EXHIBIT 19
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EXECUTION COPY
TERMINATION OF THE STOCKHOLDERS' AGREEMENT
This Termination of the Stockholders' Agreement (this "AGREEMENT") is
made and entered into as of October 21, 2003 by and among Infocrossing, Inc.
(f/k/a Computer Outsourcing Services Inc.), a Delaware corporation (the
"COMPANY"), MidOcean Capital Investors, L.P. ("MIDOCEAN"), Sandler Capital
Partners V, L.P., Sandler Capital Partners V FTE, L.P., Sandler Capital Partners
V Germany, L.P., Sandler Technology Partners Subsidiary, LLC, and Sandler
Co-Investment Partners, L.P. (each individually, a "SANDLER ENTITY," and,
collectively, the "SANDLER ENTITIES"), Xxxxxx Xxxxxxx Strategic Partners Fund,
L.P., Strategic Associates, L.P., Camden Partners Strategic Fund II-A, L.P., and
Camden Partners Strategic Fund II-B, L.P. (each individually, a "CAMDEN ENTITY"
and, collectively, the "CAMDEN ENTITIES"), the individuals designated as a
"Management Stockholders" on the signature pages hereto (each individually, a
"MANAGEMENT STOCKHOLDER" and, collectively, the "MANAGEMENT STOCKHOLDERS") and
the entity designated as a "Non-Management Stockholder" on the signature pages
hereto (the "NON-MANAGEMENT STOCKHOLDER") (each of MidOcean, each Sandler
Entity, each Camden Entity, each Management Stockholder and the Non-Management
Stockholder is hereinafter referred to as a "STOCKHOLDER").
RECITALS
WHEREAS, reference is hereby made to the Second Amended and Restated
Stockholders Agreement (the "EXISTING STOCKHOLDERS AGREEMENT"), dated February
1, 2002, by and among the Company, DB Capital Investors, L.P. (as the
predecessor-in-interest to MidOcean), certain of the Sandler Entities and
certain of their predecessors-in-interest, the Camden Entities, the Management
Stockholders party thereto and the Non-Management Stockholders party thereto,
and the Exchange Agreement (the "EXCHANGE AGREEMENT"), dated as of October 16,
2003, by and among the Company, MidOcean, the Sandler Entities and Price Family
Limited Partners (collectively, the "PREFERRED HOLDERS").
WHEREAS, upon the terms and subject to the conditions set forth in the
Exchange Agreement, the Preferred Holders have agreed to exchange their shares
of 8% Series A Cumulative Convertible Participating Preferred Stock, par value
$0.01 per share (the "EXISTING SERIES A PREFERRED STOCK"), and the Series A
Common Stock Warrants (the "EXISTING WARRANTS") to purchase Common Stock, $0.01
par value per share, of the Company (the "COMMON STOCK") for an aggregate
consideration of (i) $55.0 million in cash and (ii) $25.0 million in aggregate
principal amount of loans.
WHEREAS, pursuant to Sections 7.1(g) and 7.2(h) of the Exchange
Agreement, the execution and delivery of this Agreement is a condition to the
consummation of the transactions contemplated by the Exchange Agreement; and
WHEREAS, the Company, MidOcean, the Sandler Entities, the Camden
Entities, the Management Stockholders listed on the signature pages hereto
representing at least 66-2/3% in interest of the Management Stockholders party
to the Existing Stockholders Agreement
and acting on their behalf pursuant to Section 6.12 of the Existing Stockholders
Agreement and the Non-Management Stockholder listed on the signature pages
hereto representing at least 66-2/3% in interest of the Non-Management
Stockholders party to the Existing Stockholders Agreement and acting on their
behalf pursuant to Section 6.12 of the Existing Stockholders Agreement wish to
terminate the Existing Stockholders Agreement as set forth below, effective as
of the Closing under the Exchange Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual covenants herein set
forth and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto hereby agree to terminate the
Existing Stockholders Agreement as follows (capitalized terms used but not
defined herein shall have the respective meanings ascribed thereto in the
Exchange Agreement):
1. TERMINATION AND WAIVER.
1.1 TERMINATION. The undersigned parties hereby acknowledge and
agree that as of the Closing under the Exchange Agreement, the Existing
Stockholders Agreement shall be terminated and of no further force or effect and
all rights and obligations of the undersigned Stockholders and the Company
existing on or prior to the date hereof or that may exist after the date hereof,
in each case, arising from the Existing Stockholders Agreement shall be
terminated and of no further force or effect.
