Document:

Exhibit 10.40

 

EXECUTION COPY

 

FIFTH AMENDMENT

dated as of March 14, 2006

 

between

 

HUNTSMAN RECEIVABLES FINANCE LLC,

as
Company

 

HUNTSMAN (EUROPE), BVBA,

as
Master Servicer

 

JPMORGAN CHASE BANK, N.A.

as
Funding Agent

 

and

 

J.P. MORGAN (IRELAND) plc,

as
Trustee

 

SERIES 2000-1 SUPPLEMENT

Dated as of December 21, 2000

 

SIDLEY AUSTIN

WOOLGATE EXCHANGE

25 BASINGHALL STREET

LONDON EC2V 5HA

TELEPHONE 020 7360 3600

FACSIMILE 020 7626 7937

REF:  DDD
/30508-30240

 

 

THIS
FIFTH AMENDMENT, dated as of March 14, 2006 (the “Amendment”)
between Huntsman Receivables Finance LLC (the “Company”), a Delaware limited
liability company, Huntsman (Europe) BVBA (the “Master Servicer”), JPMorgan
Chase Bank, N.A., successor-in-interest to The Chase Manhattan Bank, as funding
agent for the Series 2000-1 Purchasers (the “Funding Agent”) and J.P.
Morgan (Ireland) plc, successor-in-interest to Chase Manhattan Bank (Ireland) plc,
as trustee (the “Trustee”) modifies the Series 2000-1 Supplement dated
as of December 21, 2000, as amended from time to time (the “Supplement”),
which supplements the Amended and Restated Pooling Agreement, dated as of June 26,
2001, as amended from time to time (the “Pooling Agreement” and,
together with the Supplement, the “Agreement”) between the Company, the
Master Servicer and the Trustee.

 

WHEREAS,
the parties hereto (the “Parties”) wish to amend the Supplement;

 

WHEREAS, pursuant to Series 2000-1
Transfer Supplement, dated April 16, 2004, Park Avenue Receivables Company
LLC assigned its rights obligations and commitment under the Agreement to
Jupiter Securitization Corporation;

 

WHEREAS,
Section 10.01 of the Pooling Agreement permits the amendment of the
Supplement upon the terms and conditions specified therein;

 

WHEREAS,
Section 11.07(b) of the Supplement permits the amendment of
the Supplement with the prior written notice to and written consent of the
Funding Agent and all the Series 2000-1 Purchasers to add any provisions
to or change, in any manner, any of the provisions of the Supplement;

 

WHEREAS,
the prior written consent of the Funding Agent is a condition to the
effectiveness of this Amendment; and

 

WHEREAS,
the Parties have provided prior written notice of the Amendment to the Series 2000-1
Rating Agencies in accordance with the requirements of Section 11.07(c)(ii) of
the Supplement;

 

NOW,
THEREFORE, the Parties agree that the Supplement is hereby amended effective as
of the date hereof and the Parties agree hereto as follows:

 

Section 1.                                            Definitions. Capitalized terms used but not defined herein shall have the meaning
assigned to such term in Annex X to the Pooling Agreement.

 

Section 2.                                            Amendment.

 

(a)                                  Section 5.02 of the Supplement is hereby amended by deleting
the phrase “March 31, 2006” and replacing such phrase with “September 30,
2006”.

 

Section 3.                                            Ratification of Supplement. The Supplement, as amended hereby, is in all
respects ratified and confirmed.

 

Section 4.                                            Waiver of Notice by Funding Agent. The Funding Agent hereby waives any prior
notice and any notice period that may be required in connection with the execution
of this Amendment by the Pooling Agreement or the Supplement.

 

Section 5.                                            Waiver of Notice by All Parties. Each of the Parties waives any prior

 

 

notice and any notice period
that may be required by any other agreement or document in connection with
the execution of this Amendment.

 

Section 6.                                            GOVERNING LAW. THIS AMENDMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK
APPLICABLE TO CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK,
WITHOUT REFERENCE TO ANY CONFLICT OF LAW PRINCIPLES.

 

Section 7.                                            Counterparts. This Amendment may be executed in any number of counterparts, each
of which so executed shall be deemed to be an original, but all of such counterparts
shall together constitute but one and the same instrument.

 

Section 8.                                            Headings. The headings of Sections contained in this Amendment are provided for
convenience only. They form no part of this Amendment or the
Supplement and shall not affect the construction or interpretation of this
Amendment or Supplement or any provisions hereof or thereof.

 

[Remainder of Page Intentionally Left Blank]

 

2

 

IN WITNESS WHEREOF, the parties hereto have executed this Amendment as of the date set
forth on the first page hereof.

 

	
  HUNTSMAN RECEIVABLES FINANCE
  LLC,

  
	
  as Company

  
	
   

  	
   

  
	
  By:

  	
  /s/
  SEAN DOUGLAS

  	
   

  
	
   

  	
  Name:
  Sean Douglas

  
	
   

  	
  Title:
  V.P.

  

 

	
  HUNTSMAN (EUROPE) BVBA,

  as Master Servicer

  
	
   

  	
   

  
	
  By:

  	
  /s/
  F. DE CANNIERE

  	
   

  
	
   

  	
  Name:
  F. de Canniere

  Title: Director

  

 

	
  J.P. MORGAN (IRELAND) plc,

  not in its individual capacity but solely as Trustee

  
	
   

  	
   

  
	
  By:

  	
  /s/
  [Illegible]

  	
   

  
	
   

  	
  Name:

  Title:

  

 

	
  JPMORGAN CHASE BANK, N.A. ,

  as Funding Agent

  
	
   

  	
   

  
	
  By:

  	
  /s/
  PEDRAM MAZAHERI

  	
   

  
	
   

  	
  Name:  Pedram Mazaheri

  Title:  Vice President

  

 

	
  CONSENTED AND ACKNOWLEDGED:

  
	
   

  	
   

  
	
  JPMORGAN CHASE BANK, N.A. ,

  as APA Bank

  
	
   

  
	
  By:

  	
  /s/
  PEDRAM MAZAHERI

  	
   

  
	
   

  	
  Name:  Pedram Mazaheri

  Title:  Vice President

  

 

	
  JUPITER SECURITIZATION
  CORPORATION,

  As sole Series 2000-1 Purchaser

  
	
   

  	
   

  
	
  By:

  	
  /s/
  PEDRAM MAZAHERI

  	
   

  
	
   

  	
  Name:  Pedram Mazaheri

  Title:  Authorized Signatory

  

 

[SIGNATURE
PAGE TO THE FIFTH AMENDMENT TO THE SERIES 2000-l SUPPLEMENT]

 

3Exhibit 10.28

 

Employment Agreement dated
March 14, 2006 with Gregory T. Barnum

 

EMPLOYMENT AGREEMENT

 

THIS EMPLOYMENT AGREEMENT (the “Agreement”) is made and
entered into by and between Datalink Corporation, a Minnesota corporation (the “Company”), and Gregory T. Barnum
(the “Executive”) effective as of the
14th day of March, 2006.

