Document:

exv10w2

 

Exhibit 10.2

Execution Version

 

 

FOURTH AMENDMENT

TO

AMENDED AND RESTATED CREDIT AGREEMENT

dated as of

November 30, 2006

among

GOODRICH PETROLEUM COMPANY, L.L.C.,

as Borrower,

BNP PARIBAS,

as Administrative Agent,

and

The Lenders Party Hereto

 

 

 

 

FOURTH AMENDMENT TO

AMENDED AND RESTATED CREDIT AGREEMENT

          THIS FOURTH AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT (this “Fourth
Amendment”) dated as of November 30, 2006, is among GOODRICH PETROLEUM COMPANY, L.L.C.,
a Louisiana limited liability company (“Borrower”); each of the undersigned Guarantors
(collectively, the “Guarantors”); BNP PARIBAS, as administrative agent (in such capacity,
together with its successors in such capacity, “Administrative Agent”) for the lenders
party to the Credit Agreement referred to below (collectively, the “Lenders”); and the
undersigned Lenders.

RECITALS

          A. Borrower, Administrative Agent and the Lenders are parties to that certain Amended and
Restated Credit Agreement dated as of November 17, 2005, as amended by the First Amendment to
Amended and Restated Credit Agreement, dated December 14, 2005, the Second Amendment to Amended and
Restated Credit Agreement, dated June 21, 2006 and the Third Amendment to Amended and Restated
Credit Agreement, dated August 30, 2006 (the “Credit Agreement”), pursuant to which the
Lenders have made certain loans to and other extensions of credit on behalf of Borrower.

          B. Borrower has requested, and the Lenders have agreed, to amend certain provisions of the
Credit Agreement.

          C. NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained,
for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereto agree as follows:

          Section 1. Defined Terms. Each capitalized term used herein but not otherwise defined
herein has the meaning given such term in the Credit Agreement. Unless otherwise indicated, all
article and section references in this Fourth Amendment refer to articles and sections of the
Credit Agreement.

          Section 2. Amendments to Credit Agreement.

          2.1 Definitions. Section 1.1 is hereby amended by deleting the definition of
“Tangible-Net Worth” and amending or adding the following definitions:

“Agreement” means this Amended and Restated Credit Agreement, as amended by
the First Amendment to Amended and Restated Credit Agreement, dated December 14,
2005, the Second Amendment to Amended and Restated Credit Agreement, dated June 21,
2006, the Third Amendment to Amended and Restated Credit Agreement, dated August 30,
2006 and the Fourth Amendment to Amended and Restated Credit Agreement, dated
November 30, 2006.

“Convertible Notes” means the $125,000,000 aggregate principal amount of
Convertible Senior Notes due 2026 issued by Goodrich Petroleum Corporation, or up to
$175,000,000 aggregate principal amount to the extent the option to

 

 

purchase additional Convertible Notes is exercised in full as set forth in the
purchase agreement relating to the initial purchase of the Convertible Notes.

“Total Debt” means, at any date, all Debt of the Companies on a consolidated
basis, excluding (i) non-cash obligations under Financial Accounting Standards 133
and (ii) accounts payable and other accrued liabilities (for the deferred purchase
price of Property or services) from time to time incurred in the ordinary course of
business which are not greater than sixty (60) days past the date of invoice or
delinquent or which are being contested in good faith by appropriate action and for
which adequate reserves have been maintained in accordance with GAAP.

          2.2 Section 9.9(a). Section 9.9(a) is hereby amended and restated in its entirety as
follows:

          (a) Distributions. No Restricted Company may declare, make, or pay any
Distribution except Distributions paid in the form of additional common stock, and
distributions to any other Restricted Company; provided, however,
that Goodrich may make regularly scheduled interest payments, in cash, on the
Convertible Notes and, so long as no Potential Default or Borrowing Base Deficiency
exists or would result therefrom, Goodrich may pay regularly scheduled dividends, in
cash, on the Existing Preferred Stock.

          2.3 Section 9.9(b). Section 9.9(b)(iii) is hereby deleted in its entirety.

          2.4 Section 9.9(c). Section 9.9 is hereby amended by adding the following Section
9.9(c):

          (c) Redemption of Convertible Notes; Amendment of Indenture. Borrower
will not, and will not permit any Restricted Company to: (i) call, make, or offer to
make any optional or voluntary prepayment of the Convertible Notes in cash, (ii)
convert the Convertible Notes into Equity Interests other than common stock or (iii)
amend, modify, waive or otherwise consent or agree to any material amendment,
modification or waiver to the indenture governing the Convertible Notes, provided
that the foregoing shall not prohibit the execution of supplemental agreements to
add guarantors if required by the terms thereof provided that any such guarantor
also guarantees the Obligation pursuant to a written guaranty in form and substance
satisfactory to Administrative Agent and each of Borrower and such guarantor
otherwise complies with Section 5.1.

