Exhibit 5
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 __,
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 __, 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
-------------------------------------
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: Xxxxxx Spring
Title: Principal
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
-------------------------------------
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
-------------------------------------
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
-------------------------------------
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
-------------------------------------
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
-------------------------------------
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
-------------------------------------
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
-------------------------------------
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
-------------------------------------
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
-----------------------------------
Name: Xxxx Xxxxxxxx
/s/ Xxxxxx Xxxxxxx
-----------------------------------
Xxxxxx Xxxxxxx
/s/ Xxxxxx Xxxxxxx
-----------------------------------
Xxxxxx Xxxxxxx
/s/ Xxxxxxxx Xxxxxxx
-----------------------------------
Xxxxxxxx X. Xxxxxxx
/s/ Xxxxx Xxxxxxxxxx
-----------------------------------
Xxxxx Xxxxxxxxxx
/s/ Xxxx X. Xxxxx
-----------------------------------
Xxxx X. Xxxxx
NON-MANAGEMENT STOCKHOLDER:
PRICE FAMILY LIMITED PARTNERS
By: /s/ Xxxxxxx Xxxxx
-------------------------------
Name: Xxxxxxx Xxxxx
Title: General Partner
