Exhibit 10.1


 





COOPERATION AGREEMENT


 


This Cooperation Agreement (this “Agreement”)
is made and entered into as of February 25, 2019, by and among Benchmark Electronics, Inc. (the “Company”),
Engaged Capital, LLC (“Engaged”) and each of the other related Persons (as defined below) set forth on the signature
pages hereto (collectively with Engaged, the “Engaged Group”). The Engaged Group and each of their Affiliates
(as defined below) and Associates (as defined below) are collectively referred to as the “Investors”. The Company
and the Investors are referred to herein as the “Parties”.


 


RECITALS


 


WHEREAS, the Engaged Group Beneficially
Owns (as defined below) shares of common stock, par value $0.10 per share, of the Company (the “Common Stock”)
totaling, in the aggregate, 2,116,559 shares, or approximately 5.2%, of the Common Stock issued and outstanding on the date hereof;


 


WHEREAS, the Engaged Group submitted a letter
to the Company on January 28, 2019 (the “Nomination Letter”) nominating three director candidates to be elected
to the Company’s board of directors (the “Board”) at the 2019 annual meeting of shareholders of the Company
(the “2019 Annual Meeting”); and


 


WHEREAS, the Company and the Investors have
determined to come to an agreement with respect to certain matters as provided in this Agreement.


 


NOW, THEREFORE, in consideration of the
foregoing premises and the mutual covenants and agreements contained herein, and for other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the Parties hereto, intending to be legally bound hereby, agree as follows:


 


1. Board Matters. (a) (i) During
the period (the “Nomination Term”) beginning on the day after the date of the 2019 Annual Meeting and ending
on the close of business on the date that is fifteen (15) calendar days before the advance notice deadline set forth in the Company’s
by-laws for the 2020 annual meeting of shareholders of the Company (the “2020 Annual Meeting”), Engaged shall
have the right during any Nomination Window (as defined below) to provide the Company with written notice (the “Notice”)
of its request that the Board appoint Glenn W. Welling (the “New Director”) to the Board (with an initial term
expiring at the 2020 Annual Meeting). In order for the Notice to be properly provided, Engaged must certify that the New Director
is willing and able to serve on the Board and the New Director must complete and deliver to the Company the Company’s standard
director and officer questionnaire and other reasonable and customary director documentation required by the Company in connection
with the election of Board members.


 


(ii) If the Company receives a
proper Notice requesting that the Board appoint the New Director to the Board and certifying that the New Director is willing and
able to serve on the Board, then the Board shall make a determination, after a prompt, good faith, reasonable and customary review,
(A) whether the New Director qualifies as “independent” under the listing standards of the New York Stock Exchange
and the Company’s Corporate Governance Guidelines and (B) whether the New Director would fail to satisfy any of the other
criteria and requirements set forth in Section 1(e) due to an event or fact that occurs or becomes known to the Board after
the date hereof (an “Intervening Event”). Within five business days of the Board determining that the New Director
qualifies as “independent” under the listing standards of the NYSE and the Company’s Corporate Governance Guidelines
and would not fail to satisfy any of the other criteria and requirements set forth in Section 1(e) due to an Intervening
Event, the Board shall take all necessary actions to appoint the New Director to the Board (with an initial term expiring at the
2020 Annual Meeting), including if necessary increasing the size of the Board. If the Board determines that the New Director is
not independent pursuant to the listing standards of the NYSE or the Company’s Corporate Governance Guidelines or would fail
to satisfy any of the other criteria and requirements set forth in Section 1(e) as a result of an Intervening Event, then
the Board shall not be required to appoint the New Director to the Board.


 


(iii) If Engaged has delivered
a Notice and the New Director has been appointed to the Board, the Board shall give the New Director the same due consideration
for membership to any committee of the Board as any other independent director.


 






     


     


    

 


(b) If Engaged has delivered a Notice and
the New Director has been appointed to the Board, so long as the New Director is a member of the Board: (i) the Board will not
form an executive committee of the Board or any other committee of the Board with functions similar to those customarily granted
to an executive committee unless, in each case, the New Director is a member of such committee and (ii) all Board consideration
of, and voting with respect to, any tender offer or exchange offer, merger, acquisition, business combination, reorganization,
restructuring, recapitalization, sale or acquisition of material assets, liquidation or dissolution, in each case involving the
Company or its securities or a material amount of the assets or business of the Company, will take place only at the full Board
level or in committees of which the New Director is a member.


