivered to the Participant upon surrender of the legended certificates. 

11

 

 Section 7. Restricted Stock Units  

        With respect to Adjusted Awards, the provisions below will be applicable only to the extent that they are not inconsistent with the
Employee Matters Agreement and the terms of the Adjusted Award assumed under the Employee Matters Agreement: 

        (a)   Nature of Awards.    Restricted Stock Units are Awards denominated in Shares that will be settled, subject to
the terms and conditions of the Restricted Stock Units, in an amount in cash, Shares or both, based upon the Fair Market Value of a specified number of Shares. 

        (b)   Terms and Conditions.    Restricted Stock Units shall be subject to the following terms and
conditions: 

	(i)
	The
Committee shall, prior to or at the time of grant, condition the grant, vesting, or transferability of Restricted Stock Units upon the continued service
of the applicable Participant or the attainment of Performance Goals, or the attainment of Performance Goals and the continued service of the applicable Participant. In the event that the Committee
conditions the grant or vesting of Restricted Stock Units upon the attainment of Performance Goals or the attainment of Performance Goals and the continued service of the applicable Participant, the
Committee may, prior to or at the time of grant, designate such Awards as Qualified Performance-Based Awards. The conditions for grant, vesting or transferability and the other provisions of
Restricted Stock Units (including without limitation any Performance Goals) need not be the same with respect to each Participant. Except as otherwise provided in Section 7(b)(iv) or in the
applicable Award Agreement, an Award of Restricted Stock Units shall be settled if and when the Restricted Stock Units vest(but in no event later than two and a half months after the end of the fiscal
year in which the Restricted Stock Unit vest).

	(ii)
	Subject
to the provisions of the Plan and the applicable Award Agreement, during the period, if any, set by the Committee, commencing with the date of such
Restricted Stock Units for which such vesting restrictions apply and until the expiration of such vesting restrictions (the "Restriction Period"), the
Participant shall not be permitted to sell, assign, transfer, pledge or otherwise encumber Restricted Stock Units.

	(iii)
	The
Award Agreement for Restricted Stock Units shall specify whether, to what extent and on what terms and conditions the applicable Participant shall be
entitled to receive current or deferred payments of cash, Common Stock or other property corresponding to the dividends payable on the Common Stock (subject to Section 14(e) below).

	(iv)
	Except
as otherwise set forth in the applicable Award Agreement, upon a Participant's Termination of Employment for any reason during the Restriction
Period, all Restricted Stock Units still subject to restriction shall be forfeited by such Participant; provided,  however, that subject to Section 11
(b), the Committee shall have the discretion to waive, in whole or in part, any or all remaining restrictions
with respect to any or all of such Participant's Restricted Stock Units, provided, however, if any of such Participant's Restricted Stock Units constitute a "nonqualified deferred compensation plan"
within the meaning of Section 409A of the Code, settled of such Restricted Stock Units shall not occur until the earliest of (1) the date such Restricted Stock Units would otherwise be
settled pursuant to the terms of the Award Agreement or (2) the Participant's "separation of service" within the meaning of Section 409A of the Code. 

 Section 8. Other Stock-Based Awards  

        Other Awards of Common Stock and other Awards that are valued in whole or in part by reference to, or are otherwise based upon or
settled in, Common Stock, including (without limitation), 

12

 

unrestricted
stock, performance units, dividend equivalents, and convertible debentures, may be granted under the Plan. 

 Section 9. Bonus Awards  

        (a)   Determination of Awards.    The Committee shall determine the total amount of Bonus Awards for each Plan Year
or such shorter performance period as the Committee may establish in its sole discretion. Prior to the beginning of the Plan Year or such shorter performance period as the Committee may establish in
its sole discretion (or such later date as may be prescribed by the Internal Revenue Service under Section 162(m) of the Code), the Committee shall establish Performance Goals for Bonus Awards
for the Plan Year or such shorter period; provided, that such Performance Goals may be established at a later date for Participants who are not "covered
employees" (within the meaning of Section 162(m)(3) of the Code). Bonus amounts payable to any individual Participant with respect to a Plan Year will be limited to a maximum of
$10 million. For performance periods that are shorter than a Plan Year, such $10 million maximum may be prorated if so determined by the Committee. 

