Document:

EMPLOYMENT AGREEMENT

                  THIS AGREEMENT (the "Agreement"), made in New York, New York
as of the 18th day of April, 2000, between Atlantic Technology Ventures, Inc. a
Delaware corporation having its offices and principal place of business at 150
Broadway, Suite 1110, New York, New York (the "Company"), and Kelly Harris, an
individual currently residing at 3084 Peachtree Ct, Woodbridge, VA 22192
("Employee").

                  WHEREAS, the Company desires to employ Employee,  and Employee
desires to accept such  employment on the terms and conditions  hereinafter  set
forth;

                  NOW,  THEREFORE,  IN CONSIDERATION of the mutual covenants and
agreements hereinafter set forth, the Company and Employee agree as follows:

                  1. Term.

                  The term of this Agreement shall be period commencing on March
__, 2000 and ending on the date Employee's employment is terminated in
accordance with the terms hereof (the "Term").

                  2. Employment.

                     (a) Employment by the Company. Employee agrees to be
employed by the Company during the Term upon the terms and subject to the
conditions set forth in this Agreement. Employee shall serve as an employee of
the Company and shall have such duties as may be prescribed by the Company and
shall serve in such other and/or additional position(s) as the Company may
determine from time to time.

                     (b) Performance of Duties. Throughout the Term, Employee
shall faithfully and diligently perform Employee's duties in conformity with the
directions of the Company and serve the Company to the best of Employee's
ability. Employee shall devote Employee's entire working time to the business
and affairs of the Company, subject to vacations and sick leave in accordance
with Company policy and as otherwise permitted herein. Until otherwise
determined by the Company, Employee shall have the title of Director of
Administration of the Company, and in such capacity shall be responsible for
such duties as may be assigned by the Company and shall report to the President
of the Company.

                     (c) Place of Performance. Employee shall be based initially
at the Company's offices in New York, New York or such other location(s) in the
greater New York area as the Company may determine. Throughout the Term,
Employee shall maintain Employee's personal residence within reasonable access
to Employee's place of employment.

<PAGE>

                  3. Compensation and Benefits.

                     (a) Base Salary. The Company agrees to pay to Employee a
base salary ("Base Salary") at the annual rate of $40,000, payable in equal
installments consistent with the Company's payroll practices.

                     (b) Signing Bonus. Within thirty days after the execution
of this Agreement, the Company shall pay to Employee a bonus in the amount of
$10,000 (the "Signing Bonus"). Employee shall repay to the Company the Signing
Bonus if Employee is terminated by the Company for Cause (as hereinafter
defined) during the Term or voluntarily resigns her employment hereunder during
the first twelve months of the Term.

                     (c) Bonus. The Company shall pay to Employee an annual
bonus (the "Bonus") in an amount to be determined by Compensation Committee of
the Board of Directors in its discretion but in no event less than $10,000. In
addition, Employee shall be entitled to participate in any bonus or other
incentive programs as may be established by the Company.

                     (d) Grant of Options and Terms Thereof. The Company shall
grant to Employee, an option (the "Option"), pursuant to the Company's 1995
Stock Incentive Plan, to purchase twenty thousand (20,000) shares of the
Company's common stock (the "Option Shares"), subject to vesting as set forth
below. The exercise price for each Option Share shall be equal to the market
value of a share of the Company's common stock on the date of the grant of the
Option. The Option Shares shall vest in four equal installments, the first such
installment to vest on the later of the date of the grant of the Option and the
first day of the Term and each subsequent installment to vest, respectively, on
the first, second, and third anniversary of the grant of the Option, provided
that Employee is employed by the Company on each such vesting date. All other
terms (including exercisability) of the Option shall be governed by the
Company's Stock Incentive Plan, as well as the applicable option agreement to be
entered into pursuant to the terms of such plan.

                     (e) Benefits and Perquisites. Employee shall be entitled to
participate in, to the extent Employee is otherwise eligible under the terms
thereof, the benefit plans and programs, and receive the benefits and
perquisites, generally provided to the Company's employees, including without
limitation family medical insurance and life insurance (subject to applicable
employee contributions). Employee shall be entitled to four weeks of vacation
per year.

                     (f) Travel and Business Expenses. Upon submission of
itemized expense statements in the manner specified by the Company, Employee
shall be entitled to reimbursement for reasonable travel and other reasonable
business expenses duly incurred by Employee in the performance of Employee's
duties under this Agreement in accordance with the policies and procedures
established by the Company from time to time for employees of the Company.

                     (g) Relocation Expenses. The Company shall reimburse
Employee for such expenses reasonably incurred by Employee in connection with
the relocation of her residence to New York, New York or its immediate vicinity
upon submission of documentation

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<PAGE>

in a form reasonably acceptable to the Company, provided that Employee must
consult with and receive approval from the Company, which approval shall not be
unreasonably withheld, prior to incurring any such expenses. Employee shall be
required to repay to the Company any relocation expenses reimbursed pursuant to
this Section 3(f) if Employee's employment hereunder is terminated (i) by the
Company for Cause or as a result of Employee's voluntary resignation during the
first twelve months of the Term.

                     (h) No Other Compensation or Benefits; Payment. The
compensation and benefits specified in this Section 3 and in Section 4 of this
Agreement shall be in lieu of any and all other compensation and benefits.
Payment of all compensation and benefits to Employee hereunder shall be made in
accordance with the relevant Company policies in effect from time to time to the
extent the same are consistently applied, including normal payroll practices,
and shall be subject to all applicable employment and withholding taxes and
other withholdings.

                     (i) Cessation of Employment. In the event Employee shall
cease to be employed by the Company for any reason, then Employee's compensation
and benefits shall cease on the date of such event, except as otherwise provided
herein or in any applicable employee benefit plan or program.

                  4. Termination of Employment.

                     (a) Termination. The Company may terminate Employee's
employment for during the first three months of the Term for any reason or no
reason, in which case the provisions of Section 4(b) of this Agreement shall
apply. The Company may terminate Employee's employment for Cause (as defined
below) or for any breach of this Agreement, in which case the provisions of
Section 4(c) of this Agreement shall apply. The Company may also terminate
Employee's employment in the event of Employee's Disability (as defined below),
in which case the provisions of Section 4(d) of this Agreement shall apply. The
Company may also terminate the Employee's employment for any other reason by
written notice to Employee, in which case the provisions of Section 4(e) of this
Agreement shall apply. If Employee's employment is terminated by reason of
Employee's death, retirement or voluntary resignation, the provisions of Section
4(c) of this Agreement shall apply.

                     (b) Termination by the Company During Initial Period. In
the event that Employee's employment hereunder is terminated by the Company
during the first three months of the Term (such period to be the "Initial
Period") for any reason or no reason, then the Company shall pay to Employee
only the Base Salary through such date of termination and any expenses incurred
by Employee through the date of such termination and properly reimbursable
pursuant to Section 3(g) hereof.

                     (c) Termination for Cause; Termination by Reason of Death
or Retirement or Voluntary Resignation. In the event that Employee's employment
hereunder is terminated during the Term (x) by the Company for Cause (as defined
below), (y) by reason of Employee's death or retirement or (z) by reason of
Employee's voluntary resignation, then the Company shall pay to Employee only
the Base Salary through such date of termination. For purposes of this
Agreement, "Cause" shall mean (i) conviction of any crime (whether or not
involving the Company) constituting a felony in the jurisdiction involved; (ii)
engaging in any

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<PAGE>

substantiated act involving moral turpitude; (iii) engaging in any act which, in
each case, subjects, or if generally known would subject, the Company to public
ridicule or embarrassment; (iv) gross neglect or misconduct in the performance
of Employee's duties hereunder; (v) willful failure or refusal to perform such
duties as may reasonably be delegated to Employee; or (vi) material breach of
any provision of this Agreement by Employee; provided, however, that with
respect to clauses (iv), (v) or (vi), Employee shall have received written
notice from the Company setting forth the alleged act or failure to act
constituting "Cause" hereunder, and Employee shall not have cured such act or
refusal to act within 10 business days of her actual receipt of notice.

                     (d) Disability. If, as a result of Employee's incapacity
due to physical or mental illness, Employee shall have been absent from
Employee's duties hereunder on a full time basis for either (i) one hundred
twenty (120) days within any three hundred sixty-five (365) day period, or (ii)
ninety (90) consecutive days, the Company may terminate Employee's employment
hereunder for "Disability". In that event, the Company shall pay to Employee
only the Base Salary through such date of termination. During any period that
Employee fails to perform Employee's duties hereunder as a result of incapacity
due to physical or mental illness (a "Disability Period"), Employee shall
continue to receive the compensation and benefits provided by Section 3 of this
Agreement until Employee's employment hereunder is terminated; provided,
however, that the amount of compensation and benefits received by Employee
during the Disability Period shall be reduced by the aggregate amounts, if any,
payable to Employee under disability benefit plans and programs of the Company
or under the Social Security disability insurance program.

                     (e) Termination By Company For Any Other Reason. In the
event that Employee's employment hereunder is terminated by the Company during
the Term for any reason other than as provided in Section 4(b), 4(c), or 4(d) of
this Agreement, then the Company shall pay to Employee the Base Salary through
such date of termination and, in lieu of any further compensation and benefits
for the balance of the Term, severance pay equal to the Base Salary that
Employee would have otherwise received during the period beginning on such date
of termination and ending one (1) month from the effective date of such
termination, which severance pay shall be paid commencing with such date of
termination at the times and in the amounts such Base Salary would have been
paid. Notwithstanding anything to the contrary contained herein, in the event
that Employee shall breach Section 5 or 6 of this Agreement, in addition to any
other remedies the Company may have in the event Employee breaches this
Agreement, the Company's obligation pursuant to this Section 4(e) to continue
such salary shall cease and Employee's rights thereto shall terminate and shall
be forfeited.

                     (f) No Further Liability; Release. Payment made and
performance by the Company in accordance with this Section 4 shall operate to
fully discharge and release the Company and its directors, officers, employees,
subsidiaries, affiliates, stockholders, successors, assigns, agents and
representatives from any further obligation or liability with respect to
Employee's employment and termination of employment. Other than paying
Employee's Base Salary through the date of termination of Employee's employment
and making any severance payment pursuant to and in accordance with this Section
4 (as applicable), the Company and its directors, officers, employees,
subsidiaries, affiliates, stockholders, successors, assigns, agents and
representatives shall have no further obligation or liability to Employee or any
other person

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under this Agreement. The Company shall have the right to condition the payment
of any severance pursuant to this Section 4 upon the delivery by Employee to the
Company of a release in form and substance satisfactory to the Company of any
and all claims Employee may have against the Company and its directors,
officers, employees, subsidiaries, affiliates, stockholders, successors,
assigns, agents and representatives arising out of or related to Employee's
employment by the Company and the termination of such employment.

                  5. Exclusive Employment; Noncompetition.

                     (a) No Conflict; No Other Employment. During the period of
Employee's employment with the Company, Employee shall not: (i) engage in any
activity which conflicts or interferes with or derogates from the performance of
Employee's duties hereunder nor shall Employee engage in any other business
activity, whether or not such business activity is pursued for gain or profit,
except as approved in advance in writing by the Chief Employee Officer or the
Board of Directors of the Company; provided, however, that Employee shall be
entitled to manage her personal investments and otherwise attend to personal
affairs, including charitable activities, in a manner that does not unreasonably
interfere with her responsibilities hereunder, or (ii) accept any other
employment, whether as an Employee or consultant or in any other capacity, and
whether or not compensated therefor, unless Employee receives the prior approval
of the President of the Company.