 

R E C I T A L S :

 

WHEREAS, the
Company is a leading provider of data storage products and solutions;  and

 

WHEREAS, the
Company and the Executive desire to set forth in this Agreement the terms under
which Executive will serve as Vice President of Finance and Chief Financial
Officer of the Company;

 

NOW, THEREFORE,
the parties hereto agree as follows:

 

1.             Employment
and Duties. The Company hereby agrees to employ the Executive,
and the Executive hereby accepts the Company’s offer to serve, as Vice
President of Finance and Chief Financial Officer of the Company. As such, the
Executive shall have responsibilities, duties and authority reasonably accorded
to and expected of such an officer of the Company and will report to the
Company’s President and Chief Executive Officer, the Company’s Audit Committee
(the “Audit Committee”) and the Company’s
Board of Directors (the “Board”). The
Executive agrees to devote the Executive’s full business time, attention and
efforts to promote and further the business of the Company. The Executive will
faithfully adhere to, execute and fulfill all policies established by the Audit
Committee and the Board.

 

The Executive will not, during the Term of Executive’s employment
hereunder, be engaged in any other business activity pursued for gain, profit
or other pecuniary advantage if such activity interferes with the Executive’s
duties and responsibilities hereunder. The foregoing limitations will not be construed
to prohibit the Executive from making personal investments in such form or
manner as will neither require the Executive’s services in the operation or
affairs of the companies or enterprises in which such investments are made nor
violate the terms of Section 4 hereof.

 

In connection with undertaking employment with the Company, the
Executive confirms his resignation as a director of the Company, effective
March 8, 2006.

 

2.             Compensation.
For all services rendered by the Executive on and after the date hereof, the
Company will compensate the Executive as follows:

 

(a)           Base
Salary. Commencing on the date hereof, the base salary payable
to the Executive shall be $190,000 per year, payable on a regular basis in
accordance with the

 

 

Company’s standard payroll
procedures but not less than semi-monthly. Such base salary will be subject to
review and adjustment from time to time by the Company’s Compensation Committee
(the “Compensation Committee”).

 

(b)           Incentive
Bonus Plan. During the Term, the Executive is entitled to an
annual cash bonus (the “Annual Bonus”)
based on attainment of particular financial and business milestones (the “Performance Milestones”). The
Annual Bonus for attainment of 100% of the Performance Milestones for a
particular year is $60,000, subject to review and adjustment from time to time
by the Compensation Committee.

 

(i)            Performance Milestones. The
Executive and the Company shall mutually agree upon the Performance Milestones
for each fiscal year by March 1 of each year (except as to the balance of 2006,
by April 30, 2006), and the level of Annual Bonus payable for any partial or
excess achievement of the Performance Milestones. In the event of any
disagreement, the Compensation Committee will determine the percentage of the
annual Performance Milestone targets achieved by the Executive.

 

(ii)           Payment. Each Annual Bonus amount
is payable within 15 days of the completion of the audit of the Company’s
financial statements for the related fiscal year and the public announcement
(by issuance of a press release and/or filing of information on a periodic,
quarterly or annual report with the U.S. Securities and Exchange Commission) of
the financial results related thereto.

 

(c)           Executive
Perquisites, Benefits and Other Compensation. Commencing on the
date hereof, the Executive shall be entitled to receive additional benefits and
compensation from the Company in such form and to such extent as provided to
other senior executive officers from time to time. Initially, these additional
items are specified below:

 

(i)            A $500.00 per month
car allowance and reimbursement for use of a corporate cell phone, all in
accordance with Company policy.

 

(ii)           Reimbursement for
all business travel and other out-of-pocket expenses reasonably incurred by the
Executive in the performance of the Executive’s services pursuant to this
Agreement. All reimbursable expenses shall be appropriately documented in
reasonable detail by the Executive upon submission of any request for
reimbursement, and in a format and manner consistent with the Company’s expense
reporting policy.

 

3.             Grant of Restricted Stock.  In further consideration
of this Agreement, the Company hereby awards to the Executive a total of 60,000
shares of common stock, par value $.001 per share, of the Company (the “Common
Stock”), subject to the conditions and restrictions set forth
below (the “Restricted Stock”).

 

(a)           Rights Regarding Restricted Stock. 
The Restricted Stock issued to the Executive shall constitute issued and
outstanding shares of the Company’s Common Stock for all corporate
purposes.  Except as provided by Section 3(b) below, the Executive will
have the right

 

 

to (a) vote the Restricted Stock, (b) receive
and retain dividends and distributions, if any, that the Company designates,
pays and distributes generally with respect to its Common Stock and (c)
exercise all other rights, powers and privileges of a holder of Common Stock
with respect to such Restricted Stock.

 

(b)           Restrictions on Restricted Stock. 
Despite the above, the Executive’s rights to fully enjoy the ownership of the
Restricted Stock are subject to the Executive’s vesting in the Restricted Stock
as provided by Section 3(c) below.  Pending such vesting, the Executive’s
ownership of the Restricted Stock is subject to the following:

 

(i)            Company
Retention of Unvested Restricted Stock.  When issuing the
Restricted Stock, the Company shall register the Restricted Stock in the name
of the Executive, but shall hold the stock certificate, together with a stock
power endorsed by the Executive in blank, pending vesting by the Executive in
all or a portion of the Restricted Stock.  If at the end or during the
four years from and after the date hereof (such period being the “Restricted Period”), the Executive
vests in all or a portion of the Restricted Stock, the Company will promptly
reissue a certificate representing the vested portion of the Restricted Stock
and deliver such certificate to the Executive.  Any such reissued
certificate shall contain a legend prohibiting sale or other transfer of the
shares of Common Stock without registration under the Securities Act of 1933,
as amended (the “Securities Act”) or an
exemption therefrom.