        (b)   Payment of Awards.    Bonus Awards under the Plan shall be paid in cash or in shares of Common Stock (valued at
Fair Market Value as of the date of payment) as determined by the Committee, as soon as practicable following the close of the Plan Year or such shorter performance period as the Committee may
establish. It is intended that a Bonus Award will be paid no later than the fifteenth (15th) day of the third month following the later of: (i) the end of the Participant's taxable year in
which the requirements for such Bonus Award have been satisfied by the Participant or (ii) the end of the Company's fiscal year in which the requirements for such Bonus Award have been
satisfied by the Participant. The Committee may at its option establish procedures pursuant to which Participants are permitted to defer the receipt of Bonus Awards payable hereunder. The Bonus Award
for any Plan Year or such shorter performance period to any Participant may be reduced or eliminated by the Committee in its discretion. 

 Section 10. Change in Control Provisions  

        (a)   Adjusted Awards.    With respect to all Adjusted Awards, subject Sections 3(d), 3(e), 10(e) and 14(k)
unless otherwise provided in the applicable Award Agreement, notwithstanding any other provision of this Plan to the contrary, upon a Participant's Termination of Employment, during the
two-year period following a Change in Control, by the Company other than for Cause or Disability or by the Participant for Good Reason (as defined below): 

	(i)
	any
Options outstanding as of such Termination of Employment which were outstanding as of the date of such Change in Control shall be fully exercisable and
vested and shall remain exercisable until the later of (i) the last date on which such Option would be exercisable in the absence of this Section 10(a) and (ii) the earlier of
(A) the first anniversary of such Change in Control and (B) expiration of the Term of such Option;

	(ii)
	the
restrictions and deferral limitations applicable to any Restricted Stock shall lapse, and such Restricted Stock outstanding as of such Termination of
Employment which were outstanding as of the date of such Change in Control shall become free of all restrictions and become fully vested and transferable; and

	(iii)
	all
Restricted Stock Units outstanding as of such Termination of Employment which were outstanding as of the date of such Change in Control shall be
considered to be earned and payable in full, and any restrictions shall lapse and such Restricted Stock Units shall be settled as promptly as is practicable in the form set forth in the applicable
Award Agreement; provided, however, that with respect to any Restricted Stock Unit that constitutes a "nonqualified deferred compensation plan" within the meaning of Section 409A of the Code,
the settlement of each such Restricted Stock Unit pursuant to 

13

 

this
Section 10(a)(iii) shall not occur until the earliest of (1) the Change in Control if such change in Control constitutes a "change in the ownership of the corporation," a "change in
effective control of the corporation" or a "change in the ownership of a substantial portion of the assets of the corporation," within the meaning of Section 409A(a)(2)(A)(v) of the Code,
(2) the date such Restricted Stock Units would otherwise be settled pursuant to the terms of the Award Agreement and (3) the Participant's "separation of service" within the meaning of
Section 409A of the Code. 

        (b)   Impact of Event on Awards other than Adjusted Awards.    Subject to paragraph (e) of this
Section 10, and paragraph (d) of Section 12, unless otherwise provided in any applicable Award Agreement and except as otherwise provided in paragraph (a) of this
Section 10, in connection with a Change of Control, the Committee may make such adjustments and/or settlements of outstanding Awards as it deems appropriate and consistent with the Plan's
purposes, including, without limitation, the acceleration of vesting of Awards either upon a Change of Control or upon various terminations of employment following a Change of Control. The Committee
may provide for such adjustments as a term of the Award or may make such adjustments following the granting of the Award. 