                     (b) No Solicitation of Employment. During the Term and for
a period of one year thereafter, Employee shall not solicit or encourage any
employee of the Company or any Related Entity to leave the Company or such
Related Entity for any reason, nor assist any business in doing so, nor employ
such an employee in a Competing Business or any other business.

                  6. Confidential Information.

                     (a) Existence of Confidential Information. The Company and
each Related Entity owns and has developed and compiled, and will develop and
compile, certain proprietary techniques and confidential information which have
great value to its business (referred to in this Agreement, collectively, as
"Confidential Information"). Confidential Information includes not only
information disclosed by the Company or any Related Entity to Employee, but also
information developed or learned by Employee during the course or as a result of
employment with the Company, which information shall be the property of the
Company or the applicable Related Entity. Confidential Information includes all
information that has or could have commercial value or other utility in the
businesses in which the Company or any Related Entity is engaged or contemplates
engaging, and all information of which the unauthorized disclosure could be
detrimental to the interests of the Company or any Related Entity, whether or
not such information is specifically labeled as Confidential Information by such
entity. By way of example and without limitation, Confidential Information
includes any and all information developed, obtained, licensed by or to or owned
by the Company or any Related Entity concerning trade secrets, techniques,
know-how (including designs, plans, procedures, merchandising, marketing,
distribution and warehousing know-how, processes, and research records),
software, computer programs and designs, development tools, all proprietary
property, and any other intellectual property created, used or sold (through a
license or

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<PAGE>

otherwise) by the Company or a Related Entity, electronic data information
know-how and processes, innovations, discoveries, improvements, research,
development, test results, reports, specifications, data, formats, marketing
data and plans, business plans, strategies, forecasts, unpublished financial
information, orders, agreements and other forms of documents, price and cost
information, merchandising opportunities, expansion plans, budgets, projections,
customer, supplier, licensee, licensor and subcontractor identities,
characteristics, agreements and operating procedures, and salary, staffing and
employment information.

                     (b) Protection of Confidential Information. Employee
acknowledges and agrees that in the performance of Employee's duties hereunder
the Company and the Related Entities may disclose to and entrust Employee with
Confidential Information which is the exclusive property of such entities and
which Employee may possess or use only in the performance of Employee's duties
to the Company. Employee also acknowledges that Employee is aware that the
unauthorized disclosure of Confidential Information, among other things, may be
prejudicial to the Company's interests or those of a Related Entity, an invasion
of privacy and an improper disclosure of trade secrets. Employee shall not,
directly or indirectly, use, make available, sell, disclose or otherwise
communicate to any corporation, partnership or other entity, individual or other
third party, other than in the course of Employee's assigned duties and for the
benefit of the Company, any Confidential Information, either during the Term or
thereafter. In the event Employee desires to publish the results of Employee's
work for or experiences with the Company or any Related Entity through
literature, interviews or speeches, Employee will submit requests for such
interviews or such literature or speeches to the Chief Employee Officer of the
Company at least fourteen (14) days before any anticipated dissemination of such
information for a determination of whether such disclosure is in the best
interests of the Company, including whether such disclosure may impair trade
secret status or constitute an invasion of privacy. Employee agrees not to
publish, disclose or otherwise disseminate such information without the prior
written approval of the Chief Employee Officer of the Company.

                     (c) Delivery of Records, Etc. In the event Employee's
employment with the Company ceases for any reason, Employee will not remove from
the Company's premises without its prior written consent any records (written or
electronic), files, drawings, documents, equipment, materials and writings
received from, created for or belonging to the Company or any Related Entity,
including those which relate to or contain Confidential Information, or any
copies thereof. Upon request or when employment with the Company terminates,
Employee will immediately deliver the same to the Company.

                  7. Assignment and Transfer.

                     (a) Company. This Agreement shall inure to the benefit of
and be enforceable by, and may be assigned by the Company to, any purchaser of
all or substantially all of the Company's business or assets, any successor to
the Company or any assignee thereof (whether direct or indirect, by purchase,
merger, consolidation or otherwise).

                     (b) Employee. Employee's rights and obligations under this
Agreement shall not be transferable by Employee by assignment or otherwise, and
any purported assignment, transfer or delegation thereof shall be void;
provided, however, that if Employee shall die, all amounts then payable to
Employee hereunder shall be paid in accordance with the

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<PAGE>

terms of this Agreement to Employee's devisee, legatee or other designee or, if
there be no such designee, to Employee's estate.

                  8. Miscellaneous.

                     (a) Other Obligations. Employee represents and warrants
that neither Employee's employment with the Company nor Employee's performance
of Employee's obligations hereunder will conflict with or violate or otherwise
are inconsistent with any other obligations, legal or otherwise, which Employee
may have. Employee covenants that she shall perform her duties hereunder in a
professional manner and not in conflict or violation, or otherwise inconsistent
with other obligations legal or otherwise, which Employee may have.

                     (b) Nondisclosure; Other Employers. Employee will not
disclose to the Company, or use, or induce the Company to use, any proprietary
information, trade secrets or confidential business information of others.
Employee represents and warrants that Employee does not possess any property,
proprietary information, trade secrets and confidential business information
belonging to all prior employers.

                     (c) Cooperation. Following termination of employment with
the Company for any reason, Employee shall cooperate with the Company, as
requested by the Company, to affect a transition of Employee's responsibilities
and to ensure that the Company is aware of all matters being handled by
Employee.

                     (d) No Duty to Mitigate. Employee shall be under no duty to
mitigate any losses or damage to the Company with respect to any severance or
other amounts payable pursuant to Section 4 of this Agreement.

                     (e) Protection of Reputation. During the Term and
thereafter, Employee agrees that she will take not action which is intended, or
would reasonably be expected, to harm the Company or its reputation or which
would reasonably be expected to lead to unwanted or unfavorable publicity to the
Company.

                     (f) Governing Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York, without
regard to principles of the conflict of laws thereof.

                     (g) Jurisdiction; Forum. Each party hereto consents and
submits to the jurisdiction of any state or federal court sitting in the State,
City, and County of New York in connection with any dispute arising out of or
relating to this Agreement. Each party hereto waives any objection to the laying
of venue in such courts and any claim that any such action has been brought in
an inconvenient forum. To the extent permitted by law, any judgment in respect
of a dispute arising out of or relating to this Agreement may be enforced in any
other jurisdiction within or outside the United States by suit on the judgment,
a certified copy of such judgment being conclusive evidence of the fact and
amount of such judgment.

                     (h) Waiver of Jury Trial. Each of the parties hereto
irrevocably waives any and all right to trial by jury with respect to any
action, claim or other proceeding arising out of or relating to this Agreement.

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                     (i) Entire Agreement. This Agreement (including all
exhibits and schedules hereto) contains the entire agreement and understanding
between the parties hereto in respect of Employee's employment and supersedes,
cancels and annuls any prior or contemporaneous written or oral agreements,
understandings, commitments and practices between them respecting Employee's
employment, including all prior employment agreements, if any, between the
Company and Employee, which agreement(s) hereby are terminated and shall be of
no further force or effect.

                     (j) Amendment. This Agreement may be amended only by a
writing which makes express reference to this Agreement as the subject of such
amendment and which is signed by Employee and, on behalf of the Company, by its
duly authorized officer.

                     (k) Severability. If any term, provision, covenant or
condition of this Agreement or part thereof, or the application thereof to any
person, place or circumstance, shall be held to be invalid, unenforceable or
void by a court of competent jurisdiction, the remainder of this Agreement and
such term, provision, covenant or condition shall remain in full force and
effect, and any such invalid, unenforceable or void term, provision, covenant or
condition shall be deemed, without further action on the part of the parties
hereto, modified, amended and limited, and the court shall have the power to
modify, to the extent necessary to render the same and the remainder of this
Agreement valid, enforceable and lawful. In this regard, Employee acknowledges
that the provisions of Sections 5 and 6 of this Agreement are reasonable and
necessary for the protection of the Company.

                     (l) Construction. The headings and captions of this
Agreement are provided for convenience only and are intended to have no effect
in construing or interpreting this Agreement. The language in all parts of this
Agreement shall be in all cases construed according to its fair meaning and not
strictly for or against the Company or Employee. The use herein of the word
"including," when following any general provision, sentence, clause, statement,
term or matter, shall be deemed to mean "including, without limitation." As used
herein, "Company" shall mean the Company and its subsidiaries and any purchaser
of, successor to or assignee (whether direct or indirect, by purchase, merger,
consolidation or otherwise) of all or substantially all of the Company's
business or assets which is obligated to perform this Agreement by operation of
law, agreement pursuant to Section 7 of this Agreement or otherwise. As used
herein, the words "day" or "days" shall mean a calendar day or days.

                     (m) Nonwaiver. Neither any course of dealing nor any
failure or neglect of either party hereto in any instance to exercise any right,
power or privilege hereunder or under law shall constitute a waiver of any other
right, power or privilege or of the same right, power or privilege in any other
instance. All waivers by either party hereto must be contained in a written
instrument signed by the party to be charged and, in the case of the Company, by
its duly authorized officer.

                     (n) Remedies for Breach. The parties hereto agree that
Employee is obligated under this Agreement to render personal services during
the Term of a special, unique, unusual, extraordinary and intellectual
character, thereby giving this Agreement special value, and, in the event of a
breach or threatened breach of any covenant of Employee herein, the injury or
imminent injury to the value and the goodwill of the Company's business could
not be

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reasonably or adequately compensated in damages in an action at law.
Accordingly, Employee expressly acknowledges that the Company shall be entitled
to specific performance, injunctive relief or any other equitable remedy against
Employee, without the posting of a bond, in the event of any breach or
threatened breach of any provision of this Agreement by Employee (including,
without limitation, Sections 5 and 6). Without limiting the generality of the
foregoing, if Employee breaches or threatens to breach Section 5 or 6 of this
Agreement, such breach or threatened breach will entitle the Company, without
posting of bond, to an injunction prohibiting (i) Employee from disclosing any
Confidential Information to any Competing Business; (ii) such Competing Business
from receiving from Employee or using any such Confidential Information; and
(iii) Employee from, indirectly or directly, owning, managing, operating,
joining, controlling, participating in, investing in or otherwise being
connected or associated with, in any manner, any such Competing Business. The
rights and remedies of the parties hereto are cumulative and shall not be
exclusive, and each such party shall be entitled to pursue all legal and
equitable rights and remedies and to secure performance of the obligations and
duties of the other under this Agreement, and the enforcement of one or more of
such rights and remedies by a party shall in no way preclude such party from
pursuing, at the same time or subsequently, any and all other rights and
remedies available to it.