          2.5 Section 10.3. Section 10.3 is hereby amended and restated in its entirety as
follows:

“Section 10.3 Debt to EBITDAX Ratio. The ratio of Total Debt of the
Companies as of such time to EBITDAX for the four fiscal quarters ending on the last
day of the fiscal quarter immediately preceding the date of determination for which
financial statements are available to be greater than 3.5 to 1.0.”

2

 

          2.6 Schedule 9.2. Schedule 9.2 is hereby amended by adding the following item
#11: 

“11. Debt under the Convertible Notes, provided that (a) the principal amount of
such Convertible Notes does not exceed $175,000,000 in the aggregate and (b) a
portion of the net proceeds from the issuance of such Convertible Notes is used to
repay the Debt under the Second Lien Notes such that concurrently with the issuance
of the Convertible Notes, all amounts due under the Second Lien Term Loan Documents
are paid in cash in full.”

          2.7 Schedule 9.8. Schedule 9.8 is hereby amended by adding the following item
#12: 

“12. Loans of Equity Interests of Goodrich Petroleum Corporation under agreements
entered into in connection with the Convertible Notes offering.”

          Section 3. Conditions Precedent. This Fourth Amendment shall not become effective
until the date on which each of the following conditions is satisfied (or waived in accordance with
Section 14.8 of the Credit Agreement) (the “Effective Date”):

          3.1 The Administrative Agent shall have received from the Determining Lenders, the Borrower
and the Guarantors, counterparts (in such number as may be requested by Administrative Agent) of
this Fourth Amendment signed on behalf of such Persons.

          3.2 The Administrative Agent shall have received a certificate from a Responsible Officer of
Borrower certifying that attached thereto is a true and correct copy of the indenture governing the
Convertible Notes and the indenture shall be in form and substance satisfactory to the
Administrative Agent and the Determining Lenders.

          3.3 The Administrative Agent shall have received such other documents as Administrative Agent
or special counsel to Administrative Agent may reasonably request.

          3.4 No Default shall have occurred and be continuing, after giving effect to the terms of this
Fourth Amendment.

          Section 4. Miscellaneous.

          4.1 Confirmation. The provisions of the Credit Agreement, as amended by this Fourth
Amendment, shall remain in full force and effect following the effectiveness of this Fourth
Amendment.

          4.2 Ratification and Affirmation; Representations and Warranties. Borrower and each
Guarantor hereby (a) acknowledges the terms of this Fourth Amendment; (b) ratifies and affirms its
obligations under, and acknowledges, renews and extends its continued liability under, each Loan
Document to which it is a party and agrees that each Loan Document to which it is a party remains
in full force and effect, except as expressly amended or modified hereby, notwithstanding the
amendments and modifications contained herein and (c) represents and warrants to the Lenders that
as of the date hereof, after giving effect to the terms of this Fourth Amendment: (i) all of the
representations and warranties contained in each Loan Document to which it is a party are true and
correct, except to the extent any such representations and

3

 

warranties are expressly limited to an earlier date, in which case, such representations and
warranties shall continue to be true and correct as of such specified earlier date, (ii) no Default
has occurred and is continuing and (iii) since November 17, 2005, there has been no event,
development or circumstance that has had or could reasonably be expected to have a Material Adverse
Event.

          4.3 Loan Document. This Fourth Amendment is a “Loan Document” as defined and
described in the Credit Agreement and all of the terms and provisions of the Credit Agreement
relating to Loan Documents shall apply hereto.

          4.4 Counterparts. This Fourth Amendment may be executed by one or more of the parties
hereto in any number of separate counterparts, and all of such counterparts taken together shall be
deemed to constitute one and the same instrument. Delivery of this Fourth Amendment by facsimile
transmission shall be effective as delivery of a manually executed counterpart hereof.

          4.5 NO ORAL AGREEMENT. THIS FOURTH AMENDMENT, THE CREDIT AGREEMENT AND THE OTHER LOAN
DOCUMENTS EXECUTED IN CONNECTION HEREWITH AND THEREWITH REPRESENT THE FINAL AGREEMENT AMONG THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR UNWRITTEN ORAL
AGREEMENTS OF THE PARTIES. THERE ARE NO SUBSEQUENT ORAL AGREEMENTS BETWEEN THE PARTIES.

          4.6 GOVERNING LAW. THIS FOURTH AMENDMENT (INCLUDING, BUT NOT LIMITED TO, THE VALIDITY
AND ENFORCEABILITY HEREOF) SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE
STATE OF TEXAS.

[SIGNATURES BEGIN NEXT PAGE]

4

 

          IN WITNESS WHEREOF, the parties hereto have caused this Fourth Amendment to be duly
executed as of the date first written above.

	 	 	 	 	 
	BORROWER: 	GOODRICH PETROLEUM COMPANY, L.L.C.

