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Exhibit 10.10
AMENDMENT NO. 1 TO
STOCKHOLDERS AGREEMENT
AMENDMENT NO. 1 TO STOCKHOLDERS AGREEMENT ("Amendment No. 1") dated as
of December 24, 1996 (the "Stockholders Agreement"), among International
Manufacturing Services, Inc., a Delaware corporation (the "Company"), Prudential
Private Equity Investors III, L.P., a Delaware limited partnership, Oak
Investment Partners VI, L.P., a California limited partnership, Oak VI
Affiliates Fund, L.P. a California limited partnership, the Investor
Stockholders listed on the signature pages hereof, Maxtor Corporation, a
Delaware corporation, and the management Stockholders listed on the signature
pages hereof.
WHEREAS, the Company wishes to acquire (the "Acquisition") the assets
and certain liabilities of Pentagon Systems, Inc. ("Pentagon"), a California
corporation, as contemplated by the Letter of Intent dated as of November 27,
1996 relating to the Acquisition, which is attached hereto as Exhibit A (the
"Letter of Intent");
WHEREAS, subject to the conditions of the Letter of Intent and the
related definitive documentation, the Company has agreed as part of the purchase
price to issue to Pentagon 300,000 shares of the Company's Common Stock;
WHEREAS, as a condition precedent to the Acquisition, the Company has
agreed to grant to those shareholders of Pentagon who acquire shares of the
Company's common stock in connection with the Acquisition "piggyback"
registration rights; and
WHEREAS, the Company desires to obtain the required consent under the
Stockholders Agreement to grant to Pentagon (including those shareholders of
Pentagon that acquire such shares from Pentagon) Piggyback Registration Rights
with respect to the Company's Common Stock issued in the Acquisition by amending
and restating the definition of the term "Registrable Securities" and adding
Pentagon (and such Pentagon shareholders) as parties to the Stockholder's
Agreement with respect to certain provisions thereof but solely as they relate
to such Piggyback Registration Rights.
NOW, THEREFORE, in consideration of the foregoing premises and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties to this Amendment No. 1 hereby agree as
follows:
SECTION 1. Defined Terms. All capitalized terms used but not defined
herein shall have the meanings assigned thereto in the Stockholders Agreement.
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SECTION 2. Amendment of the term "Registrable Securities".
The definition of the term "Registrable Securities" located in Section
12 of the Stockholders Agreement is hereby deleted and replaced with the
following:
"'Registrable Securities' means (i) any Initial Shares
which are shares of Common Stock (and any shares of Common Stock
issuable upon conversion of Initial Shares which are Preferred Shares)
(whether held by a Stockholder or any permitted successor or assignee
of a Stockholder), (ii) any Common Stock issued or issuable with
respect to the securities referred to in clauses (i) and (iv) by way
of a stock dividend or stock split or in connection with a combination
of shares, recapitalization, merger, consolidation or other
reorganization, (iii) Common Stock issuable upon the exercise of the
Maxtor Warrant (as defined in the Redemption Agreement), (iv) up to
300,000 shares of Common Stock issued by the Company in connection
with acquisition by the Company of the assets of Pentagon Systems,
Inc., a California corporation ("Pentagon"), and (v) any other shares
of Common Stock held by Persons holding securities described in
clauses (i) and (ii) of this sentence above; provided, however, that
the term 'Registrable Securities' shall include the shares of Common
Stock covered by clause (iv) above and any shares issued in respect
thereof as contemplated by clause (ii) above (collectively, the
"Pentagon Company Shares") only with respect to the rights and
obligations set forth in Sections 11.2, 11.3, 11.4, 11.5, 11.6, 11.7,
11.8, 11.9, 12 (to the extent applicable) 15, 16, 18, 19, 20, 21 and
22 of this Agreement. As to any particular Registrable Securities,
such securities will cease to be Registrable Securities when they have
been distributed to the public pursuant to an offering registered
under the Securities Act or are permitted to be sold to the public
through a broker, dealer or market maker in compliance with Rule 144
(other than pursuant to the provisions of Rule 144(k)) under the
Securities Act (or any similar rule then in force). For purposes of
this Agreement, a Person will be deemed to be a holder of Registrable
Securities whenever such Person has the right to acquire directly or
indirectly such Registrable Securities (upon conversion or exercise in
connection with a transfer of securities or otherwise, but
disregarding any restrictions or limitations upon the exercise of such
right), whether or not such acquisition has actually been effected."
SECTION 3. Addition of Section 23. The Stockholders Agreement is hereby
amended by inserting after Section 22 the following Section 23.
"23. Pentagon Provisions. (a) Solely with respect to Sections
11.2, 11.3, 11.4, 11.5, 11.6, 11.7, 11.8, 11.9, 12 (to the extent
applicable), 15, 16, 18, 19, 20, 21 and 22 of this Agreement, and only
for so long as the Pentagon Company Shares constitute Registrable
Securities, Pentagon and any permitted transferee of the Pentagon
Company Shares shall be deemed to be a party to this Agreement in
respect of the Pentagon Company Shares and such provisions.