 

(ii)           Company Retention of Dividends and Distributions on
Unvested Restricted Stock.  In the event that the Company
declares and pays a dividend or other distribution on its Common Stock, the
Company shall retain custody of all such dividends and distributions (the “Retained
Distributions”) made or declared with respect to the unvested
portion of the Restricted Stock.  The Company is not required to segregate
the Retained Distributions in a separate or interest-bearing account, but
payment thereof by the Company upon vesting of the Restricted Stock shall be a
general, unsecured obligation of the Company.  If at the end or during the
Restricted Period, the Executive vests in all or a portion of the Restricted
Stock, the Company shall promptly pay or distribute to the Executive (without
any interest) the portion of the Retained Distributions held by the Company that
relate to the vested portion of the Restricted Stock.

 

(iii)          Restriction on Transfer of Restricted Stock. 
Except for a transfer without consideration to a trust for the benefit of the
Executive and/or the Executive’s spouse and children (and then only if the
trust agrees to be bound by the restrictions of this Agreement on the
Restricted Stock so transferred), the Executive may not sell, assign, transfer,
pledge, exchange, encumber or dispose of the Restricted Stock or any Retained
Distributions or the Executive’s interest in any of them until vested therein.

 

(c)           Vesting of Restricted Stock.  The
Executive will vest in all or a portion of the Restricted Stock (and the
Retained Distributions, if any, related thereto), as follows:

 

(i)            Service-Based Vesting.  The
Executive will vest in 50% of the Restricted Stock (and the Retained
Distributions, if any, related thereto) on the second anniversary hereof if

 

 

the Executive has been
employed with the Company continuously from the date hereof to such date. The
Executive will vest in an additional 25% of the Restricted Stock (and the
Retained Distributions, if any, related thereto) on the third anniversary
hereof if the Executive has been employed with the Company continuously from
the date hereof to such date. The Executive will vest in the last 25% of the
Restricted Stock (and the Retained Distributions, if any, related thereto) on
the last date of the Restricted Period if the Executive has been employed with
the Company continuously from the date hereof to such date.

 

(ii)           Vesting Upon Termination by the Company Without
Cause or by the Executive For Good Reason. If during the Term
hereof (as defined in Section 5 below), the Company terminates the Executive’s
employment without Cause (as defined in Section 5(c) below), or if during the
Term hereof, the Executive terminates employment with the Company for Good
Reason (as defined in Section 5(d) below), and subject to Section 5(f) below,
the Executive will vest in all of the Restricted Stock (and the Retained Distributions,
if any, related thereto).

 

(iii)          Vesting Upon a Change of Control. Subject
to Section 5(f) below, all of the Restricted Stock (and all Retained
Distributions, if any) will vest upon a Change of Control event (as defined
below) that occurs during the Term hereof, but only if (i) the Executive has
been employed with the Company continuously from the date hereof to the date of
the Change of Control and (ii) the Change of Control Price (as defined below)
exceeds $4.11 (the closing price of the Company’s Common Stock on the date
hereof).  However, if the Change of Control event is an event described in
Section 3(c)(iii)(A)(2) below, then (subject to Section 5(f) below) vesting
under this Section 3(c)(iii) will occur if the Executive has been employed with
the Company continuously from the date hereof to the date of the Change of
Control, regardless of the Change of Control Price.

 

(A)          Change of
Control. A “Change of Control”
means the happening of any of the following events:

 

(1)           An
acquisition of outstanding or newly issued Company securities that results in
any individual, entity or group within the meaning of Section 13(d)(3) or
14(d)(2) of the Securities Exchange Act of 1933, as amended (a “Person,” with such Act being the “Exchange Act”) having beneficial
ownership within the meaning of Rule 13d-3 under the Exchange Act (“Beneficial Ownership”) of more than
50% (other than any Person who, as of the date hereof, already has Beneficial
Ownership of at least 25%) of either (x) the then outstanding shares of the
Company’s Common Stock (the “Outstanding Company
Common Stock”) or (y) the combined voting power of the then
outstanding voting securities of the Company entitled to vote generally in the
election of directors (the “Outstanding Company
Voting Securities”);  or

 

(2)           A change in the composition of the Board in connection with a tender or exchange offer, a reorganization, merger or consolidation or sale or other disposition of all or substantially all of the assets of the Company or the acquisition of assets of another corporation (a “Corporate Transaction”) or a direct purchase of securities from the

 

 

Company such that (i) the individuals who, as of the date hereof, constitute the members of the Board (the “Incumbent Board,” it being intended that the Executive is not considered a member of the Incumbent Board at the date hereof) cease to constitute at least a majority of the Board or (ii) a majority of the individuals who, as of the date hereof, constitute the Incumbent Board resign or are removed from the Board;  provided, however, that any individual becoming a director subsequent to the date hereof whose election, or nomination for election by the Company’s shareholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of either an actual or threatened election contest (as such terms are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act) or other actual or threatened solicitation of proxies or consents;  or
 

(3)           The
approval by the shareholders of the Company of a Corporate Transaction or, if
consummation of such Corporate Transaction is subject, at the time of such
approval by shareholders, to the consent of any government or governmental
agency, the obtaining of such consent (either explicitly or implicitly by
consummation);  excluding, however, such a Corporate Transaction pursuant
to which (1) all or substantially all of the Beneficial Owners of the
Outstanding Company Common Stock and Outstanding Company Voting Securities
immediately prior to such Corporate Transaction will Beneficially Own, directly
or indirectly, more than 50% of the outstanding shares of common stock, or more
than 50% of the combined voting power of the then outstanding voting securities
entitled to vote generally in the election of directors, of the company resulting
from such Corporate Transaction (including, without limitation, a corporation
which as a result of such transaction owns the Company or all or substantially
all of the Company’s assets either directly or through one or more
subsidiaries) in substantially the same proportions as their ownership,
immediately prior to such Corporate Transaction, of the Outstanding Company
Common Stock and Outstanding Company Voting Securities, as the case may be, (2)
no Person (other than the Company, any employee benefit plan (or related trust)
sponsored or maintained by the Company or any corporation controlled by the
Company or such corporation resulting from such Corporate Transaction) will
Beneficially Own, directly or indirectly, 20% or more of, respectively, the outstanding
shares of common stock of the corporation resulting from such Corporate
Transaction or the combined voting power of the outstanding voting securities
of such corporation entitled to vote generally in the election of directors
except to the extent that such ownership existed with respect to the Company
prior to the Corporate Transaction and (3) individuals who were members of the
Incumbent Board will constitute at least a majority of the board of directors
of the corporation resulting from such Corporate Transaction;  or

 

(4)           The
approval by the shareholders of the Company of a complete liquidation or
dissolution of the Company.