                     (o) Notices. Any notice, request, consent or approval
required or permitted to be given under this Agreement or pursuant to law shall
be sufficient if in writing, and if and when sent by certified or registered
mail, return receipt requested, with postage prepaid, to Employee's residence
(as reflected in the Company's records or as otherwise designated by Employee on
thirty (30) days' prior written notice to the Company) or to the Company's
principal Employee office, attention: President, as the case may be. All such
notices, requests, consents and approvals shall be effective upon being
deposited in the United States mail. However, the time period in which a
response thereto must be given shall commence to run from the date of receipt on
the return receipt of the notice, request, consent or approval by the addressee
thereof. Rejection or other refusal to accept, or the inability to deliver
because of changed address of which no notice was given as provided herein,
shall be deemed to be receipt of the notice, request, consent or approval sent.

                     (p) Assistance in Proceedings, Etc. Employee shall, without
additional compensation, during and after expiration of the Term, upon
reasonable notice, furnish such information and proper assistance to the Company
as may reasonably be required by the Company in connection with any legal or
quasi-legal proceeding, including any external or internal investigation,
involving the Company or any of its affiliates or in which any of them is, or
may become, a party.

                     (q) Survival. Cessation or termination of Employee's
employment with the Company shall not result in termination of this Agreement.
The respective obligations of Employee and rights and benefits afforded to the
Company as provided in this Agreement shall survive cessation or termination of
Employee's employment hereunder.

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<PAGE>

                  IN WITNESS  WHEREOF,  the Company has caused this Agreement to
be duly  executed  on its behalf by an officer  thereunto  duly  authorized  and
Employee has duly  executed  this  Agreement,  all as of the date and year first
written above.

ATLANTIC TECHNOLOGY VENTURES, INC.                  EMPLOYEE:

By:  /s/ A. Joseph Rudick                           /s/ Kelly Harris
     -----------------------                        -------------------------
     Name: A. Joseph Rudick                         Kelly Harris
     Title: CEO

                                       10<PAGE>

                                                                     EXHIBIT 4.1

================================================================================

                             STOCKHOLDERS AGREEMENT

                                     among

                                SMTC Corporation

                                      and

                      The Stockholders referred to herein

                           Dated as of July 27, 2000

================================================================================
<PAGE>

                               TABLE OF CONTENTS

                                                            Page
1.   EFFECTIVENESS; DEFINITIONS............................   2
     1.1.   Effectiveness..................................   2
     1.2.   Definitions....................................   2

2.   [RESERVED]............................................   2

3.   [RESERVED]............................................   2

4.   [RESERVED]............................................   2

5.   [RESERVED]............................................   2

6.   REGISTRATION RIGHTS...................................   2
     6.1.   Majority Investor Demand Registration Rights...   3
            6.1.1.  General................................   3
            6.1.2.  Payment of Expenses....................   4
            6.1.3.  Additional Procedures..................   4
     6.2.   Investors' Demand Registration Rights..........   4
            6.2.1.  General................................   4
            6.2.2.  Payment of Expenses....................   5
            6.2.3.  Additional Procedures..................   5
     6.3.   Piggyback Registration Rights..................   6
            6.3.1.  Piggyback Registration.................   6
            6.3.2.  Payment of Expenses....................   7
            6.3.3.  Additional Procedures..................   7
     6.4.   Certain Other Provisions.......................   7
            6.4.1.  Underwriter's Cutback..................   7
            6.4.2.  Other Actions..........................   8
            6.4.3.  Selection of Underwriters and Counsel..   9
            6.4.4.  Lock-Up................................   9
     6.5.   Indemnification and Contribution...............   9
            6.5.1.  Indemnities of the Company.............   9
            6.5.2.  Indemnities to the Company.............  11
            6.5.3.  Contribution...........................  11
            6.5.4.  Limitation on Liability of Holders of
                    Registrable Securities.................  12

7.   TRANSFERS TO OTHER HOLDERS............................  12

8.   REMEDIES..............................................  12
<PAGE>

     8.1.   Generally......................................  12
     8.2.   [RESERVED].....................................  12

9.   LEGENDS...............................................  12
     9.1.   [RESERVED].....................................  12
     9.2.   1933 Act Legends...............................  12
     9.3.   Stop Transfer Instruction......................  13
     9.4.   Termination of 1933 Act Legend.................  13

10.  [RESERVED]............................................  13

11.  AMENDMENT, TERMINATION, ETC...........................  13
     11.1.  Oral Modifications.............................  13
     11.2.  Written Modifications..........................  13
     11.3.  Termination....................................  14

12.  DEFINITIONS...........................................  14
     12.1.  Certain Matters of Construction................  14
     12.2.  Definitions....................................  14

13.  MISCELLANEOUS.........................................  19
     13.1.  Expenses of EMSIcon Transfers..................  19
     13.2.  Authority; Effect..............................  20
     13.3.  Notices........................................  20
     13.4.  Binding Effect, Etc............................  21
     13.5.  Descriptive Headings...........................  22
     13.6.  Counterparts...................................  22
     13.7.  Severability...................................  22

14.  GOVERNING LAW, ETC....................................  22
     14.1.  Governing Law..................................  22
     14.2.  Consent to Jurisdiction........................  22
     14.3.  WAIVER OF JURY TRIAL...........................  23
     14.4.  Exercise of Rights and Remedies................  23

                                     -ii-
<PAGE>

                             STOCKHOLDERS AGREEMENT

     The Stockholders Agreement (the "1999 Agreement") made as of July 30, 1999
                                      --------------
by and among:

     (i)   SMTC Corporation (the "Company");
                                  -------

     (ii)  SMTC Manufacturing Corporation of Canada (f/k/a The Surface Mount
           Technology Centre, Inc.) ("SMTC-Canada");
                                      -----------

     (iii) EMSIcon Investments ("EMSIcon"), LLC, Edward A. Johnson, James
                                 -------
           Holmes, J & E Enterprises, LLC, Allen & Company, Incorporated, Allen
           Value Partners, L.P., Allen Value Limited, Celerity EMSIcon, LLC,
           Bain Capital Fund VI, L.P., BCIP Associates II, BCIP Trust Associates
           II, BCIP Associates II-B, BCIP Associates II-C, BCM Capital Partners,
           L.P., Bain Capital V Mezzanine Fund, L.P., Sankaty High Yield Asset
           Partners, L.P., General Electric Capital Corporation, RGIP, LLC, J&L
           Investments, LLC ("J&L) and the members of Celerity EMSIcon, LLC
                              ---
           listed on the signature pages thereto (collectively, the "HTM
                                                                     ---
           Investors");
           ---------

     (iv)  P.N. Walker Consulting Inc., Paul Walker, Nichal Inc., Derek
           D'Andrade, Gary Walker, Philip Woodard and Kilmer Electronics Group
           Limited (collectively, the "SMTC Investors"); and
                                       --------------

     (v)   Edward A. Johnson, James Laurion and each Person who, upon acquiring
           Shares in connection with the exercise of Options granted by the
           Company, became party hereto by executing a counterpart signature
           page thereto (collectively, the "Managers"),
                                            --------
is hereby amended and restated in its entirety pursuant to Section 11.2 of the
1999 Agreement by written agreement of the Majority Stockholders, the Majority
HTM Investors, the Majority SMTC Investors and the Majority Managers (as each
term is defined in the 1999 Agreement) in the form of this Stockholders
Agreement (1999 Agreement as amended and restated hereby is referred to herein
as the "Agreement") as of July 27, 2000 to read as follows:
        ---------

                                    Recitals
                                    --------

1.   The Company (i) has filed a registration statement on Form S-1 with the
Commission, (ii) intends to effect an Initial Public Offering of New Common
Stock and Exchangeable Shares (each as defined below) and (iii) immediately
prior to the consummation of the Initial Public Offering, intends to (a)
purchase all outstanding Class N Stock from the holders thereof, (b) issue a
single share of special voting stock (the "Special Voting Stock"), (c) cause
                                           --------------------
SMTC Nova
<PAGE>

Scotia to purchase all outstanding Class Y Canadian Shares in exchange
for Class L Stock (d) convert its Class L Stock into Class A Stock, (e)
thereafter convert its Class A stock into a new class of common stock, par value
$.01 (the "New Common Stock"), and (f) cause SMTC-Canada to convert the Class L
           ----------------
Exchangeable Shares into exchangeable shares of SMTC-Canada (the "Exchangeable
                                                                  ------------
Shares") which are exchangeable for New Common Stock (the foregoing actions
------
together the "Reclassification").
              ----------------

2.   Pursuant to the terms of a Stock Purchase Agreement dated May 23, 2000, the
Company intends to acquire the capital stock of Pensar Corporation, a Wisconsin
corporation ("Pensar") and, in connection with such acquisition, the Sellers (as
              ------
defined in such Stock Purchase Agreement, and for purposes of this agreement the
"Pensar Investors") will acquire New Common Stock in consideration of their
 ----------------
interests in the capital stock of Pensar.

3.   The parties desire to amend and restate the 1999 Agreement on the date
hereof to establish the agreements on certain matters following the
Reclassification and the effectiveness of the Initial Public Offering.

4.   It is a condition to the closing of the acquisition of Pensar that the
Pensar Investors execute a counterpart signature page to this Agreement as
"Pensar Investors."

                                 Agreement
                                 ---------

     Therefore, the parties hereto hereby agree as follows:

1.   EFFECTIVENESS; DEFINITIONS.

     1.1. Effectiveness.  This Agreement shall become effective upon the closing
          -------------
of the Initial Public Offering.

     1.2. Definitions.  Certain terms are used in this Agreement as specifically
          -----------
defined herein.  These definitions are set forth or referred to in Section 12
hereof.

2.   [RESERVED].

3.   [RESERVED].

4.   [RESERVED].

5.   [RESERVED].

6.   REGISTRATION RIGHTS.  The Company will perform and comply, and cause each
of its subsidiaries to perform and comply, with such of the following provisions
as are

                                      -2-
<PAGE>

applicable to it.  Each holder of Shares will perform and comply with
such of the following provisions as are applicable to such holder.

     6.1.  Majority Investor Demand Registration Rights.
           --------------------------------------------

           6.1.1.  General. The Majority Stockholders (for purposes of this
                   -------
     Section 6.1, "Initiating Investors"), by notice to the Company specifying
     the intended method or methods of disposition, may request that the Company
     effect the registration under the Securities Act for a Public Offering of
     all or a specified part of the Registrable Securities (x) held by such
     Initiating Investors or (y) issuable to such Initiating Investors upon
     Conversion of any Exchangeable Shares held by such Initiating Investors.
     The Company will then use its best efforts to effect the registration under
     the Securities Act of the Registrable Securities which the Company has been
     requested to register by such Initiating Investors together with all other
     Registrable Securities which the Company has been requested to register
     pursuant to Section 6.3 all to the extent requisite to permit the
     disposition (in accordance with the intended methods thereof as aforesaid)
     of the Registrable Securities which the Company has been so requested to
     register; provided, however, that the Company shall not be obligated to
               --------  -------
     take any action to effect any such registration pursuant to this
     Section 6.1.1:

                 (a) Within 180 days immediately following the effective date of
           any registration statement pertaining to an underwritten public
           offering of securities of the Company for its own account (other than
           a Rule 145 Transaction, or a registration relating solely to employee
           benefit plans); or

                 (b) On any form other than Form S-3 (or any successor form) if
           the Company has previously effected three or more registrations of
           Registrable Securities under this Section 6.1.1 on any form other
           than Form S-3 (or any successor form); provided, however, that no
                                                  --------  -------
           registrations of Registrable Securities which shall not have become
           and remained effective in accordance with the provisions of this
           Section 6, and no registrations of Registrable Securities pursuant to
           which the Initiating Investors are not able to include at least 90%
           of the Registrable Securities which they desired to include, shall be
           included in the calculation of numbers of registrations contemplated
           by this clause (b).

