Document:

Amendment to Deferred Compensation Agmt. by and btwn. the Reg. and Todd R. Ford

 Exhibit 10.24 
  
 AMENDMENT TO 
 DEFERRED COMPENSATION AGREEMENT 
  
 This
AMENDMENT TO DEFERRED COMPENSATION AGREEMENT (the “Amendment”) is entered into as of September 30, 2004, by and among
RACKABLE SYSTEMS, INC., a Delaware corporation (the “Company”) and Todd Ford (the “Executive”). 
  
 WHEREAS, the Company and Executive are parties to that
certain Deferred Compensation Agreement, dated December 23, 2002 (the “Deferred Compensation Agreement”); 
  
 WHEREAS, the Company and Executive hereby desire to amend the Deferred Compensation Agreement to provide for the immediate payment
of the compensation benefits as described in Section 1 below; and 
  
 WHEREAS, pursuant to Section 7 of the Deferred Compensation Agreement, the Deferred Compensation Agreement may be amended by an instrument in writing executed by the Company and Executive. 
  
 AGREEMENT 
  
 NOW THEREFORE, in consideration of the amendment of the Deferred Compensation Agreement
and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the undersigned hereby agree as follows: 
  
 1. Section 1 of the Deferred Compensation Agreement is amended to read in its entirety as follows: 
  
 “1. Deferred Compensation Benefit. The Company shall pay to the Executive on September 30, 2004, a
single, lump-sum payment of three hundred one thousand forty one dollars ($301,041.00).” 
  
 2. Other than as set forth in Section 1 hereof, all provisions of the Deferred Compensation Agreement shall remain in full force and effect. 
  
 3. This Amendment may not be waived, amended or modified without the prior mutual written consent of the Company and Executive.

  
 4. This Amendment shall be governed construed in accordance with the
substantive laws of the State of Delaware, without application of its conflict or choice of law provision. The Company and the Executive agree that this Amendment is not an ERISA plan or part of an ERISA plan. 
  
 5. This Amendment may be executed in one or more counterparts, each of which shall be
deemed an original, but such counterparts shall together constitute one and the same instrument. 

 IN WITNESS WHEREOF, the undersigned have executed
this AMENDMENT as of the date set first set forth above. 
  

					
	RACKABLE SYSTEMS, INC.	 	 	 	EXECUTIVE
			
	    /s/ Tom Barton	 	 	 	    /s/ Todd Ford
	 Tom Barton
 President and Chief Executive
Officer
	 	 	 	Todd FordPromissory Note, dated as of December 23, 2002, by Todd R. Ford

 Exhibit 10.25 
  
 PROMISSORY NOTE 
  

									
	$283,333	 	 	 	 	 	 	 	December 23, 2002

  
 For value
received, Todd Ford (“Executive”) promises to pay to the order of Rackable Systems, Inc., a Delaware corporation (f/k/a Rackable Corporation) (the “Company”), at its officers in 721 Charcot Avenue, San Jose, California
95131, or such other place as designated in writing by the holder hereof, the principal sum of $283,333 together with interest accrued from the date hereof on the unpaid principal at the rate of 3.31% per annum, or the maximum rate permissible by
law (which under the laws of the State of California shall be deemed to the laws relating to permissible rates of interest on commercial loans), whichever is less, as follows 
  
 Principal Repayment. The outstanding principal amount hereunder shall be due and payable in full on December 20,
2011. 
  
 Interest Payments. Interest shall be compounded
annually and shall be payable annually; 
  
 provided, however, that if upon
the earlier to occur of a Public Offering or a Sale of the Company, this Note shall be accelerated and all remaining unpaid principal and interest shall become due and payable immediately. For the purposes of this Note, a “Sale of the
Company” shall mean (i) a sale of all or substantially all of the consolidated assets of the Company to any Person or (ii) the transfer or other disposition to any Person or group of Persons (as the term “group” is defined in the
Securities Exchange Act of 1934) (other than Rackable Investment LLC or any affiliate thereof) of outstanding equity securities (whether by sale, issuance, merger, consolidation, reorganization, combination or otherwise) of the Company such that
after giving effect to such transfer, such Person or group of Persons would own or control the right to elect at least a majority of the members of the board of directors. For the purposes of this Note, “Person” means an individual,
a partnership, a corporation, a limited liability company, an association, a joint stock company, a trust, a joint venture, an unincorporated organization and a governmental entity or any department, agency or political subdivision thereof. For the
purposes of this Note, “Public Offering” means the consummation of the first of the following events (i) the securities of the Company are registered under Section 12 of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), (ii) the Company is or becomes subject to the reporting requirements under Section 15(d) of the Exchange Act, or (iii) the Company files or has filed a registration statement under the Securities Act of 1933, as
amended. 
  
