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Exhibit 4.24
STOCK PURCHASE AGREEMENT
(JPM CONSULTING INC.)
This STOCK PURCHASE AGREEMENT (this "Agreement") is dated as of
March
16, 2004, by and between CHIEF MANUFACTURING HOLDING CORP., a
Delaware
corporation (the "Company"), and JPM CONSULTING INC., a
Pennsylvania corporation
(the "Stockholder").
WHEREAS, the Company wishes to sell and the Stockholder wishes to
buy
certain shares of the Company's Class B Common Stock (as defined in
Section 1
hereof) on the terms and subject to the restrictions contained in
this
Agreement; and
NOW, THEREFORE, in consideration of the mutual promises and
agreements
set forth herein, the Company and the Stockholder agree as
follows:
1. DEFINITIONS. As used herein, the following terms shall have
the
meanings specified below:
"Affiliate" has the meaning specified in the Stockholder
Agreement.
"Act" has the meaning specified in Section 5 (a) hereof.
"Board" means the Board of Directors of the Company.
"Cause Event" shall mean the occurrence of, as determined by
the
Board, any one or more of the following events:
(i) the Stockholder or James P. Miller ("Miller") shall have
committed an act of fraud, embezzlement, or misappropriation
against the Company
or any of its Subsidiaries, including, but not limited to, the
offer, payment,
solicitation or acceptance of any unlawful bribe or kickback with
respect to the
business of the Company or any of its Subsidiaries; or
(ii) the Stockholder or Miller shall have been convicted by a
court of competent jurisdiction of, or pleaded guilty or nolo
contendere to, any
felony; or
(iii) the Stockholder or Miller shall have breached Section
10.1
or 10.2 of the Stock Purchase Agreement or any one or more of the
provisions of
the Stockholder Agreement; or
(iv) the Stockholder shall have terminated the Consulting
Agreement, or the Company shall have terminated the Consulting
Agreement
following (A) any breach by the Stockholder of any obligation of
the Stockholder
under the Consulting Agreement which is not cured within ten (10)
business days
after receipt by the Stockholder from the Company of a notice
describing such
breach, (B) any act of negligence by the Stockholder or any of its
employees
that causes or is reasonably likely to cause material harm to the
Company or its
reputation or the reputation of any of the Company's key officers
or significant
investors, or (C)
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Miller fails to make himself personally available to, or otherwise
fails in any
material respect and for any reason whatsoever (excluding death or
disability)
to provide consulting and advisory services to the Company at a
level and in a
manner consistent with the practices of the Stockholder and Miller
prior to the
"Closing Date" under the Purchase Agreement.
"Class A Common Stock" means the Company's Class A Voting
Common
Stock, $0.001 par value per share.
"Class B Common Stock" means the Company's Class B Non-Voting
Common
Stock, $0.001 par value per share.
"Class C Common Stock" means the Company's Class C Voting
Common
Stock, $0.001 par value per share.
"CMI" means Chief Manufacturing, Inc., a Massachusetts
corporation.
"Common Equity Value" means, as of any date, the fair market value
(as
determined in good faith by the Board) of the entire common stock
equity of the
Company (without premium for control or discounts for minority
interests,
restrictions on transfer or lack of voting rights or other premiums
or discounts
that would be applicable if less than all of the common stock
equity is sold in
a single transaction), calculated as of such date, plus the
aggregate
consideration to be paid to the Company upon the exercise of all
then
outstanding and exercisable warrants, options or convertible
securities pursuant
to which the Company is then obligated to issue shares of Common
Stock
(excluding any options or warrants for which the exercise price per
share
exceeds the Market Value Per Share of a share of Common Stock as of
such date).
"Common Stock" means the Class A Common Stock, the Class B
Common
Stock and the Class C Common Stock, and any capital stock of the
Company which
is (a) not preferred as to dividends or assets over any class of
stock of the
Company, (b) not subject to redemption, and (c) issued to the
holders of Common
Stock upon any reclassification thereof.
"Company" has the meaning specified in the preamble hereto.
"Consulting Agreement" means the Consulting Agreement, dated as
of
March 16, 2004, between CMI and the Stockholder.
"Delayed Closing Date" has the meaning specified in Section 7.2
hereof.
"Disposition Event" means (a) (i) the sale of all or substantially
all
of the assets of the Company or its Subsidiaries in a single
transaction or
series of related transactions whether by liquidation, dissolution,
merger,
consolidation or sale or (ii) the sale or other transfer of at
least 51% of the
outstanding shares of Common Stock in a single transaction or a
series of
related transactions, in either case to any Person who is not an
Affiliate of
the Company, or of a stockholder thereof, immediately prior to such
transaction
or transactions, or (b) the effective time of any merger, share
exchange,
consolidation, or other business combination of the Company if
immediately after
such transaction Persons who hold a majority of the outstanding
voting
securities entitled to vote generally in the election of directors
of the
surviving entity (or
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the entity owning 100% of such surviving entity) are not Persons
who,
immediately prior to such transaction, held the securities of the
Company
entitled to vote generally in the election of directors.