 

Despite all of the foregoing, no Change in Control is deemed to have
occurred with respect to the Executive if the Executive is part of a purchasing
group which consummates the Change in Control transaction. The Executive is
deemed “part of a purchasing group” for purposes of the preceding sentence if
the Executive is an equity participant in the purchasing

 

 

company or group except for
(i) passive ownership of less than three percent (3%) of the stock of the
purchasing company or (ii) ownership of an equity participation in the
purchasing company or group which is otherwise not significant, as determined
prior to the Change in Control by a majority of the Incumbent Board.

 

(B)           Change of Control Price. “Change of Control Price” means the higher
of (i) the highest reported closing price of a share of Common Stock in any
transaction reported on the Nasdaq Stock Market during the 30-day period prior
to and including the date of a Change of Control or (ii) if the Change of
Control is the result of a tender or exchange offer, a Corporate Transaction or
a direct purchase of securities from the Company, the highest price per share of
Common Stock paid in such tender or exchange offer, Corporate Transaction or
direct purchase of securities.

 

If
the Change of Control is the result of a direct purchase of securities from the
Company for a consideration consisting in whole or in part other than cash,
then:

 

(i)            insofar as the purchase
consideration consists of securities and the value of such securities is not
determinable by reference to a separate agreement, (A) if the securities are
then traded on a national securities exchange or the Nasdaq Stock Market (or a
similar national quotation system), then the value shall be computed based on
the average of the closing prices of the securities on such exchange or system
over the thirty (30)-day period ending on the date of receipt by the Company,
(B) if the securities are actively traded over-the-counter, then the value
shall be computed based on the average of the closing bid prices over the
thirty (30) day ending on the date of receipt by the Company and (C) if there
is no active public market, then the value shall be computed based on the fair
market value thereof on the date of receipt by the Company, as determined in
good faith by the Board and

 

(ii)           insofar as the purchase consideration
consists of property other than cash and securities, then the value shall be
computed at the fair market value thereof at the time of such issuance, as
determined in good faith by the Board.

 

(d)           Effect of Termination
of Service.  In the event the Executive’s
employment with the Company ceases for any reason whatsoever (except upon a
termination of employment by the Company without Cause, a termination of
employment by the Executive with Good Reason or upon Change of Control), all
Restricted Stock awarded to the Executive (and the related Retained Distributions,
if any) that has not previously vested shall be forfeited as of the date of
such termination.

 

(e)           Other Cancellation of
Unvested Restricted Stock and Retained Distributions.  The
Company will cancel any Restricted Stock and Retained Distributions that the
Executive has not vested in by the last day of the Restricted Period.  In
addition, if the Compensation Committee determines that the Executive has
materially breached any of the provisions, restrictions, terms or conditions of
this Agreement or as established by the Compensation Committee with respect to
any Restricted Stock or Retained Distributions, the Executive will forfeit all
then Beneficially Owned Restricted Stock and Retained Distributions.

 

 

(f)            No Code Section
83(b) Election.  The Executive shall not make an
election, under Section 83(b) of the Internal Revenue Code of 1986, as amended
(the “Code”), to include an amount in
income in respect of the Restricted Stock.

 

(g)           Non-Alienation of Benefits.  Other
than pursuant to a qualified domestic relations order, no right or benefit
under this Section 3 shall be subject to transfer, anticipation, alienation,
sale, assignment, pledge, encumbrance or charge, whether voluntary, involuntary
or by operation of law, and any attempt to transfer, anticipate, alienate,
sell, assign, pledge, encumber or charge the same shall be void.

 

(h)           Subscription
Representations;  Transfer Restrictions.
The Executive understands that the Restricted Stock constitutes “restricted
securities” within the meaning of the Securities Act. Accordingly, even if the
Executive is fully vested in the Restricted Stock, the Executive may never be
able to resell the underlying shares for a profit, or at all. In any event, the
Executive will be able to resell or otherwise transfer the Restricted Stock
only if the sale or other transfer is registered under the Securities Act and
applicable state securities laws or there is an available exemption from this
registration. The Executive confirms that the Executive can bear the loss of
the Executive’s entire investment in the Company.

 

(i)            Lock-Up Agreement.
The Executive agrees that, in the event of each future public offering of the
Company’s equity securities (an “Offering”),
the Executive will agree to such restrictions on the resale of any shares of
the Company’s Common Stock (including the Restricted Stock) then beneficially
owned by Executive as requested by the managing underwriter or underwriters of
the Offering;  provided, however, that
such restrictions run no longer than the period of resale restriction imposed
by such underwriters on the Company’s other executive officers and directors. The
Executive agrees not to sell or otherwise transfer (including upon death) any
of the shares of Common Stock (including the shares of Restricted Stock)
beneficially owned by the Executive, unless the purchaser or recipient agrees
in writing to be bound by the foregoing lock-up agreement.

 

(j)            Stock Certificate Restrictions. The
Executive acknowledges that the Company will place a restrictive legend on any
certificate representing the Restricted Stock, and a “stop transfer order” with
any transfer agent of the Company’s securities, barring the sale or other
transfer of such shares except in compliance with this Agreement and without
registration under the Securities Act or an exemption therefrom, and noting the
existence of the lock-up agreement above.

 

(k)           Future
Grants of Equity Securities. Future grants of restricted stock,
stock options or other equity securities, if any, will be governed by the terms
of the grant agreement to which the future grant relates, and not by this
Agreement.

