EMPLOYMENT AGREEMENT

Exhibit 10.42

EXECUTION VERSION

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT (“Agreement”) is entered into by and between Sergio D. Rivera (“Executive”) and ILG, Inc. (“ILG” or the “Company”), effective as of November 7, 2016 (the “Effective Date”)  Executive and the Company may hereinafter be referred to individually as a “Party” or collectively as the “Parties”.

WHEREAS, the Company desires to establish its right to the services of Executive, in the capacity described below, on the terms and conditions hereinafter set forth, and Executive is willing to accept such employment on such terms and conditions.

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

1A.EMPLOYMENT.  During the Term (as defined below), the Company shall employ Executive, and Executive shall be employed as the President and Chief Executive Officer of the Company’s Vacation Ownership Segment (the “VO Segment”) and, in such capacity, Executive shall provide executive leadership to those businesses currently comprising such segment, including, without limitation, Vistana Signature Experiences, Inc., HV Global Group, Inc. and their associated businesses as well as any other substantially similar businesses subsequently included within the VO Segment. Notwithstanding the foregoing, Executive acknowledges and agrees that, during the course of his employment with the Company, the Company may undergo one or more segment restructurings, provided, in each such instance, at a minimum, Executive shall remain responsible for providing executive leadership to the Company regarding the development, sales, marketing and financing of shared ownership interests as well as resort operations of managed shared ownership resorts.  During such employment, Executive shall do and perform all services and acts necessary or advisable to fulfill the duties and responsibilities as are commensurate and consistent with Executive’s position and shall render such services on the terms set forth herein.  Executive shall report directly to the Chairman, President and Chief Executive Officer of the Company (the “Reporting Officer”).  Executive shall have such powers and duties, as may reasonably be assigned to Executive by the Reporting Officer.  Executive agrees to devote all of Executive’s working time, attention and efforts to the Company and to perform the duties of Executive’s position in accordance with its policies as in effect from time to time. The foregoing shall not be construed as preventing Executive from serving on the board of Welltower, Inc. or continuing his ownership interest in the Caloosa Cove Resort.  Executive’s primary location of employment shall be Orlando, Florida, provided, he will be required to regularly perform services at the Company’s headquarters in Miami, Florida and otherwise engage in periodic visits to other locations as may be necessary to perform his duties and responsibilities for the Company effectively.

2A.TERM.  The term of this Agreement shall begin on the Effective Date and shall end on the second year anniversary of the Effective Date (the “Term”).  Thereafter, the Term shall automatically continue, until and unless either Party provides the other Party with not less than

ninety (90) days’ written notice of their intent to terminate this Agreement, subject to either Party’s right to terminate this Agreement in accordance with Section 1 of the Standard Terms and Conditions, attached hereto and incorporated herein. 

3A.COMPENSATION.

(c)RESTRICTED STOCK UNITS. 

(i)(A)As promptly as practicable following the Effective Date, subject to approval by the Committee, Executive shall be granted, under and subject to the provisions of the 2013 ILG Stock and Annual Incentive Plan, an award of a number of ILG RSUs determined by dividing US$2,000,000 by the average of the ILG’s common stock closing prices for the 30 trading days ending on the trading day prior to the Effective Date, rounded down to the nearest whole number of ILG RSUs (the “Initial Equity Award”). 

(B)The Initial Equity Award shall be comprised of two components: (A) 60% service-based RSUs valued at US$1,200,000; and (B) 40% performance RSUs valued at US$800,000.   Both such components shall vest, assuming continued employment with the Company, in equal

tranches, on each of the initial three anniversaries of the Effective Date or, as it relates to the performance RSUs, on or about the date on which the Committee certifies the requisite performance.  Other terms for the Initial Equity Award will be set forth in the Award Notices and related Terms and Conditions accompanying such award, copies of which are attached hereto and incorporated herein as composite Exhibit A.   

(C)In the event that there is a Change of Control (as defined in the Plan) with regard to the Company any portion of the Initial Equity Award that would have vested during the twenty-four (24) month period following such Change of Control shall vest, as of the date of such Change of Control.  In the event any portion of the Initial Equity Award remains unvested after application of the foregoing sentence, the agreements effectuating the Change of Control shall provide for the assumption of, or compensation for, the unvested portion of the Initial Equity Award by the successor entity (unless the successor entity is ILG, in which case the unvested portion of the Initial Equity Award shall remain outstanding and vest in accordance with its terms). 

(D)In the event that (1) Executive is terminated by the Company without Cause, or (2) Executive resigns with Good Reason, any portion of the Initial Equity Award that would have vested during the twenty-four (24) month period following such separation shall vest, as of the date of such separation.  Where such event follows a Change of Control, any portion of the Initial Equity Award that remains unvested shall vest as of the effective date of Executive’s separation from the Company; provided, as it relates to any performance RSUs, vesting shall be at 100% of the Target, unless, if at the time of the Change of Control, the Committee believes, in its good faith and sole judgment, that it is substantially likely that in the absence of the Change of Control a greater portion of the performance RSUs would have vested than the Target, then at such time the Committee shall make a determination to vest additional shares accordingly.