 	 
	 	By:  	/s/
David R. Looney 	 
	 	 	Name: 	David R. Looney	 
	 	 	Title:	Executive Vice President &
Chief
Financial Officer	 
	 
	GUARANTORS: 	GOODRICH PETROLEUM CORPORATION

 	 
	 	By:  	 /s/
David R. Looney	 
	 	 	Name: 	David R. Looney	 
	 	 	Title:	Executive Vice President &
Chief
Financial Officer	 
	 
	 	GOODRICH PETROLEUM COMPANY — LAFITTE, L.L.C.

 	 
	 	By:  	 /s/
David R. Looney	 
	 	 	Name:	David R. Looney	 
	 	 	Title: 	Executive Vice President &
Chief
Financial Officer	 

S-1

 

	 	 	 	 	 

	 	 	 	 	 
	ADMINISTRATIVE AGENT: 	BNP Paribas, as a Lender and as Administrative Agent

 	 
	 	By:  	 /s/
Brian M. Malone	 
	 	 	Name:  	Brian M. Malone 	 
	 	 	Title:  	Managing Director 	 
	 
	 	 	 
	 	By:  	
 /s/ Pally Schott	 
	 	 	Name:  	Pally Schott 	 
	 	 	Title:  	Vice President 	 

S-2

 

	 	 	 	 	 

	 	 	 	 	 
	LENDERS: 	Comerica Bank, as Lender

 	 
	 	By:  	 /s/
Juli Bieser	 
	 	 	Name:  	Juli Bieser 	 
	 	 	Title:  	Vice President 	 
	 
	 	BMO Capital Markets Financing, Inc. (formerly known

as Harris Nesbitt Financing, Inc.), as Lender

 	 
	 	By:  	 /s/
James V. Ducote	 
	 	 	Name:  	James V. Ducote 	 
	 	 	Title:  	Vice President 	 
	 
	 	The Prudential Insurance Company of America, as

Lender

 	 
	 	By:  	 /s/
Brian N. Thomas	 
	 	 	Name:  	Brian N. Thomas 	 
	 	 	Title:  	Vice President 	 
	 
	 	Deutsche Bank Trust Company Americas, as Lender

 	 
	 	By:  	 /s/
Saad Jobal	 
	 	 	Name:  	Saad Jobal 	 
	 	 	Title:  	Vice President 	 
	 	 	 
	 	By:  	
 /s/ Evelyn Thierry	 
	 	 	Name:  	Evelyn Thierry 	 
	 	 	Title:  	Vice President 	 
	 

S-3exv10w25

 

Exhibit 10.25

PRODUCTS LICENSE AND DISTRIBUTION AGREEMENT

This Product License and Distribution Agreement (“Agreement”) is made and entered into as of the
November 16, 2001, (the “Effective Date”), by and between Dell Products L.P., a Texas limited
partnership, by and on behalf of itself and Dell Computer Corporation, a Delaware corporation, and
the other affiliates of Dell Computer Corporation (collectively referred to as “Dell”), with its
principal place of business at One Dell Way, Round Rock, Texas 78682, and Network Specialists,
Inc., a New Jersey corporation, with its principal place of business at 2 Hudson Place, Hoboken,
New Jersey 07030 (“Distributor”).

	1.	 	LICENSE AND DISTRIBUTION TERMS AND DEFINITIONS

	 	1.1	 	Definitions. The following terms shall have the following meanings
within this Agreement:

(a) “Customer” shall mean an end-user of the Licensed Products who purchases a
license to the Licensed Products from Dell for their own use.

(b) “Distributor’s Trademarks” shall mean those trademarks, trade names, service
marks, slogans, designs, distinctive advertising, labels, logos, and other
trade-identifying symbols as are or have been developed and used with the Licensed
Products by Distributor or any of its subsidiaries or affiliate companies anywhere
in the world.

(c) “Documentation” shall mean the documentation which is typically included by
Distributor in the “retail” versions of its standard packaging of the Licensed
Products.

(d) “Licensed Products” shall mean the software listed in Exhibit A and Documentation.

	 	1.2	 	Grant of License. In consideration for Dell paying to Distributor
the royalty fee per license set forth in Exhibit A, Distributor hereby grants
to Dell a world-wide, non-exclusive right and license to sub-license and distribute the
Licensed Products to its Customers. Dell may not modify or attempt to modify the
Licensed Products, nor create derivative works, nor may Dell sell, rent, sub-license,
lease, timeshare or transfer the Licensed Products to any third party, except as may
be expressly authorized under this Agreement. Distributor represents and warrants
that it has all right, title and interest necessary for it to enter into this
Agreement and to provide the Licensed Products to Dell under the terms and conditions
set forth in herein.

 

			
	*	 	Denotes confidential information that has been omitted from the exhibit and filed
separately, accompanied by a confidential treatment request, with the Securities and Exchange
Commission pursuant to Rule 406 of the Securities Act of 1933.