Notwithstanding the foregoing, any notice required to be given to any
holder of Pentagon Company Shares shall be required to be given only to
Pentagon in the manner contemplated by Section 13 of this Agreement to:
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Pentagon Systems, Inc.
0000 X. Xxxxx Xxxxxx
Xxx Xxxx, Xxxxxxxxxx 00000-0000
Attention: Xx. Xxxxx Kothari
Telephone: (000) 000-0000
Fax: (000) 000-0000
with a copy to:
Xxxx Xxxxx, Esq.
Skjerven, Morrill, XxxXxxxxxx, Xxxxxxxx
& Xxxxx LLP
00 Xxxxx Xxxxx, #000
Xxx Xxxx, Xxxxxxxxxx 00000
Telephone: (000) 000-0000
Fax: (000) 000-0000
(b) Notwithstanding the other provisions of this Agreement and
for so long as any Pentagon Company Shares constitute Registrable
Securities, without the prior written consent of Pentagon (on its
behalf and on behalf of any holder of Pentagon Company Shares), this
Agreement shall not be amended in a manner that adversely impacts in
any material respect the rights or obligations in respect of the
Pentagon Company Shares under Section 11.2, 11.3, 11.4, 11.5, 11.6,
11.7, 11.8, 11.9, 12 (to the extent applicable), 15, 16, 18, 19, 20, 21
or 22 hereof."
SECTION 4. Effectiveness. This Amendment No. 1 shall become effective
upon (a) execution of this Amendment No. 1 by the Company and the holders of at
least 66.67% of the Registrable Securities and (b) the consummation of the
Acquisition and the issuance to Pentagon of the Company's Common Stock in
connection therewith.
SECTION 5. GOVERNING LAW. THIS AMENDMENT NO. 1 SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL SUBSTANTIVE LAWS (AND NOT THE
CONFLICTS LAW) OF THE STATE OF DELAWARE.
SECTION 6. Counterparts. This Amendment No. 1 may be executed in one or
more counterparts, each of which shall be deemed an original, but all of which
taken together shall constitute one and the same Agreement.
SECTION 7. Entire Agreement. This Amendment No. 1 and the Agreement
constitute the entire agreement of the parties with respect to the subject
matter thereof, and supersedes all previous agreements.
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SECTION 8. Ratification. Except as expressly amended hereby, each
provision of the Agreement shall remain in full force and effect and; as amended
hereby, the Agreement is in all respects agreed to, ratified and confirmed by
each party to the Agreement.
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IN WITNESS WHEREOF, this Amendment No. 1 has been executed as of the
date first written above.
INTERNATIONAL MANUFACTURING
SERVICES, INC.
By:____________________________________
Xxxxxx X. Xxxxxxx, President and
Chief Executive Officer
PRUDENTIAL PRIVATE EQUITY
INVESTORS III, L.P.
By: Prudential Equity Investors, Inc.
General Partner
By:____________________________________
Name:
Title:
OAK INVESTMENT PARTNERS VI, L.P.
By:____________________________________
Name:
Title:
OAK VI AFFILIATES FUND, L.P.
By:____________________________________
Name:
Title:
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MAXTOR CORPORATION
By:____________________________________
Name:
Title:
XXXXXXXXXX ASSOCIATES, 1992 L.P.
By:____________________________________
Name:
Title:
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INVESTOR STOCKHOLDERS:
XXXXXXX VENTURE CAPITAL FUND III, L.P.
By: Xxxxxxx Partners, Inc., general partner
By:
------------------------------------------
Name:
Title:
XXXXXXX TRUST COMPANY,
as Trustee of the Xxxxxxx MAP Venture Capital
Fund III
By:
-----------------------------------------
Name:
Title:
--------------------------------------------
Xxxxxxx X. Xxxxxx
(individually)
XXXXX AND XXXXX XXXX FAMILY TRUST
By:
-----------------------------------------
Name:
Title:
J. XXXXX XXXXX AND XXXXXX X. XXXXX
TRUST DATED 3/29/95
By:
-----------------------------------------
Name:
Title:
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Xxxxxx Xxxxxxx
(individually)
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Xxxxxxx Xxxxx
(individually)
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Xxxxxxx X. Xxxxxxx
(individually)
WS INVESTMENT COMPANY 96A
By:
------------------------------------
Name:
Title: general partner
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MANAGEMENT STOCKHOLDERS:
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Xxxxxx X. Xxxxxxx
(individually)
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Xxxx Xxxxxx
(individually)
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X.X. Xxxx
(individually)
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Xxxxxxx Xxxx
(individually)
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Xxxx Xxxxxx
(individually)
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Xxxxx Mahowold
(individually)
ACKNOWLEDGED AND AGREED:
PENTAGON SYSTEMS, INC.
By:
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Muder Kothari
President and Chief Executive Officer