 

 

4.             Non-Competition
and Non-Solicitation.

 

(a)           Basic
Terms. In consideration of this Agreement (including the
Restricted Stock grant hereunder), the Executive will not, during the period of
the Executive’s employment with the Company and for a period of one (1) year
immediately following the termination of the Executive’s employment under this
Agreement, for any reason whatsoever, directly or indirectly, for the Executive
or on behalf of or in conjunction with any other person, firm, entity, company,
business, partnership, corporation, limited liability company or limited
liability partnership of whatever nature:

 

(i)            engage, as an
officer, director, shareholder, owner, partner, joint venturer or in a  managerial capacity, whether as an employee,
independent contractor, consultant or advisor or as a sales representative or
executive, in any business that, at the date of the Executive’s termination of
employment, manufactures, markets and/or sells data storage hardware and/or
data storage software products and/or services in competition with the Company
in the United States;

 

(ii)           recruit, solicit,
hire or induce, or attempt to recruit, hire or induce, any employee or employees
to terminate employment or otherwise cease his, her or their relationship with
the Company;

 

(iii)          solicit,
divert or take away, or attempt to solicit, divert or to take away, the data
storage hardware and/or software products and/or services business or patronage
of any of the Company’s actual or prospective clients, customers or accounts
contracted, solicited or served by the Company during Executive’s
employment;  or

 

(iv)          call
upon or solicit any prospective acquisition candidate or individual or groups
of employees of other organizations, which, to the Executive’s actual knowledge
after due inquiry, the Company has called upon or for which the Company has
made an acquisition or hiring analysis, for the purpose of acquiring such
entity or its assets or hiring such individuals.

 

Notwithstanding
the above, the Executive may acquire as a passive investment not more than
three percent (3%) of the capital stock of a competing business, whose stock is
traded on a national securities exchange or over-the-counter.

 

(b)           Equitable
Relief. Because of the difficulty of measuring economic losses
to the Company as a result of a breach of the foregoing covenants, and because
of the immediate and irreparable damage that could be caused to the Company for
which it would have no other adequate remedy, the Executive agrees that the
foregoing covenants may be enforced by the Company in the event of breach by
the Executive by injunctions and restraining orders.

 

(c)           Severability
and/or Reformation. The covenants in this Section 4 are
severable and separate, and the unenforceability of any specific covenant shall
not affect the provisions of any other covenant. Moreover, in the event any
court of competent jurisdiction determines that the scope, time or territorial
restrictions set forth are unreasonable, then it is the intention of the
parties that such restrictions be enforced to the fullest extent which the
court deems reasonable, and the Agreement shall be reformed in accordance
therewith.

 

 

(d)           Independently
Enforceable. All of the covenants in this Section 4 shall be
construed as an agreement independent of any other provision in this Agreement,
and the existence of any claim or cause of action of the Executive against the
Company, whether predicated on this Agreement or otherwise, shall not
constitute a defense to the enforcement by the Company of such covenants. It is
specifically agreed that the period of one (1) year following termination of
employment stated at the beginning of this Section 4, during which the agreements
and covenants of the Executive made in this Section 4 shall be effective, shall
be computed by excluding from such computation any time during which the
Executive is in violation of any provision of this Section 4.

 

5.             Term;  Termination; 
Rights on Termination.

 

The term of Executive’s employment under this Agreement (the “Term”) begins on the date hereof
and continues through the earlier to occur of (i) the second anniversary of the
date hereof or (ii) the first day of the month next following the Executive’s
65th birthday (the “Normal Retirement Date”);  provided, however, that on the second
anniversary of the date hereof, and on each successive second anniversary
thereafter (such date and each second anniversary thereof shall be hereinafter
referred to as the “Renewal Date”), the Term
will automatically extend so as to terminate on the earlier of (x) two years
from such Renewal Date or (y) the Executive’s Normal Retirement Date, unless at
least 90 days prior to the Renewal Date, the Company gives written notice to
the Executive that the Company is not extending the Term. Despite the Term,
this Agreement and the Executive’s employment may be terminated in any one of
the following ways:

 

(a)           Termination
Upon Death. The Executive’s death will immediately terminate
this Agreement. The Company will pay the Executive’s estate any of Executive’s
accrued base salary and any earned, but unpaid, Annual Bonus (at the time
otherwise payable under this Agreement) through the date of termination and
reimbursement of expenses. The Executive’s estate will forfeit any Restricted
Stock (and the related Retained Distributions) not vested in the Executive as
of the date of the Executive’s death.

 

(b)           Termination
on Account of Disability. If, as a result of incapacity due to
physical or mental illness or injury, as reasonably determined by the Executive’s
physician, the Executive is absent from the Executive’s full-time duties
hereunder for ninety (90) days, then thirty (30) days after receiving written
notice (which notice may occur before or after the end of such 90-day period,
but which will not be effective earlier than the last day of such 90-day
period), the Company may terminate the Executive’s employment hereunder;  provided that the Executive is unable to
resume the Executive’s full-time duties at the conclusion of such notice period.
The Company will pay the Executive any of the Executive’s accrued base salary
and any earned, but unpaid, Annual Bonus (at the time otherwise payable under
this Agreement) through the date of termination and reimbursement of expenses. The
Executive will forfeit any Restricted Stock (and the related Retained
Distributions) not vested as of the date of termination. For a period of 18
months following the date of termination, the Company will make available to
the Executive and the Executive’s eligible family members, at the Executive’s
sole expense,

 

 

health insurance
continuation coverage pursuant to Section 4980B of the Code, Sections 601-608
of the Employee Retirement Income Security Act of 1974, as amended, and under
any other applicable law, to the extent required by such laws (“COBRA Coverage”).