1

 

	 	1.3	 	Grant of Intellectual Property License. Distributor hereby grants
Dell a non-exclusive, non-transferable, royalty-free, worldwide right and license to
utilize the Distributor’s Trademarks in connection with advertising, promotion, and
license of the Licensed Products, subject to any trademark usage guidelines provided
by Distributor to Dell from time to time. Dell will use commercially reasonable
efforts to avoid any action that materially diminishes the value of Distributor’s
Trademarks and agrees that the Distributor’s Trademarks used and owned by Distributor
shall remain the exclusive property of Distributor or its designees and that it shall
not acquire any rights in or to any Distributor’s Trademarks by virtue of its use
thereof pursuant to this Agreement.
	 
	 	1.4	 	No Exclusivity. Dell shall have no obligation to purchase the
Products pursuant hereto. Furthermore, Dell may purchase products that are the same as
or similar to the Licensed Products from sources other than Distributor. Nothing
under the foregoing, however, shall be construed to be a license under Distributor’s
patents, copyrights, trademarks, trade secrets and other intellectual property rights
except as specifically granted in other provisions of this Agreement. This Agreement
does not constitute an order.
	 
	 	1.5	 	End User License Agreements. Dell may distribute and/or sublicense
the Licensed Products by providing each Customer with an end user license agreement in
a form substantially similar to that provided by Distributor and attached as
Exhibit B1 and Exhibit B2. 
	 
	 	1.6	 	Ownership and Confidentiality. All patents, copyrights, trademarks,
trade secrets and other ownership rights in the Licensed Products are and shall remain
the property of Distributor. The source code of the Licensed Products, which is not
provided to Dell or its Customers, and all information regarding the design, structure
or internal operation of the Licensed Products are valuable trade secrets of
Distributor (“Confidential Product Information”). Dell shall not sell, transfer,
publish, disclose, display or otherwise permit access to any Confidential Product
Information by any third party, except as may be expressly authorized under this
Agreement. The Licensed Products may not be reverse-engineered, decompiled or
disassembled.
	 
	 	1.7	 	Support and Maintenance. NSI shall provide at no additional charge,
product support to each Customer for the first year a Licensed Product is licensed to
such Customer. Thereafter, product support of the Licensed Product shall be provided
to each Customer who has elected to purchase an Annual Support and Maintenance Renewal
License for each Licensed Product. The royalty fee for such Annual Support and
Maintenance Contract for each Customer shall be paid to Distributor as set forth in
the Exhibit A.
	 
	 	1.8	 	Limited Warranty. Distributor warrants that the Licensed Software
will materially comply to Distributor’s then-current published specifications for the
licensed version of the Licensed Products To the extent that Distributor
becomes aware of any significant defect or functional issue, Distributor shall use
best

 
 

			
	*	 	Denotes confidential information that has been omitted from the exhibit and filed
separately, accompanied by a confidential treatment request, with the Securities and Exchange
Commission pursuant to Rule 406 of the Securities Act of 1933.

2

 

	 	 	 	efforts to remedy any such defects or functional issues in as prompt a manner
as is commercially possible. OTHER THAN THE FOREGOING, DISTRIBUTOR MAKES NO
WARRANTY, EXPRESS OR IMPLIED AND ALL OTHER WARRANTIES, INCLUDING WITHOUT LIMITATION
THE WARRANTIES OF MERCHANTABILITY AND OF FITNESS FOR A PARTICULAR PURPOSE ARE
HEREBY DISCLAIMED. DISTRIBUTOR DOES NOT WARRANT THAT THE LICENSED PRODUCTS WILL
MEET DELL OR ITS CUSTOMER’S REQUIREMENTS OR THAT THE OPERATION OF THE LICENSED
PRODUCTS WILL BE UNINTERRUPTED OR ERROR FREE. Dell and its Customers are solely
responsible for the selection of the Licensed Software to achieve its intended
results and for the results actually obtained.
	 
	 	1.9	 	Ordering. Dell will place orders via fax or Email or other
electronic means with Distributor so as to facilitate “expedites” or other special
orders on an ad hoc basis. As long as an order is placed by Dell by 6:00 p.m.
prevailing Central time, Distributor shall confirm its acceptance or rejection of a
manual order via fax or e-mail within 8 business hours of Distributor’s receipt of the
order. Upon acceptance of the order, Distributor must include in its fax or Email
confirmation, at a minimum, the invoice and airbill numbers and carrier information
for the order.
	 
	 	1.10	 	Orders. An “Order” will consist of the following information:

	 	Ø	 	DellWare PO Number (Customer’s Dell Order Number)
	 
	 	Ø	 	Customer PO Number
	 
	 	Ø	 	Shipping Method
	 
	 	Ø	 	Sku
	 
	 	Ø	 	Manufacturer Part Number
	 
	 	Ø	 	Quantity Ordered
	 
	 	Ø	 	Cost to DellWare
	 
	 	Ø	 	Customer Ship-To Address (Customer P# must be included in the ship-to
label).
	 
	 	Ø	 	If serial numbers are required, an asterisk (*) will be placed in front of
the manufacturer part number.

