Exhibit 10.24
FIFTH AMENDMENT AGREEMENT
This Fifth Amendment Agreement (the "Agreement") is executed and entered
into effective as of March 9, 1999 by and among Monitronics International, Inc.,
a Texas corporation (the "Company"), and the holders (the "Security Holders") of
certain obligations and securities of the Company whose names appear on the
signature pages to this Agreement.
RECITALS:
The Company and certain of the Security Holders are parties to, among other
agreements, the following agreements (collectively, the "Existing Security
Holder Agreements"): (i) Preferred Stock Subordination Agreement, dated as of
May 10, 1996, as amended by that certain Amendment Agreement dated as of
November 22, 1996 (the "First Amendment Agreement"), that certain Second
Amendment Agreement dated as of May 19, 1997 (the "Second Amendment Agreement"),
that certain Transfer, Assignment and Assumption Agreement and Third Amendment
Agreement dated as of January 1, 1998 (the "Third Amendment Agreement"), and
that certain Transfer, Assignment and Assumption Agreement and Fourth Amendment
Agreement dated as of July 22, 1998 (the "Fourth Amendment Agreement," and
collectively with the First Amendment Agreement, the Second Amendment Agreement
and the Third Amendment Agreement, the "Previous Amendment Agreements") (as so
amended, the "Preferred Subordination Agreement"); (ii) Amended and Restated
Co-Sale Agreement, dated May 10, 1996, as amended by the Previous Amendment
Agreements (as so amended, the "Hull Co-Sale Agreement") among the Company, CRL,
Austin Ventures and Xxxxx X. Xxxx ("Xxxx"); and (iii) Amended and Restated
Co-Sale Agreement, dated May 10, 1996, as amended by the Previous Amendment
Agreements (as so amended, the "Xxxxxxx Co-Sale Agreement") among the Company,
CRL, Austin Ventures and Xxxxxx X. Xxxxxxx.
The Company and certain of the Security Holders have entered into a Series
C Preferred Stock Purchase Agreement, dated as of February 22, 1999 (the "Series
C Purchase Agreement"), providing, among other things, for the purchase by
certain Security Holders of 1,409,375 shares of Series C Preferred Stock of the
Company (the "Purchasers"). Terms defined in the Series C Purchase Agreement or
in the Articles of Incorporation of the Company, as amended (the "Articles of
Incorporation"), and not otherwise defined herein are used herein with the same
meanings as defined in the Series C Purchase Agreement or in the Articles of
Incorporation, as applicable.
As a result of the transactions contemplated by the Series C Purchase
Agreement, the parties hereto desire to amend the Existing Security Holder
Agreements.
In consideration of the premises and the agreements herein contained, and
intending to be bound hereby, the parties hereby agree as follows:
1. Addition of Purchasers as Parties to the Existing Security Holder
Agreements. The parties to this Agreement hereby consent to and approve of the
addition of the Purchasers as parties to the Preferred Subordination Agreement,
the Hull Co-Sale Agreement and the Xxxxxxx Co-Sale Agreement, and acknowledge
and agree that such Purchasers shall be bound by all of the terms and conditions
of such agreements, as amended hereby and as from time to time in
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effect, and that such terms and conditions shall inure to the benefit of the
Purchasers. Notwithstanding the foregoing, Windward may transfer and sell shares
of Series C Preferred Stock to Bear, Steams & Co., Inc. or one or more of its
affiliates, as the case may be (collectively, "Bear"), without any restriction
under paragraph IA of the Hull Co-Sale Agreement or the Xxxxxxx Co-Sale
Agreement. In the event Windward transfers Series C Preferred Stock to Bear,
Bear shall be deemed a Purchaser for purposes of this Agreement and shall be
bound by all of the terms and conditions of this Agreement, and prior to
registration of any such transfer on the books of the Company, Bear shall
execute an agreement with the parties hereto agreeing to be bound hereby.