           6.1.1.1. Form.  Except as otherwise provided above, each registration
                    ----
     requested pursuant to this Section 6.1.1 shall be effected by the filing of
     a registration statement on Form S-1 (or any other form which includes
     substantially the same information as would be required to be included in a
     registration statement on such form as currently constituted), unless the
     use of a different form has been agreed to in writing by holders of at
     least a majority of

                                      -3-
<PAGE>

     the Registrable Securities to be included in the proposed registration
     statement in question by the Initiating Investors (the "Majority
                                                             --------
     Participating Stockholders").
     --------------------------

           6.1.2  Payment of Expenses.  The Company shall pay all reasonable
                  -------------------
     expenses of the Initiating Investors incurred in connection with each
     registration of Registrable Securities requested pursuant to this Section
     6.1, other than underwriting discount and commission, if any, and
     applicable transfer taxes, if any.

           6.1.3. Additional Procedures. In the case of a registration pursuant
                  ---------------------
     to Section 6.1, whenever the Majority Participating Stockholders shall
     request that such registration shall be effected pursuant to an
     underwritten offering, the Company shall include such information in the
     written notices to holders of Registrable Securities and Convertible
     Securities referred to in Section 6.3. In such event, the right of any
     holder of Registrable Securities to have securities owned by such holder
     included in such registration pursuant to Section 6.1 shall be conditioned
     upon such holder's participation in such underwriting and the inclusion of
     such holder's Registrable Securities in the underwriting (unless otherwise
     mutually agreed upon by the Majority Participating Stockholders and such
     holder). If requested by such underwriters, the Company together with the
     holders of Registrable Securities proposing to distribute their securities
     through such underwriting will enter into an underwriting agreement with
     such underwriters for such offering containing such representations and
     warranties by the Company and such holders and such other terms and
     provisions as are customarily contained in underwriting agreements with
     respect to secondary distributions, including, without limitation,
     customary indemnity and contribution provisions (subject, in each case, to
     the limitations on such liabilities set forth in this Agreement).

     6.2.  Investors' Demand Registration Rights.
           -------------------------------------

           6.2.1.  General. From and after July 30, 2003, each of the Majority
                   -------
     Bain Investors, the Majority Celerity Investors and the Majority SMTC
     Investors, in each case, holding Shares that constitute at least 15% of the
     Registrable Securities (for purposes of this Section 6.2, "Initiating
                                                                ----------
     Investors"), by notice to the Company specifying the intended method or
     ---------
     methods of disposition, may request that the Company effect the
     registration under the Securities Act for a Public Offering of all or a
     specified part of the Registrable Securities (x) held by such Initiating
     Investors or (y) issuable to such Initiating Investor upon Conversion of
     any Exchangeable Shares held by such Initiating Investor. The Company will
     then use its best efforts to effect the registration under the Securities
     Act of the Registrable Securities which the Company has been requested to
     register by such Initiating Investors together with all other Registrable
     Securities which the Company has been requested to register pursuant to
     Section 6.3 all to the extent requisite to permit the disposition (in
     accordance with

                                      -4-
<PAGE>

     the intended methods thereof as aforesaid) of the Registrable Securities
     which the Company has been so requested to register; provided, however,
                                                          --------  -------
     that the Company shall not be obligated to take any action to effect any
     such registration pursuant to this Section 6.2.1:

                         (a) Within 180 days immediately following the effective
                   date of any registration statement pertaining to an
                   underwritten public offering of securities of the Company for
                   its own account (other than a Rule 145 Transaction, or a
                   registration relating solely to employee benefit plans); or

                         (b) On any form other than Form S-3 (or any successor
                   form) if the Company has previously effected three or more
                   registrations of Registrable Securities under this Section
                   6.2.1 on any form other than Form S-3 (or any successor
                   form); provided, however, that no registrations of
                   Registrable Securities which shall not have become and
                   remained effective in accordance with the provisions of this
                   Section 6, and no registrations of Registrable Securities
                   pursuant to which the Initiating Investors are not able to
                   include at least 90% of the Registrable Securities which they
                   desired to include, shall be included in the calculation of
                   numbers of registrations contemplated by this clause (b).

                   6.2.1.1.  Form. Except as otherwise provided above, each
           registration requested pursuant to this Section 6.2.1 shall be
           effected by the filing of a registration statement on Form S-1 (or
           any other form which includes substantially the same information as
           would be required to be included in a registration statement on such
           form as currently constituted), unless the use of a different form
           has been agreed to in writing by holders of at least a majority of
           the Registrable Securities to be included in the proposed
           registration statement in question by the Initiating Investors (the
           "Majority Participating Stockholders").

           6.2.2.  Payment of Expenses.  The Company shall pay all reasonable
                   -------------------
     expenses of the Initiating Investors incurred in connection with each
     registration of Registrable Securities requested pursuant to this Section
     6.2, other than underwriting discount and commission, if any, and
     applicable transfer taxes, if any.

           6.2.3.  Additional Procedures. In the case of a registration pursuant
                   ---------------------
     to Section 6.2, whenever the Majority Participating Stockholders shall
     request that such registration shall be effected pursuant to an
     underwritten offering, the Company shall include such information in the
     written notices to holders of Registrable Securities and Convertible
     Securities referred to in Section 6.3. In such event, the right of any
     holder of Registrable Securities to have securities owned by such holder
     included in such

                                      -5-
<PAGE>

     registration pursuant to Section 6.2 shall be conditioned upon such
     holder's participation in such underwriting and the inclusion of such
     holder's Registrable Securities in the underwriting (unless otherwise
     mutually agreed upon by the Majority Participating Stockholders and such
     holder). If requested by such underwriters, the Company together with the
     holders of Registrable Securities proposing to distribute their securities
     through such underwriting will enter into an underwriting agreement with
     such underwriters for such offering containing such representations and
     warranties by the Company and such holders and such other terms and
     provisions as are customarily contained in underwriting agreements with
     respect to secondary distributions, including, without limitation,
     customary indemnity and contribution provisions (subject, in each case, to
     the limitations on such liabilities set forth in this Agreement).

     6.3.  Piggyback Registration Rights.
           -----------------------------

           6.3.1.  Piggyback Registration.
                   ----------------------

                   6.3.1.1.  General. Each time the Company proposes to register
                             -------
           any shares of Common Stock under the Securities Act on a form which
           would permit registration of Registrable Securities for sale to the
           public, for its own account and/or for the account of any stockholder
           (pursuant to Section 6.1, Section 6.2 or otherwise) for sale in a
           Public Offering, the Company will give notice to all holders of
           Registrable Securities and holders of Convertible Securities of its
           intention to do so. Any such holder may, by written response
           delivered to the Company within 20 days after the effectiveness of
           such notice, request that all or a specified part of the Registrable
           Securities (a) held by such holder or (b) issuable to such holder
           upon Conversion of Exchangeable Shares held by such holder be
           included in such registration. The Company thereupon will use its
           reasonable efforts to cause to be included in such registration under
           the Securities Act all shares of Common Stock which the Company has
           been so requested to register by such holders, to the extent required
           to permit the disposition (in accordance with the methods to be used
           by the Company or other holders of shares of Common Stock in such
           Public Offering) of the Registrable Securities to be so registered.
           No registration of Registrable Securities effected under this Section
           6.3 shall relieve the Company of any of its obligations to effect
           registrations of Registrable Securities pursuant to Section 6.1 or
           Section 6.2.

                   6.3.1.2.  Excluded Transactions. The Company shall not be
                             ---------------------
           obligated to effect any registration of Registrable Securities under
           this Section 6.3 incidental to the registration of any of its
           securities in connection with:

                                      -6-
<PAGE>

                        (a) Any Public Offering relating to employee benefit
                   plans or dividend reinvestment plans;

                        (b) Any Public Offering relating to the acquisition or
                   merger after the date hereof by the Company or any of its
                   subsidiaries of or with any other businesses; or

                        (c) The Initial Public Offering and the Qualified Public
                   Offering, unless such Public Offering has been initiated
                   pursuant to Section 6.1.1 or 6.2.1.

           6.3.2.  Payment of Expenses.  The Company shall pay all reasonable
                   -------------------
     expenses of a single legal counsel representing any and all holders of
     Registrable Securities incurred in connection with each registration of
     Registrable Securities requested pursuant to this Section 6.3.

           6.3.3.  Additional Procedures.  Holders of Shares participating in
                   ---------------------
     any Public Offering pursuant to this Section 6.3 shall take all such
     actions and execute all such documents and instruments that are reasonably
     requested by the Company to effect the sale of their Shares in such Public
     Offering, including, without limitation, being parties to the underwriting
     agreement entered into by the Company and any other selling shareholders in
     connection therewith and being liable in respect of the representations and
     warranties by, and the other agreements (including without limitation
     customary selling stockholder representations, warranties, indemnifications
     and "lock-up" agreements) for the benefit of the underwriters; provided,
                                                                    --------
     however, that (a) with respect to individual representations, warranties,
     -------
     indemnities and agreements of sellers of Shares in such Public Offering,
     the aggregate amount of such liability shall not exceed such holder's net
     proceeds from such offering and (b) to the extent selling stockholders give
     further representations, warranties and indemnities, then with respect to
     all other representations, warranties and indemnities of sellers of shares
     in such Public Offering, the aggregate amount of such liability shall not
     exceed the lesser of (i) such holder's pro rata portion of any such
     liability, in accordance with such holder's portion of the total number of
     Shares included in the offering or (ii) such holder's net proceeds from
     such offering.

     6.4.  Certain Other Provisions.
           ------------------------

           6.4.1.  Underwriter's Cutback. In connection with any registration of
                   ---------------------
     shares, the underwriter may determine that marketing factors (including,
     without limitation, an adverse effect on the per share offering price)
     require a limitation of the number of shares to be underwritten.
     Notwithstanding any contrary provision of this Section 6 and subject to the
     terms of this Section 6.4.1, the underwriter may limit the number of shares
     which would otherwise be included in such registration by excluding any or
     all

                                      -7-
<PAGE>

     Registrable Securities from such registration (it being understood that
     the number of shares which the Company seeks to have registered in such
     registration shall not be subject to exclusion, in whole or in part, under
     this Section 6.4.1). Upon receipt of notice from the underwriter of the
     need to reduce the number of shares to be included in the registration, the
     Company shall advise all holders of the Company's securities that would
     otherwise be registered and underwritten pursuant hereto, and the number of
     shares of such securities, including Registrable Securities, that may be
     included in the registration shall be allocated in the following manner,
     unless the underwriter shall determine that marketing factors require a
     different allocation: shares, other than Registrable Securities, requested
     to be included in such registration by shareholders shall be excluded to
     the extent necessary to achieve the underwriter's cutback unless the
     Company has, with the consent of the Majority Stockholders, granted
     registration rights which are to be treated on an equal basis with
     Registrable Securities for the purpose of the exercise of the underwriter
     cutback; and, if a limitation on the number of shares is still required,
     the number of Registrable Securities and other shares of Common Stock that
     may be included in such registration shall be allocated among holders
     thereof in proportion, as nearly as practicable, to the respective amounts
     of Common Stock which each shareholder requested be registered in such
     registration. For purposes of any underwriter cutback, all Common Stock
     held by any holder of Registrable Securities which is a partnership or
     corporation shall also include any Common Stock held by the partners,
     retired partners, shareholders or affiliated entities of such holder, or
     the estates and family members of any such partners and retired partners
     and any trusts for the benefit of any of the foregoing persons, and such
     holder and other persons shall be deemed to be a single selling holder, and
     any pro rata reduction with respect to such selling holder shall be based
     upon the aggregate amount of Common Stock owned by all entities and
     individuals included in such selling holder, as defined in this sentence.
     No securities excluded from the underwriting by reason of the underwriter's
     marketing limitation shall be included in such registration. If any holder
     of Registrable Securities disapproves of the terms of the underwriting, it
     may elect to withdraw therefrom by written notice to the Company and the
     underwriter. The Registrable Securities so withdrawn shall also be
     withdrawn from registration.