 


(c) Notwithstanding anything to the contrary
in this Agreement, if at any time after the date of this Agreement, (i) the members of the Engaged Group (together with their controlled
Affiliates) collectively cease to have Beneficial Ownership of at least the lesser of (1) 2.5% of the outstanding Voting Securities
(as defined below) of the Company and (2) 1,092,759 shares of Common Stock or (ii) any member of the Engaged Group materially breaches
any of its obligations under this Agreement, then (x) if the New Director is serving on the Board at such time, the New Director
shall, and each member of the Engaged Group shall cause the New Director to, promptly tender his resignation from the Board and
any committee of the Board on which he may be a member and (y) the Company shall have no further obligations under this Section
1. In furtherance of the foregoing, the New Director shall, simultaneously with the delivery of a Notice by Engaged, and each
member of the Engaged Group shall cause the New Director to, execute an irrevocable resignation in the form attached hereto as
Exhibit A.


 


(d) If Engaged has delivered a Notice and
the New Director has been appointed to the Board, from and after the date of the 2019 Annual Meeting, for any annual meeting of
the shareholders of the Company, so long as the New Director is on the Board, the Company shall notify the Engaged Group in writing
no less than thirty (30) calendar days before the advance notice deadline set forth in the Company’s by-laws if the New Director
is to be nominated by the Company for election as a director at such meeting. If the Engaged Group is notified by the Company that
the New Director is to be nominated, and the New Director agrees to serve as a director, the Company shall use its reasonable best
efforts to cause the election of the New Director to the Board at such meeting (including listing the New Director in the proxy
statement and proxy card prepared, filed and delivered in connection with such meeting and recommending that the Company’s
shareholders vote in favor of the election of the New Director and otherwise supporting him for election in a manner no less rigorous
and favorable than the manner in which the Company supports its other nominees in the aggregate). Each member of the Engaged Group
agrees to provide, or cause to be provided, to the Company, simultaneously with the delivery of a Notice by Engaged, such information
as is required to be disclosed in proxy statements under applicable law or is otherwise necessary for appointment of the New Director
to the Board or inclusion of the New Director on a slate of directors, as applicable.


 


(e) If the New Director is appointed to
the Board, the New Director shall, and each member of the Engaged Group shall cause the New Director to: (i) comply with the
Company’s Code of Conduct and Corporate Governance Guidelines, including all policies, procedures, processes, codes, rules,
standards and guidelines applicable to members of the Board, including all applicable conflict of interest, confidentiality, stock
ownership, insider trading and corporate governance policies, guidelines and manuals of the Company; (ii) not enter into any agreement,
arrangement or understanding with any Person (A) other than the Company with respect to any direct or indirect compensation, reimbursement
or indemnification in connection with service or action as a director of the Company, (B) concerning how the New Director will
act or vote on any issue or question or (C) that could limit or interfere with the New Director’s ability to comply with
the New Director’s fiduciary duties under applicable law; (iii) keep confidential any and all information concerning or relating
to the Company or any of its Affiliates or Associates, together with any notes, analyses, reports, models, compilations, studies,
interpretations, documents, records or extracts thereof containing, referring to, relating to, based upon or derived from such
information, in whole or in part and not disclose to any third parties discussions or matters considered in meetings of the Board
or Board committees; and (iv) complete the Company’s standard director and officer questionnaire and other reasonable and
customary director documentation required by the Company in connection with the election of Board members. The New Director will
be subject to the same protections and obligations, and shall have the same rights and benefits, as are applicable to all other
directors of the Company.


 


(f) The Engaged Group hereby irrevocably
withdraws the Nomination Letter.


 






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2. Standstill. (a) For the purposes
of this Agreement, the “Restricted Period” shall mean the period from and after the date of this Agreement until
the later of (x) the day that is the earlier to occur of (i) the date that is fifteen (15) calendar days prior to the first anniversary
of the deadline for submission of shareholder nominations of director candidates for the 2019 Annual Meeting and (ii) the date
that is fifteen (15) calendar days prior to the deadline for submission of shareholder nominations of director candidates for the
2020 Annual Meeting and (y) if Engaged has delivered a Notice and the New Director has been appointed to the Board, the date that
the New Director no longer serves on the Board.