	 	1.11	 	Product Shipment. All Orders placed by Dell, during business hours,
in accordance with this Agreement and accepted by Distributor by 6.00 p.m. prevailing
Central time on a business day shall be completely filled and shipped by Distributor
(or made available to Dell’s designated carrier as the case may be) on that same
business day, unless otherwise agreed to by both parties. If an Order is accepted by
Distributor after 6:00 p.m. prevailing Central time on a business day, then
Distributor shall fill and ship the Order no later than the next business day.

	 	1.12	 	Packing Slip Requirements. The following information should appear
on the packing slip accompanying all Orders:

 

			
	*	 	Denotes confidential information that has been omitted from the exhibit and filed
separately, accompanied by a confidential treatment request, with the Securities and Exchange
Commission pursuant to Rule 406 of the Securities Act of 1933.

3

 

	 	Ø	 	DellWare PO Number (Customer’s Dell order number)
	 
	 	Ø	 	Customer PO Number
	 
	 	Ø	 	Shipping Method
	 
	 	Ø	 	Dell’s Return Policy: “You may return your order for any reason within 30
days of receipt. Please call Dell customer service at 1-800-847-4098 for a
return authorization number.” (or such other text regarding its then-current
return policy as Dell may provide to Distributor from time to time)
	 
	 	Ø	 	Dell Return address: Dell, 8801 Research Blvd., Austin TX 78758,
1-800-847-4098

	 	1.13	 	Shipping Label Requirements. The following information should appear
on the shipping label for all orders:

	 	Ø	 	DellWare PO Number (Customer’s Dell order number)
	 
	 	Ø	 	Customer PO Number- located with customer address
	 
	 	Ø	 	Return address: Dell Computer, address of originating warehouse

	 	1.14	 	Service and Support. Distributor shall make available to Dell
(through at least one toll-free 800 or 888 telephone number and e-mail), *, an
adequate number of trained and qualified representatives to answer inquiries and
perform tracking services with respect to all Orders placed by Dell, including lost
shipments, short shipments, billing errors, stock balancing, expedites, defective
Products replacement Products, damaged shipments and mis-shipments. Such service and
support shall be made available to Dell between the hours of * prevailing Central
time.
	 
	 	1.15	 	Freight. Distributor shall set up an account with each of its
carriers that allows Dell to directly access in real time (or as close to real time as
possible) each carrier’s “214 EDI” transmissions relating to shipping status
information for all Orders. Distributor or its designated carriers shall ship all
Orders within the United States on a next business day delivery basis.
	 
	 	1.16	 	Shipment Discrepancies. Short shipment or lost shipment Product
credits will be credited the next business day after Dell has reported the problem to
the Distributor. Full credit for Products will be given for short shipments or lost
shipments.
	 
	 	1.17	 	Backorders and End of Life Products. Distributor shall immediately
notify Dell when stock is available for a Product that is being held on backorder, but
shall not release the Order for shipment until it has received written or electronic
approval from Dell to do so. Distributor shall provide Dell with at least * advance
written notice of any Product that will be discontinued or has an end of life status.
	 
	 	1.18	 	Returns Policy. Dell may return any Products purchased from
Distributor within * of the invoice date; provided, however, that Dell may return any
defective Product purchased from Distributor within * of the invoice date. Dell must
obtain a Return Material Authorization number (“RMA”) for each Product that is

 
 

			
	*	 	Denotes confidential information that has been omitted from the exhibit and filed
separately, accompanied by a confidential treatment request, with the Securities and Exchange
Commission pursuant to Rule 406 of the Securities Act of 1933.

4

 

	 	 	 	returned to the Distributor. RMA’s will be faxed to Dell within * of such request.
Distributor shall credit the amounts for returned Products to Dell’s account on the
same day that Distributor receives the returned Products in its warehouse and shall
promptly send written confirmation of such credits to Dell’s Accounts Receivable
Department. Distributor shall not charge Dell any restocking fees for any Products
that are returned to Distributor in accordance with this Section.

	2.	 	PRICING

	 	2.1	 	Pricing. License Fees shall be as set forth in Exhibit A, or
such other means as determined and agreed by the parties in writing subsequent to the
execution of this Agreement.
	 
	 	2.2	 	Most Favored Customer. Distributor represents and warrants that the
prices for the Products shall not be less favorable than prices applicable to sales by
Distributor to any other customer purchasing like quantities of substantially
comparable products. If at any time during the term of this Agreement Distributor
accords to any other such customer more favorable prices, Distributor shall
immediately offer to sell the Products to Dell at equivalent prices accorded to such
other customer.
	 
	 	2.3	 	Volume Rebate Schedule. Distributor shall pay to Dell, in accordance
with Exhibit D, certain amounts based on the total volume of Products
purchased by Dell (“Volume Rebate”) on a * basis * or any pro rated amount thereof if
this Agreement has not been in effect for a full *. All Volume Rebates shall be paid
to Dell in the form of a check payable to Dell Products, L.P. within * after the end
of each calendar year and shall be accompanied by a report detailing the volumes of
Products purchased by Dell during the relevant period and the calculation of the
Volume Rebate. Distributor shall pay to Dell any Volume Rebates based on the schedule
(see Exhibit D).
	 