1.2 WAIVERS.
(a) The Company and each of the undersigned Stockholders,
to the extent applicable, hereby waive any condition, right, notice requirement,
breach, or default under the Existing Stockholders Agreement and any predecessor
agreements (including, without limitation, waivers of the notice requirement,
approvals and consents required under Sections 2.2, Section 4.1(e), (g) and (h)
and Section 5.1 and 5.2 under the Existing Stockholders Agreement) in connection
with, and grants any and all of its consents and approvals under the Existing
Stockholders Agreements and any predecessor agreements to permit, the
consummation of the Transactions contemplated by the Exchange Agreement,
including without limitation the Exchange, the Private Placement and the Term
Loan Agreement.
(b) Each of the Company, MidOcean, the Camden Entities,
the Management Stockholders and the Non-Management Stockholder hereby
acknowledges receipt of the transfer notice, dated as of October 15, 2003, by
certain Sandler Entities in connection with the assignment of certain securities
of the Company and hereby waives any notice requirement, approval or consent
required under the Existing Stockholders Agreement (including, without
limitation, waiver of the notice requirement under Section 2.2(c) of the
Existing Stockholders' Agreement) in connection with the assignment of such
securities.
2. REPRESENTATIONS AND WARRANTIES.
Each party hereto represents and warrants that (i) such party has the
authority and power to enter into and perform this Agreement, (ii) the execution
and performance by such party of this Agreement has been duly authorized by all
necessary action of such party and (iii) this Agreement has been duly executed
and delivered by such party, and
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constitutes the legal, valid and binding obligation of such party, enforceable
against it in accordance with its terms except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization, moratorium,
liquidation or similar laws relating to, or affecting generally the enforcement
of, creditors' rights and remedies or by other equitable principles of general
application.
3. MISCELLANEOUS.
3.1 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY,
INTERPRETED UNDER, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW
YORK, REGARDLESS OF THE LAWS THAT MIGHT OTHERWISE GOVERN UNDER APPLICABLE
PRINCIPLES OF CONFLICTS OF LAW THEREOF.
3.2 ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement of the parties with respect to the subject matter hereof and
supersedes all prior and contemporaneous agreements, representations,
understandings, negotiations and discussions between the parties, whether oral
or written, with respect to the subject matter hereof, including, without
limitation, the Existing Stockholders' Agreement.
3.3 COUNTERPARTS; EXECUTION BY FACSIMILE SIGNATURE. This Agreement
may be executed in counterparts, each of which shall be deemed an original, but
all of which taken together shall constitute one and the same instrument. This
Agreement may be executed by facsimile signature(s).
3.4 FURTHER ASSURANCES. Each party hereto, upon the request of any
other party hereto, shall do all such further acts and execute, acknowledge and
deliver all such further instruments and documents as may be necessary or
desirable to carry out the transactions contemplated by this Agreement.
3.5 SPECIFIC PERFORMANCE. The parties hereto agree that the remedy
at law for any breach of this Agreement may be inadequate, and that any party by
whom this Agreement is enforceable shall be entitled to specific performance in
addition to any other appropriate relief or remedy. Such party may, in its sole
discretion, apply to a court of competent jurisdiction for specific performance
or injunctive or such other relief as such court may deem just and proper in
order to enforce this Agreement, or prevent any violation hereof, and, to the
extent permitted by Applicable Law, each party waives any objection to the
imposition of such relief.
3.6 EFFECTIVENESS. This Agreement shall become effective upon the
date first written above.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first set forth above.
INFOCROSSING, INC.