 This Note may be prepaid at any time without penalty.
All money paid toward the satisfaction of this Note shall be applied first to the payment of interest as required hereunder and then to the retirement of the principal. 
  
 This Note is fifty percent (50%) recourse and fifty percent (50%) nonrecourse. In addition, this Note is secured by a pledge
of the shares of Series A Preferred Stock of the Company. 
  
 Executive hereby represents and agrees that the amounts due under this Note are not consumer debt, and are not incurred primarily for personal, family or household purposes, but are for business and commercial purposes only. 
  
 Executive hereby waives presentment, protest and notice of protest, demand
for payment, notice of dishonor and all other notices or demands in connection with the delivery, acceptance, performance, default or endorsement of this Note. 

 The holder hereof shall be entitled to recover, and the undersigned agrees to pay when incurred, all
costs and expenses of collection of this Note, including without limitation, reasonable attorneys’ fees. 
  
 This Note shall be governed by, and construed, enforced and interpreted in accordance with, the laws of the State of Delaware, excluding conflict laws of
any other jurisdiction. 
  

	
	 /s/ Todd Ford

	Todd FordAdvisory Agreement

 Exhibit 10.26 
  
 Rackable Systems, Inc. 
 721 Charcot Avenue 
 San Jose, CA 95131 
  
 December 23, 2002 
  
 Parthenon Capital, LLC 
 200 State Street 
 Boston, Massachusetts 94111 
  

	 	Re:	Advisory Agreement 

  
 Ladies and Gentlemen: 
  
 1.
Agreement. This letter agreement (the “Advisory Agreement”) confirms that Rackable Systems, Inc., a Delaware corporation (formerly known as Rackable Corporation, the “Company” and, together with its
subsidiaries, the “Companies”) has engaged Parthenon Capital, LLC (“PC”) to act as its business advisor. PC shall render advisory services to the Companies and shall make available the services of certain of its
employees to advise the Companies, and to assist and support the management of the Companies on business matters, in each case to the extent mutually agreed upon by the parties hereto. Such advisory services may include but are not limited to:
support of management, board and committee participation, advice with respect to development and implementation of strategies for the operating, marketing and financial performance of the Companies, evaluation of acquisition opportunities, if any,
evaluation of corporate initiatives, assistance in obtaining financing and operations under any financing agreements. 
  
 2. Fees and Expenses. During the term of PC’s engagement hereunder, the Companies jointly and severally agree to pay the following:

  
 (a) Monitoring Fee. The Companies shall pay, or cause
to be paid, to PC a fee equal to $210,000 per annum, in advance in quarterly installments of $52,500 each (a “Payment”), on March 31, June 30, September 30, and December 31 of each year; provided, that, should this letter agreement
be terminated for any reason prior to the end of a quarter with respect to which PC has received a Payment, PC shall not be obligated to return any portion of such Payment and provided further, that, the first Payment shall be due as of the date
hereof. 
  
 (b) Closing Fee. On the date hereof, the
Companies shall pay, or cause to be paid, to PC a fee equal to $210,000 for services rendered in connection with the structuring of the transactions contemplated by the Securities Purchase Agreement (the “Securities Purchase
Agreement”), dated as of the date hereof, between such affiliates and the Company, plus out-of-pocket fees and expenses incurred in connection therewith or related thereto. 
  
 (c) Funding Fee. In addition, immediately upon the closing of each investment by PC or its affiliates in one or more
of the Companies (including, without limitation, pursuant to Section 1.4 of the Securities Purchase Agreement of the Company), the Companies shall pay, or cause to be paid, to PC a transaction fee equal to 1% of the aggregate amounts funded by PC
and/or its affiliates in connection with such closing, plus out-of-pocket fees and expenses incurred in connection therewith or related thereto. 

