Exhibit 10.1
THE SECURITIES OFFERED HEREBY HAVE
NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE “ ACT ”), OR THE SECURITIES LAWS OF ANY
STATE AND ARE BEING OFFERED AND SOLD IN RELIANCE UPON EXEMPTIONS
FROM THE REGISTRATION REQUIREMENTS OF THE ACT. THE SECURITIES
PURCHASED HEREUNDER ARE SUBJECT TO RESTRICTIONS ON TRANSFER AND
RESALE UNDER A REGISTRATION RIGHTS AGREEMENT, AND MAY NOT BE
TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE ACT AND OTHER
APPLICABLE LAWS PURSUANT TO REGISTRATION OR EXEMPTION FROM
REGISTRATION REQUIREMENTS THEREUNDER AND UNDER SUCH
AGREEMENT.
STOCK SUBSCRIPTION
AGREEMENT
This Stock Subscription Agreement
(this “ Agreement ”) is made as of July 15,
2009, between hhgregg, Inc., a Delaware corporation (the “
Company ”), and the undersigned investors
(collectively, the “ Subscriber ”).
RECITALS
The Company desires to engage in a
public offering for the issuance and sale of shares of common
stock, par value $0.0001 per share, of the Company (the “
Common Stock ”), in the aggregate number of
3,000,000 (three million) shares exclusive of any
overallotment option (the “ Public Offering ”).
Concurrently with the Public Offering, the Company desires to
engage in a private offering of shares of Common Stock to the
Subscriber, subject to the representations, warranties, covenants
and conditions set forth herein (the “ Private
Offering ”).
The Company, Subscriber and certain
other parties have entered into a Registration Rights Agreement,
dated as of April 12, 2007 (as the same may be amended
from time to time in accordance with its terms, the “
Registration Rights Agreement ”), setting forth
certain agreements with respect to, among other things, the
registration, under the Securities and Exchange Act of 1934 (the
“ Exchange Act ”), of any shares of Common Stock
held by the Subscriber that constitute Registrable Securities, as
such term is defined in the Registration Rights
Agreement.
In connection with the Private
Offering, the Subscriber desires to purchase, and the Company
desire to sell to the Subscriber, shares of Common Stock, subject
to and in accordance with this Agreement.
In consideration of the foregoing,
and the representations, warranties, covenants and conditions set
forth below, the parties hereto, intending to be legally bound,
hereby agree as follows:
1. Sale and Purchase of Common
Stock
1.1. Subject to the conditions
hereof, the Company hereby agrees to issue and sell to Subscriber,
and Subscriber hereby agrees to subscribe for and purchase from the
Company, for investment, on the Closing Date (as defined below),
the number of shares of Common Stock set forth next to
Subscriber’s name on the signature page below (the “
Shares ”) at a purchase price equal to the price per
share to the public in the Public Offering (the “ Purchase
Price ”).
1.2. Subject to the satisfaction of
the conditions set forth in Sections 5.1 and 5.2 hereof, the
closing of the sale and purchase of the Shares provided for in
Section 1.1 hereof (the “ Closing ”) shall
take place at 10:00 a.m. (local time) at the offices of Bingham
McCutchen LLP, 399 Park Avenue, New York, New York, on or before
the date which is fourteen (14) calendar days following the
date of the closing of the Public Offering, or if later, such date
as may be agreed upon by the Company and the Subscriber that is
within three business days after the satisfaction of the conditions
set forth in Section 5.1 and 5.2 hereof, or on such other time
and date as may be agreed by the Company and the Subscriber. The
date on which the Closing is held is referred to in this Agreement
as the “ Closing Date ”.
1.3. On the Closing Date, against
payment by Subscriber of the Purchase Price by wire transfer of
immediately available federal funds, the Company shall direct
National City Bank, as transfer agent and registrar of its Common
Stock, to issue, register and deliver to the Subscriber the number
of shares of Common Stock set forth next to the Subscriber’s
name on the signature page below, in the form of stock
certificates.
1.4. The Company hereby agrees that
any shares of Common Stock to be purchased by the Subscriber under
this Agreement shall constitute Registrable Securities, as such
term is defined in the Registration Rights Agreement.
2. Certain Definitions
.
“ Rules and Regulations
” means the rules and regulations of the
Commission.
“ Securities Laws
” means, collectively, the Sarbanes-Oxley Act of 2002
(“ Sarbanes-Oxley ”), the Act, the Exchange Act,
the Rules and Regulations, the auditing principles, rules,
standards and practices applicable to auditors of “
issuers ” (as defined in Sarbanes-Oxley) promulgated
or approved by the Public Company Accounting Oversight Board and
the rules of the New York Stock Exchange (“ Exchange
Rules ”).