 


(b) During the Restricted Period, none of
the Investors shall, directly or indirectly, and each Investor agrees and shall cause each of its Affiliates and Associates not
to, directly or indirectly, with respect to the Company (it being understood that the foregoing shall not restrict the New Director
from taking any action in his capacity as a director in a manner consistent with his fiduciary duties to the Company):


 


(i) solicit proxies or written
consents of shareholders (including any solicitation of consents with respect to the call of a special meeting of shareholders)
or conduct any other type of referendum (binding or non-binding) with respect to, or from the holders of Voting Securities, or
become a “participant” (as such term is defined in Instruction 3 to Item 4 of Schedule 14A promulgated by the Securities
and Exchange Commission (the “SEC”) under the Securities Exchange Act of 1934, as amended (the “Exchange
Act”)) in or in any way engage or assist any third party in any “solicitation” (as such term is defined under
the Exchange Act) of any proxy, consent or other authority to vote or withhold from voting any Voting Securities;


 


(ii) knowingly encourage, advise
or influence any Person, or knowingly assist any third party in so encouraging, advising or influencing any Person, with respect
to the giving or withholding of any proxy, consent or other authority to vote any Voting Securities or in conducting any type of
referendum;


 


(iii) form, join or in any way
participate in a partnership, limited partnership, syndicate or “group” (as defined under Section 13(d) of the Exchange
Act), with respect to the Voting Securities (other than a “group” that includes only other members of the Engaged Group),
or otherwise support or participate in any effort by, or initiate any discussions or enter into any negotiations, arrangements
or understandings with, a third party with respect to the matters set forth in this Section 2;


 


(iv) except as otherwise permitted
by Section 1 and excluding any action taken by the New Director acting in his capacity as a director of the Company, (A)
seek or encourage any Person to submit nominations in furtherance of a “contested solicitation” for the election or
removal of directors with respect to the Company, (B) seek, encourage or take any other action with respect to the election or
removal of any directors or with respect to the submission of any shareholder proposal or (C) otherwise acting alone or in concert
with others, seek to exercise control over the management, strategies, governance or policies of the Company;


 






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(v) seek to call, or to request
the call of, a special meeting of the Company’s shareholders, or present (or request to present) at any annual meeting or
any special meeting of the Company’s shareholders or in connection with any action by written consent, any proposal for consideration
for action by shareholders or propose (or request to propose) any nominee for election to the Board or seek representation on the
Board or the removal of any member of the Board, except as permitted by Section 1;


 


(vi) grant any proxy, consent
or other authority to vote with respect to any matters (other than to the named proxies included in the Company’s proxy card
for any annual meeting or special meeting of shareholders or as otherwise permitted by Section 2(d)) or deposit any Voting
Securities in a voting trust or subject them to a voting agreement or other arrangement of similar effect (excluding customary
brokerage accounts, margin accounts, prime brokerage accounts and the like);


 


(vii) make any request under Section
21.218 of the Texas Business Organization Code or other applicable legal provisions regarding inspection of books and records or
other materials (including stocklist materials) (except for by the New Director acting in his capacity as a director of the Company);


 


(viii) institute, solicit, assist
or join as a party, any litigation, arbitration or other proceeding against or involving the Company or any of its current or former
directors or officers (including derivative actions); provided, however, that the foregoing shall not prevent any
Investor from (A) bringing litigation against the Company to enforce the provisions of this Agreement, (B) making counterclaims
with respect to any proceeding initiated by, or on behalf of, the Company against an Investor, or (C) responding to or complying
with a validly issued legal process that neither the Engaged Group nor any of its Affiliates initiated, encouraged or facilitated;


 