 (d) Expenses. 
  
 (i) Out of Pocket. The Companies shall reimburse PC, upon request from time to time, for all of PC’s reasonable
out-of-pocket expenses incurred in connection with the provision of services hereunder or the attendance at any meeting of the board of managers (or other similar governing body) of the Companies or any committee thereof related to the services PC
shall provide the Companies in accordance with this Advisory Agreement or otherwise in any way relating to the Companies or in any way relating to, or arising out of, the direct or indirect investment in or ownership of the Companies (or their
respective parent(s)) by any fund affiliated with PC. 
  
 (ii)
Legal and Other Fees and Expenses. The Companies shall reimburse PC for the reasonable fees and disbursements of legal counsel, accountants, other consultants and advisors, related to the services PC shall provide the Companies in accordance
with this Advisory Agreement. 
  
 (iii) Acquisition or
Financing Expenses. The Companies shall reimburse PC for any documented out-of-pocket expenses in connection with add-on acquisitions or financings for the Companies. 
  
 (iv) Other Customary Fees. The Companies shall pay PC for any mutually agreeable customary fees, otherwise payable
to third party providers in connection with strategic advisory services provided by PC. 
  
 (v) Other Customary Financing Fees. The Companies shall pay PC for any mutually agreeable customary fees in connection with PC’s participation in the evaluation, negotiation and/or consummation of senior
financing for any acquisition transactions by the Companies, which such fee may be based upon a percentage of the gross purchase price of the transaction (including all liabilities assumed or otherwise included in the transaction), such fee to be
due and payable for the foregoing services at the closing of the transaction, whether or not any such senior financing is actually applied for, committed or drawn upon. 
  
 3. Payments. All fees shall be payable pursuant to this Advisory Agreement shall be paid by wire transfer of
immediately available funds to PC or, at PC’s direction, to its designees and shall be paid irrespective of the level, quality or amount of service provided. Without in any way limiting any rights or remedies that PC may have at law or in
equity, all payments not made hereunder on the date on which they are due, shall accrue interest until paid in full at the rate of 12% per annum, compounded as of the last day of each month. 
  
 4. Term. The engagement of PC hereunder shall be for a term of five
years commencing on date hereof: provided, that, such term shall automatically extend for an additional five years upon such termination, unless otherwise terminated upon the mutual written consent of the parties. No termination of this Advisory
Agreement shall affect the Companies’ obligations with respect to the fees, costs and expenses incurred by PC in rendering services hereunder that have been approved from time to time by the Company’s board of managers and not reimbursed
by the Company or any other fees otherwise payable to PC hereunder as of the effective date of such termination. 
  

 2. 

 5. Personnel. PC shall provide and devote to the performance of this Advisory Agreement such
partners, employees and agents of PC as PC shall deem appropriate to the furnishing of the services required. 
  
 6. Information. The Companies shall furnish to PC such information as PC reasonably believes to be appropriate to its engagement hereunder (all
such information so furnished being referred to hereinafter as the “Information”). The Companies recognize and confirm that PC (a) will use and rely primarily on the Information and information available from generally recognized
public sources in performing the services contemplated by this letter without having independently verified the same and (b) does not assume responsibility for the accuracy or completeness of the Information and such other information. 

 
 7. Indemnification. The Companies shall jointly and severally
indemnify and hold harmless PC and its affiliates and each of their respective directors, officers, employees, affiliates and agents (collectively, the “Indemnified Parties”) from and against any and all actions, claims, liabilities,
obligations, damages or expenses arising out of or in connection with PC’s engagement or provision of services hereunder or any action of any Indemnified Party in connection therewith, and the Companies shall advance expenses, including
reasonable legal fees and disbursements, for which any Indemnified Party would be entitled by this Advisory Agreement to be indemnified (collectively, “Claims”); provided, however, that the Companies shall have no obligation under
this Section 7 to indemnify an Indemnified Party with respect to any claim, liability, obligation, damage or expense resulting from the bad faith or willful misconduct of such Indemnified Party. The Companies shall defend at their own cost and
expense any and all suits and actions (just or unjust) which may be brought against the Companies or any Indemnified Parties or in which any of the Indemnified Parties may be impleaded with others upon any Claims, or upon any other matter, directly
or indirectly, related to or arising out of this Advisory Agreement or the performance hereof by any of the Indemnified Parties, except that if such damage shall be proven to be the direct result of bad faith or willful misconduct by an Indemnified
Party, then PC shall reimburse the Companies for the costs of defense and other costs incurred by the Companies. 
  