“ Subsidiary ”
has the meaning set forth in Rule 405 of the Rules and
Regulations.
3. Representations and Warranties
of the Company . The Company represents and warrants to
Subscriber that:
3.1. The Shares, when issued
hereunder and upon delivery of the consideration therefor, will be
duly authorized, validly issued, fully paid and non-assessable, and
free and clear of restrictions on transfer, liens, preemptive
rights or other encumbrances of any kind, other than those set
forth in the Registration Rights Agreement and applicable federal
and state securities laws.
3.2. The Company has been duly
incorporated and is validly existing as a corporation in good
standing under the laws of the State of Delaware, with power and
authority (corporate and other) to own its properties and conduct
its business as described in the
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Company’s Annual Report on Form 10-K for
its fiscal year ended March 31, 2009 and the Company’s
Current Report on Form 8-K filed with the SEC on
July 8, 2009 (collectively, the “ Exchange Act
Reports ”); and the Company is duly qualified to do
business as a foreign corporation and is in good standing in all
other jurisdictions in which its ownership or lease of property or
the conduct of its business requires such qualification, except
where the failure to so qualify or be in good standing would not,
individually or in the aggregate, result in a material adverse
effect on the condition (financial or otherwise), results of
operations, business, properties or prospects of the Company and
its Subsidiaries taken as a whole (“ Material Adverse
Effect ”).
3.3. Each Subsidiary of the Company
has been duly incorporated and is validly existing in good standing
under the laws of the jurisdiction of its incorporation, with power
and authority (corporate and other) to own its properties and
conduct its business as described in the Exchange Act Reports; and
each Subsidiary of the Company is duly qualified to do business as
a foreign corporation and is in good standing in all other
jurisdictions in which its ownership or leasing of property or the
conduct of its business requires such qualification, except where
the failure to so qualify or be in good standing would not,
individually or in the aggregate, result in a Material Adverse
Effect; all of the issued and outstanding capital stock of each
Subsidiary of the Company has been duly authorized and validly
issued and is fully paid and non-assessable; and, except as
described in the Exchange Act Reports, the capital stock of each
Subsidiary of the Company owned by the Company, directly or through
such Subsidiaries, is owned free from liens, encumbrances and
defects.
3.4. The outstanding shares of
capital stock of the Company have been duly authorized; the
authorized equity capitalization of the Company conforms to the
description in the Exchange Act Reports; all outstanding shares of
capital stock of the Company are validly issued, fully paid and
non-assessable; the stockholders of the Company have no preemptive
rights with respect to the Shares; and none of the outstanding
shares of capital stock of the Company have been issued in
violation of any preemptive or similar rights of any security
holder.
3.5. Except as disclosed in the
Exchange Act Reports, there are no contracts, agreements or
understandings between the Company or any of its Subsidiaries and
any other person granting such person the right to require the
Company to file a registration statement under the Act with respect
to any securities of the Company or any of its Subsidiaries owned
or to be owned by such person or to require the Company or any of
its Subsidiaries to include such securities in the securities
registered pursuant to any registration statement filed by the
Company under the Act.
3.6. Except for the Private
Placement Engagement Letter between the Company, Credit Suisse
Securities (USA) LLC, Barclays Capital Inc. and Wells Fargo
Securities, LLC, dated as of July 15, 2009, there are no contracts,
agreements or understandings between the Company and any person
that would give rise to a valid claim against the Company or
Subscriber for a brokerage commission, finder’s fee or other
like payment in connection with the Private Offering.
3.7. No consent, approval,
authorization, or order of, or filing or registration with, ANY
federal, state, local or other government, regulatory or
administrative authority or any court, tribunal or judicial or
arbitral body having jurisdiction over the Company or any of its
Subsidiaries or any of their respective properties (a “
Governmental Authority ”) is required to
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be obtained or made by the Company or Gregg
Appliances, Inc., an Indiana corporation (“ Gregg
Appliances ”), for the consummation of the transactions
contemplated by this Agreement in connection with the sale of the
Shares, except such as have been obtained, or made and such as may
be required under state securities laws.
3.8. Except as disclosed in the
Exchange Act Reports, the Company and its Subsidiaries have good
and marketable title to all real properties and all other
properties and assets owned by them, which are material to the
Company or Gregg Appliances, in each case free from liens, charges,
encumbrances and defects that would materially affect the value
thereof or materially interfere with the use made or to be made
thereof by them and, except as disclosed in the Exchange Act
Reports, the Company and its Subsidiaries hold any leased real or
personal property, which are material to the Company or Gregg
Appliances, under valid and enforceable leases with no terms or
provisions that would materially interfere with the use made or to
be made thereof by them.