(ix) without the prior written
approval of the Board, separately or in conjunction with any other Person in which it is or proposes to be either a principal,
partner or financing source or is acting or proposes to act as broker or agent for compensation, propose, suggest or recommend
publicly or in a manner that the Engaged Group is required under applicable law, rule or regulation to disclose publicly or participate
in, effect or seek to effect, any tender offer or exchange offer, merger, acquisition, business combination, reorganization, restructuring,
recapitalization, sale or acquisition of assets, liquidation or dissolution involving the Company or any of its Affiliates or its
or their securities or the assets or businesses of the Company or any of its Affiliates (collectively, an “Extraordinary
Transaction”) or knowingly encourage, initiate or support any other third party in any such activity; provided, however,
that nothing in this Section 2 shall be interpreted to prohibit the Engaged Group from proposing, suggesting or recommending
any Extraordinary Transaction privately to the Company so long as the Engaged Group is not required to publicly disclose such activity
under applicable law, rule or regulation;


 






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(x) enter into any negotiations,
agreements, arrangements or understandings with any third party with respect to the matters set forth in this Section 2;


 


(xi) publicly make or disclose
any statement regarding any intent, purpose, plan or proposal with respect to the Board, the Company, its management, policies
or affairs or any of its securities or assets or this Agreement, that is inconsistent with the provisions of this Agreement, including
any intent, purpose, plan or proposal that is conditioned on or would require any waiver, amendment, nullification or invalidation
of any provision of this Agreement or take any action that could require the Company or the Investor to make any public disclosure
relating to any such intent, purpose, plan, proposal or condition;


 


(xii) publicly request that the
Company or any of its representatives release any Investor from, amend or waive any provision of this Agreement;


 


(xiii) acquire, offer or propose
to acquire, or agree to acquire, directly or indirectly, whether by purchase, tender or exchange offer, through the acquisition
of control of another Person or by joining a partnership, limited partnership, syndicate or other “group” (as defined
under Section 13(d) of the Exchange Act), Beneficial Ownership of Voting Securities in an amount that would result in the Investors
and their Affiliates and Associates having Beneficial Ownership in the aggregate of ten percent (10%) or more of the outstanding
Voting Securities; or


 


(xiv) (A) enter into any discussions,
negotiations, agreements or undertakings with any Person with respect to the foregoing, (B) knowingly advise, assist, encourage
or seek to persuade any Person to take any action with respect to any of the foregoing or (C) take any action that would cause
the Company to be required to make public disclosure regarding any of the foregoing.


 


(c) Notwithstanding the foregoing, nothing
in this Agreement shall prohibit or restrict the Engaged Group from: (i) communicating privately with the Board or any of the Company’s
officers regarding any matter, so long as such communications are not intended to, and would not reasonably be expected to, require
any public disclosure of such communications or (ii) communicating privately with stockholders of the Company and others in a manner
that does not otherwise violate Section 2(b). Furthermore, for the avoidance of doubt, nothing in this Agreement shall be
deemed to restrict in any way the ability of the New Director from fulfilling his duties as a director.


 


(d) At any meeting of shareholders of the
Company occurring during the Restricted Period, each of the Investors agrees to appear in person or by proxy and to vote all of
the Voting Securities it directly or indirectly Beneficially Owns (i) in favor of the election of the Company’s slate of
director nominees, (ii) against any shareholder nominations for director that are not approved and recommended by the Board for
election at such meeting and (iii) in accordance with the Board’s recommendations with respect to any other matter presented
to shareholders of the Company for consideration; provided, however, that in the event that Institutional Shareholder
Services Inc. (“ISS”) recommends otherwise with respect to any proposal, the Engaged Group may, notwithstanding
this clause (iii), vote in accordance with ISS’s recommendation; provided, further, that the Engaged
Group shall be permitted to vote in its sole discretion with respect to any publicly announced proposals relating to an Extraordinary
Transaction.


 






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(e) During the Restricted Period, upon written
request from the Company, the Engaged Group will promptly provide the Company with information regarding the amount of the securities
of the Company then Beneficially Owned by the Engaged Group. Such information provided to the Company will be kept strictly confidential
unless required to be disclosed pursuant to applicable law.