           6.4.2.  Other Actions. If and in each case when the Company is
                   -------------
     required to use its best efforts to effect a registration of any
     Registrable Securities as provided in this Section 6, the Company shall
     take appropriate and customary actions in furtherance thereof, including,
     without limitation: (a) promptly filing with the Commission a registration
     statement and using reasonable efforts to cause such registration statement
     to become effective, (b) preparing and filing with the Commission such
     amendments and supplements to such registration statements as may be
     required to comply with the Securities Act and to keep such registration
     statement effective for a period not to exceed 270 days from the date of
     effectiveness or such earlier time as the Registrable Securities covered by
     such registration statement shall have been disposed of in accordance with
     the intended method of distribution therefor or the expiration of the

                                      -8-
<PAGE>

     time when a prospectus relating to such registration is required to be
     delivered under the Securities Act, (c) use its best efforts to register or
     qualify such Registrable Securities under the state securities or "blue
     sky" laws of such jurisdictions as the sellers shall reasonably request;
     provided, however, that the Company shall not be obligated to file any
     --------  -------
     general consent to service of process or to qualify as a foreign
     corporation in any jurisdiction in which it is not so qualified or to
     subject itself to taxation in respect of doing business in any jurisdiction
     in which it would not otherwise be so subject and (d) otherwise cooperate
     reasonably with, and take such customary actions as may reasonably be
     requested by the holders of Registrable Securities in connection with, such
     registration.

           6.4.3.  Selection of Underwriters and Counsel.  The underwriters and
                   -------------------------------------
     legal counsel to be retained in connection with any Public Offering shall
     be selected by the Board or, in the case of an offering following a request
     therefor under Section 6.1, the Initiating Investors.

           6.4.4.  Lock-Up. Without the prior written consent of the
                   -------
     underwriters managing any Public Offering, for a period beginning seven
     days immediately preceding and ending on the 90th day (or, in the case of
     the Initial Public Offering, the 180th day) following the effective date of
     the registration statement used in connection with such offering, no holder
     of Shares (whether or not a selling shareholder pursuant to such
     registration statement) shall (a) offer, pledge, sell, contract to sell,
     sell any option or contract to purchase, purchase any option or contract to
     sell, grant any option, right or warrant to purchase, lend, or otherwise
     Transfer, directly or indirectly, any shares of Common Stock or any
     securities convertible into or exercisable or exchangeable for such Common
     Stock or (b) enter into any swap or other arrangement that transfers to
     another, in whole or in part, any of the economic consequences of ownership
     of Common Stock, whether any such transaction described in clause (a) or
     (b) above is to be settled by delivery of such Common Stock or such other
     securities, in cash or otherwise; provided, however, that the foregoing
                                       --------  -------
     restrictions shall not apply to (i) transactions relating to shares of
     Common Stock or other securities acquired in open market transactions after
     the completion of the Initial Public Offering, (ii) Transfers to a
     Permitted Transferee of such holder or (iii) Conversions of Exchangeable
     Shares or conversions or exchanges of shares of Common Stock into other
     classes of Common Stock, in either case without change of holder, or (iv)
     transfers of Common Stock to any of the Pensar Investors, the Company or
     its affiliates pursuant to the Escrow Agreement dated on or about the date
     hereof among the Company, the Pensar Investors and Brown Brothers Harriman
     & Co., as Escrow Agent.

     6.5.  Indemnification and Contribution.
           --------------------------------

           6.5.1.  Indemnities of the Company. In the event of any registration
                   --------------------------
     of any Registrable Securities or other debt or equity securities of the
     Company or any of its

                                      -9-
<PAGE>

     subsidiaries under the Securities Act pursuant to this Section 6 or
     otherwise, and in connection with any registration statement or any other
     disclosure document produced by or on behalf of the Company or any of its
     subsidiaries including, without limitation, reports required and other
     documents filed under the Exchange Act, and other documents pursuant to
     which any debt or equity securities of the Company or any of its
     subsidiaries are sold (whether or not for the account of the Company or its
     subsidiaries), the Company will, and hereby does, and will cause each of
     its subsidiaries, jointly and severally, to indemnify and hold harmless
     each seller of Registrable Securities, any Person who is or might be deemed
     to be a controlling Person of the Company or any of its subsidiaries within
     the meaning of Section 15 of the Securities Act or Section 20 of the
     Exchange Act, their respective direct and indirect partners, advisory board
     members, directors, officers, trustees, members and shareholders, and each
     other Person, if any, who controls any such seller or any such holder
     within the meaning of Section 15 of the Securities Act or Section 20 of the
     Exchange Act (each such person being referred to herein as a "Covered
                                                                   -------
     Person"), against any losses, claims, damages or liabilities (or actions or
     ------
     proceedings in respect thereof), joint or several, to which such Covered
     Person may be or become subject under the Securities Act, the Exchange Act,
     any other securities or other law of any jurisdiction, the common law or
     otherwise, insofar as such losses, claims, damages or liabilities (or
     actions or proceedings in respect thereof) arise out of or are based upon
     (a) any untrue statement or alleged untrue statement of any material fact
     contained or incorporated by reference in any registration statement under
     the Securities Act, any preliminary prospectus or final prospectus included
     therein, or any related summary prospectus, or any amendment or supplement
     thereto, or any document incorporated by reference therein, or any other
     such disclosure document (including without limitation reports and other
     documents filed under the Exchange Act and any document incorporated by
     reference therein) or other document or report, (b) any omission or alleged
     omission to state therein a material fact required to be stated therein or
     necessary to make the statements therein not misleading or (c) any
     violation or alleged violation by the Company or any of its subsidiaries of
     any federal, state, foreign or common law rule or regulation applicable to
     the Company or any of its subsidiaries and relating to action or inaction
     in connection with any such registration, disclosure document or other
     document or report, and will reimburse such Covered Person for any legal or
     any other expenses incurred by it in connection with investigating or
     defending any such loss, claim, damage, liability, action or proceeding;
     provided, however, that neither the Company nor any of its subsidiaries
     --------  -------
     shall be liable to any Covered Person in any such case to the extent that
     any such loss, claim, damage, liability, action or proceeding arises out of
     or is based upon an untrue statement or alleged untrue statement or
     omission or alleged omission made in such registration statement, any such
     preliminary prospectus, final prospectus, summary prospectus, amendment or
     supplement, incorporated document or other such disclosure document or
     other document or report, in reliance upon and in conformity with written
     information furnished to the Company or to any of its subsidiaries through
     an instrument duly

                                      -10-
<PAGE>

     executed by such Covered Person specifically stating that it is for use in
     the preparation thereof. The indemnities of the Company and of its
     subsidiaries contained in this Section 6.5.1 shall remain in full force and
     effect regardless of any investigation made by or on behalf of such Covered
     Person and shall survive any transfer of securities.

           6.5.2.  Indemnities to the Company.  The Company and any of its
                   --------------------------
     subsidiaries may require, as a condition to including any securities in any
     registration statement filed pursuant to this Section 6, that the Company
     and any of its subsidiaries shall have received an undertaking satisfactory
     to it from the prospective seller of such securities, to indemnify and hold
     harmless the Company and any of its subsidiaries, each director of the
     Company or any of its subsidiaries, each officer of the Company or any of
     its subsidiaries who shall sign such registration statement and each other
     Person (other than such seller), if any, who controls the Company and any
     of its subsidiaries within the meaning of Section 15 of the Securities Act
     or Section 20 of the Exchange Act and each other prospective seller of such
     securities with respect to any statement in or omission from such
     registration statement, any preliminary prospectus, final prospectus or
     summary prospectus included therein, or any amendment or supplement
     thereto, or any other disclosure document (including, without limitation,
     reports and other documents filed under the Exchange Act or any document
     incorporated therein) or other document or report, if such statement or
     omission was made in reliance upon and in conformity with written
     information furnished to the Company or any of its subsidiaries through an
     instrument executed by such seller specifically stating that it is for use
     in the preparation of such registration statement, preliminary prospectus,
     final prospectus, summary prospectus, amendment or supplement, incorporated
     document or other document or report. Such indemnity shall remain in full
     force and effect regardless of any investigation made by or on behalf of
     the Company, any of its subsidiaries or any such director, officer or
     controlling Person and shall survive any transfer of securities.

          6.5.3.  Contribution.  If the indemnification provided for in Sections
                  ------------
     6.5.1 or 6.5.2 is unavailable to a party that would have been entitled to
     indemnification pursuant to the foregoing provisions of this Section 6.5
     (an "Indemnitee") in respect of any losses, claims, damages or liabilities
          ----------
     (or actions or proceedings in respect thereof) referred to therein, then
     each party that would have been an indemnifying party thereunder shall, in
     lieu of indemnifying such Indemnitee, contribute to the amount paid or
     payable by such Indemnitee as a result of such losses, claims, damages or
     liabilities (or actions or proceedings in respect thereof) in such
     proportion as is appropriate to reflect the relative fault of such
     indemnifying party on the one hand and such Indemnitee on the other in
     connection with the statements or omissions which resulted in such losses,
     claims, damages or liabilities (or actions or proceedings in respect
     thereof). The relative fault shall be determined by reference to, among
     other things, whether the untrue or alleged untrue statement of a material
     fact or the omission or alleged omission to state a material fact relates
     to information supplied by such

                                      -11-
<PAGE>

     indemnifying party or such Indemnitee and the parties' relative intent,
     knowledge, access to information and opportunity to correct or prevent such
     statement or omission. The parties agree that it would not be just or
     equitable if contribution pursuant to this Section 6.5.3 were determined by
     pro rata allocation or by any other method of allocation which does not
     take account of the equitable considerations referred to in the preceding
     sentence. The amount paid or payable by a contributing party as a result of
     the losses, claims, damages or liabilities (or actions or proceedings in
     respect thereof) referred to above in this Section 6.5.3 shall include any
     legal or other expenses reasonably incurred by such Indemnitee in
     connection with investigating or defending any such action or claim. No
     Person guilty of fraudulent misrepresentation (within the meaning of
     Section 11(f) of the Securities Act) shall be entitled to contribution from
     any Person who was not guilty of such fraudulent misrepresentation.

