**Exhibit 10.7**

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**AMENDMENT TO STOCK RESTRICTION AND REPURCHASE AGREEMENT AND STOCK PURCHASE AGREEMENT**

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This Amendment(the “Amendment”) is entered into as of the       dayof May, 2003, by and between PERRY JUDD’S HOLDINGS, INC., a Delawarecorporation (the “Corporation”), and Verne F. Schmidt (“Executive”), andconstitutes an amendment to (i) that certain Stock Restriction andRepurchase Agreement made as of February 3, 2000, by and between theCorporation and Executive, as amended on March 27, 2001 and September 20,2001 (the “Stock Restriction and Repurchase Agreement”), and (ii) that certainStock Purchase Agreement, dated as of June 1, 2000, by and between theCorporation and Executive, as amended on March 27, 2001 (the “StockPurchase Agreement”).  Capitalized termsused herein and not otherwise defined herein shall have the meanings ascribedto them in the Stock Restrictive and Repurchase Agreement.

 

WHEREAS, Executiveowns 5,718 shares of common stock of the Corporation (the “Purchased Shares”),of which 2,218 shares are subject to the Stock Restriction and RepurchaseAgreement, and 3,500 shares are subject to the Stock Purchase Agreement;

 

WHEREAS, upon aMandatory Redemption Event, including retirement from the Corporation afterattaining the age of 62, the Corporation is obligated to purchase, and theExecutive is obligated to sell, the Purchased Shares for Fair Market Value (the“Mandatory Repurchase”);

 

WHEREAS, as aninducement to Executive to forego retirement from the Corporation until atleast December 31, 2005, the Corporation has agreed to enter into thisAmendment of the Stock Restriction and Repurchase Agreement and the StockPurchase Agreement;

 

NOW, THEREFORE, inconsideration of the foregoing and the mutual representations, warranties, covenantsand agreements in this Amendment, the parties hereto, intending to be legallybound, agree as follows:

 

# 1.             Amendment to Mandatory Repurchase Process. Section C.2 of the Stock Restriction and Repurchase Agreement andSection E.2 of the Stock Purchase Agreement are each hereby amended andrestated in their entirety as follows:

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“**MandatoryRepurchase Process**.  Notlater than sixty (60) days after the occurrence of a Mandatory RedemptionEvent, the Corporation shall deliver a written notice to each Owner of thePurchased Shares.  The notice shallindicate the Mandatory Repurchase Price to be paid for the Purchased Shares andthe date on which the repurchase is to be effected, such date to be not morethan thirty (30) days after the date of such notice.  The certificates representing the Purchased Shares shall bedelivered to the Corporation on the closing date specified for therepurchase.  Concurrently with thereceipt of such stock certificates, the Corporation shall pay to the Owner(s)an amount equal to the Mandatory Repurchase Price pursuant to either of thefollowing alternative methods of payment determined in the sole discretion ofthe Corporation:  (a) in cash or

 

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cash equivalents (including the cancellation of any purchase-moneyindebtedness) or (b) by a Promissory Note; provided that, if the MandatoryRepurchase Price is $25 per share or greater, at least $25 of the totalMandatory Repurchase Price per share shall be paid for in cash or cashequivalents.

 

TheMandatory Repurchase Price payable by the Corporation with respect to thePurchased Shares which are to be repurchased from each Owner on a MandatoryRepurchase shall be the greater of (i) $146.68 per share, adjusted afterthe date hereof for any stock splits or reverse stock splits, or (ii) theFair Market Value of the Purchased Shares.

 

Notwithstanding the foregoing, in the event that a Subsequent ValueEvent is consummated within six (6) months after the date of a MandatoryRedemption Event and such Subsequent Value Event evidences a Subsequent Valuein excess of the Mandatory Repurchase Price (on a per share basis) determinedpursuant to the preceding paragraph, then the Mandatory Repurchase Price shallbe adjusted as follows: the Mandatory Repurchase Price to be paid per share inconnection with the Mandatory Redemption Event shall be directly increased bythe excess of the Subsequent Value per share over the Mandatory Purchase Pricepreviously paid per share.

