EXHIBIT 10.2
RESTRICTED STOCK OWNERSHIP
AGREEMENT
This RESTRICTED STOCK OWNERSHIP
AGREEMENT (the “Agreement”) is made as of
April 19, 2002, by and between Monitronics International,
Inc., a Texas corporation (the “Company”), and Michael
Meyers, an employee of the Company (the
“Employee”).
WHEREAS, pursuant to this Agreement, the Company desires
to transfer to the Employee 39,231 shares (the
“Shares”) of the Company’s Class A Common
Stock, $0.01 par value, per share (the “Common Stock”)
which shares shall be subject to certain restrictions as set forth
herein and shall be herein referred to as the “Restricted
Shares”; and
WHEREAS, Company and Employee desire to enter into this
Agreement to provide for restrictions on transfer and forfeiture of
the Restricted Shares prior to the vesting of such Restricted
Shares and removal of such forfeiture restrictions upon vesting of
the Restricted Shares.
NOW, THEREFORE,
in consideration of the foregoing
recitals and the mutual covenants and agreements set forth herein,
together with other good and valuable consideration, the receipt
and sufficiency of which is hereby acknowledged, the parties hereto
agree as follows:
1. Purchase of Restricted
Shares. Concurrently with execution of this Agreement, Employee
has purchased the Restricted Shares and paid the purchase price of
$0.01 per share (the “Purchase Price”). Concurrently
with execution of this Agreement and payment of the Purchase Price,
Employee shall also execute and deliver to Company an executed
blank Stock Power of Attorney in the form attached hereto as
Exhibit “A” with respect to the Restricted
Shares.
2. Repurchase
Right
2.1 Grant.
Employee hereby grants to Company
the right (the “Repurchase Right”) exercisable at any
time during the 180-day period following the date Employee’s
employment by Company is terminated for any reason, to repurchase
at the Purchase Price all or any portion of the Restricted Shares
in which Employee is not, at the time of his or her termination of
employment, vested in accordance with the Vesting Schedule
described in Section 2.3 and set forth in the form attached
hereto as Exhibit “B” (such shares to be hereinafter
referred to as the “Unvested Shares”).
2.2 Exercise of the Repurchase
Right. The Repurchase
Right shall be exercisable by written notice delivered to Employee
prior to the expiration of the 180-day exercise period. The notice
shall indicate the number of Unvested Shares to be repurchased and
the date on which the repurchase is to be effected, such date to be
not more than 30 days after the date of such notice. The
certificates representing the Unvested Shares to be repurchased
shall be delivered to Company prior to the close of business on the
date specified for the repurchase. Concurrently with the receipt of
such stock certificates, Company shall pay to Employee, in cash or
cash equivalents (including the cancellation of any purchase-money
indebtedness), an amount equal to the Purchase Price previously
paid for the Unvested Shares which are to be repurchased from
Employee.
2.3 Termination of the Repurchase
Right. The Repurchase
Right shall terminate with respect to any Unvested Shares for which
it is not timely exercised under Section 2.2. In addition, the
Repurchase Right shall terminate and cease to be exercisable with
respect to any and all Unvested Shares in which Participant vests
in accordance with the Vesting Schedule set forth in Exhibit
B.
Notwithstanding the foregoing, the
Unvested Shares shall become fully vested and shall no longer be
subject to the Repurchase Right upon a “Change of
Control.”
2.4 Recapitalization. Any
new, substituted or additional securities or other property
(including cash paid other than as a regular cash dividend) which
is by reason of any “Recapitalization” distributed with
respect to the Unvested Shares shall be immediately subject to the
Repurchase Right, but only to the extent the Unvested Shares are at
the time covered by such right. Appropriate adjustments to reflect
such distribution shall be made to the number and/or class of
Unvested Shares subject to this Agreement and to the price per
share to be paid upon the exercise of the Repurchase Right in order
to reflect the effect of any such Recapitalization upon
Company’s capital structure; provided, however, that the
aggregate purchase price shall remain the same. For purposes of
this Agreement, a “Recapitalization” shall mean any
stock split, stock dividend, recapitalization, reorganization,
combination of shares, exchange of shares, or other change
affecting the outstanding Common Stock as a class without the
Company’s receipt of consideration.