2. Amendments to Existing Security Holder Agreements.
(a) That the Preferred Subordination Agreement shall be amended by amending
the definitions of the terms "Notes," "Preferred Stock" and "Purchase Agreement"
to read in their entirety as follows:
"Notes" shall mean the 12.0% Senior Subordinated Notes due June 30, 2006
issued by the Company pursuant to the Purchase Agreement, and any notes
issued in exchange therefor or in replacement thereof, as the same may be
amended, modified or supplemented from time to time.
"Preferred Stock" shall mean the Company's preferred stock, $.0l par value
per share, as authorized by the Company's Articles of Incorporation as
filed and in effect on March 9, 1999, and as the same may be amended from
time to time.
"Purchase Agreement" shall mean the Senior Subordinated Note and Warrant
Purchase Agreement dated as of May 10, 1996 by and among the Company and
the Purchasers, as supplemented and modified by (i) the Senior Subordinated
Note and Warrant Purchase Agreement dated as of November 22, 1996 and (ii)
the Senior Subordinated Note and Warrant Purchase Agreement dated as of May
19, 1997, as amended by that certain Amendment dated as of March 13, 1998
and that certain Second Amendment dated as of January 13, 1999, and as such
agreement may be further amended, modified or supplemented from time to
time.
(b) That (i) all references to "Underlying Common Stock" in the Hull
Co-Sale Agreement and the Xxxxxxx Co-Sale Agreement shall be deemed to include
the shares of Common Stock issued or issuable upon conversion of the Series C
Preferred Stock, (ii) all references to "Purchasers" in the Hull Co-Sale
Agreement and the Xxxxxxx Co-Sale Agreement shall be deemed to include the
Purchasers, and (iii) all references to "Preferred Stock" in the Hull Co-Sale
Agreement and the Xxxxxxx Co-Sale Agreement shall be deemed to include the
Series C Preferred Stock.
(c) That each of the Hull Co-Sale Agreement and the Xxxxxxx Co-Sale
Agreement shall be amended so that paragraph 3B(a) of each such agreement is
hereby deleted in its entirety and replaced by the following:
"This Agreement shall terminate upon the earlier to occur of (i)(A) the
written agreement of the holders of at least 66 2/3% of the Series C
Preferred Stock,
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(B) the holders of at least 66 2/3% of the Underlying Common Stock then
outstanding and (C) the holders of at least 66 2/3% of the Common Stock
issued and issuable upon exercise of the Warrants, (ii) the acquisition by
a single purchaser of all of the issued and outstanding shares of the
Common Stock, Series C Preferred Stock, Warrants, Warrant Shares and the
Underlying Common Stock or (iii) the closing of a Qualified Public Offering
(as defined in the Series C Purchase Agreement)."
3. Miscellaneous.
(a) Effect. Except as amended hereby, the Existing Security Holder
Agreements shall remain in full force and effect.
(b) Descriptive Headings. The descriptive headings in this Agreement are
inserted for convenience only and do not constitute a part of this Agreement.
(c) Consents. Subject to compliance by the Purchasers with the terms of
this Agreement, each of the parties hereto (i) consents to the issuance of the
Shares of Series C Preferred Stock to the Purchasers pursuant to the terms of
the Series C Purchase Agreement and the adoption of the Articles of Amendment,
and (ii) agrees that such issuance and adoption will not constitute a breach or
default under any of the Series A Purchase Agreement, the Series B Purchase
Agreement, the Note Agreement or the Credit Agreement.
(d) Governing Law. The construction, validity and interpretation of this
Agreement will be governed by and construed in accordance with the domestic laws
of the State of Texas without giving effect to any choice of law or conflict of
law provision or rule (whether of the State of Texas or any other jurisdiction)
that would cause the application of the laws of any jurisdiction other than the
State of Texas
(e) Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument, and each of the parties hereto may execute this Agreement by signing
any such counterpart. Facsimile signatures shall be accepted for all purposes as
original signatures.