 


(f) As used in this Agreement: (i) the term
“Voting Securities” shall mean the Common Stock, and any other securities of the Company entitled to vote in
the election of directors, or securities convertible into, or exercisable or exchangeable for, Common Stock or other securities,
whether or not subject to the passage of time or other contingencies; (ii) the term “Beneficial Owner” shall
have the same meaning as set forth in Rule 13d-3 promulgated by the SEC under the Exchange Act, except that a Person will also
be deemed to beneficially own (A) all Voting Securities that such Person has the right to acquire pursuant to the exercise of any
rights in connection with any securities or any agreement, regardless of when such rights may be exercised and whether they are
conditional, and (B) all Voting Securities in which such Person has any economic interest, including pursuant to a cash-settled
call option or other derivative security (including swaps), contract or instrument in any way related to the price of any Voting
Securities (and the terms “Beneficially Own” and “Beneficial Ownership” shall have correlative
meanings); (iii) the term “Person” or “Persons” shall mean any individual, corporation (including
not-for-profit), general or limited partnership, limited liability company, joint venture, estate, trust, association, organization
or other entity of any kind or nature; and (iv) the term “Nomination Window” shall mean any of (A) for each
fiscal quarter of the Company ending during the Nomination Term (other than the fourth quarter of 2019), the period beginning on
the day after the Company’s quarterly earnings announcement for such fiscal quarter and ending on the close of business on
the date that is thirty (30) days after such announcement and (B) the period beginning January 1, 2020 and ending on the close
of business on the date that is fifteen (15) calendar days before the advance notice deadline set forth in the Company’s
by-laws for the 2020 Annual Meeting.


 


3. Non-Disparagement. During the
Restricted Period, the Company, on the one hand, and each Investor, on the other hand, will each refrain from making, and will
cause their respective Affiliates and Associates and its and their respective Representatives (as defined below) not to make, any
statement or announcement that relates to or constitutes an ad hominem attack on, or that relates to and otherwise disparages,
impugns or is reasonably likely to damage the reputation of, (a) in the case of statements or announcements by or on behalf of
such Investor, the Company or any of its Affiliates or Associates or any of its or their respective officers, directors or employees
or any person who has served as an officer, director or employee of the Company or any of its Affiliates or Associates and (b)
in the case of statements or announcements by or on behalf of the Company, each Investor and its respective Affiliates and Associates
and its and their respective principals, directors, officers, employees, members or general partners or any person who has served
as such. The foregoing will not prevent the making of any factual statement in any compelled testimony or the production of information,
whether by legal process, subpoena or as part of a response to a request for information from any governmental authority with jurisdiction
over the Party from whom information is sought. For purposes of this Agreement, “Representatives”, with respect
to each Party, shall mean such Party’s principals, directors, officers, employees, general partners, members, agents, representatives,
attorneys and advisors acting at the direction or on behalf of such Party.


 






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4. Representations and Warranties of
the Company. The Company represents and warrants to the Engaged Group that: (a) the Company has the corporate power and authority
to execute this Agreement and to bind it thereto; (b) this Agreement has been duly and validly authorized, executed and delivered
by the Company, constitutes a valid and binding obligation and agreement of the Company and is enforceable against the Company
in accordance with its terms, except as enforcement thereof may be limited by applicable bankruptcy, insolvency, reorganization,
moratorium, fraudulent conveyance or similar laws generally affecting the rights of creditors and subject to general equity principles;
and (c) the execution, delivery and performance of this Agreement by the Company does not and will not (i) violate or conflict
with any law, rule, regulation, order, judgment or decree applicable to the Company; (ii) result in any breach or violation of
or constitute a default (or an event that with notice or lapse of time or both could constitute such a breach, violation or default)
under or pursuant to, or result in the loss of a material benefit under, or give any right of termination, amendment, acceleration
or cancellation of, any organizational document, agreement, contract, commitment, understanding or arrangement to which the Company
is a party or by which it is bound; or (iii) result in or constitute a change in control for purposes of any of the Company’s
existing severance, compensation or change in control agreements and arrangements.


 