 

(c)           Termination
by the Company for Cause. The Company may terminate this
Agreement at any time for Cause upon written notice to the Executive. For
purposes of this Agreement, “Cause” is
(i) the Executive’s willful, material and irreparable breach of this
Agreement;  (ii) the Executive’s gross
negligence in the performance or intentional nonperformance (continuing for
thirty (30) days after receipt of written notice of need to cure) of any of the
Executive’s material duties and responsibilities under this Agreement;  (iii) the Executive’s willful dishonesty,
fraud or misconduct with respect to the business or affairs of the
Company;  or (iv) the Executive’s
conviction of a felony crime. Upon any termination for Cause, the Executive
will receive no severance compensation other than base salary accrued through
the date of termination and reimbursement of expenses. The Executive will
forfeit any Restricted Stock (and the related Retained Distributions) not
vested as of the date of termination. Without limiting the scope of Section
3(e) above, the Compensation Committee also may deem the Executive’s
termination for Cause as a reason pursuant to Section 3(e) for the Executive’s
forfeiture of all vested shares of Restricted Stock (and any related Retained
Distributions) then Beneficially Owned by the Executive. For a period of 18
months following the date of termination, the Company will make COBRA Coverage
available to the Executive and the Executive’s eligible family members, at the
Executive’s sole expense.

 

(d)           Termination
by the Company Without Cause or by the Executive for Good Reason.
At any time, either the Executive or the Company may terminate this Agreement
and the Executive’s employment, effective thirty (30) days after written notice
is provided to the other. If the Company terminates the Executive’s employment
without Cause or if the Executive resigns employment for Good Reason (as defined
below), the Executive will receive from the Company, subject to Section 5(f)
below, (i) any base salary accrued through the date of termination and
reimbursement of expenses, (ii) any earned, but unpaid, Annual Bonus (at the
time otherwise payable under this Agreement) through the date of termination
and (iii) a single, lump sum payment equal to one year of the Executive’s base
salary. Subject to Section 5(f) below, the Executive also will vest in all then
unvested Restricted Stock (and the related Retained Distributions) as provided
by Section 3(c)(ii) above. For a period of 18 months following the date of
termination, the Company will make COBRA Coverage available to the Executive
and the Executive’s eligible family members. Subject to Section 5(f) below, the
Company will directly pay, or will reimburse the Executive for, the first one
year of premiums for the COBRA Coverage. However, if the Executive becomes
re-employed with another employer and is eligible to receive any health
insurance benefits under another employer’s plans, the Company’s obligations to
pay or reimburse for medical and dental insurance benefits under this Section
5(d) shall terminate. COBRA Coverage extending beyond the first year after the
Executive’s date of termination will be at the Executive’s sole expense.

 

For purposes of this Agreement, each of the following is a “Good Reason” for the Executive to
terminate employment with the Company: 
(i) the Company’s imposition of material and adverse changes, without
the Executive’s consent, in the Executive’s principal

 

 

duties (including upon a
Change of Control);  (ii) the Company’s
move (including upon a Change of Control) of its principal executive offices
more than 50 miles from its current location without the Executive’s consent;  and (iii) the reduction by the Company
(including upon a Change of Control) in the Executive’s base salary without the
Executive’s consent by more than the weighted average percentage reduction made
contemporaneously by the Company of the base salaries all other executive
officers. Despite the foregoing, if within the 30-day period after receiving
the Executive’s notice of intent to terminate employment on account of Good
Reason, the Company corrects the deficiency giving rise to such notice, a
subsequent resignation by the Executive will not constitute a termination for
Good Reason (without a new event giving rise therefor).

 

(e)           Termination
in Connection with a Change of Control. Notwithstanding the
other provisions of this Section 5, if during the Term of this Agreement, (x)
the Company terminates the Executive’s employment in anticipation of, in
connection with, at the time of or within one year after a Change of Control or
(y) the Executive resigns employment with the Company for Good Reason arising
in anticipation of, in connection with, at the time of or within one year after
a Change of Control, the Executive will receive from the Company, subject to
Section 5(f) below, (i) any base salary accrued through the date of termination
and reimbursement of expenses, (ii) any earned, but unpaid, Annual Bonus (at
the time otherwise payable under this Agreement) through the date of
termination and (iii) a single, lump sum payment equal to one year of the
Executive’s base salary. Subject to Section 5(f) below, the Executive also will
vest in all then unvested Restricted Stock (and the related Retained
Distributions) to the extent provided by Section 3(c)(iii) above. For a period
of 18 months following the date of termination, the Company will make COBRA
Coverage available to the Executive and the Executive’s eligible family members.
Subject to Section 5(f) below, the Company will directly pay, or will reimburse
the Executive for, the first one year of premiums for the COBRA Coverage. However,
if the Executive becomes re-employed with another employer and is eligible to
receive any health insurance benefits under another employer’s plans, the
Company’s obligations to pay or reimburse for medical and dental insurance
benefits under this Section 5(e) shall terminate. COBRA Coverage extending
beyond the first year after the Executive’s date of termination will be at the
Executive’s sole expense.

 

(f)            Prerequisites to Severance Benefits;  Timing of Cash Payments. The
Company’s obligations to make cash payments, and the vesting of Restricted
Stock (and the related Retained Distributions), under this Section 5 are
subject to the following:

 

(i)            the Executive must
execute and deliver to the Company a release in the form attached as Exhibit A
(the “Release”)
and must not revoke it and

 

(ii)           the Executive must
continuously comply with the provisions of this Agreement (including the
non-competition and non-solicitation provisions of Section 4 above).

 

The
Company will pay the lump sum cash severance amounts under Section 5(d) or 5(e)
above on the first day of the month following the Executive’s date of
termination (or, if later, five business days after expiration of any period
for revocation under the Release).

 

 

6.             Tax
Withholdings. The Company may withhold from any amounts payable
under this Agreement such federal, state, local or foreign taxes as shall be
required to be withheld pursuant to any applicable law or regulation. The
Executive may satisfy withholding obligations relating to the vesting of
Restricted Stock by instructing the Company to retain and cancel a number of
shares of Common Stock having a Market Price on the date of termination (or as
of the immediately preceding business day if the date of termination is not a
business day) equal to the withholding tax obligation amount. The term “Market Price” with respect to
shares of Common Stock means the closing price on the Nasdaq Stock Market or,
if none, the average of the last reported closing bid and asked prices on any
other national or regional securities exchange or as quoted in the National
Association of Securities Dealers, Inc.’s Automated Quotations System (“Nasdaq”),
or if not listed on a national or regional securities exchange or quoted in
Nasdaq, the closing price as reported by bigcharts.com (or if this service is
discontinued, such other reporting service acceptable to the Company), or if no
quotations in such Common Stock are available, the fair market value of the
shares as determined in good faith by the Board.