By: /s/ Xxxx Xxxxxxxx
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Name: Xxxx Xxxxxxxx
Title: Chief Executive Officer
MIDOCEAN CAPITAL INVESTORS, L.P.
By: MidOcean Capital Partners, L.P.,
its general partner
By: Existing Fund GP, LTD., its
general partner
By: /s/ Xxxxxx Spring
-------------------------------------
Name:
Title:
SANDLER CAPITAL PARTNERS V, L.P.
By: Sandler Investment Partners, L.P.,
General Partner
By: Sandler Capital Management, General
Partner
By: MJDM Corp., a General Partner
By: /s/ Xxxxx Xxxxxxxx
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Name: Xxxxx Xxxxxxxx
Title: President
SANDLER CAPITAL PARTNERS V, FTE, L.P.
By: Sandler Investment Partners, L.P.,
General Partner
By: Sandler Capital Management, General
Partner
By: MJDM Corp., a General Partner
By: /s/ Xxxxx Xxxxxxxx
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Name: Xxxxx Xxxxxxxx
Title: President
SANDLER CAPITAL PARTNERS V GERMANY, L.P.
By: Sandler Investment Partners, L.P.,
General Partner
By: Sandler Capital Management, General
Partner
By: MJDM Corp., a General Partner
By: /s/ Xxxxx Xxxxxxxx
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Name: Xxxxx Xxxxxxxx
Title: President
SANDLER TECHNOLOGY PARTNERS SUBSIDIARY,
LLC
By: Sandler Technology Partners, L.P.,
Manager
By: Sandler Investment Partners, L.P.,
General Partner
By: Sandler Capital Management, General
Partner
By: MJDM Corp., a General Partner
By: /s/ Xxxxx Xxxxxxxx
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Name: Xxxxx Xxxxxxxx
Title: President
SANDLER CO-INVESTMENT PARTNERS, L.P.
By: Sandler Capital Management, General
Partner
By: MJDM Corp., a General Partner
By: /s/ Xxxxx Xxxxxxxx
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Name: Xxxxx Xxxxxxxx
Title: President
CAMDEN PARTNERS STRATEGIC FUND II-A, L.P.
By: Camden Partners Strategic II, LLC,
its General Partner
By: /s/ Xxxxx X. Xxxxxxx
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Name: Xxxxx X. Xxxxxxx
Title: Managing Member
CAMDEN PARTNERS STRATEGIC FUND II-B, L.P.
By: Camden Partners Strategic II, LLC,
its General Partner
By: /s/ Xxxxx X. Xxxxxxx
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Name: Xxxxx X. Xxxxxxx
Title: Managing Member
XXXXXX, XXXXXXX STRATEGIC PARTNERS FUND,
L.P.
By: Camden Partners Strategic II, LLC,
its General Partner
By: /s/ Xxxxx X. Xxxxxxx
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Name: Xxxxx X. Xxxxxxx
Title: General Partner
STRATEGIC ASSOCIATES, L.P.
By: Camden Partners Strategic II, LLC,
its General Partner
By: /s/ Xxxxx X. Xxxxxxx
-------------------------------------
Name: Xxxxx X. Xxxxxxx
Title: General Partner
MANAGEMENT STOCKHOLDERS:
/s/ Xxxx Xxxxxxxx
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Name: Xxxx Xxxxxxxx
/s/ Xxxxxx Xxxxxxx
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Xxxxxx Xxxxxxx
/s/ Xxxxxx Xxxxxxx
--------------------------------------
Xxxxxx Xxxxxxx
/s/ Xxxxxxxx X. Xxxxxxx
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Xxxxxxxx X. Xxxxxxx
/s/ Xxxxx Xxxxxxxxxx
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Xxxxx Xxxxxxxxxx
/s/ Xxxx X. Xxxxx
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Xxxx X. Xxxxx
NON-MANAGEMENT STOCKHOLDER:
PRICE FAMILY LIMITED PARTNERS
By: /s/ Xxxxxxx Xxxxx
---------------------------------
Name: Xxxxxxx Xxxxx
Title: General Partner