[Signature Pages Follow]
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IN WITNESS WHEREOF, this Fifth Amendment Agreement has been executed by the
parties hereto as of the day and year first above set forth.
COMPANY:
Monitronics International Inc.
By: /s/ Xxxxx X. Xxxx
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Xxxxx X. Xxxx, President
SECURITY HOLDERS:
Austin Ventures III-A, L.P.
By: AV Partners III, L.P.,
Its General Partner
By:
----------------------------------------
Xxxxxx X. Xxxxxx,
Authorized Signatory
Austin Ventures 111-B, L.P.
By: AV Partners III, L.P.,
Its General Partner
By:
----------------------------------------
Xxxxxx X. Xxxxxx,
Authorized Signatory
Austin Ventures V, L.P.
By: AV Partners V, L.P.,
Its General Partner
By
----------------------------------------
Xxxxxx X. Xxxxxx,
General Partner
SIGNATURE PAGE TO
FIFTH AMENDMENT AGREEMENT
IN WITNESS WHEREOF, this Fifth Amendment Agreement has been executed by the
parties hereto as of the day and year first above set forth.
COMPANY:
Monitronics International, Inc.
By:
----------------------------------------
Xxxxx X. Xxxx, President
SECURITY HOLDERS:
Austin Ventures III-A, L.P.
By: AV Partners III, L.P.,
Its General Partner
By: /s/ Xxxxxx X. Xxxxxx
----------------------------------------
Xxxxxx X. Xxxxxx,
Authorized Signatory
Austin Ventures III-B, L.P.
By: AV Partners III, L.P.,
Its General Partner
By: /s/ Xxxxxx X. Xxxxxx
----------------------------------------
Xxxxxx X. Xxxxxx,
Authorized Signatory
Austin Ventures V, L.P.
By: AV Partners V, L.P.,
Its General Partner
By: /s/ Xxxxxx X. Xxxxxx
----------------------------------------
Xxxxxx X. Xxxxxx
General Partner
SIGNATURE PAGE TO
FIFTH AMENDMENT AGREEMENT
Austin Ventures V Affiliates Fund, L.P.
By: AV Partners V, L.P.,
Its General Partner
By: /s/ Xxxxxx X. Xxxxxx
----------------------------------------
Xxxxxx X. Xxxxxx,
General Partner
Capital Resource Lenders II, L.P.
By: Capital Resource Partners II, L.P.
Its General Partner
By: /s/ Xxxxxx X. Ammern
----------------------------------------
Managing Partner,
----------------
General Partner
Hull Family Limited Partnership
By: Xxxxx X. Xxxx Management Trust
Its General Partner
By: /s/ Xxxxx X. Xxxx
----------------------------------------
Xxxxx X. Xxxx, Trustee
/s/ Xxxxxx X. Xxxxxxx
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Xxxxxx X. Xxxxxxx
/s/ Xxxxxxx Xxxxxx
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Xxxxxxx Xxxxxx
/s/ Xxxxxxx Xxxxxxx
--------------------------------------------
Xxxxxxx Xxxxxxx
/s/ Xxxxxxx Xxxxxxx
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Xxxxxxx Xxxxxxx
SIGNATURE PAGE TO
FIFTH AMENDMENT AGREEMENT
PURCHASERS:
Windward Capital Partners II, L.P.
By: Windward Capital XX XX, LLC,
Its General Partner
By: /s/ Xxxxx X. Xxxxxxxxx
----------------------------------------
Xxxxx X. Xxxxxxxxx,
Managing Member
Windward Capital XX XX, LLC
By: /s/ Xxxxx X. Xxxxxxxxx
----------------------------------------
Xxxxx X. Xxxxxxxxx,
Managing Member
Capital Resource Lenders II, L.P.
By: Capital Resources Partners II, L.P.
Its General Partner
By: /s/ Xxxxxx X. Ammern
----------------------------------------
Managing Partner,
----------------
General Partner
SIGNATURE PAGE TO
FIFTH AMENDMENT AGREEMENT