 

7.             Reduction to Avoid Excise Tax.  If any payment or
distribution to or for the benefit of the Executive (whether paid or payable or
distributed or distributable) pursuant to the terms of this Agreement or
otherwise (a “Payment”) would constitute a “parachute payment” within
the meaning of Section 280G of the Code, the Payment shall be reduced to the
extent necessary so that no portion of the Payment is subject to the excise tax
imposed by Section 4999 of the Code, together with any interest or penalties
imposed with respect to such excise tax, but only if, by reason of such
reduction, the net after-tax benefit to the Executive shall equal or exceed the
net after-tax benefit to the Executive if no reduction was made.  Subject
to the next paragraph, the Company shall afford the Executive an opportunity to
select a reduction of cash or non-cash items, or a combination of both, to
reduce the excess Payment.

 

All determinations required to be made under this
Section 7, including whether a reduction of any Payment is required and the
assumptions to be utilized in arriving at such determination, shall be made by
the Company’s independent registered public accountants serving immediately
prior to the Change in Control, or such other nationally recognized accounting
firm as may be agreed by the Company and the Executive (the “Accounting
Firm”);  provided, that the Accounting Firm’s determination
shall be made based upon “substantial authority” within the meaning of Section
6662 of the Code.  Any determination by the Accounting Firm hereunder
shall be binding upon the Company and the Executive.

 

8.             Return of
Company Property. All records, designs, tradenames and
trademarks, service names and service marks, patents, business plans, financial
statements, manuals, memoranda, customer and other lists and other property
delivered to or compiled by the Executive by or on behalf of the Company, or
its representatives, vendors or customers which pertain to the business of the
Company are and will remain the property of the Company, and be subject at all
times to its discretion and control. Likewise, all correspondence, reports,
records, charts, advertising and marketing materials and other similar data
pertaining to the business, activities or future plans of the Company which is
collected by or in the possession of the Executive shall be delivered promptly
to the Company without request by it upon termination of

 

 

the
Executive’s employment. Further, upon any termination of employment, the
Executive shall return any Company computer (without deleting or tampering with
information thereon) and any other physical property of the Company.

 

9.             Inventions.
The Executive will disclose promptly to the Company any and all significant
conceptions and ideas for inventions, improvements and valuable discoveries,
whether patentable or not, which are conceived or made by the Executive, solely
or jointly with another, during the period of employment, and which are
directly related to the business or activities of the Company and which the
Executive conceives as a result of the Executive’s employment by the Company. The
Executive hereby assigns and agrees to assign all of the Executive’s interests
therein to the Company or its nominee. Whenever requested to do so by the
Company, the Executive will execute any and all applications, assignments or
other instruments that the Company shall deem necessary to apply for and obtain
letters patent of the United States or any foreign country or to otherwise
protect the Company’s interest therein. Nothing in this Agreement shall apply
to an invention for which no equipment, supplies, facility or trade secret
information of the Company was used and which was developed entirely on the
Executive’s own time and (i) which does not relate (a) directly to the business
of the Company or (b) to the Company’s actual or demonstrably anticipated
research or development or (ii) which does not result from any work performed
by the Executive for the Company.

 

10.           Confidentiality. 
In consideration of this Agreement, the Executive agrees to not at any time use
or, other than as required by court order, disclose, or permit use or
disclosure of, any of the Company’s confidential information or trade
secrets.  This includes all knowledge and information that Executive
acquires during employment with the Company which relates to the business,
developments, activities, products and services or financial affairs of the
Company or any individual or firm that is engaged in or has done business with
the Company.  This also includes any information or compilation of information
that derives independent economic value from not being generally known or
readily ascertainable by proper means by other persons and which relates to any
aspect of the Company’s business, including, but not limited to:  trade
secrets within the meaning of the Minnesota Trade Secrets Act, customer lists,
customer information, costs and selling prices, payment and credit information,
customer profiles and analysis, prospect tracking recording, financial
information, budget and financial plans, costing, pricing, billing information,
tax data, sales and marketing information, business strategies and plans,
technical information including software, research, product/product development
information, personnel information such as salaries, phone numbers, titles,
benefits, bonuses, employment histories, shareholder information and stock data
and any discoveries, inventions, ideas, methods, products, equipment,
developments, improvements or programs which the Company holds confidential and
has not publicly disclosed.  Despite the above, the Executive is not
obliged to maintain the confidentiality of information that is or becomes
public other than as a result of acts by or through the Executive or that the
Executive independently obtains from a third party having no duty of
confidentiality to the Company.

 

11.           Indemnification; 
Directors’ and Officers’ Insurance. The Executive shall have the
benefit of indemnification to the fullest extent permitted by applicable law,
which indemnification shall continue after the termination of this Agreement
for such period as may be

 

 

necessary
to continue to indemnify Executive for acts or omissions during the Term hereof
to the fullest extent permitted by applicable law.

 

12.           Complete Agreement.
This Agreement supersedes any other agreements or understandings, written or
oral, between the Company and the Executive, and the Executive has no oral
representations, understandings or agreements with the Company or any of its
officers, directors, employees or representatives covering the same subject
matter as this Agreement. This document is the final, complete and exclusive
statement and expression of the agreement between the Company and the Executive
and of all the terms of this Agreement, and it cannot be varied, contradicted
or supplemented by evidence of any prior or contemporaneous oral or written
agreements. This document may not be later modified except by a written
instrument signed by a duly authorized officer of the Company and the
Executive, and no term of this Agreement may be waived except by a written
instrument signed by the party waiving the benefit of such term.

 

13.           Notice. Whenever
any notice is required hereunder, it shall be given in writing addressed as
follows:

 

	
  To
  the Company:

  	
  Datalink
  Corporation

  
	
   

  	
  8170
  Upland Circle

  
	
   

  	
  Chanhassen,
  Minnesota 55317

  
	
   

  	
  Attention:
  Charles B. Westling, President and Chief Executive Officer

  
	
   

  	
   

  
	
  To
  the Executive:

  	
  Gregory
  T. Barnum

  
	
   

  	
  4760
  Bayside Road

  
	
   

  	
  Orono,
  Minnesota 55359

  

 

Notice
is given and effective three (3) days after the deposit in the U.S. mail of a
writing addressed as above and sent first class mail, certified, return receipt
requested, or when actually received. Either party may change the address for
notice by notifying the other party of such change in accordance with this
Section 13.