 8. Liability. Neither PC nor any other Indemnified Party shall be liable to the Companies or their affiliates for any loss, liability, damage or
expense arising out of or in connection with the performance of services contemplated by this Advisory Agreement, unless such loss, liability, damage or expense shall be proven to result directly from willful misconduct or bad faith on the part of
an Indemnified Party in performance of PC’s obligations hereunder. PC makes no representations or warranties, express or implied, in respect of the services to be provided by PC or any of the other Indemnified Parties. In no event will either
party hereto be liable to the other for any indirect, special, incidental or consequential damages, including lost profits or savings, whether or not such damages are foreseeable, or in respect of any liabilities relating to any third party claims
(whether based in contract, tort or otherwise) other than the Claims relating to the services to be provided by PC hereunder. 
  

 3. 

 9. PC as Independent Contractor. PC and the Companies agree that PC and/or its affiliates shall
perform services hereunder as an independent contractor, retaining control over and responsibility for its own operations and personnel. Neither PC nor the other Indemnified Parties shall be considered employees or agents of any of the Companies as
a result of this Advisory Agreement nor shall any of them have authority to contract in the name of or bind the Companies as a result of this Advisory Agreement, except as expressly agreed to in writing by one or more of the Companies. 

 
 10. Dealings with the Investor Group. Each of the Companies
acknowledges and agrees that: (a) PC and its affiliates, and each of their respective stockholders, directors, officers, controlling persons, partners, members, and employees (collectively, the “PC Group”) have business interests
and engage in business activities or commercial transactions in addition to those relating to the Companies (including those which may compete with the Companies); (b) the Companies shall not have any right in or to such other ventures or activities
or to the income or proceeds derived therefrom; (c) no member of the PC Group shall be obligated to present any particular investment or business opportunity to the Companies even if such opportunity is of a character which, if presented to one of
the Companies, could be undertaken by the Companies, and in fact, each member of the PC Group shall have the right to undertake any such opportunity for itself for its own account or on behalf of another or to recommend any such opportunity to other
persons; and (d) each member of the PC Group may enter into contracts and other arrangements with the Companies and its affiliates from time to time on terms approved by the board of directors of the Company and its affiliates. Each of the Companies
hereby waives, to the fullest extent permitted by applicable law, any claims and rights that such person may otherwise have in connection with the matters described in this Section 10. 
  
 11. Miscellaneous. This Advisory Agreement shall be governed by and construed in accordance with the laws of the
Commonwealth of Massachusetts applicable to agreements made and to be performed entirely in such state. This Advisory Agreement may not be amended or otherwise modified except by a written instrument, signed by the parties hereto. If any provision
hereof is determined to be invalid or unenforceable, such determination shall not affect any other provision of this letter agreement, each of which shall remain in full force and effect. This Advisory Agreement may be executed in one or more
counterparts, all of which shall constitute one and the same agreement. 
  
 [Remainder of this page intentionally left blank.] 
  

 4. 

 If the foregoing correctly sets forth our understanding, please indicate so by signing below and
returning an executed copy of this Advisory Agreement to us. 
  

			
	 Very truly yours,

	
	RACKABLE SYSTEMS, INC.
	(F/K/A RACKABLE CORPORATION)
		
	 By:
	  	 /s/ Tom Barton

	 Name:
	  	 Tom Barton

	 Title:
	  	 CEO

  
 Accepted and agreed to as

 of the date first written above: 
  
 PARTHENON CAPITAL, LLC, 
 a Delaware limited liability company 
  

			
	 By:
	  	 /s/ William C. Kessinger

	 Name:
	  	 William C. Kessinger

	 Title:
	  	 Vice President

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