(ii)Commencing with grants issued in calendar year 2017, based on calendar year 2016 performance, Executive shall be entitled to participate in ILG’s long-term incentive program in accordance with ILG’s policies as in effect from time to time; provided, Executive acknowledges and agrees that his eligibility to participate in this program is subject to a number of factors, including, without limitation, ILG’s continuation of a long-term incentive program, the performance of ILG, Executive’s individual performance, the availability of RSUs to effectuate such grant and the Committee’s approval of each such grant as well as the performance criteria associated therewith.  Executive further acknowledges and agrees that each such award is subject to the terms and conditions of ILG’s 2013 Stock and Incentive Compensation Plan, as such may amended or replaced, from time to time, and the Award Notice and related Terms and Conditions accompanying such award.

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

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

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

Each Party (i) agrees that service of process may be made by mailing a copy of any relevant document to the address of the Party set forth above, (ii) waives to the fullest extent permitted by law any objection which it may now or hereafter have to the courts referred to above on the grounds

of inconvenient forum or otherwise as regards any dispute between the Parties arising out of or related to this Agreement, (iii) waives to the fullest extent permitted by law any objection which it may now or hereafter have to the laying of venue in the courts referred to above as regards any dispute between the Parties arising out of or related to this Agreement and (iv) agrees that, subject to a Party’s right of appeal, a judgment or order of any court referred to above in connection with any dispute between the Parties arising out of or related to this Agreement is conclusive and binding on it and may be enforced against it in the courts of any other jurisdiction. 

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

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

8A.SECTION 409A OF THE INTERNAL REVENUE CODE. 

(a)This Agreement is not intended to constitute a “nonqualified deferred compensation plan” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended, and the rules and regulations issued thereunder (“Section 409A”).  It is intended that any amounts payable under this Agreement and ILG’s and Executive’s exercise of authority or discretion hereunder shall comply with and avoid the imputation of any tax, penalty or interest under Section 409A of the Code.  This Agreement shall be construed and interpreted consistent with that intent.

(b)To the extent that any reimbursement pursuant to this Agreement is taxable to Executive, Executive shall provide ILG with documentation of the related expenses promptly so as to facilitate the timing of the reimbursement payment contemplated by this section, and any reimbursement payment due to Executive pursuant to such provision shall be paid to Executive on or before the last day of Executive’s taxable year following the taxable year in which the related expense was incurred.  Such reimbursement obligations pursuant to this Agreement are not subject to liquidation or exchange for another benefit and the amount of such benefits that Executive receives in one taxable year shall not affect the amount of such benefits that Executive receives in any other taxable year.

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

[Signature appear on the following page]

IN WITNESS WHEREOF, the Company has caused this Agreement to be executed and delivered by its duly authorized officer and Executive has executed and delivered this Agreement on November 7, 2016.

STANDARD TERMS AND CONDITIONS

(iv)(A)Notwithstanding any other provision of this Agreement or any other plan, arrangement or agreement to the contrary, if any of the payments or benefits provided or to be provided by the Company or its affiliates to the Executive or for the Executive's benefit pursuant to the terms of this Agreement or otherwise ("Covered Payments") constitute parachute payments ("Parachute Payments") within the meaning of Section 280G of the Code and would, but for this Section 1(e)(iv) be subject to the excise tax imposed under Section 4999 of the Code (or any successor provision thereto) or any similar tax imposed by state or local law or any interest or penalties with respect to such taxes (collectively, the "Excise Tax"), then the Covered Payments shall be payable either (1) in full (“Full Payment”) or (2) reduced to the minimum extent necessary (“Reduced Payment”) to ensure that no portion of the Covered Payments is subject to the Excise Tax, whichever of the Full Payment or Reduced Payment results in the Employee's receipt on an after-tax basis of the greatest amount of benefits after taking into account the applicable federal, state, local and foreign income, employment and excise taxes (including the Excise Tax).  Any such reduction shall be made in accordance with Section 409A of the Code and the following: (aa) the Covered Payments which do not constitute nonqualified deferred

compensation subject to Section 409A of the Code shall be reduced first; and (bb) Covered Payments shall then be reduced as follows: (x) cash payments shall be reduced before non-cash payments; and (y) payments to be made on a later payment date shall be reduced before payments to be made on an earlier payment date.

(B)Any determination required under this Section 1(e)(iv) shall be made in writing in good faith by an independent accounting firm selected by the Company (the “Accounting Firm”), which shall provide detailed supporting calculations to Company  and the Employee as requested by the Company or the Employee.  The Company and the Employee shall provide the Accounting Firm with such information and documents as the Accounting Firm may reasonably request in order to make a determination under this Section 1(e)(iv). 

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

(i)Executive recognizes that he will possess confidential information about other employees of ILG and its Affiliates relating to their education, experience, skills, abilities, compensation and benefits, and interpersonal relationships with suppliers to and customers of ILG and its Affiliates.  Executive recognizes that the information he will possess about these other employees is not generally known, is of substantial value to ILG and its Affiliates in developing their respective businesses and in securing and retaining customers, and will be acquired by Executive because of Executive’s business position with ILG or its Affiliates.

(ii)Executive agrees that, during the Term (and for a period of twenty-four (24) months after  the separation of his employment, irrespective of the cause, manner or time of such separation), Executive will not, directly or indirectly, solicit or recruit any employee of ILG or any of its Affiliates for the purpose of being employed by Executive or by any business, individual, partnership, firm, corporation or other entity on whose behalf Executive is acting as an agent, representative or employee and that Executive will not convey any such confidential information or trade secrets about other employees of ILG or any of its Affiliates to any other person except within the scope of Executive’s duties hereunder.