        (c)   Definition of Change in Control.    For purposes of the Plan, unless otherwise provided in an option agreement
or other agreement relating to an Award, a "Change in Control" shall mean the happening of any of the following events: 

	(i)
	The
acquisition by any individual, entity or Group (a "Person"), other than the Company, of Beneficial
Ownership of equity securities of the Company representing more than 50% of the voting power of the then outstanding equity securities of the Company entitled to vote generally in the election of
directors (the "Outstanding Company Voting Securities"); provided,  however, that any acquisition that would
constitute a Change in Control under this subsection (i) that is also a Business Combination shall be
determined exclusively under subsection (iii) below; or

	(ii)
	Individuals
who, as of the Effective Date, constitute the Board (the "Incumbent Directors") cease for any
reason to constitute at least a majority of the Board; provided, however, that any individual becoming a
director subsequent to the Effective Date, whose election, or nomination for election by the Company's stockholders, was approved by a vote of at least a majority of the Incumbent Directors at such
time shall become an Incumbent Director, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a Person other than the Board; or

	(iii)
	Consummation
of a reorganization, merger, consolidation, sale or other disposition of all or substantially all of the assets of the Company, the purchase
of assets or stock of another entity, or other similar corporate transaction (a "Business Combination"), in each case, unless immediately following such
Business Combination, (A) more than 50% of the Resulting Voting Power shall reside in Outstanding Company Voting Securities retained by the Company's stockholders in the Business Combination
and/or voting securities received by such stockholders in the Business Combination on account of Outstanding Company Voting Securities, and (B) at least a majority of the members of the board
of directors (or equivalent governing body, if applicable) of the entity resulting from such Business Combination were Incumbent Directors at the time of the initial agreement, or action of the Board,
providing for such Business Combination; or

	(iv)
	Approval
by the stockholders of the Company of a complete liquidation or dissolution of the Company. 

14

 

Notwithstanding
the foregoing, the Separation shall not constitute a Change in Control. For the avoidance of doubt, with respect to Adjusted Awards, any reference in an Award Agreement or the
applicable IAC Long Term Incentive Plan to a "change in control," "change of control" or similar definition shall be deemed to refer to a Change of Control hereunder. 

        (d)   For
purposes of this Section 10, "Good Reason" means (i) "Good Reason" as defined in any Individual Agreement or Award Agreement to which the applicable
Participant is a party, or (ii) if there is no such Individual Agreement or if it does not define Good Reason, without the Participant's prior written consent: (A) a material reduction
in the Participant's rate of annual base salary from the rate of annual base salary in effect for such Participant immediately prior to the Change in Control, (B) a relocation of the
Participant's principal place of business more than 35 miles from the city in which such Participant's principal place of business was located immediately prior to the Change in Control or
(C) a material and demonstrable adverse change in the nature and scope of the Participant's duties from those in effect immediately prior to the Change in Control. In order to invoke a
Termination of Employment for Good Reason, a Participant shall provide written notice to the Company of the existence of one or more of the conditions described in clauses (A) through
(C) within 90 days following the Participant's knowledge of the initial existence of such condition or conditions, and the Company shall have 30 days following receipt of such
written notice (the "Cure Period") during which it may remedy the condition. In the event that the Company fails to remedy the condition constituting
Good Reason during the Cure Period, the Participant must terminate employment, if at all, within 90 days following the Cure Period in order for such Termination of Employment to constitute a
Termination of Employment for Good Reason. 

        (e)   Notwithstanding
the foregoing, if any Award is subject to Section 409A of the Code, this Section 10 shall be applicable only to the extent specifically
provided in the Award Agreement and as permitted pursuant to Section 14(k). 