"Disposition Proceeds" means (i) in the case of a merger or any
other
stock transaction, (A) the average price per share received by the
holders of
Common Stock or by the Company or its Subsidiaries in connection
with such
transaction, multiplied by (B) the sum of (x) the total number of
shares of
Common Stock then outstanding, plus (y) the total number of shares
of Common
Stock issuable upon exercise or conversion of any then outstanding
and
exercisable warrants, options or convertible securities pursuant to
which the
Company is then obligated to issue shares of Common Stock, or (ii)
in the case
of any liquidation or sale of assets (including, without
limitation, the sale by
the Company of the capital stock of its Subsidiaries), the Net
Worth of the
Common Stock of the Company immediately prior to such liquidation
or immediately
after such sale.
"Market Value Per Share" means, with respect to any date, for
any
share of Common Stock, (i) the Common Equity Value as of such date,
divided by
(ii) the sum of (x) the total number of shares of Common Stock then
outstanding,
plus (y) the total number of shares of Common Stock issuable upon
exercise or
conversion of any outstanding and exercisable warrants, options or
convertible
securities pursuant to which the Company is then obligated to issue
shares of
Common Stock (excluding any options or warrants for which the
exercise price per
share exceeds the Market Value Per Share of a share of Common Stock
as of such
date).
"Net Worth" means, in connection with any liquidation or sale
of
assets by the Company, the consolidated net worth of the Common
Stock of the
Company and its Subsidiaries, determined in accordance with
generally accepted
accounting principles, taking into account (i) the total
consideration received
by the Company for such transaction, (ii) the transaction costs
incurred in
connection with such transaction and (iii) any liabilities of the
Company and
its Subsidiaries whether or not to be discharged in connection with
such
transaction (including, without limitation, payment of the
liquidation value and
accrued dividends on any Preferred Stock of the Company).
"Note" has the meaning specified in Section 2(a) hereof.
"Original Price Per Share" means $1.00 per Share for each share
of
Class B Common Stock.
"Person" means an individual, partnership, limited liability
company,
corporation, association, trust, joint venture, unincorporated
organization, or
any government, governmental department or agency or political
subdivision
thereof.
"Plan" means the Company's 2003 Equity Incentive Plan attached
hereto
as Exhibit A.
"Preferred Stock" means the Series A Preferred Stock and any
capital
stock of the Company which is (a) preferred as to dividends or
assets over any
other class of stock of the Company, (b) subject to redemption or
(c) issued to
the holders of shares of Preferred Stock upon any reclassification
thereof.
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"Public Sale" means the Company's initial public offering of
Common
Stock.
"Purchase Price" has the meaning specified in Section 2(a)
hereof.
"Repurchase Notice" has the meaning assigned to such term in
Section
3.3 hereof.
"Series A Preferred Stock" means the Company's Series A
Participating
Preferred Stock, $0.001 par value per share.
"Shares" has the meaning specified in Section 2(a) hereof.
"Stockholder" has the meaning specified in the introductory
paragraph
hereof.
"Stockholder Agreement" means the Stockholder Agreement, dated as
of
August 29, 2003, among the Company and its stockholders, as amended
and in
effect from time to time.
"Stock Purchase Agreement" means the Stock Purchase and
Exchange
Agreement, dated as of August 29, 2003, among the Company, Chief
Manufacturing
Acquisition Corp., CMI, the stockholders of CMI and the Seller
Representative
named therein, as amended and in effect from time to time.
"Subsidiary" means, with respect to the Company, any corporation,
a
majority (by number of votes) of the outstanding shares of any
class or classes
of which shall at the time be owned by the Company or by a
Subsidiary of the
Company, if the holders of the shares of such class or classes (a)
are
ordinarily, in the absence of contingencies, entitled to vote for
the election
of a majority of the directors (or persons performing similar
functions) of the
issuer thereof, even though the right so to vote has been suspended
by the
happening of such a contingency, or (b) are at the time entitled,
as such
holders, to vote for the election of a majority of the directors
(or persons
performing similar functions) of the issuer thereof, whether or not
the right so
to vote exists by reason of the happening of a contingency.
"Target
Amount" means $30,000,000; provided, that if the Company
enters into any extraordinary transaction, such as a business
acquisition or
disposition, the Board in the exercise of its business judgment may
adjust
upward or downward the Target Amount to take into account such
extraordinary
transaction.
"Target Disposition Event" means a Disposition Event in which
the
Disposition Proceeds equal or exceed the Target Amount.
"Termination of Consulting Services" means the termination of
the
Stockholder's consulting services provided to CMI under the
Consulting
Agreement, for any reason whatsoever.
"Transfer" has the meaning specified in Section 4 hereof.
"Unvested Shares" has the meaning specified in Section 3.1
hereof.
"Vested Shares" has the meaning specified in Section 3.1
hereof.
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2. PURCHASE AND SALE OF SHARES. (a) Subject to (i) the terms
and
conditions hereinafter set forth and in reliance on the
representations and
warranties contained herein, and (ii) the Company's receipt of any
and all
necessary consents, authorizations and approvals of the
transactions
contemplated by this Agreement, the Company hereby agrees to issue
and sell to
the Stockholder and the Stockholder hereby agrees to purchase from
the Company,
on the date hereof 25,000 shares of Class B Common Stock (the
"Shares"), which
will be evidenced by stock certificate number B9. The aggregate
purchase price
paid by the Stockholder for the Shares will be $25,000 (the
"Purchase Price").
On the date hereof (A) the full amount of the Purchase Price will
be paid to the
Company by delivery of the Stockholder's promissory note to the
Company in the
aggregate principal amount of the Purchase Price and in the form of
Exhibit B