(iii)Executive agrees that, during the Term (and for a period of twenty-four (24) months after the separation of his employment, irrespective of the cause, manner or time of such separation), Executive will not make any statement or perform any act intended to advance the interest of any competitor of ILG or any of its Affiliates in any way that will injure the interests of ILG or any of its Affiliates.  Executive also agrees that during such period, he shall not solicit or attempt to take away or to sever from ILG or any of its Affiliates the business or goodwill of any individuals or entities who are customers or clients of ILG or any of its Affiliates.

(h)SURVIVAL OF PROVISIONS.  The obligations contained in this Section 2 survive the termination or expiration of Executive’s employment with the Company and, as applicable, shall be fully enforceable thereafter in accordance with the terms of this Agreement.  If it is determined by a court of competent jurisdiction in any state that any restriction in this Section 2 is excessive in duration or scope or is unreasonable or unenforceable under the laws of that state, it is the intention of the Parties that such restriction may be modified or amended by the court to render it enforceable to the maximum extent permitted by the law of that state.

3.TERMINATION OF PRIOR AGREEMENTS.  The Agreement, these Standard Terms and Conditions, and Exhibit A constitute the entire agreement between the Parties and, as of the Effective Date, terminate and supersede any and all prior agreements and understandings (whether written or oral) between the Parties with respect to the subject matter of this Agreement.  Executive acknowledges and agrees that neither the Company nor anyone acting on its behalf has made, and is not making, and in executing this Agreement, Executive has not relied upon, any representations, promises or inducements except to the extent the same is expressly set forth in this Agreement.

(a)For purposes of this Agreement, a “Separation from Service” occurs when Executive dies, retires or otherwise has a separation of employment with the Company that constitutes a “separation from service” within the meaning of Treasury Regulation Section 1.409A-1(h)(1), without regard to the optional alternative definitions available thereunder.

(b)It is intended that any amounts payable under this Agreement and ILG’s and Executive’s exercise of authority or discretion hereunder shall comply with and avoid the imputation of any tax, penalty or interest under Section 409A of the Code.  This Agreement shall be construed and interpreted consistent with that intent.

[Signatures appear on the following page]

ACKNOWLEDGED AND AGREED:

Date: November 7, 2016

EXHIBIT A

RESTRICTED STOCK UNIT AWARD NOTICES

AND AWARD TERMS AND CONDITIONS

Notice of 2016 Restricted Stock Unit Award Granted Under the
Interval Leisure Group, Inc. 2013 Stock and Incentive Compensation Plan

1Number of RSUs to be established by dividing the award value, $1,200,000,  by the average of the ILG’s common stock closing prices for the 30 trading days ending on the trading day prior to the Effective Date of employment, rounded down to the nearest whole number of ILG RSUs.

Terms and Conditions for
Service-Based Restricted Stock Unit Awards

These Terms and Conditions apply to the grant awarded to you by ILG, Inc. (“ILG” or the “Company”) pursuant to Section 12 of the Interval Leisure Group 2013 Stock and Incentive Compensation Plan (the “Plan”) of Restricted Stock Units (the “Award”). You were notified of your Award by way of an award notice (the “Award Notice”).

ALL CAPITALIZED TERMS USED HEREIN, TO THE EXTENT NOT

DEFINED, SHALL HAVE THE MEANINGS SET FORTH IN THE PLAN.

Continuous Service

In order for your Award to vest, you must be continuously employed by ILG or any of its Affiliates during the Restriction Period (as defined below).  Nothing in your Award Notice, these Terms and Conditions, or the Plan, shall confer upon you any right to continue in the employ or service of ILG or any of its Affiliates or interfere in any way with their rights to terminate your employment or service at any time.

Vesting

Subject to the Award Notice, these Terms and Conditions and the provisions of the Plan, the Restricted Stock Units (“RSUs”) in respect to your Award, shall vest and no longer be subject to any restriction (such period during which restrictions apply is the “Restriction Period”), provided the performance set forth on Schedule A, attached hereto, is met for calendar year 2017:

Termination of Employment

Subject to the provisions of your employment agreement and these terms and conditions, upon your Termination of Employment during the Restriction Period for any reason, any unvested RSUs shall be forfeited and canceled in their entirety effective immediately upon such Termination of Employment, provided, however, where such Termination of Employment occurs following the applicable vesting date, but before the actual settlement of such RSUs, you shall remain eligible to receive such shares.  For the avoidance of doubt, transfers of employment among the Company and its Subsidiaries or other Affiliates, without any break in service, is not a Termination of Employment.  

If you have a Termination of Employment due to death, any unvested portion of the Award shall vest in full.  If you have a Termination of Employment as a result of a Disability, the Award shall continue to vest for up to four years after the effective date of such termination of your employment provided you continue to comply with any applicable confidentiality and non-competition obligations you have to the Company and its Affiliates. 

Upon your Termination of Employment by ILG or any of its Affiliates without Cause or your resignation for Good Reason (as such is defined in your employment agreement), any portion of the Award that would have vested during the twenty-four (24) month period following such separation shall vest, as of the date of such separation.  Where such event follows a Change of Control (as such defined in the Plan), 100% of the RSUs set forth in your Award Notice shall automatically vest upon such termination of employment.

