This excerpt taken from the TREE DEF 14A filed Mar 19, 2009.
Private Placement Transaction with Chief Executive Officer
On February 8, 2009, we entered into a stock purchase agreement with Mr. Lebda pursuant to which we agreed to sell him 935,000 shares of common stock at a purchase price of $3.91 per share for an aggregate purchase price of $3,655,850. The purchase price represents the closing market price of the common stock on the day prior to the execution of the stock purchase agreement. The shares are subject to certain transfer restrictions and vest over a 24-month period. Unvested shares held by Mr. Lebda are subject to a repurchase option in favor of the Company at $3.91 per share in the event of a change of control of the Company or if Mr. Lebda's employment with the Company terminates for any reason other than (i) death, (ii) disability, (iii) the Company's termination of his employment without Cause or (iv) Mr. Lebda's resignation from the Company for Good Reason (with such terms having the meaning provided them under Mr. Lebda's employment agreement). The Committee believes that Mr. Lebda's purchase of these shares will further align his interests with those of stockholders generally and provide him with a strong incentive to create stockholder value. The Compensation Committee also believes that the Company's ability to repurchase the shares in connection with Mr. Lebda's resignation or termination with Cause (as defined in his employment agreement) at the lesser of the then current market price or the original purchase price will serve as an added retention tool.
Prior to the spin-off in August 2008, we were a subsidiary of IAC and our compensation programs and philosophies were determined by IAC, acting in effect as our compensation committee. Accordingly, prior to the spin-off IAC determined all compensation elements for our Chief Executive Officer, while our Chief Executive Officer in turn made the determinations for our other executive officers, subject to IAC's review and approval.