 Section 11. Qualified Performance-Based Awards; Section 16(b)xxx  

        (a)   The
provisions of this Plan are intended to ensure that all Options and Stock Appreciation Rights granted hereunder to any Participant who is or may be a "covered
employee" (within the meaning of Section 162(m)(3) of the Code) in the tax year in which such Option or Stock Appreciation Right is expected to be deductible to the Company qualify for the
Section 162(m) Exemption, and all such Awards shall therefore be considered Qualified Performance-Based Awards and this Plan shall be interpreted and operated consistent with that intention
(including, without limitation, to require that all such Awards be granted by a committee composed solely of members who satisfy the requirements for being "outside directors" for purposes of the
Section 162(m) Exemption ("Outside Directors")). When granting any Award other than an Option or Stock Appreciation Right, the Committee may
designate such Award as a Qualified Performance-Based Award, based upon a determination that (i) the recipient is or may be a "covered employee" (within the meaning of Section 162(m)(3)
of the Code) with respect to such Award, and (ii) the Committee wishes such Award to qualify for the Section 162(m) Exemption, and the terms of any such Award (and of the grant thereof)
shall be consistent with such designation (including, without limitation, that all such Awards be granted by a committee composed solely of Outside Directors). 

        (b)   Each
Qualified Performance-Based Award (other than an Option or Stock Appreciation Right) shall be earned, vested and payable (as applicable) only upon the achievement
of one or more Performance Goals (as certified in writing by the Committee, except if compensation is attributable solely to the increase in the value of the Common Stock) (but in no event shall such
Award be payable later than two and a half months after the end of the fiscal year in which the Qualified Performance-Based Award becomes earned and vested (as applicable)), together with the
satisfaction of any other conditions, such as continued employment, as the Committee may determine to be appropriate, and no Qualified Performance-Based Award may be amended, nor may the Committee
exercise any 

15

 

discretionary
authority it may otherwise have under this Plan with respect to a Qualified Performance-Based Award under this Plan, in any manner that would cause the Qualified Performance-Based Award
to cease to qualify for the Section 162(m) Exemption; provided, however, that (i) the
Committee may provide, either in connection with the grant of the applicable Award or by amendment thereafter, that achievement of such Performance Goals will be waived upon the death or Disability of
the Participant or under any other circumstance with respect to which the existence of such possible waiver will not cause the Award to fail to qualify for the Section 162(m) Exemption as of
the Grant Date, and (ii) the provisions of Section 10 shall apply notwithstanding this Section 11(b). 

        (c)   The
full Board shall not be permitted to exercise authority granted to the Committee to the extent that the grant or exercise of such authority would cause an Award
designated as a Qualified Performance-Based Award not to qualify for, or to cease to qualify for, the Section 162(m) Exemption. 

        (d)   The
provisions of this Plan are intended to ensure that no transaction under the Plan is subject to (and not exempt from) the short-swing recovery rules of
Section 16(b) of the Exchange Act ("Section 16(b)"). Accordingly, the composition of the Committee shall be subject to such limitations as
the Board deems appropriate to permit transactions pursuant to this Plan to be exempt (pursuant to Rule 16b-3 promulgated under the Exchange Act) from Section 16(b), and no
delegation of authority by the Committee shall be permitted if such delegation would cause any such transaction to be subject to (and not exempt from) Section 16(b). 

 Section 12. Term, Amendment and Termination  

        (a)   Effectiveness.    The Plan shall be effective as of the date (the "Effective
Date") it is adopted by the Board, subject to the approval by the holders of at least a majority of the voting power represented by outstanding capital stock of the Company
that is entitled generally to vote in the election of directors. 

        (b)   Termination.    The Plan will terminate on the tenth anniversary of the Effective Date. Awards outstanding as
of such date shall not be affected or impaired by the termination of the Plan. 

        (c)   Amendment of Plan.    The Board may amend, alter, or discontinue the Plan, but no amendment, alteration or
discontinuation shall be made which would materially impair the rights of the Participant with respect to a previously granted Award without such Participant's consent, except such an amendment made
to comply with applicable law, including without limitation Section 409A of the Code, stock exchange rules or accounting rules. In addition, no such amendment shall be made without the approval
of the Company's stockholders to the extent such approval is required by applicable law or the listing standards of the Applicable Exchange. 