5. Representations and Warranties of
the Engaged Group. Each member of the Engaged Group represents and warrants to the Company that: (a) the authorized signatory
of such member of the Engaged Group set forth on the signature page hereto has the power and authority to execute this Agreement
and to bind it thereto; (b) this Agreement has been duly and validly authorized, executed and delivered by such member of the Engaged
Group, constitutes a valid and binding obligation and agreement of such member of the Engaged Group and is enforceable against
such member of the Engaged Group in accordance with its terms, except as enforcement thereof may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium, fraudulent conveyance or similar laws generally affecting the rights of creditors and subject
to general equity principles; (c) the execution, delivery and performance of this Agreement by such member of the Engaged Group
do not and will not (i) violate or conflict with any law, rule, regulation, order, judgment or decree applicable to such member
of the Engaged Group; (ii) require the approval of any owner or holder of any equity interest of such Person, as applicable; or
(iii) result in any breach or violation of or constitute a default (or an event that with notice or lapse of time or both could
constitute such a breach, violation or default) under or pursuant to, or result in the loss of a material benefit under, or give
any right of termination, amendment, acceleration or cancellation of, any organizational document, agreement, contract, commitment,
understanding or arrangement to which such member of the Engaged Group is a party or by which it is bound; and (d) as of the date
of this Agreement, (i) the Engaged Group Beneficially Owns in the aggregate 2,116,559 shares of Common Stock and (ii) the Engaged
Group does not currently have, and does not currently have any right to acquire, any interest in any other securities of the Company
or derivative or equity-linked positions therein.


 


6. Press Release. Neither the Company
(and the Company shall cause each of its Affiliates, directors and officers not to) nor any member of the Engaged Group shall make
or cause to be made any public announcement, disclosure or statement with respect to this Agreement or the actions contemplated
hereby, except as required by law or the rules of any stock exchange or with the prior written consent of the other Party. The
Company shall have an opportunity to review and comment upon any proposed Schedule 13D filing made by any member of the Engaged
Group with respect to this Agreement prior to filing, and such member of the Engaged Group shall consider in good faith any changes
proposed by the Company. The Engaged Group shall have an opportunity to review and comment upon any proposed Form 8-K or other
public filing by the Company with respect to this Agreement prior to filing, and the Company shall consider in good faith any changes
proposed by the Engaged Group.


 


7. Specific Performance. Each Investor,
on the one hand, and the Company, on the other hand, acknowledges and agrees that irreparable injury to the other Parties hereto
would occur in the event any of the provisions of this Agreement were not performed in accordance with their specific terms or
were otherwise breached, and that such injury would not be adequately compensable by the remedies available at law (including the
payment of money damages). It is accordingly agreed that each Investor, on the one hand, and the Company, on the other hand (the
“Moving Party”), shall be entitled to specific enforcement of, and injunctive relief to prevent any violation
of, the terms hereof, and the other Parties hereto will not take action, directly or indirectly, in opposition to the Moving Party
seeking such relief on the grounds that any other remedy or relief is available at law or in equity. Furthermore, each of the Parties
hereto agrees to waive any bonding requirement under any applicable law in the case any other Party seeks to enforce the terms
of this Agreement by way of equitable relief. This Section 7 is not the exclusive remedy for any violation of this Agreement.


 


8. Expenses. Each Party shall be
responsible for its own fees and expenses incurred in connection with the negotiation, execution and effectuation of this Agreement
and the transactions contemplated hereby, including, but not limited to, any matters related to the 2019 Annual Meeting, except
that the Company will reimburse the Engaged Group for its reasonable documented expenses, including legal fees, incurred in connection
with the negotiation and entry into this Agreement and other matters related to the 2019 Annual Meeting, in an amount not to exceed
$50,000.


 






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9. Severability. If any term, provision,
covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain in full force and effect and shall
in no way be affected, impaired or invalidated. It is hereby stipulated and declared to be the intention of the Parties that the
Parties would have executed the remaining terms, provisions, covenants and restrictions without including any of such that may
be hereafter declared invalid, void or unenforceable. In addition, the Parties agree to use their best efforts to agree upon and
substitute a valid and enforceable term, provision, covenant or restriction for any of such that is held invalid, void or unenforceable
by a court of competent jurisdiction.


 


10. Notices. Any notices, consents,
determinations, waivers or other communications required or permitted to be given under the terms of this Agreement must be in
writing and will be deemed to have been delivered: (i) upon receipt, when delivered personally; (ii) upon receipt, when sent by
email, when such email is sent to the email address set forth below and the appropriate confirmation is received; or (iii) one
(1) business day after deposit with a nationally recognized overnight delivery service, in each case properly addressed to
the Party to receive the same. The addresses for such communications shall be:


 


If to the Company:


 


Benchmark Electronics, Inc.