	 	2.4	 	Terms. Payment terms will be net * from Dell’s receipt of an invoice
from Distributor.

	3.	 	QUARTERLY BUSINESS REVIEWS AND ASSESSMENT

	 	3.1	 	Quarterly Business Reviews. On a quarterly basis, Dell and
Distributor will hold Quarterly Business Reviews to review: 1) Distributor’s
performance against the service level standards and operations standards in place
between the parties, as well as other items, including but not limited to the pricing
and quality of the Products, the transmission, fulfillment, and delivery of Products; 2) to review
success of lead generation and revenue creation; to define demand creation
activities for the next quarter, and to review the next quarter’s forecast; and (3)
the Product returns process. Distributor agrees to provide reports as reasonably

 
 

			
	*	 	Denotes confidential information that has been omitted from the exhibit and filed
separately, accompanied by a confidential treatment request, with the Securities and Exchange
Commission pursuant to Rule 406 of the Securities Act of 1933.

5

 

	 	 	 	requested by Dell to support these discussions. Meetings will be held in
Austin, Texas, unless otherwise mutually agreed to by the parties.
	 
	 	3.2	 	Escalation Process. In the event that a specific operational issue
arises or systemic operational issues arise during the Term of this Agreement, the
parties agree that the contact list set forth in attached Exhibit C will be
the escalation path for Dell personnel and management to address and resolve such
issues.

	4.	 	TERM AND TERMINATION

	 	4.1	 	Term. This Agreement will begin as of the Effective Date and will
continue for a period of one (1) year, unless earlier terminated in accordance with
Section 4.2 below. The Term will be renewed automatically for successive one (1) year
periods unless either party notifies the other party in writing of its intent not to
renew the Agreement at least sixty (60) days prior to the end of the then current
term.
	 
	 	4.2	 	Termination. Either party may terminate this Agreement for any
reason upon sixty (60) days prior written notice to the other party. Either party may
terminate this Agreement for cause: (i) upon thirty (30) days prior written notice of
a material breach, if the breach has not been cured within the thirty (30) day period
(except as provided below); or (ii) immediately upon written notice to the other
party, (a) if the other party attempts to make an assignment in violation of the terms
of this Agreement, (b) if the other party declares insolvency or bankruptcy or a
petition is filed in any court and is not dismissed in ninety (90) days to declare the
other party bankrupt or for the other part’s reorganization under the United States
bankruptcy act of any similar statute; or (c) if the other party consents to the
appointment of a trustee in bankruptcy or a receiver of similar entity.

	5.	 	ADDITIONAL TERMS

	 	5.1	 	Dispute Process. Before either party initiates a lawsuit against the
other relating to a dispute under this Agreement or the other party’s performance
thereunder, the parties agree to work in good faith to resolve between them such
disputes and claims. To this end, either party may request, after informal
discussions have failed to resolve a dispute or claim, that each party designate an
officer or other management employee with authority to bind the party to meet in good
faith and attempt to resolve the dispute. During their discussions, each party will
honor the other’s reasonable requests for information relating to the dispute or
claim.
	 
	 	5.2	 	Assignment. This Agreement may not be assigned, in whole or in part,
by either party without the prior written consent of the other party, except that each
party may assign the Agreement to a direct or indirect parent or subsidiary upon prior
written notice to the other party.

 

			
	*	 	Denotes confidential information that has been omitted from the exhibit and filed
separately, accompanied by a confidential treatment request, with the Securities and Exchange
Commission pursuant to Rule 406 of the Securities Act of 1933.

6

 

	 	5.3	 	Governing Law. This Agreement will be governed by and construed in
accordance with the laws of the State of Texas. The parties are independent
contractors and neither party is an employee, agent, partner, or joint venture of the
other.
	 
	 	5.4	 	Compliance.

5.4.1 Since Dell transacts business with the United States government, Distributor
must comply with applicable laws and Federal Acquisition Regulations (“FARs”) in
order to do business with Dell. Distributor, therefore, represents and warrants
that it will comply with applicable FAR regulations. Upon request from
Distributor, and without releasing Distributor from its independent obligations
under this Section, Dell shall endeavor to assist Distributor in identifying which
FARs may be applicable in connection with transactions hereunder. The parties
agree to cooperate with one another to identify applicable FARs to enable
Distributor to comply with its obligations under this Agreement.

5.4.2 The parties, at their respective expense, will comply with all applicable
laws, orders and regulations of any governmental authority with jurisdiction over
their activities in connection with this Agreement and will furnish to each other
any information required to enable a party to comply with applicable laws related
to the Products.