If your Termination of Employment is a Termination for Cause, or if following a Termination of Employment for any reason, ILG determines that during the two years prior to such termination there was an event or circumstance that would have been grounds for Termination for Cause, your Award shall be forfeited and canceled in its entirety upon such termination (or the determination of the basis for a Termination for Cause, if later) and ILG may cause you, immediately upon notice, either to return the shares issued upon the settlement of RSUs that vested during the two-year period after the events or circumstances giving rise to or constituting grounds for Termination for Cause or to pay ILG an amount equal to the aggregate amount, if any, that you had previously realized in respect of any and all shares issued upon settlement of RSUs that vested during the two-year period after the events or circumstances giving rise to or constituting grounds for such Termination for Cause (i.e., the value of the RSUs upon vesting), in each case, including any dividend equivalents or other distributions received in respect of any such RSUs. This remedy shall be without prejudice to, or waiver of, any other remedies ILG or its Affiliates may have in such event.

Settlement

Subject to your satisfaction of the tax obligations described immediately below under “Taxes and Withholding,” as soon as practicable after any RSUs have vested and are no longer subject to the Restriction Period, such RSUs shall be settled. In no event shall settlement occur later than two and one half months after the end of the fiscal year in which the RSUs vest.  For each RSU settled, ILG shall issue one share of Common Stock for each RSU vesting. Notwithstanding the foregoing, ILG shall be entitled to hold the shares issuable to you upon settlement of all RSUs that have vested until ILG or the agent selected by ILG to administer the Plan (the “Agent”) has received from you (i) a duly executed Form W-9 or W-8 and (ii) payment for any federal, state, local or foreign taxes of any kind required by law to be withheld with respect to such RSUs.

Taxes and Withholding

No later than the date as of which an amount in respect of any RSUs first becomes includible in your gross income for federal, state, local or foreign income or employment or other tax purposes, ILG or its Affiliates shall, unless prohibited by law, have the right to deduct any federal, state, local or foreign taxes of any kind required by law to be withheld with respect to such amount due to you, including deducting such amount from the delivery of shares issued upon settlement of the RSUs that gives rise to the withholding requirement. In the event shares are deducted to cover tax withholdings, the number of shares withheld shall generally have a Fair Market Value equal to the aggregate amount of ILG’s withholding obligation. In the event that any such deduction and/or withholding is prohibited by law, you shall, prior to or contemporaneously with the vesting of your RSUs, 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.

Adjustment in the Event of Change in Stock; Disaffiliation; Change of Control

Adjustment in the Event of Change in Stock.  In the event of (i) a stock dividend, stock split, reverse stock split, share combination, or recapitalization or similar event affecting the capital structure of ILG (each, a “Share Change”), or (ii) a merger, consolidation, acquisition of property or shares, separation, spin-off, reorganization, significant non-recurring cash dividend, stock rights offering, liquidation, Disaffiliation, or similar event affecting the Company or any of its Affiliates (each, a “Corporate Transaction”), ILG’s Compensation and Human Resources Committee (the “Committee”) or the Board may make such substitutions or adjustments as it, in its sole discretion, deems appropriate and equitable to the number of RSUs and the number and kind of shares of Common Stock underlying the RSUs.  The determination of the Committee regarding any such adjustment will be final and conclusive and need not be the same for all RSU award recipients.

Disaffiliation.  The Disaffiliation of the Affiliate of ILG by which you are employed or for which you are performing services at the time of its sale or other disposition by ILG shall be considered a Termination of Employment (not a Change of Control).  Any unvested RSUs covered by your Award shall be forfeited and canceled in their entirety on the date of such Disaffiliation; provided, however, that the Committee or the Board may deem it appropriate to make an equitable adjustment to the number of RSUs and the number and kind of shares of Common Stock underlying the RSUs underlying your Award.

Change of Control.  In the event there is a Change of Control (as defined in the Plan), any portion of your RSU Award that is outstanding and unvested at the time that would have vested during the twenty-four (24) month period following such occurrences shall vest as of the date of such Change of Control.  In the event any portion of the RSU Award remains unvested after application of the foregoing sentence, the agreements effectuating the Change of Control shall provide for the assumption of, or compensation for, the unvested portion of the RSU Award by the successor entity (unless the successor entity is ILG, in which case the unvested portion of the RSU Award shall remain outstanding and vest in accordance with its terms).  For the avoidance of doubt, the Change of Control provision shall only apply in the case of a Change in Control of ILG and in no event shall apply to a Subsidiary of ILG.

Non-Transferability of the RSUs

Until such time as your RSUs are ultimately settled, they shall not be transferable by you by means of sale, assignment, exchange, encumbrance, pledge, hedge or otherwise.