4141 N. Scottsdale Road, Suite 301

Scottsdale, Arizona 85251


		Attention:	Stephen Beaver



 


		Email:	steve.beaver@bench.com



 


With copies (which shall not constitute notice) to:


 


Cravath, Swaine & Moore LLP


825 Eighth Avenue


New York, NY 10019


		Attention:	Richard Hall



O. Keith Hallam, III


 


		Email:	rhall@cravath.com



khallam@cravath.com






If to the Engaged Group:


 


Engaged Capital, LLC

610 Newport Center Drive, Suite 250

Newport Beach, California 92660


		Attention:	Glenn W. Welling



 


		Email:	glenn@engagedcapital.com



 





With copies (which shall not constitute notice) to:


 


Olshan Frome Wolosky LLP

1325 Avenue of the Americas

New York, NY 10019


		Attention:	Steve Wolosky

Ryan Nebel



 


		Email:	swolosky@olshanlaw.com

rnebel@olshanlaw.com



 






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11. Applicable Law. This Agreement
shall be governed by and construed and enforced in accordance with the laws of the State of Texas without reference to the conflict
of laws principles thereof that would result in the application of the laws of another jurisdiction. Each of the Parties hereto
irrevocably agrees that any legal action or proceeding with respect to this Agreement and the rights and obligations arising hereunder,
or for recognition and enforcement of any judgment in respect of this Agreement and the rights and obligations arising hereunder
brought by the other Parties hereto or their successors or assigns, shall be brought and determined exclusively in state or federal
courts located in the State of Texas and any appellate court therefrom. Each of the Parties hereto hereby irrevocably submits with
regard to any such action or proceeding for itself and in respect of its property, generally and unconditionally, to the personal
jurisdiction of the aforesaid courts and agrees that it will not bring any action relating to this Agreement in any court other
than the aforesaid courts. Each of the Parties hereto hereby irrevocably waives, and agrees not to assert in any action or proceeding
with respect to this Agreement, (i) any claim that it is not personally subject to the jurisdiction of the above-named courts for
any reason; (ii) any claim that it or its property is exempt or immune from the jurisdiction of any such court or from any
legal process commenced in such courts (whether through service of notice, attachment prior to judgment, attachment in aid of execution
of judgment, execution of judgment or otherwise); and (iii) to the fullest extent permitted by applicable legal requirements, any
claim that (A) the suit, action or proceeding in such court is brought in an inconvenient forum, (B) the venue of such suit, action
or proceeding is improper or (C) this Agreement, or the subject matter hereof, may not be enforced in or by such courts.


 


12. Affiliates and Associates; Construction.
Each member of the Engaged Group agrees that it will cause its Affiliates and Associates to comply with the terms of this Agreement.
As used in this Agreement, the terms “Affiliate” and “Associate” shall have the respective
meanings set forth in Rule 12b-2 promulgated by the SEC under the Exchange Act and shall include all Persons that at any time during
the Restricted Period become Affiliates or Associates of any Person referred to in this Agreement. The obligations of the members
of the Engaged Group will be joint and several among such members. Each of the Parties hereto acknowledges that it has been represented
by counsel of its choice throughout all negotiations that have preceded the execution of this Agreement, and that it has executed
the same with the advice of said independent counsel. Each Party and its counsel cooperated and participated in the drafting and
preparation of this Agreement and the documents referred to herein, and any and all drafts relating thereto exchanged among the
Parties shall be deemed the work product of all of the Parties and may not be construed against any Party by reason of its drafting
or preparation. Accordingly, any rule of law or any legal decision that would require interpretation of any ambiguities in this
Agreement against any Party that drafted or prepared it is of no application and is hereby expressly waived by each of the Parties
hereto, and any controversy over interpretations of this Agreement shall be decided without regard to events of drafting or preparation.
The section headings contained in this Agreement are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. The term “including” shall be deemed to mean “including without limitation”
in all instances.


 


13. Counterparts. This Agreement
may be executed in two or more counterparts, each of which shall be considered one and the same agreement and shall become effective
when counterparts have been signed by each of the Parties and delivered to the other Parties (including by means of electronic
delivery).