 

The increase to the Mandatory Repurchase Price per share which resultsfrom such adjustment shall be hereinafter designated as the Excess Value pershare and shall be payable as follows: (x) if the Corporation elected topay the original Mandatory Repurchase Price in cash or cash equivalents, thensuch Excess Value shall be payable in cash or cash equivalents within ninety(90) days after the Subsequent Value Event, or (y) if the Corporation electedto pay such Mandatory Repurchase price partly in cash or cash equivalents andthe balance by Promissory Note, then the principal amount of the PromissoryNote shall be increased in an amount equal to such Excess Value, as the date ofissuance of such Promissory Note, and the installment amounts shall bereamortized for such increased principal amount.  In the latter event, the Corporation shall deliver to each owner,in exchange for such Owner’s original Promissory Note, a new Promissory Notewith such revised terms.”

 

# 2.             Change of Control Transaction. The Stock Restriction and Repurchase Agreement and the Stock PurchaseAgreement are each hereby amended by adding the following as Section C.5and E.5, respectively:

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“5.           Change of ControlTransaction.  Within sixty (60) daysafter a Change of Control Transaction (as defined herein) in which an Ownerreceives consideration for all or a portion of the Purchased Shares, theCorporation shall pay to such Owner in cash the difference between the valueper share received, or to be received, for the Purchased Shares by such Ownerin the Change of Control Transaction, and the Mandatory Repurchase Price.  “Change of Control Transaction” shall mean(i) a merger or consolidation in which the Corporation is not thesurviving entity, (ii) a sale, transfer or other disposition of all orsubstantially all of the Corporation’s assets, or (iii) a reverse merger inwhich the Corporation is the surviving entity but in which the Corporation’soutstanding voting securities are transferred in whole or in part to a person

 

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or persons different from the persons holding those securitiesimmediately prior to the merger.”

 

# 3.             Amendment to Mandatory Redemption Event. Section H.17 of the Stock Restriction and Repurchase Agreement andSection L.18 of the Stock Purchase Agreement are each hereby amended andrestated in their entirety as follows:

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“MandatoryRedemption Event” shall mean (A) the Stockholder’s death, (B) theStockholder’s Permanent Disability, (C) the Stockholder’s resignation orretirement from the Corporation on or after December 31, 2005, or (D) thetermination of the Stockholder’s services upon a Change of ControlTransaction.”

 

# 4.             Entire Amendment.  ThisAmendment constitutes the entire agreement among the parties pertaining to thesubject matter hereof and supercedes any and all prior or contemporaneousamendments relating to the subject matter hereof.  Except as expressly amended hereby, the Stock Restriction andRepurchase Agreement and the Stock Purchase Agreement shall remain unchangedand in full force and effect.  ThisAmendment shall be deemed part of and is hereby incorporated into the StockRestriction and Repurchase Agreement and the Stock Purchase Agreement.  To the extent that any terms or conditionsof the Stock Restriction and Repurchase Agreement and the Stock PurchaseAgreement shall contradict or be in conflict with any terms or conditions ofthis Amendment, the terms and conditions of this Amendment shall control.

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# 5.             Counterparts.  ThisAmendment may be executed in any number of counterparts, all of which takentogether shall constitute one and the same instrument and any of the partieshereto may execute this Amendment by signing any such counterpart.

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# 6.             Amendments.  ThisAmendment cannot be altered, amended, changed or modified in any respect orparticular except by an instrument in writing signed by both the Corporationand Executive.

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[Signature page follows.]

 

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IN WITNESSWHEREOF, the undersigned have caused this Amendment to the Stock PurchaseAgreement to be executed and delivered as of the date first written above.

 
|   | PERRY JUDD’S HOLDINGS,  INC. |
|--------|-----------------------------------|
|   |                              |
|   |                              |
|   | By:                               |   |   |
|   | Name:                             |
|   | Title:                            |
|   |                              |
|   | Address:                          | 575 West Madison Street |
|   |                              | Waterloo, Wisconsin 53594 |
|   |                              | Attention: Chief Executive Officer |
|   |                              |
|   |                              |
|   | EXECUTIVE                         |
|   |                              |
|   |                              |   |
|   | Name: Verne F. Schmidt            |
|   |                              |
|   | Address:                          |   |   |
|   |                              |   |   |
|        |                                   |  |  |  |  |

 

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