        (d)   Amendment of Awards.    Subject to Section 5(d), the Committee may unilaterally amend the terms of any
Award theretofore granted, but no such amendment shall cause a Qualified Performance-Based Award to cease to qualify for the Section 162(m) Exemption or without the Participant's consent
materially impair the rights of any Participant with respect to an Award, except such an amendment made to cause the Plan or Award to comply with applicable law, stock exchange rules or accounting
rules. 

 Section 13. Unfunded Status of Plan  

        It is presently intended that the Plan constitute an "unfunded" plan for incentive and deferred compensation. Solely to the extent
permitted under Section 409A, the Committee may authorize the creation of trusts or other arrangements to meet the obligations created under the Plan to deliver Common Stock or make payments;  provided, however, that the existence of such trusts or other arrangements is consistent with the
"unfunded" status of the Plan. Notwithstanding any other provision of this Plan to the contrary, with respect to any Award that constitutes a "nonqualified deferred 

16

 

compensation
plan" within the meaning of Section 409A of the Code, no trust shall be funded with respect to any such Award if such funding would result in taxable income to the Participant by
reason of Section 409A(b) of the Code and in no event shall any such trust assets at any time be located or transferred outside of the United States, within the meaning of
Section 409A(b) of the Code. 

 Section 14. General Provisions  

        (a)   Conditions for Issuance.    The Committee may require each person purchasing or receiving Shares pursuant to an
Award to represent to and agree with the Company in writing that such person is acquiring the Shares without a view to the distribution thereof. The certificates for such Shares may include any legend
which the Committee deems appropriate to reflect any restrictions on transfer. Notwithstanding any other provision of the Plan or agreements made pursuant thereto, the Company shall not be required to
issue or deliver any certificate or certificates for Shares under the Plan prior to fulfillment of all of the following conditions: (i) listing or approval for listing upon notice of issuance,
of such Shares on the Applicable Exchange; (ii) any registration or other qualification of such Shares of the Company under any state or federal law or regulation, or the maintaining in effect
of any such registration or other qualification which the Committee shall, in its absolute discretion upon the advice of counsel, deem necessary or advisable; and (iii) obtaining any other
consent, approval, or permit from any state or federal governmental agency which the Committee shall, in its absolute discretion after receiving the advice of counsel, determine to be necessary or
advisable. 

        (b)   Additional Compensation Arrangements.    Nothing contained in the Plan shall prevent the Company or any
Subsidiary or Affiliate from adopting other or additional compensation arrangements for its employees. 

        (c)   No Contract of Employment.    The Plan shall not constitute a contract of employment, and adoption of the Plan
shall not confer upon any employee any right to continued employment, nor shall it interfere in any way with the right of the Company or any Subsidiary or Affiliate to terminate the employment of any
employee at any time. 

        (d)   Required Taxes.    No later than the date as of which an amount first becomes includible in the gross income of
a Participant for federal, state, local or foreign income or employment or other tax purposes with respect to any Award under the Plan, such Participant shall pay to the Company, or make arrangements
satisfactory to the Company regarding the payment of, any federal, state, local or foreign taxes of any kind required by law to be withheld with respect to such amount. If determined by the Company,
withholding obligations may be settled with Common Stock, including Common Stock that is part of the Award that gives rise to the withholding requirement. The obligations of the Company under the Plan
shall be conditional on such payment or arrangements, and the Company and its Affiliates shall, to the extent permitted by law, have the right to deduct any such taxes from any payment otherwise due
to such Participant. The Committee may establish such procedures as it deems appropriate, including making irrevocable elections, for the settlement of withholding obligations with Common Stock. 