	 	5.5	 	Indemnities.

5.5.1 Distributor agrees to defend, indemnify and hold harmless Dell Products L.P,
Dell Computer Corporation and Dell Computer Corporation’s subsidiaries and
affiliates and their respective directors, officers, employees, agents, customers
and distributors from and against any and all claims, suits, actions, demands,
legal proceedings, liabilities, damages, losses, judgments, authorized settlements,
costs and expenses, including without limitation attorney’s fees, arising out of or
in connection with any alleged or actual:

	 	(i)	 	infringement by Distributor of a copyright, patent,
trademark, trade secret or other intellectual property right of any third
party where such infringement is not due in whole or in part to any
modification of the Licensed Products or their incorporation with other
software, hardware or apparatus in ways not contemplated by Distributor’s
published specifications for the licensed version of the Licensed Products;
	 
	 	(ii)	 	claim that a Product provided under this Agreement has caused
bodily injury (including death) or has damaged real or tangible personal
property;
	 
	 	(iii)	 	breach of any of Distributor’s warranties contained in this Agreement;

 
 

			
	*	 	Denotes confidential information that has been omitted from the exhibit and filed
separately, accompanied by a confidential treatment request, with the Securities and Exchange
Commission pursuant to Rule 406 of the Securities Act of 1933.

7

 

	 	(iv)	 	claim arising out of or relating to Distributor’s provision
of repaired Products that contain used or refurbished parts that are not
clearly and conspicuously labeled as such;
	 
	 	(v)	 	any violation by Distributor of any governmental laws, rules,
ordinances or regulations; and/or
	 
	 	(vi)	 	claim by or on behalf of Distributor’s subcontractors,
materialmen, providers, employees or agents.

Notwithstanding the foregoing, Distributor shall not be responsible to indemnify
any party herein, including any third party, for consequential, indirect or
punitive damages

5.5.2 Distributor will provide the above indemnity even if losses are due, or
alleged to be due, in part to Dell’s concurrent negligence or other fault, breach
of contract or warranty, violation of the Texas Deceptive Trade Practices Act, or
strict liability without regard to fault; provided, however, that Distributor’s
contractual obligation of indemnification shall not extend to the percentage of the
third party claimant’s damages or injuries or the settlement amount attributable to
Dell’s negligence or other fault, breach of contract or warranty, or breach of the
Texas Deceptive Trade Practices Act, or to strict liability imposed upon Dell as a
matter of law.

5.5.3 In the event of any such claims, Dell shall: (i) promptly notify Distributor,
(ii) provide Distributor a first option to respond, defend and litigate said claims
with counsel of Distributor’s selection (iii) cooperate with Distributor in the
defense thereof, and (iv) not settle any such claims without Distributor’s consent,
which Distributor agrees not to unreasonably withhold.

5.5.4 If Distributor becomes aware of an infringement claim that is being made or
appears likely to be made about a Product, Distributor shall promptly notify Dell
of such claim. Dell may, at its option, return or cancel any Orders for such
Products for a full credit or refund of the purchase price.

	 	5.6	 	Liability.

5.6.1 EXCEPT AS SET FORTH BELOW NEITHER PARTY SHALL BE
LIABLE FOR ANY LOST PROFITS, LOST SAVINGS OR ANY OTHER INCIDENTAL, INDIRECT,
PUNITIVE, OR CONSEQUENTIAL DAMAGES UNDER ANY PART OF THIS AGREEMENT EVEN IF ADVISED
OR AWARE OF THE POSSIBILITY OF SUCH DAMAGES.

 

			
	*	 	Denotes confidential information that has been omitted from the exhibit and filed
separately, accompanied by a confidential treatment request, with the Securities and Exchange
Commission pursuant to Rule 406 of the Securities Act of 1933.

8

 

	 	5.7	 	Miscellaneous.

5.7.1 Dell shall have full freedom and flexibility in its decisions concerning the
distribution and marketing of the Licensed Product, including, without limitation,
the decision of whether or not to distribute or discontinue distribution of the
Licensed Products. Dell does not guarantee that its marketing of the Licensed
Products will be successful.

5.7.2 Dell may distribute/sell the Licensed Products on a stand-alone basis or in
conjunction with a system sale or lease.

5.7.3 Any confidential information that will be disclosed by either party related
to this Agreement shall be disclosed pursuant to the terms and conditions of the
Non-Disclosure Agreement between the parties. The terms and conditions of this
Agreement shall be deemed to be confidential information.

5.7.4 Nothing in this Agreement shall require Dell to purchase from Distributor a
minimum quantity or any or all of its requirements for products that are the same
or similar to the Products. Furthermore, Distributor agrees to cooperate and work
with Dell and any other distributors that Dell may engage in connection with the
provision of Products.