No Rights as a Stockholder

Except as otherwise specifically provided in the Plan, unless and until your RSUs are settled, you shall not be entitled to any rights of a stockholder with respect to the RSUs (including the right to vote the underlying shares) under this Award. Notwithstanding the foregoing, if ILG declares and pays dividends on the Common Stock during the Restriction Period for particular RSUs in respect of your Award, you will be credited with additional amounts for each RSU underlying such Award equal to the dividend that would have been paid with respect to such RSU as if it had been an actual share of Common Stock, which amount shall remain subject to restrictions (and as determined by the Committee may be reinvested in RSUs or may be held in kind as restricted property) and shall vest concurrently with the vesting of the RSUs upon which such dividend equivalent amounts were paid. Notwithstanding the foregoing, dividends and distributions other

than regular quarterly cash dividends, if any, may result in an adjustment pursuant to the “Adjustment in the Event of Change in Stock; Disaffiliation” section above.

Other Restrictions

The RSUs shall be subject to the requirement that, if at any time the Committee shall determine that (i) the listing, registration or qualification of the shares of Common Stock subject or related thereto upon any securities exchange or under any state or federal law, or (ii) the consent or approval of any government regulatory body is necessary or desirable as a condition of, or in connection with, the delivery of shares, then in any such event, the award of RSUs shall not be effective unless such listing, registration, qualification, consent or approval shall have been effected or obtained free of any conditions not acceptable to the Committee.

Conflicts and Interpretation

In the event of any conflict between these Terms and Conditions and the Plan, the Plan shall control; provided, that an action or provision that is permissive under the terms of the Plan, and required under these Terms and Conditions, shall not be deemed a conflict and these Terms and Conditions shall control.  In the event of any ambiguity in these Terms and Conditions, or any matters as to which these Terms and Conditions are silent, the Plan shall govern. In the event of any conflict between the Award Notice (or any other information posted on ILG’s extranet or given to you directly or indirectly through the Agent (including information posted on www.stockplanconnect.com) and ILG’s books and records, or (ii) ambiguity in the Award Notice (or any other information posted on ILG’s extranet or given to you directly or indirectly through the Agent (including information posted on www.stockplanconnect.com)), ILG’s books and records shall control.

Amendment

ILG may modify, amend or waive the terms of your RSUs, prospectively or retroactively, but no such modification, amendment or waiver shall materially impair your rights without your consent, except as required by applicable law, NASDAQ or stock exchange rules, tax rules or accounting rules.

Data Protection

The acceptance of your RSUs constitutes your authorization of the release from time to time to ILG or any of its Affiliates and to the Agent (together, the “Relevant Companies”) of any and all personal or professional data that is necessary or desirable for the administration of your RSUs and/or the Plan (the “Relevant Information”). Without limiting the above, this authorization permits your employing company to collect, process, register and transfer to the Relevant Companies all Relevant Information (including any professional and personal data that may be useful or necessary for the purposes of the administration of your RSUs and/or the Plan and/or to implement or structure any further grants of equity awards (if any)). The acceptance of your RSUs also constitutes your authorization of the transfer of the Relevant Information to any jurisdiction in which ILG, your employing company or the Agent considers appropriate. You shall have access to, and the right to change, the Relevant Information, which will only be used in accordance with applicable law.

Section 409A of the Code

Your Award is not intended to constitute “nonqualified deferred compensation” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended, and the rules and regulations issued there under (“Section 409A”).   In no event shall ILG be required to pay you any “gross-up” or other payment with respect to any taxes or penalties imposed under Section 409A with respect to any amounts or benefits paid to you in respect of your Award.

Notification of Changes

Any changes to these Terms and Conditions shall either be posted on ILG’s intranet and www.stockplanconnect.com or communicated (either directly by ILG or indirectly through any of its Affiliates or the Agent) to you electronically via e-mail (or otherwise in writing) promptly after such change becomes effective.

Notice of 2016 Adjusted EBITDA Performance RSU Award Granted Under the
Interval Leisure Group, Inc. 2013 Stock and Incentive Compensation Plan

1Number of PRSUs to be established by dividing the award value, $800,000, by the average of the ILG’s common stock closing prices for the 30 trading days ending on the trading day prior to the Effective Date, rounded down to the nearest whole number of ILG PRSUs.

Terms and Conditions for Adjusted EBITDA Performance RSU Awards

Overview

These Terms and Conditions apply to Performance RSU Awards, which are grants of performance-based restricted stock units (“PRSUs”) made pursuant to Section 12 of the Interval Leisure Group, Inc. 2013 Stock and Incentive Compensation Plan (the “Plan”).  You were notified of your PRSU Award by way of an award notice (the “Award Notice”).

ALL CAPITALIZED TERMS USED HEREIN, TO THE EXTENT NOT DEFINED, SHALL HAVE THE MEANINGS SET FORTH IN THE PLAN.

Continuous Service

In order for your Award to vest, you must be continuously employed by ILG or any of its Affiliates during the Restriction Period (as defined below) (the “Continuous Service Requirement”).  Nothing in your Award Notice, these Terms and Conditions, or the Plan shall confer upon you any right to continue in the employ or service of ILG or any of its Affiliates or interfere in any way with their rights to terminate your employment or service at any time.