        (e)   Limitation on Dividend Reinvestment and Dividend Equivalents.    Reinvestment of dividends in additional
Restricted Stock at the time of any dividend payment, and the payment of Shares with respect to dividends to Participants holding Awards of Restricted Stock Units, shall only be permissible if
sufficient Shares are available under Section 3 for such reinvestment or payment (taking into account then outstanding Awards). In the event that sufficient Shares are not available for such
reinvestment or payment, such reinvestment or payment shall be made in the form of a grant of Restricted Stock Units equal in number to the Shares that would have been obtained by such payment or
reinvestment, the terms of which Restricted Stock Units shall provide for settlement in cash and for dividend equivalent reinvestment in further Restricted Stock Units on the terms contemplated by
this Section 14(e). 

17

 

        (f)    Designation of Death Beneficiary.    The Committee shall establish such procedures as it deems appropriate for
a Participant to designate a beneficiary to whom any amounts payable in the event of such Participant's death are to be paid or by whom any rights of such eligible Individual, after such Participant's
death, may be exercised. 

        (g)   Subsidiary Employees.    In the case of a grant of an Award to any employee of a Subsidiary of the Company, the
Company may, if the Committee so directs, issue or transfer the Shares, if any, covered by the Award to the Subsidiary, for such lawful consideration as the Committee may specify, upon the condition
or understanding that the Subsidiary will transfer the Shares to the employee in accordance with the terms of the Award specified by the Committee pursuant to the provisions of the Plan. All Shares
underlying Awards that are forfeited or canceled should revert to the Company. 

        (h)   Governing Law and Interpretation.    The Plan and all Awards made and actions taken thereunder shall be
governed by and construed in accordance with the laws of the State of Delaware, without reference to principles of conflict of laws. The captions of this Plan are not part of the provisions hereof and
shall have no force or effect. 

        (i)    Non-Transferability.    Except as otherwise provided in Section 5(j) or by the Committee,
Awards under the Plan are not transferable except by will or by laws of descent and distribution. 

        (j)    Foreign Employees and Foreign Law Considerations.    The Committee may grant Awards to Eligible Individuals who
are foreign nationals, who are located outside the United States or who are not compensated from a payroll maintained in the United States, or who are otherwise subject to (or could cause the Company
to be subject to) legal or regulatory provisions of countries or jurisdictions outside the United States, on such terms and conditions different from those specified in the Plan as may, in the
judgment of the Committee, be necessary or desirable to foster and promote achievement of the purposes of the Plan, and, in furtherance of such purposes, the Committee may make such modifications,
amendments, procedures, or subplans as may be necessary or advisable to comply with such legal or regulatory provisions. 

        (k)   Section 409A of the Code.    It is the intention of the Company that no Award shall be "deferred
compensation" subject to Section 409A of the Code, unless and to the extent that the Committee specifically determines otherwise as provided in this Section 14(k), and the Plan and the
terms and conditions of all Awards shall be interpreted accordingly. The terms and conditions governing any Awards that the Committee determines will be subject to Section 409A of the Code,
including any rules for elective or mandatory deferral of the delivery of cash or Shares pursuant thereto and any rules regarding treatment of such Awards in the event of a Change in Control, shall be
set forth in the applicable Award Agreement, and shall comply in all respects with Section 409A of the Code. Notwithstanding any other provision of the Plan to the contrary, with respect to any
Award that constitutes a "nonqualified deferred compensation plan" subject to Section 409A of the Code, any payments (whether in cash, Shares or other property) to be made with respect to the
Award upon the Participant's Termination of Employment shall be delayed until the earlier of (A) the first day of the seventh month following the Participant's Termination of Employment if the
Participant is a "specified employee" within the meaning of Section 409A of the Code and (B) the Participant's death. 

        (l)    Employee Matters Agreement.    Notwithstanding anything in this Plan to the contrary, to the extent that the
terms of this Plan are inconsistent with the terms of an Adjusted Award, the terms of the Adjusted Award shall be governed by the Employee Matters Agreement, the applicable IAC Long-Term
Incentive Plan and the award agreement entered into thereunder. 

18

QuickLinks

Exhibit 10.13

AMENDED AND RESTATED TREE.COM, INC. 2008 STOCK AND ANNUAL INCENTIVE PLAN

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