           6.5.4.  Limitation on Liability of Holders of Registrable Securities.
                   ------------------------------------------------------------
     The liability of each holder of Registrable Securities in respect of any
     indemnification or contribution obligation of such holder arising under
     this Section 6.5 shall not in any event exceed an amount equal to the net
     proceeds to such holder (after deduction of all underwriters' discounts and
     commissions) from the disposition of the Registrable Securities disposed of
     by such holder pursuant to such registration.

7.   TRANSFERS TO OTHER HOLDERS.  Shares Transferred by a holder of Shares to
another holder of shares under this Agreement shall be deemed for all purposes
hereof to be HTM Shares, SMTC Shares, Pensar Shares, or the Management Shares
hereunder, of like kind with the other Shares held by the acquiring holder.

8.   REMEDIES.

     8.1.  Generally. To the extent permitted by applicable law, the Company and
           ---------
each holder of Shares shall have all remedies at law, in equity or otherwise in
the event of any breach or violation of this Agreement or any default hereunder
by the Company or any holder of Shares. The parties acknowledge and agree that
in the event of any breach of this Agreement, in addition to any other remedies
which may be available, each of the parties hereto shall be entitled to specific
performance of the obligations of the other parties hereto and, in addition, to
such other equitable remedies (including, without limitation, preliminary or
temporary relief) as may be appropriate in the circumstances.

     8.2.  [RESERVED].

9.   LEGENDS.

     9.1.  [RESERVED].

                                      -12-
<PAGE>

     9.2.  1933 Act Legends. Each certificate representing Shares shall have the
           ----------------
following legend endorsed conspicuously thereupon:

           The securities represented by this certificate were issued in a
     private placement, without registration under the Securities Act of 1933,
     as amended (the "Act"), and may not be sold, assigned, pledged or otherwise
                      ---
     transferred in the absence of an effective registration under the Act
     covering the transfer or an opinion of counsel, satisfactory to the issuer,
     that registration under the Act is not required.

     9.3.  Stop Transfer Instruction.  The Company will instruct any transfer
           -------------------------
agent not to register the Transfer of any Shares until the conditions specified
in the foregoing legends are satisfied.

     9.4.  Termination of 1933 Act Legend.  The requirement imposed by Section
           ------------------------------
9.2 shall cease and terminate as to any particular Shares (a) when, in the
opinion of Ropes & Gray, or other counsel reasonably acceptable to the Company,
such legend is no longer required in order to assure compliance by the Company
with the Securities Act or (b) when such Shares have been effectively registered
under the Securities Act or transferred pursuant to Rule 144. Wherever (x) such
requirement shall cease and terminate as to any Shares or (y) such Shares shall
be transferable under paragraph (k) of Rule 144, the holder thereof shall be
entitled to receive from the Company, without expense, new certificates not
bearing the legend set forth in Section 9.2.

10.  [RESERVED].

11.  AMENDMENT, TERMINATION, ETC.

     11.1. Oral Modifications.  This Agreement may not be orally amended,
           ------------------
modified, extended or terminated, nor shall any oral waiver of any of its terms
be effective.

     11.2. Written Modifications.  This Agreement may be amended, modified,
           ---------------------
extended or terminated, and the provisions hereof may be waived, only by an
agreement in writing signed by the Majority Stockholders; provided, however,
                                                          --------  -------
that (a) the consent of the Majority HTM Investors shall be required for any
amendment, modification, extension, termination or waiver which has a material
adverse effect on the rights of the holders of HTM Shares as such under this
Agreement, (b) the consent of the Majority SMTC Investors shall be required for
any amendment, modification, extension, termination or waiver which has a
material adverse effect on the rights of the holders of SMTC Shares as such
under this Agreement, (c) the consent of the Majority Pensar Investors shall be
required for any amendment, modification, extension, termination or waiver which
has a material adverse effect on the rights of the holders of Pensar Shares as
such under this Agreement and (d) the consent of the Majority Managers shall be
required for any amendment, modification, extension, termination or waiver

                                      -13-
<PAGE>

which has a material adverse effect on the rights of the holders of Management
Shares as such under this Agreement. Each such amendment, modification,
extension, termination and waiver shall be binding upon each party hereto and
each holder of Shares subject hereto. In addition, each party hereto and each
holder of Shares subject hereto may waive any right hereunder by an instrument
in writing signed by such party or holder.

     11.3.  Termination.  No termination under this Agreement shall relieve any
            -----------
Person of liability for breach prior to termination.

 12. DEFINITIONS.  For purposes of this Agreement:

     12.1.  Certain Matters of Construction.  In addition to the definitions
            -------------------------------
referred to or set forth below in this Section 12:

          (a) The words "hereof", "herein", "hereunder" and words of similar
     import shall refer to this Agreement as a whole and not to any particular
     Section or provision of this Agreement, and, unless otherwise provided,
     reference to a particular Section shall refer to the applicable Section of
     this Agreement and shall include all subsections thereof;

          (b) Definitions shall be equally applicable to both nouns and verbs
     and the singular and plural forms of the terms defined; and

          (c) The masculine, feminine and neuter genders shall each include the
     other.

     12.2.  Definitions.  The following terms shall have the following meanings:
            -----------

     "Agreement" shall have the meaning set forth in the Preamble.
      ---------

     "Bain Equity Funds" shall mean, collectively, Bain Capital Fund VI, L.P.,
      -----------------
BCIP Associates II, BCIP Trust Associates II, BCIP Associates II-B and BCIP
Associates II-C.

     "Bain Investors" shall mean, collectively, Bain Capital Fund VI, L.P., BCIP
      --------------
Associates II, BCIP Trust Associates II, BCIP Associates II-B, BCIP Associates
II-C, Bain Capital V Mezzanine Fund, L.P., BCM Capital Partners, L.P., Sankaty
High Yield Asset Partners, L.P.

     The "Beneficial Owner" of any Share shall be the owner of such Share and,
          ----------------
in the case of any Share owned by EMSIcon, the owner of the membership unit of
EMSIcon corresponding to such Share.  The terms "Beneficial Ownership" and
                                                 --------------------
"Beneficially Owned" shall have a corresponding meaning.
-------------------

     "Celerity Investor" shall mean Celerity EMSIcon, LLC.
      -----------------

                                      -14-
<PAGE>

     "Class A Stock" shall mean the Company's Class A-1 Common Stock together
      -------------
with the Class A-2 Common Stock.

     "Class A-1 Stock" shall mean the Company's Class A-1 Common Stock, par
      ---------------
value $.001 per share.

     "Class A-2 Stock" shall mean the Company's Class A-2 Common Stock, par
      ---------------
value $.001 per share.

     "Class L Exchangeable Shares" shall mean SMTC-Canada's Class L non-voting
      ---------------------------
preferred shares.

     "Class L Stock" shall mean the Company's Class L Common Stock, par value
      -------------
$.001 per share.

     "Class N Stock" shall mean the Company's Class N Common Stock, par value
      -------------
$.001 per share.

     "Class Y Canadian Shares" shall mean SMTC-Canada's Class Y non-voting
      -----------------------
preferred shares.

     "Commission" shall mean the Securities and Exchange Commission.
      ----------

     "Common Stock" shall mean the common stock of the Company including without
      ------------
limitation the Class A Stock, the Class L Stock and the New Common Stock.

     "Company" shall have the meaning set forth in the Preamble.
      -------

     "Conversion" shall mean the Transfer of an Exchangeable Share to the
      ----------
Company or one of its subsidiaries in consideration of the receipt of Common
Stock whether pursuant to the Articles of Incorporation (as amended from time to
time) of SMTC-Canada, any agreement relating generally to the conversion of
Exchangeable Shares or otherwise, and "Convert" shall have a similar meaning.

     "Convertible Securities" shall mean any evidence of indebtedness, shares of
      ----------------------
stock (other than Common Stock) or other securities which are directly or
indirectly convertible into or exchangeable or exercisable for shares of Common
Stock, including without limitation the Exchangeable Shares.

     "Covered Person" shall have the meaning set forth in Section 6.5.1.
      --------------

     "EMSIcon" shall have the meaning set forth in the Preamble.
      -------

                                      -15-
<PAGE>

     "Equivalent Shares" shall mean as to any outstanding shares of Common
      -----------------
Stock, such number of shares of Common Stock, and as to any outstanding Options
or Convertible Securities, the maximum number of shares of Common Stock for
which or into which such Options or Convertible Securities may at the time be
exercised, exchanged or converted.

     "Exchange Act" shall mean the Securities Exchange Act of 1934, as in effect
      ------------
from time to time.

     "Exchangeable Shares" shall have the meaning set forth in the Recitals.
      -------------------

     "HTM" shall have the meaning set forth in the Recitals.
      ---

     "HTM Investors" shall have the meaning set forth in the Preamble.
      -------------

     "HTM Shares" shall mean (a) all shares of Common Stock originally issued
      ----------
to, or issued with respect to shares originally issued to, or held by, an HTM
Investor, whenever issued, including, without limitation, all shares of Common
Stock issued pursuant to the exercise of any Convertible Securities and (b) all
Convertible Securities originally granted or issued to an HTM Investor.  As to
any particular HTM Shares, such shares shall cease to be HTM Shares when (w) a
registration statement with respect to the sale of such securities shall have
become effective under the Securities Act and such securities shall have been
disposed of in accordance with such registration statement, (x) such securities
shall have been Transferred pursuant to Rule 144 or Rule 701, (y) subject to the
provisions of Section 9, such securities shall have been otherwise transferred,
new certificates for them not bearing a legend restricting further transfer
shall have been delivered by the Company and subsequent disposition of them
shall not require registration of them under the Securities Act and such
securities may be distributed without volume limitation or other restrictions on
transfer under Rule 144 (including without application of paragraphs (c), (e),
(f) and (h) of Rule 144) or (z) such securities shall have ceased to be
outstanding.  Except as otherwise provided in this Agreement, Convertible
Securities shall be treated as a number of Shares equal to the number of
Equivalent Shares represented by such Convertible Securities in all cases where
it is necessary to calculate the number of Shares held by any holder of HTM
Shares.

     "Indemnitee" shall have the meaning set forth in Section 6.5.3.
      ----------

     "Initial Public Offering" means the initial Public Offering registered on
      -----------------------
Form S-1 (or any successor form under the Securities Act).

     "Initiating Investors" shall have the meaning set forth in Sections 6.1.1,
      --------------------
6.2.1.1 and 6.2.1.2.

     "J&L" shall have the meaning set forth in the Preamble.
      ---

                                      -16-
<PAGE>

     "Majority Bain Investors" shall mean, as of any date, the holders of a
      -----------------------
majority of the Shares then Beneficially Owned by the Bain Investors.

     "Majority Celerity Investors" shall mean, as of any date, the holders of a
      ---------------------------
majority of the Shares then Beneficially Owned by the Celerity Investor.

     "Majority HTM Investors" shall mean, as of any date, the holders of a
      ----------------------
majority of the HTM Shares outstanding on such date.

     "Majority Managers" shall mean, as of any date, the holders of a majority
      -----------------
of the Management Shares outstanding on such date.