 


14. Entire Agreement; Amendment and Waiver;
Successors and Assigns; Third-Party Beneficiaries. This Agreement contains the entire understanding of the Parties hereto with
respect to its subject matter. There are no restrictions, agreements, promises, representations, warranties, covenants or undertakings
between the Parties other than those expressly set forth herein. No modifications of this Agreement can be made except in writing
signed by an authorized representative of each of the Company and Engaged. No failure on the part of any Party to exercise, and
no delay in exercising, any right, power or remedy hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise of such right, power or remedy by such Party preclude any other or further exercise thereof or the exercise of any other
right, power or remedy. All remedies hereunder are cumulative and are not exclusive of any other remedies provided by law. The
terms and conditions of this Agreement shall be binding upon, inure to the benefit of, and be enforceable by the Parties hereto
and their respective successors, heirs, executors, legal representatives and permitted assigns. No Party shall assign this Agreement
or any rights or obligations hereunder without, with respect to any member of the Engaged Group, the prior written consent of the
Company, and with respect to the Company, the prior written consent of Engaged. This Agreement is solely for the benefit of the
Parties hereto and is not enforceable by any other Persons.


 


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IN WITNESS WHEREOF, this Agreement has been
duly executed and delivered by the duly authorized signatories of the Parties as of the date hereof.


 


	 	BENCHMARK ELECTRONICS, INC.
	 	 
	 	 
	 	By:	/s/ Stephen J. Beaver
	 	 	Name:Stephen J. Beaver, Esq.
	 	 	Title:Vice President and General Counsel


 






    
Signature Page to Cooperation Agreement


     


    







 


ENGAGED GROUP:


 


	 	ENGAGED CAPITAL FLAGSHIP MASTER FUND, LP
	 	 
	 	By:	Engaged Capital, LLC

General Partner
	 	 	 
	 	By:	/s/ Glenn W. Welling
	 	 	Name: 	Glenn W. Welling
	 	 	Title:	Founder and Chief Investment Officer


 


	 	ENGAGED CAPITAL FLAGSHIP FUND, LP
	 	 
	 	By:	Engaged Capital, LLC

General Partner
	 	 	 
	 	By:	/s/ Glenn W. Welling
	 	 	Name:	Glenn W. Welling
	
         

         
	 	Title:	Founder and Chief Investment Officer


 


	 	ENGAGED CAPITAL FLAGSHIP FUND, LTD.
	 	 	 
	 	By:	/s/ Glenn W. Welling
	 	 	Name:	Glenn W. Welling
	 	 	Title:	Director


 


	 	ENGAGED CAPITAL, LLC 
	 	 	 
	 	By:	/s/ Glenn W. Welling
	 	 	Name:	Glenn W. Welling
	
         

         
	 	Title:	Founder and Chief Investment Officer


 


	 	ENGAGED CAPITAL HOLDINGS, LLC 
	 	 	 
	 	By:	/s/ Glenn W. Welling
	 	 	Name:	Glenn W. Welling
	 	 	Title:	Sole Member


 


 


	 	GLENN W. WELLING 
	 	 	 
	 	By:	/s/ Glenn W. Welling
	 	 	 	Glenn W. Welling
	 	 	 	 



 






    
Signature Page to Cooperation Agreement


     


    

 





EXHIBIT A







 







EXHIBIT A


  


RESIGNATION


 


[·], 2019


 


Board of Directors


Benchmark Electronics, Inc.

4141 N. Scottsdale Road, Suite 301

Scottsdale, Arizona 85251


 


Re: Resignation


 


Ladies and Gentlemen:


 


This irrevocable resignation is delivered
pursuant to that certain Cooperation Agreement, dated as of February 25, 2019, among Benchmark Electronics, Inc., Engaged Capital,
LLC and the other signatories thereto (the “Cooperation Agreement”). Capitalized terms used herein but not defined
shall have the meaning set forth in the Cooperation Agreement.


 


Effective only upon, and subject to, such
time as (i) the members of the Engaged Group (together with their controlled Affiliates) collectively cease to have Beneficial
Ownership of at least the lesser of (1) 2.5% of the outstanding Voting Securities of the Company and (2) 1,092,759 shares of Common
Stock or (ii) any member of the Engaged Group materially breaches any of its obligations under the Cooperation Agreement, I hereby
irrevocably resign from my position as a director of the Company and from any and all committees of the Board on which I serve.


 





	Sincerely,	 
	 	 
	 	 
	Name: Glenn W. Welling	 







 






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