3.9. The execution, delivery and
performance of this Agreement, the issuance and sale of the Shares
and the consummation of the transactions herein contemplated will
not result in a breach or violation of any of the terms and
provisions of, or constitute a default or a Debt Repayment
Triggering Event (as defined below) under, or result in the
imposition of any lien, charge or encumbrance upon any property or
assets of the Company or any of its Subsidiaries pursuant to,
(i) the charter or by-laws of the Company or any of its
Subsidiaries, (ii) any statute, rule, regulation or order of
any Governmental Authority, or (iii) any agreement or
instrument to which the Company or any of its Subsidiaries is a
party or by which the Company or any of its Subsidiaries is bound
or to which any of the properties of the Company or any of its
Subsidiaries is subject, except with respect to clauses
(ii) and (iii), such conflict, breach or violation or
imposition which would not have a Material Adverse Effect on the
Company or any of its Subsidiaries, the performance of this
Agreement or the consummation of any of the transactions
contemplated hereby; a “ Debt Repayment Triggering
Event ” means any event or condition that gives, or with
the giving of notice or lapse of time or both would give, the
holder of any note, debenture, or other evidence of indebtedness
(or any person acting on such holder’s behalf) the right to
require the repurchase, redemption or repayment of all or a portion
of such indebtedness by the Company or any of its
Subsidiaries.
3.10. Neither the Company nor any of
its Subsidiaries is in violation of its respective charter or
by-laws or in default (or with the giving of notice or lapse of
time or both would be in default) under any existing obligation,
agreement, covenant or condition contained in any indenture, loan
agreement, mortgage, lease or other agreement or instrument to
which any of them is a party or by which any of them is bound or to
which any of the properties of any of them is subject, except such
defaults that would not, individually or in the aggregate, have a
Material Adverse Effect.
3.11. This Agreement has been duly
authorized, executed and delivered by the Company.
3.12. The Company and its
Subsidiaries possess, and are in compliance with the terms of, all
certificates, authorizations, franchises, licenses and permits
(“ Licenses ”) necessary or material to the
conduct of the business now conducted or proposed in the Exchange
Act
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Reports to be conducted by them and have not
received any notice of proceedings relating to the revocation or
modification of any Licenses that, if determined adversely to the
Company or any of its Subsidiaries, would individually or in the
aggregate have a Material Adverse Effect.
3.13. No labor dispute with the
employees of the Company or any of its Subsidiaries exists or, to
the knowledge of the Company, is imminent that could have a
Material Adverse Effect.
3.14. With respect to any employment
benefit plan (as defined in Section 3(3) of ERISA) which the
Company maintains, contributes to or has any obligation to
contribute to, or with respect to which the Company has any
liability, contingent or otherwise (a “ Plan ”),
no prohibited transaction (as defined in Section 406 of ERISA,
or Section 4975 of the Internal Revenue Code of 1986, as
amended from time to time (the “ Code ”)) has
occurred, no “accumulated funding deficiency” (as
defined in Section 302 of ERISA) or any of the events set
forth in Section 4043(c) of ERISA (other than events with
respect to which the 30-day notice requirement under
Section 4043 of ERISA has been waived) has occurred, exists or
is reasonably expected to occur with respect to any Plan; each Plan
is in compliance in all material respects with applicable law,
including ERISA and the Code; the Company has not (i) failed
to timely make all required contributions to each Plan that is an
“employee benefit pension plan” within the meaning of
Section 3(2) of ERISA, or (ii) incurred or expects to
incur liability under Title IV of ERISA with respect to the
termination of, or withdrawal from, any Plan; and each Plan that is
intended to be qualified under Section 401(a) of the Code is
so qualified, and nothing has occurred, whether by action or
failure to act, which could reasonably be expected to cause a loss
of such qualification.
3.15. The Company and its
Subsidiaries own, possess or can acquire on reasonable terms,
adequate trademarks, trade names and other rights to inventions,
know-how, patents, copyrights, confidential information and other
intellectual property (collectively, “ intellectual
property rights ”) necessary to conduct the business now
operated by them, or presently employed by them, and have not
received any notice of infringement of or conflict with asserted
rights of others with respect to any intellectual property rights
that, if determined adversely to the Company or any of its
Subsidiaries, would individually or in the aggregate have a
Material Adverse Effect.
3.16. Except as disclosed in the
Exchange Act Reports, neither the Company nor any of its
Subsidiaries is in violation of any statute, rule, regulation,
decision or order of any Governmental Authority relating to the
use, disposal or release of hazardous or toxic substances or
relating to the protection or restoration of the environment or
human exposure to hazardous or toxic substances (collectively,
“ environmental laws ”), owns or operates any
real property contaminated with any substance that is subject to
any environmental laws, is liable