     "Majority Participating Stockholders" shall have the meaning set forth in
      -----------------------------------
Section 6.2.1.1 and 6.2.1.4.

     "Majority SMTC Investors" shall mean, as of any date, the holders of a
      -----------------------
majority of the SMTC Shares outstanding on such date.

     "Majority Stockholders" shall mean, as of any date, the holders of a
      ---------------------
majority of the Shares outstanding on such date.

     "Management Shares" shall mean (a) all shares of Common Stock originally
      -----------------
issued to, or issued with respect to shares originally issued to, or held by, a
Manager, whenever issued, including, without limitation, all shares of Common
Stock issued pursuant to the exercise of any Convertible Securities and (b) all
Convertible Securities originally granted or issued to a Manager.  As to any
particular Management Shares, such shares shall cease to be Management Shares
when (w) a registration statement with respect to the sale of such securities
shall have become effective under the Securities Act and such securities shall
have been disposed of in accordance with such registration statement, (x) such
securities shall have been Transferred pursuant to Rule 144 or Rule 701, (y)
subject to the provisions of Section 9, such securities shall have been
otherwise transferred, new certificates for them not bearing a legend
restricting further transfer shall have been delivered by the Company and
subsequent disposition of them shall not require registration of them under the
Securities Act and such securities may be distributed without volume limitation
or other restrictions on transfer under Rule 144 (including without application
of paragraphs (c), (e), (f) and (h) of Rule 144) or (z) such securities shall
have ceased to be outstanding.  Except as otherwise provided in this Agreement,
Convertible Securities shall be treated as a number of Shares equal to the
number of Equivalent Shares represented by such Convertible Securities in all
cases where it is necessary to calculate the number of Shares held by any holder
of Management Shares.

     "Managers" shall have the meaning set forth in the Preamble.
      --------

     "New Common Stock" shall have the meaning set forth in the Recitals.
      ----------------

                                      -17-
<PAGE>

     "Options" shall mean Convertible Securities in the form of options or
      -------
warrants to subscribe for, purchase or otherwise acquire either Common Stock or
other Convertible Securities.

     "Pensar" shall have the meaning set forth in the Recitals.
      ------

     "Pensar Investors" shall have the meaning set forth in the Recitals.
      ----------------

     "Pensar Shares" shall mean (a) all shares of Common Stock originally issued
      -------------
to, or issued with respect to shares originally issued to, or held by, a Pensar
Investor, whenever issued, including, without limitation, all shares of Common
Stock issued pursuant to the exercise of any Convertible Securities and (b) all
Convertible Securities originally granted or issued to a Pensar Investor.  As to
any particular Pensar Shares, such shares shall cease to be Pensar Shares when
(w) a registration statement with respect to the sale of such securities shall
have become effective under the Securities Act and such securities shall have
been disposed of in accordance with such registration statement, (x) such
securities shall have been Transferred pursuant to Rule 144 or Rule 701, (y)
subject to the provisions of Section 9, such securities shall have been
otherwise transferred, new certificates for them not bearing a legend
restricting further transfer shall have been delivered by the Company and
subsequent disposition of them shall not require registration of them under the
Securities Act and such securities may be distributed without volume limitation
or other restrictions on transfer under Rule 144 (including without application
of paragraphs (c), (e), (f) and (h) of Rule 144) or (z) such securities shall
have ceased to be outstanding.  Except as otherwise provided in this Agreement,
Convertible Securities shall be treated as a number of Shares equal to the
number of Equivalent Shares represented by such Convertible Securities in all
cases where it is necessary to calculate the number of Shares held by any holder
of Pensar Shares.

     "Permitted Transferee" shall mean (a) with respect to any holder of Shares
      --------------------
who is a natural Person, each spouse or child or other descendants of such
holder, each trust created solely for the benefit of one or more of the
aforementioned Persons and their spouses and each custodian or guardian of any
property of one or more of the aforementioned Persons in his capacity as such
custodian or guardian (each such Person set forth in this clause (a), a "Member
                                                                         ------
of the Immediate Family"), (b) with respect to Shares held by a natural Person
-----------------------
and distributed by will or other instrument taking effect at death of such
holder or by applicable laws of descent and distribution, such holder's estate,
executors, administrators, personal representatives, heirs, legatees or
distributees whether or not such recipients are Members of the Immediate Family
of such holder and (c) with respect to any holder of Shares, an Affiliate of
such holder or the holders of the beneficial interests (which, for purposes of
this clause (c), shall be deemed to include, without limitation, its partners,
members or stockholders) of such holder; provided, however, that no Transferee
                                         --------  -------
pursuant to the above clauses (a), (b) or (c) shall be a "Permitted Transferee"
unless such Transferee has delivered to the Company a written acknowledgment and
agreement in form and substance reasonably satisfactory to the Company that such
Shares to be received by such Transferee shall remain HTM Shares, SMTC

                                      -18-
<PAGE>

Shares or Management Shares hereunder, as the case may be, and shall continue to
be subject to all of the provisions of this Agreement and that such Transferee
shall be bound by, and shall be a party to, this Agreement as the holder of HTM
Shares, SMTC Shares or Management Shares, as the case may be; provided, further,
                                                              --------  -------
that no Transfer by any party to a Permitted Transferee shall relieve such party
of any of its obligations hereunder.

     "Person" shall mean any individual, partnership, corporation, company,
      ------
association, trust, joint venture, unincorporated organization, entity or
division, or any government, governmental department or agency or political
subdivision thereof.

     "Public Offering" shall mean a public offering and sale of Common Stock for
      ---------------
cash pursuant to an effective registration statement under the Securities Act.

     "Qualified Public Offering" shall mean a Public Offering, other than any
      -------------------------
Public Offering or sale pursuant to a registration statement on Form S-8 or
comparable form, in which the aggregate price to the public of all such common
stock sold in such offering shall exceed $55 million.

     "Reclassification" shall have the meaning set forth in the Recitals.
      ----------------

     "Registrable Securities" shall mean (a) all shares of Common Stock, (b) all
      ----------------------
shares of Common Stock issuable upon exercise of any Convertible Security and
(c) all shares of Common Stock directly or indirectly issued or issuable with
respect to the securities referred to in clauses (a) or (b) above by way of
stock dividend or stock split or in connection with a combination of shares,
recapitalization, merger, consolidation or other reorganization, in each case
constituting Shares.  As to any particular Registrable Securities, such shares
shall cease to be Registrable Securities when (w) a registration statement with
respect to the sale of such securities shall have become effective under the
Securities Act and such securities shall have been disposed of in accordance
with such registration statement, (x) such securities shall have been
Transferred pursuant to Rule 144 or Rule 701, (y) subject to the provisions of
Section 9, such securities shall have been otherwise transferred, new
certificates for them not bearing a legend restricting further transfer shall
have been delivered by the Company and subsequent disposition of them shall not
require registration of them under the Securities Act and such securities may be
distributed without volume limitation or other restrictions on transfer under
Rule 144 (including without application of paragraphs (c), (e), (f) and (h) of
Rule 144) or (z) such securities shall have ceased to be outstanding.

     "Rule 144" shall mean Rule 144 under the Securities Act (or any successor
      --------
Rule).

     "Rule 145 Transaction" shall mean a registration on Form S-4 pursuant to
      --------------------
Rule 145 of the Securities Act (or any successor Form or provision, as
applicable).

     "Rule 701" shall mean Rule 701 under the Securities Act (or any successor
      --------
Rule).

                                      -19-
<PAGE>

     "Sale" shall mean any Transfer for value.
      ----

     "Securities Act" shall mean the Securities Act of 1933, as in effect from
      --------------
time to time.

     "Shares" shall mean all HTM Shares, SMTC Shares, Pensar Shares and
      ------
Management Shares.

     "SMTC" shall have the meaning set forth in the Recitals.
      ----

     "SMTC - Canada" shall have the meaning set forth in the Preamble.
      -------------

     "SMTC Investors" shall have the meaning set forth in the Preamble.
      --------------

     "SMTC Nova Scotia" shall mean SMTC Nova Scotia Company.
      ----------------

     "SMTC Shares" shall mean (a) all shares of Common Stock originally issued
      -----------
to, or issued with respect to shares originally issued to, or held by, an SMTC
Investor, whenever issued, including, without limitation, all shares of Common
Stock issued pursuant to the exercise of any Convertible Securities and (b) all
Convertible Securities originally granted or issued to an SMTC Investor.  As to
any particular SMTC Shares, such shares shall cease to be SMTC Shares when (w) a
registration statement with respect to the sale of such securities shall have
become effective under the Securities Act and such securities shall have been
disposed of in accordance with such registration statement, (x) such securities
shall have been Transferred pursuant to Rule 144 or Rule 701, (y) subject to the
provisions of Section 9, such securities shall have been otherwise transferred,
new certificates for them not bearing a legend restricting further transfer
shall have been delivered by the Company and subsequent disposition of them
shall not require registration of them under the Securities Act and such
securities may be distributed without volume limitation or other restrictions on
transfer under Rule 144 (including without application of paragraphs (c), (e),
(f) and (h) of Rule 144) or (z) such securities shall have ceased to be
outstanding.  Except as otherwise provided in this Agreement, Convertible
Securities shall be treated as a number of Shares equal to the number of
Equivalent Shares represented by such Convertible Securities in all cases where
it is necessary to calculate the number of Shares held by any holder of SMTC
Shares.

     "Special Voting Stock" shall have the meaning set forth in the Recitals.
      --------------------

     "Stockholders" shall mean the HTM Investors, the SMTC Investors, the
      ------------
Managers and the Pensar Investors.

     "Transfer" shall mean any sale, pledge, assignment, encumbrance or other
      --------
transfer or disposition of any Shares to any other Person, whether directly,
indirectly, voluntarily, involuntarily, by operation of law, pursuant to
judicial process or otherwise.

                                      -20-
<PAGE>

13. MISCELLANEOUS.

     13.1.  Expenses of EMSIcon Transfers.  In connection with any Transfer of
            -----------------------------
Shares by EMSIcon to the Beneficial Owner of such Shares, the Company will pay,
or cause one of its subsidiaries to pay, on behalf of EMSIcon or any such
Beneficial Owner, all fees payable to governmental authorities relating to
securities regulation and anti-trust enforcement in connection with, or
resulting from, such Transfer.

     13.2.  Authority; Effect.  Each party hereto represents and warrants to and
            -----------------
agrees with each other party that the execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby have been duly
authorized on behalf of such party and do not violate any agreement or other
instrument applicable to such party or by which its assets are bound.  This
Agreement does not, and shall not be construed to, give rise to the creation of
a partnership among any of the parties hereto, or to constitute any of such
parties members of a joint venture or other association.