Vesting

Subject to the Award Notice, these Terms and Conditions and the provisions of the Plan, the PRSUs in respect to your Award, shall vest and no longer be subject to any restriction (such period during which restrictions apply is the “Restriction Period”):

Adjusted EBITDA Performance Hurdles

Assuming satisfaction of the Continuous Service Requirement, the actual number of PRSUs covered by your Performance RSU Award that will vest is dependent upon the actual achievement by ILG’s Vacation Ownership Segment (the “VO Segment”) of Adjusted EBITDA for calendar years 2017, 2018 and 2019 against the VO Segment’s Adjusted EBITDA target for the applicable calendar, determined based on the segment’s Board-approved budget for such years, with the actual number of PRSUs vesting ranging from 0 to 200% of the target number of PRSUs.  Schedule A to these Terms and Conditions defines Adjusted EBITDA and explains how the achievement by the Company of various levels of Adjusted EBITDA performance impacts the number of PRSUs that you will ultimately receive (the “Performance Hurdles”).

Vesting Date

The actual vesting of your PRSUs will occur on the date on which ILG’s Compensation and Human Resources Committee (the “Committee”) certifies the level of Adjusted EBITDA that the Company actually achieved for calendar years 2017, 2018 and 2019, which certification shall occur as soon as reasonably practicable following the date on which ILG releases its earnings for the prior calendar year (the “Adjusted EBITDA Certification Date”).

Termination of Employment

Subject to the provisions of your employment agreement and these Terms and Conditions, upon your Termination of Employment during the Restriction Period for any reason, any unvested PRSUs shall be forfeited and canceled in their entirety effective immediately upon such Termination of Employment, provided, however, where such Termination of Employment occurs following the Committee’s certification of the Company’s actual Adjusted EBITDA for the measurement period, but before the actual settlement of such PRSUs, you shall remain eligible to receive such shares.  For the avoidance of doubt, transfers of employment among the Company and its Affiliates, without any break in service, is not a Termination of Employment.  

If you have a Termination of Employment due to death, any unvested portion of the Award shall vest in full at the Target RSU number.  If you have a termination of your employment as a result of a Disability, the Award shall continue to vest for up to three years after the effective date of such termination of your employment provided you continue to comply with any applicable confidentiality and non-competition obligations you have to the Company and its Affiliates

Upon your Termination of Employment by ILG or any of its Affiliates without Cause or your resignation for Good Reason (as such is defined in your employment agreement), any portion of the Award that would have vested during the twenty-four (24) month period following such separation shall vest at Target, as of the date of such separation.  Where such event follows a Change of Control (as such defined in the Plan), 100% of the Target RSUs set forth in your Award Notice shall automatically vest upon such termination of employment.  Notwithstanding the foregoing, if at the time of the Change in Control, the Committee believes, in its good faith and sole judgment, that it is substantially likely that in the absence of the Change in Control a greater portion of the RSUs would have vested than the Target RSUs, then at such time the Committee shall make a determination to vest additional shares accordingly.

Notwithstanding the foregoing, if your Termination of Employment is a Termination for Cause, or if following your Termination of Employment for any reason ILG determines that during the two years prior to such termination there was an event or circumstance that would have been grounds for Termination for Cause, all outstanding Performance RSU Awards held by you shall be forfeited and canceled in their entirety upon such termination (or the determination of the basis for a Termination for Cause, if later), and ILG may cause you, immediately upon notice, either to return the shares issued upon the settlement of PRSUs that vested during the two-year period after the events or circumstances giving rise to or constituting grounds for Termination for Cause or to pay ILG an amount equal to the

aggregate amount, if any, that you had previously realized in respect of any and all shares issued upon settlement of PRSUs that vested during the two-year period after the events or circumstances giving rise to or constituting grounds for such Termination for Cause (i.e., the value of the PRSUs upon vesting), in each case, including any dividend equivalents or other distributions received in respect of any such PRSUs.  This remedy shall be without prejudice to, or waiver of, any other remedies ILG or its Affiliates may have in such event.

Determination of Adjusted EBITDA Performance

As soon as reasonably practicable following the date on which ILG releases its earnings for the applicable calendar year, the Committee shall certify as to the level of Adjusted EBITDA that the Company achieved for the measurement period, and the resulting percentage of Target PRSUs that will vest on the applicable vesting date (the “Adjusted EBITDA Certification Date”).

Committee Discretion to Adjust Adjusted EBITDA Performance Hurdles

Decrease of Performance Hurdles. Through the Adjusted EBITDA Certification Date, the Committee shall retain discretion to decrease Performance Hurdles (or otherwise make adjustments that increase the likelihood of Performance Hurdles being achieved) at any time.  Furthermore, the Committee shall, within 90 days of the discovery of all relevant material facts relating to a Material Reduction Event (as defined below) by the Committee, decrease Performance Hurdles (or otherwise make adjustments that increase the likelihood of Performance Hurdles being achieved), such that, in the Committee’s good faith and sole judgment, the likelihood of achievement of the various Performance Hurdles as adjusted is no less likely than prior to the Material Reduction Event.

A “Material Reduction Event” means a discrete event which is likely to materially decrease Adjusted EBITDA during the period in a manner the Committee determines, in its good faith and sole judgment, is not properly reflective of growth in the Company’s performance in the applicable period. For purposes of a Material Reduction Event, materiality shall be judged by the Committee without regard to the likelihood of achievement of any particular Performance Hurdles.

Increase of Performance Hurdles.  Through the Adjusted EBITDA Certification Date, the Committee may, within 90 days of the discovery of all relevant material facts relating to a Material Accretion Event (as defined below) by the Committee, increase Performance Hurdles (or otherwise make adjustments that decrease the likelihood of Performance Hurdles being achieved). Any such adjustment shall be made such that, in the Committee’s good faith and sole judgment, the likelihood of achievement of the various Performance Hurdles is no less likely than prior to the Material Accretion Event.