 

14.           Arbitration.
Except as to matters of injunctive or equitable relief (over which the parties
agree that the federal and state courts located in Minneapolis, Minnesota will
have exclusive jurisdiction and are deemed to be of proper venue and
convenience to the parties), any unresolved dispute or controversy arising
under or in connection with this Agreement will be settled exclusively by
arbitration, conducted before a panel of three (3) arbitrators in Minneapolis,
Minnesota, in accordance with the rules of the American Arbitration Association
then in effect. The arbitrators will not have the authority to add to, detract
from or modify any provision hereof nor to award punitive damages to any
injured party. A decision by a majority of the arbitration panel will be final
and binding. Judgment may be entered on the arbitrators’ award in any court
having jurisdiction. The direct expense of any arbitration proceedings,
including, but not limited to, the administrative fees and the arbitrators’ fees
and expenses, will be borne by the Company.

 

 

15.           Binding Effect;  Governing Law. This Agreement will
inure to the benefit of the successors or assigns of the Company. The Company
agrees that, as a condition of any merger of the Company into or with, or the
sale of all or substantially all of the Company’s assets to, another person,
firm or entity, it will require the successor expressly to assume the Company’s
obligations hereunder. This Agreement shall be governed by and construed in
accordance with the laws of the State of Minnesota, exclusive of its conflicts
of laws rules.

 

IN WITNESS WHEREOF, the undersigned have hereunto affixed their signatures.

 

	
  DATALINK
  CORPORATION

  	
  EXECUTIVE

  
	
   

  	
   

  
	
   

  	
   

  
	
  By

  	
  /s/Charles
  B Westling

  	
   

  	
  By

  	
  /s/Gregory
  T. Barnum

  	
   

  
	
   

  	
  Charles
  B. Westling, President and

  	
   

  	
  Gregory
  T. Barnum

  
	
   

  	
  Chief Executive Officer

  	
   

  
						

 

 

Exhibit A

Release of Claims

 

I
release Datalink Corporation and its officers, directors, employees and agents
from any claim, cause of action, damages or expenses, including attorneys’
fees, arising out of the relationship between the parties through the signing
of this Release.  This is intended to be a complete release of claims by
me, whether the claims are known or unknown, matured or unmatured or fixed or
contingent.  Therefore, by this release I GIVE UP
ANY RIGHT TO MAKE A CLAIM, BRING A LAWSUIT, FILE AN ADMINISTRATIVE CHARGE OF
DISCRIMINATION OR OTHERWISE SEEK MONEY DAMAGES OR COURT ORDERS AS A RESULT OF
MY EMPLOYMENT BY DATALINK, OR OF MY SEPARATION FROM EMPLOYMENT WITH DATALINK. 
I acknowledge and intend that this Release cover claims of wrongful
termination, defamation, intentional infliction of emotional distress, any
claims under the Federal Age Discrimination in Employment Act, Title VII of the
Civil Rights Act of 1964, the Americans With Disabilities Act, the Minnesota
Human Rights Act and Minnesota Statute Section 181.81 (which prohibits age
discrimination) and any other state or federal statutes prohibiting
discrimination in employment.  This Release also binds my heirs,
administrators, representatives, executors, successors and assigns.  I
have been advised by my legal counsel of the effect of this Release. 
Despite the above, this Release does not apply to claims against Datalink for
breaching its obligations under an Employment Agreement dated March 14, 2006.

 

NOTICE TO THE UNDERSIGNED:

 

THIS
IS A RELEASE OF LEGAL RIGHTS YOU MAY HAVE.  YOU SHOULD CONSULT WITH AN
ATTORNEY REGARDING THIS RELEASE AND OTHER ASPECTS OF THIS LETTER BEFORE YOU
SIGN IT.

 

YOU
HAVE 21 DAYS TO CONSIDER WHETHER OR NOT TO SIGN THIS RELEASE, STARTING FROM THE
DATE YOU FIRST RECEIVE A COPY OF IT.  YOU MAY SIGN THIS RELEASE AT ANY
TIME DURING THE 21-DAY PERIOD.

 

YOUR
EMPLOYMENT BY DATALINK HAS TERMINATED.  YOUR ACCEPTANCE OR FAILURE TO
ACCEPT THIS RELEASE DOES NOT AFFECT YOUR TERMINATION.  IF YOU DO NOT
ACCEPT THIS RELEASE, OR IF YOU REVOKE YOUR ACCEPTANCE OF IT, DATALINK WILL NOT
PROVIDE YOU THE SEVERANCE PAY AND OTHER BENEFITS DESCRIBED IN YOUR EMPLOYMENT
AGREEMENT.

 

AFTER
YOU ACCEPT THIS RELEASE BY SIGNING IT, YOU MAY REVOKE YOUR ACCEPTANCE FOR A
PERIOD OF 15 DAYS AFTER THE DATE YOU SIGN.  THIS RELEASE IS NOT EFFECTIVE
UNTIL THIS 15-DAY REVOCATION PERIOD EXPIRES.

 

IF
YOU WISH TO REVOKE YOUR ACCEPTANCE OF THIS RELEASE, YOU MUST NOTIFY DATALINK IN
WRITING WITHIN THE 15-DAY REVOCATION PERIOD.  YOU MUST DELIVER YOUR NOTICE
TO DATALINK IN PERSON OR BY CERTIFIED MAIL, RETURN RECEIPT REQUESTED, ADDRESSED
TO:  Charles B. Westling, President and Chief

 

 

Executive Officer, Datalink Corporation, 8170
Upland Circle, Chanhassen, Minnesota  55317.  IF YOU FAIL TO PROPERLY
DELIVER OR MAIL YOUR WRITTEN REVOCATION AS INSTRUCTED, YOUR REVOCATION WILL NOT
BE EFFECTIVE.

 

 

	
  Date
  this Release is first given by

  Datalink to the undersigned:

  	
   

  	
   

  
	
   

  	
   

  
	
  Agreed to and accepted by the

  undersigned:

  	
   

  
	
   

  	
   

  
	
  Date
  this Release is signed by the

  undersigned:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Employee

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