     13.3.  Notices.  Any notices and other communications required or permitted
            -------
in this Agreement shall be effective if in writing and (a) delivered personally
or (b) sent (i) by Federal Express, DHL or UPS or (ii) by registered or
certified mail, postage prepaid, in each case, addressed as follows:

          If to the Company to it:

                    c/o EMSIcon

               with a copy to:

                    SMTC Manufacturing Corporation of Canada
                    625 Hood Road
                    Markham, Ontario L3R 4N6
                    Canada
                    Attention: President

          If to EMSIcon, to it:

                    c/o Bain Capital, Inc.
                    Two Copley Place, 7th Floor
                    Boston, MA  02116
                    Attention: Stephen G. Pagliuca
                               Ian K. Loring

                                      -21-
<PAGE>

               with copies to:

                    Celerity Management Co., Inc.
                    11111 Santa Monica Boulevard, Suite 1127
                    Los Angeles, CA  90025
                    Attention: Stephen E. Adamson

                    and

                    Ropes & Gray
                    One International Place
                    Boston, Massachusetts 02110
                    Attention: Alfred O. Rose, Esq.

                    and

                    Brownstein, Hyatt & Farber, P.C.
                    410 Seventeenth Street
                    22nd Floor
                    Denver, CO 80202-4437
                    Attention: Jacquelyn Kilmer, Esq.

     If to any other holder of Shares, to him at the address set forth in the
stock record book of the Company.

     Notice to the holder of record of any shares of capital stock shall be
deemed to be notice to the holder of such shares for all purposes hereof.

     Unless otherwise specified herein, such notices or other communications
shall be deemed effective (a) on the date received, if personally delivered, (b)
two business days after being sent by Federal Express, DHL or UPS and (c) three
business days after deposit with the U.S. Postal Service, if sent by registered
or certified mail.  Each of the parties hereto shall be entitled to specify a
different address by giving notice as aforesaid to each of the other parties
hereto.

     13.4.  Binding Effect, Etc.  Except for restrictions on Transfer of Shares
            -------------------
set forth in other agreements, plans or other documents, this Agreement
constitutes the entire agreement of the parties with respect to its subject
matter, supersedes all prior or contemporaneous oral or written agreements or
discussions with respect to such subject matter, and shall be binding upon and
inure to the benefit of the parties hereto and their respective heirs,
representatives, successors and assigns. Upon execution by any party, this
Agreement shall become a valid and binding obligation of such party
notwithstanding the failure of any Stockholder to execute this Agreement.

                                      -22-
<PAGE>

     13.5.  Descriptive Headings.  The descriptive headings of this Agreement
            --------------------
are for convenience of reference only, are not to be considered a part hereof
and shall not be construed to define or limit any of the terms or provisions
hereof.

     13.6.  Counterparts.  This Agreement may be executed in multiple
            ------------
counterparts, each of which shall be deemed an original, but all of which taken
together shall constitute one instrument.

     13.7.  Severability.  In the event that any provision hereof would, under
            ------------
applicable law, be invalid or unenforceable in any respect, such provision shall
be construed by modifying or limiting it so as to be valid and enforceable to
the maximum extent compatible with, and possible under, applicable law.  The
provisions hereof are severable, and in the event any provision hereof should be
held invalid or unenforceable in any respect, it shall not invalidate, render
unenforceable or otherwise affect any other provision hereof.

14.  GOVERNING LAW, ETC.

     14.1.  Governing Law.  This Agreement shall be governed by and construed in
            -------------
accordance with the domestic substantive laws of the State of Delaware without
giving effect to any choice or conflict of laws provision or rule that would
cause the application of the domestic substantive laws of any other
jurisdiction.

     14.2.  Consent to Jurisdiction.  Each party to this Agreement, by its
            -----------------------
execution hereof, (a) hereby irrevocably submits to the exclusive jurisdiction
of the state courts of the United States District Court for the District of
Delaware for the purpose of any action, claim, cause of action or suit (in
contract, tort or otherwise), inquiry, proceeding or investigation arising out
of or based upon this Agreement or relating to the subject matter hereof, (b)
hereby waives to the extent not prohibited by applicable law, and agrees not to
assert, and agrees not to allow any of its subsidiaries to assert, by way of
motion, as a defense or otherwise, in any such action, any claim that it is not
subject personally to the jurisdiction of the above-named courts, that its
property is exempt or immune from attachment or execution, that any such
proceeding brought in one of the above-named courts is improper, or that this
Agreement or the subject matter hereof or thereof may not be enforced in or by
such court and (c) hereby agrees not to commence or maintain any action, claim,
cause of action or suit (in contract, tort or otherwise), inquiry, proceeding or
investigation arising out of or based upon this Agreement or relating to the
subject matter hereof or thereof other than before one of the above-named courts
nor to make any motion or take any other action seeking or intending to cause
the transfer or removal of any such action, claim, cause of action or suit (in
contract, tort or otherwise), inquiry, proceeding or investigation to any court
other than one of the above-named courts whether on the grounds of inconvenient
forum or otherwise.  Notwithstanding the foregoing, to the extent that any party
hereto is or becomes a party in any litigation in connection with which it may
assert indemnification rights set forth in this agreement, the court in which
such

                                      -23-
<PAGE>

litigation is being heard shall be deemed to be included in clause (a) above.
Each party hereto hereby consents to service of process in any such proceeding
in any manner permitted by Delaware law, and agrees that service of process by
registered or certified mail, return receipt requested, at its address specified
pursuant to Section 13.3 is reasonably calculated to give actual notice.

     14.3.  WAIVER OF JURY TRIAL.  TO THE EXTENT NOT PROHIBITED BY APPLICABLE
            --------------------
LAW WHICH CANNOT BE WAIVED, EACH PARTY HERETO HEREBY WAIVES AND COVENANTS THAT
IT WILL NOT ASSERT (WHETHER AS PLAINTIFF, DEFENDANT OR OTHERWISE) ANY RIGHT TO
TRIAL BY JURY IN ANY FORUM IN RESPECT OF ANY ISSUE OR ACTION, CLAIM, CAUSE OF
ACTION OR SUIT (IN CONTRACT, TORT OR OTHERWISE), INQUIRY, PROCEEDING OR
INVESTIGATION ARISING OUT OF OR BASED UPON THIS AGREEMENT OR THE SUBJECT MATTER
HEREOF OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE TRANSACTIONS
CONTEMPLATED HEREBY, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING.
EACH PARTY HERETO ACKNOWLEDGES THAT IT HAS BEEN INFORMED BY THE OTHER PARTIES
HERETO THAT THIS SECTION 14.3 CONSTITUTES A MATERIAL INDUCEMENT UPON WHICH THEY
ARE RELYING AND WILL RELY IN ENTERING INTO THIS AGREEMENT. ANY PARTY HERETO MAY
FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION 14.3 WITH ANY COURT AS
WRITTEN EVIDENCE OF THE CONSENT OF EACH SUCH PARTY TO THE WAIVER OF ITS RIGHT TO
TRIAL BY JURY.

     14.4.  Exercise of Rights and Remedies.  No delay of or omission in the
            -------------------------------
exercise of any right, power or remedy accruing to any party as a result of any
breach or default by any other party under this Agreement shall impair any such
right, power or remedy, nor shall it be construed as a waiver of or acquiescence
in any such breach or default, or of any similar breach or default occurring
later; nor shall any such delay, omission nor waiver of any single breach or
default be deemed a waiver of any other breach or default occurring before or
after that waiver.

                                      -24-
<PAGE>

                                                      SMTC Corporation
                                                      Stockholders Agreement
                                                      July 27, 2000

     IN WITNESS WHEREOF, each of the undersigned has duly executed this
Agreement (or caused this Agreement to be executed on its behalf by its officer
or representative thereunto duly authorized) under seal as of the date first
above written.

THE COMPANY:                SMTC Corporation

                            By /s/ Paul Walker
                               --------------------------------------
                               Name: Paul Walker
                               Title: President

THE STOCKHOLDERS:           EMSIcon Investments, LLC

                            By /s/ Stephen Adamson
                               --------------------------------------
                               Name: Stephen Adamson
                               Title: Authorized Person

                            Bain Capital Fund VI, L.P.
                            By: Bain Capital Partners VI, L.P.,
                                its general partner
                              By: Bain Capital Investors VI, Inc.,
                                  its general partner

                            By /s/ Paul Edgerley
                               --------------------------------------
                               Name: Paul Edgerley
                               Title:

                            Sankaty High Yield Asset Partners, L.P.

                            By /s/ Diane J. Exter
                               --------------------------------------
                               Name: Diane J. Exter
                               Title: Executive Vice President
<PAGE>

                                                      SMTC Corporation
                                                      Stockholders Agreement
                                                      July 27, 2000

                            Bain Capital V Mezzanine Fund, L.P.
                            By: Bain Capital V Mezzanine Partners, L.P.,
                                its general partner
                              By: Bain Capital Investors V, Inc.,
                                  its general partner

                            By /s/ Paul Edgerley
                               --------------------------------------
                               Name: Paul Edgerley
                               Title:

                            BCM Capital Partners, L.P.
                            By: Bain Capital V Mezzanine Partners, L.P.
                                its general partner
                              By: Bain Capital Investors V, Inc.,
                                  its general partner
`
                            By /s/ Paul Edgerley
                               --------------------------------------
                               Name: Paul Edgerley
                               Title:

                            BCIP Associates II
                            BCIP Trust Associates II
                            BCIP Associates II-B
                            BCIP Associates II-C
                            By: Bain Capital, Inc.,
                                their Managing Partner

                            By /s/ Paul Edgerley
                               --------------------------------------
                               Name: Paul Edgerley
                               Title:

                            Celerity EMSIcon, LLC

                            By /s/ Stephen Adamson
                               --------------------------------------
                               Name: Stephen Adamson
                               Title: An Authorized Person
<PAGE>

                                                      SMTC Corporation
                                                      Stockholders Agreement
                                                      July 27, 2000

                            P.N. Walker Consulting Inc.

                            By /s/ Paul Walker
                               --------------------------------------
                               Name: Paul Walker
                               Title:

                            Nichal Inc.

                            By /s/ Derek D'Andrade
                               --------------------------------------
                               Name: Derek D'Andrade
                               Title:

                            Kilmer Electronics Group Limited

                            By /s/ Michael Griffiths
                               --------------------------------------
                               Name: Michael Griffiths
                               Title: Secretary-Treasurer

                               /s/ Gary Walker
                            -----------------------------------------
                                         Gary Walker

                               /s/ Philip Woodard
                            -----------------------------------------
                                         Philip Woodard

                               /s/ Paul Walker
                            -----------------------------------------
                                           Paul Walker

                               /s/ Derek D'Andrade
                            -----------------------------------------
                                         Derek D'Andrade

                               /s/ Edward A. Johnson
                            -----------------------------------------
                                        Edward A. Johnson
<PAGE>

                                                      SMTC Corporation
                                                      Stockholders Agreement
                                                      July 27, 2000

                               /s/ James Laurion
                            -----------------------------------------
                                          James Laurion

                               /s/ Brad Tesch
                            -----------------------------------------
                                            Brad Tesch

                               /s/ Robert Koss
                            -----------------------------------------
                                        Robert Koss

THE PENSAR INVESTORS:

                               /s/ Stanley C. Plzak
                            -----------------------------------------
                                        Stanley C. Plzak

                               /s/ William M. Moeller
                            -----------------------------------------
                                        William M. Moeller

                               /s/ Richard V. Baxter
                            -----------------------------------------
                                         Richard V. Baxter

                               /s/ David E. Steel
                            -----------------------------------------
                                          David E. Steel

                               /s/ Bruce D. Backer
                            -----------------------------------------
                                         Bruce D. Backer

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