A “Material Accretion Event” means a discrete event which is likely to materially increase Adjusted EBITDA during the Measurement Period in a manner the Committee determines, in its good faith and sole judgment, is not properly reflective of growth in the Company’s performance in the applicable period.  For purposes of a Material Accretion Event, materiality shall be judged by the Committee without regard to the likelihood of achievement of any particular Performance Hurdles.

Determinations of the Committee regarding any adjustment (downward or upward) to Performance Hurdles through the Adjusted EBITDA Certification Date will be final and conclusive. Discretion, both positive and negative, need not be applied uniformly by the Committee to all outstanding Performance RSU Awards, but no Performance RSU Awards can be treated less favorably than the majority of Performance RSU Awards subject to the same set of Performance Hurdles.

Settlement

Subject to your satisfaction of the tax obligations described immediately below under “Taxes and Withholding,” as soon as practicable after the Performance RSU Award Vesting Date your PRSUs shall be settled.  In no event shall settlement occur later than two and one half months after the end of the fiscal year in which the PRSUs vest.  For each PRSU settled, ILG shall issue one share of Common Stock for each RSU vesting.  Notwithstanding the foregoing, ILG shall be entitled to hold the shares issuable to you upon settlement of all PRSUs that have vested until ILG or the agent selected by ILG to administer the Plan (the “Agent”) has received from you (i) a duly executed Form W-9 or W-8, as applicable or (ii) payment for any federal, state, local or foreign taxes of any kind required by law to be withheld with respect to such PRSU.

Taxes and Withholding

No later than the date as of which an amount in respect of any PRSUs first becomes includible in your gross income for federal, state, local or foreign income or employment or other tax purposes, ILG or its Subsidiaries shall, unless prohibited by law, have the right to deduct any federal, state, local or foreign taxes of any kind required by law to be withheld with respect to such amount due to you, including deducting such amount from the delivery of shares issued upon settlement of the PRSUs that gives rise to the withholding requirement.  In the event shares are deducted to cover tax withholdings, the number of shares withheld shall generally have a Fair Market Value equal to the aggregate amount of ILG’s withholding obligation. In the event that any such deduction and/or withholding is prohibited by law, you shall, prior to or contemporaneously with the vesting or your PRSUs, pay to ILG, or make arrangements satisfactory to ILG 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.

Adjustment in the Event of Change in Stock or Disaffiliation; Change of Control

Adjustment in the Event of Change in Stock.  In the event of (i) a stock dividend, stock split, reverse stock split, share combination, or recapitalization or similar event affecting the capital structure of ILG (each, a “Share Change”), or (ii) a merger, consolidation, acquisition of property or shares, separation, spin-off, reorganization, significant non-recurring cash dividend, stock rights offering, liquidation, Disaffiliation, or similar event affecting ILG or any of its Affiliates (each, a “Corporate Transaction”), the Committee or the Board may make such substitutions or adjustments as it, in its sole discretion, deems appropriate and equitable to the number of PRSUs and the number and kind of shares of Common Stock underlying the PRSUs.  The determination of the Committee regarding any such adjustment will be final and conclusive and need not be the same for all RSU award recipients.

Disaffiliation.  The Disaffiliation of the Affiliate of ILG by which you are employed or for which you are performing services at the time of its sale or other disposition by ILG shall be considered a Termination of Employment (not a Change of Control). Any unvested PRSUs covered by your Award shall be forfeited and canceled in their entirety on the date of such Disaffiliation; provided, however, that the Committee or the Board may deem it appropriate to make an equitable adjustment to the number of RSUs and the number and kind of shares of Common Stock underlying the RSUs underlying your Award.

Change of Control.  In the event there is a Change of Control (as defined in the Plan), any portion of your Performance RSU Award that is outstanding and unvested at the time that would have vested during the twenty-four (24) month period following such occurrences shall vest at Target as of the date of such Change of Control.  In the event any portion of the Performance RSU Award remains unvested after application of the foregoing sentence, the agreements effectuating the Change of Control shall provide for the assumption of, or compensation for, the unvested portion of the Performance RSU Award by the successor entity (unless the successor entity is ILG, in which case the unvested portion of the Performance RSU Award shall remain outstanding and vest in accordance with its terms).  For the avoidance of doubt, the Change of Control provision shall only apply in the case of a Change in Control of ILG and in no event shall apply to a Subsidiary of ILG.

Non-Transferability of the PRSUs

Until such time as your PRSUs are ultimately settled, they shall not be transferable by you by means of sale, assignment, exchange, encumbrance, pledge, hedge or otherwise.

No Rights as a Stockholder

Except as otherwise specifically provided in the Plan, unless and until your PRSUs are settled, you shall not be entitled to any rights of a stockholder with respect to the PRSUs under this Award.  Notwithstanding the foregoing, if ILG declares and pays dividends on the Common Stock prior to the Performance RSU Award Vesting Date for a particular Performance RSU Award, you will be credited with additional amounts for each PRSU underlying such Performance RSU Award equal to the dividend that would have been paid with respect to such RSU as if it had been an actual share of Common Stock, which amount shall remain subject to restrictions (and as determined by the Committee may be reinvested in PRSUs or may be held in kind as restricted property) and shall vest concurrently with the vesting of the PRSUs upon which such dividend equivalent amounts were paid. Notwithstanding the foregoing, dividends and distributions other than regular quarterly cash dividends, if any, may result in an adjustment pursuant to the “Adjustment in the Event of Change in Stock; Disaffiliation” section above.