2.5 Corporate
Transaction.
(a) The Repurchase Right shall be
assignable by Company to any successor entity of Company in a
merger or consolidation, share exchange, or sale, transfer or other
disposition of all or substantially all of the Company’s
assets in complete liquidation or dissolution of the Company;
subject, however, to termination on the Repurchase Right in
accordance with Section 2.3 if a Change of Control has
occurred as a result thereof. However, to the extent the successor
entity does not accept such assignment, the Repurchase Right shall
lapse immediately prior to the consummation of the transaction with
such successor entity.
(b) To the extent the Repurchase
Right remains in effect following any such transaction, such right
shall apply to the new capital stock or other property (including
any cash payments) received in exchange for the Unvested Shares in
consummation of such transaction, but only to the extent the
Unvested Shares are at the time covered by such right. Appropriate
adjustments shall be made to the price per share payable upon
exercise of the Repurchase Right to reflect the effect of such
transaction upon Company’s capital structure; provided,
however, that the aggregate purchase price shall remain the
same.
3. Delivery of Certificates.
The certificates representing any Restricted Shares which are
subject to the Repurchase Right shall be held in escrow in
accordance with the provisions of this Agreement.
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4. Shareholder Rights.
Until such time as the Company
exercises the Repurchase Right, Employee (or any permitted
successor in interest) shall have all the rights of a shareholder
(including voting, dividend and liquidation rights) with respect to
the Restricted Shares, subject, however, to the transfer
restrictions of Sections 5.2 and 6.
5. Securities Law
Compliance.
5.1 Restricted Securities.
The Shares have not been registered under the Securities Act of
1933, as amended (the “1933 Act”), and are being issued
to Employee in reliance upon the exemption from such registration
provided by, among other exemptions, the nonpublic offering
exemption provided by Section 4(2) of the 1933 Act and,
therefore, are subject to restrictions on further transfer under
the 1933 Act. Employee hereby confirms that Employee has been
informed that the Shares are restricted securities under the 1933
Act and may not be resold or transferred unless the Shares are
first registered under the Federal securities laws or unless an
exemption from such registration is available. Accordingly,
Employee hereby acknowledges that Employee is prepared to hold the
Shares for an indefinite period and that Employee is aware that
Rule 144 issued under the 1933 Act which exempts certain resales of
unrestricted securities is not presently available to exempt the
resale of the Shares from the registration requirements of the 1933
Act.
5.2 Disposition of Shares.
Employee shall make no disposition of the Shares, which are not
subject to the Repurchase Right, unless and until there is
compliance with all of the following requirements:
(a) Employee shall have provided
Company with a written summary of the terms and conditions of the
proposed disposition.
(b) Employee shall have complied
with all requirements of this Agreement applicable to the
disposition of the Shares.
(c) Employee shall have provided
Company with written assurances, in form and substance satisfactory
to Company, that (i) the proposed disposition does not require
registration of the Shares under the 1933 Act or (ii) all
appropriate action necessary for compliance with the registration
requirements of the 1933 Act or any exemption from registration
available under the 1933 Act (including Rule 144) has been
taken.
Company shall not be required
(A) to transfer on its books any Shares which have been sold
or transferred in violation of the provisions of this Agreement or
(B) to treat as the owner of the Shares, or otherwise to
accord voting, dividend or liquidation rights to, any transferee to
whom the Shares have been transferred in contravention of this
Agreement.
5.3 Restrictive Legends. The
stock certificates for all the Shares shall be endorsed with the
legend set forth in subsection (a) below, and the stock
certificates for the Restricted Shares shall be endorsed with the
legend set forth in subsection (b) below:
(a) “The shares represented by
this certificate have not been registered under the Securities Act
of 1933. The shares may not be sold or offered for sale in the
absence of (i) an effective registration statement for the
shares under such Act, (ii) a “no action” letter
of the Securities and Exchange Commission with respect to such sale
or offer or (iii) satisfactory assurances to the Company that
registration under such Act is not required with respect to such
sale or offer.”
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(b) “The shares represented by
this certificate are unvested and are subject to certain repurchase
rights granted to the Company and accordingly may not be sold,
assigned, transferred, encumbered, or in any manner disposed of
except in conformity with the terms of a written agreement dated
April 19, 200