Other Restrictions

The PRSUs shall be subject to the requirement that, if at any time the Committee shall determine that (i) the listing, registration or qualification of the shares of Common Stock subject or related thereto upon any securities exchange or under any state or federal law, or (ii) the consent or approval of any government regulatory body is necessary or desirable as a condition of, or in connection with, the delivery of shares, then in any such event, the award of PRSUs shall not be effective unless such listing, registration, qualification, consent

or approval shall have been effected or obtained free of any conditions not acceptable to the Committee.

Conflicts and Interpretation

In the event of any conflict between these Terms and Conditions and the Plan, the Plan shall control.  In the event of any ambiguity in these Terms and Conditions, or any matters as to which these Terms and Conditions are silent, the Plan shall govern.  In the event of any conflict between the Award Notice (or any other information posted on ILG’s extranet or given to you directly or indirectly through the Agent (including information posted on www.stockplanconnect.com) and ILG’s books and records, or (ii) ambiguity in the Award Notice (or any other information posted on ILG’s intranet or given to you directly or indirectly through the Agent (including information posted on www.stockplanconnect.com), ILG’s books and records shall control.

Amendment

ILG may modify, amend or waive the terms of your PRSUs, prospectively or retroactively, but no such modification, amendment or waiver shall materially impair your rights without your consent, except as required by applicable law, NASDAQ or stock exchange rules, tax rules or accounting rules.

Data Protection

The acceptance of your PRSUs constitutes your authorization of the release from time to time to ILG or any of its Affiliates and to the Agent (together, the “Relevant Companies”) of any and all personal or professional data that is necessary or desirable for the administration of your PRSUs and/or the Plan (the “Relevant Information”).  Without limiting the above, this authorization permits your employing company to collect, process, register and transfer to the Relevant Companies all Relevant Information (including any professional and personal data that may be useful or necessary for the purposes of the administration of your PRSUs and/or the Plan and/or to implement or structure any further grants of equity awards (if any)). The acceptance of your PRSUs also constitutes your authorization of the transfer of the Relevant Information to any jurisdiction in which ILG, your employing company or the Agent considers appropriate.  You shall have access to, and the right to change, the Relevant Information, which will only be used in accordance with applicable law.

Section 409A of the Code

Performance RSU Awards are not intended to constitute “nonqualified deferred compensation” within the meaning of Section 409A of the Internal Revenue Code of 1986, as amended, and the rules and regulations issued thereunder (“Section 409A”).  In no event shall ILG be required to pay you any “gross-up” or other payment with respect to any taxes or penalties imposed under Section 409A with respect to any amounts or benefits paid to you in respect of your Performance RSU Award.

Notification of Changes

Any changes to these Terms and Conditions, including Schedule A (or any additional schedules) hereto, shall either be posted on ILG’s intranet and www.benefitaccess.com or communicated (either directly by ILG or indirectly through any of its Subsidiaries or the Agent) to you electronically via e-mail (or otherwise in writing) promptly after such change becomes effective. You are therefore urged to periodically check these Terms and Conditions, especially any schedules, to determine whether any changes have been made.

SCHEDULE A

Adjusted EBITDA Performance Hurdle for Performance RSU Awards

This award of PRSUs will vest on the date on which the Committee certifies the level of Adjusted EBITDA that the VO Segment1 has achieved during calendar year 2017, 2018 and 2019, respectively.

The number of shares to vest shall be based on the VO Segment’s actual Adjusted EBITDA achieved for calendar year 2017, 2018 and 2019, respectively, against the segment’s annual Adjusted EBITDA target for such period, determined based on ILG’s Board-approved budgets for calendar year 2017, 2018 and 2019,  pursuant to the following performance schedule:

For purposes of this Schedule A, Adjusted EBITDA is defined as the operating income generated by the VO Segment in the aggregate, excluding, if applicable: (A) non-cash compensation expense, (B) depreciation expense, (C) amortization expense of intangibles, (D) acquisition related and restructuring costs, including the effect of purchase accounting, (E) goodwill and asset impairments, and (F) other non-operating income and expense.

1The term, VO Segment, shall mean those businesses currently comprising such segment, including, without limitation, Vistana Signature Experiences, Inc., HV Global Group, Inc., their associated businesses as well as any other substantially similar businesses subsequently included within the VO Segment.  If ILG engages in one or more segment restructurings during the measurement period, for the purposes of this Schedule A, the term, VO Segment, shall be deemed to apply to those businesses which then engage in the development, sales, marketing and financing of shared ownership interests as well as resort operations of managed shared ownership resorts and, under such circumstances, the Committee may adjust the applicable Adjusted EBITDA target as it deems appropriate in its sole discretion.

2T equals the VO Segment’s annual Adjusted EBITDA target for calendar year 2017, 2018 or 2019, respectively, with the target amount for each calendar year being established by the Committee, within the initial 90-days of the applicable calendar year, based on the VO Segment’s Board-approved budget for such year.