5.7.5 This Agreement and its attached Exhibits/Schedules set forth the entire
agreement and understanding of the parties relating to the subject matter contained
herein, and merges all prior discussions and agreements, both oral and written,
between the parties. Each party agrees that use of pre-printed forms, such as
purchase orders or acknowledgments, is for convenience only and all terms and
conditions stated thereon, except as specifically set forth in this Agreement, are
void and of no effect. Unless otherwise expressly set forth in an Addendum,
Exhibit, Attachment or Schedule, as so designated, in the event of a conflict
between this Agreement and any Addenda, Exhibit, Attachment or Schedule, the terms
of this Agreement shall prevail.

IN WITNESS WHEREOF, the parties have executed this Agreement by their duly authorized
representatives as of the Effective Date.

	 	 	 	 	 	 	 
	DISTRIBUTOR
	 	 	DELL PRODUCTS L.P.
	 
	 	 	 	 	 	 
	By:

	 	/s/ Scott Meyers
	 	By:
	 	/s/ Bill Morris
	 

	 	 
	 	 	 	 
	 
	 	 	 	 	 	 
	Name:

	 	Scott Meyers
	 	Name:
	 	Bill Morris
	 

	 	 
	 	 	 	 
	 
	 	 	 	 	 	 
	Title:

	 	Chief Operating Officer
	 	Title:
	 	Director, Dell Software
	 

	 	 
	 	 	 	 
	 
	 	 	 	 	 	 
	Date:

	 	11/14/01
	 	Date:
	 	12/10/01
	 

	 	 
	 	 	 	 

 
 

			
	*	 	Denotes confidential information that has been omitted from the exhibit and filed
separately, accompanied by a confidential treatment request, with the Securities and Exchange
Commission pursuant to Rule 406 of the Securities Act of 1933.

9

 

EXHIBIT A

Licensed Software:

	 	ú	 	Double-Take®: Real time transaction based backup software.
	 
	 	ú	 	GeoCluster: adds data redundancy to MSCS Clusters (Microsoft Cluster Services) by
creating replicated disks to all available cluster nodes.

Royalty:

	 	ú	 	The discount for this Agreement is:

	 	•	 	* off of the then-current list price for all Licensed Programs listed.
	 
	 	•	 	* off the then-current list price for all Annual Maintenance Renewals
sold to Customers.
	 
	 	•	 	* off of the then-current list price for all Training scheduled for
internal use.
	 
	 	•	 	* off of the then-current list price for all Customer training passed
through to NSI.

 
 

			
	*	 	Denotes confidential information that has been omitted from the exhibit and filed
separately, accompanied by a confidential treatment request, with the Securities and Exchange
Commission pursuant to Rule 406 of the Securities Act of 1933.

10

 

EXHIBIT B1

END USER LICENSE AGREEMENT

DOUBLE-TAKE LICENSE AGREEMENT

This purchased version may be used on only one server. NSI Software hereby grants you, the user, a
limited, non-transferable license to use this copy of the software as specified by this license
agreement. By opening, installing, and using this software you signify agreement to all terms of
this license.

You agree that this software remains the property of NSI Software and that you only have a license
to use this software. NSI Software reserves all other rights to the software.

PERMITTED USES-YOU MAY:

	•	 	Use the software on a computer used as a server or its replacement.
	 
	•	 	Install the software onto a permanent storage device, such as a hard disk, for use by you on your computer.
	 
	•	 	Make and maintain backup copies of the software, provided they are used only for your own backup purposes and
you keep possession of all backup copies. This license grants usage of Double-Take for only one server.

USES NOT PERMITTED-YOU MAY NOT:

	•	 	Copy the software except as permitted herein.
	 
	•	 	Make copies of the manual.
	 
	•	 	Rent, lease, sub-license, time-share or sell the software or the manual.

Any breach of one or more of the provisions of this agreement shall constitute an immediate
termination of your license under this Agreement.

You may not reverse engineer, decompile, disassemble, or otherwise attempt directly or indirectly
to discover, use, disclose or transfer any source code or other confidential information contained
in the software.

NSI SOFTWARE MAKES AND YOU RECEIVE NO WARRANTIES, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION
THE WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. IN NO EVENT SHALL NSI
SOFTWARE OR ITS SUPPLIERS BE LIABLE FOR ANY

 
 

			
	*	 	Denotes confidential information that has been omitted from the exhibit and filed
separately, accompanied by a confidential treatment request, with the Securities and Exchange
Commission pursuant to Rule 406 of the Securities Act of 1933.

11

 

CONSEQUENTIAL, SPECIAL, INCIDENTAL, INDIRECT OR PUNITIVE DAMAGES RELATED TO THE SOFTWARE OR ITS
USE, EVEN IF NSI SOFTWARE IS ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.

NSI and Double-Take are registered trademarks of Network Specialists Inc. All other products are
trademarks of their respective companies.

(c) 1996-2001 NSI Software

 
 

			
	*	 	Denotes confidential information that has been omitted from the exhibit and filed
separately, accompanied by a confidential treatment request, with the Securities and Exchange
Commission pursuant to Rule 406 of the Securities Act of 1933.

12

 

EXHIBIT B2

END USER LICENSE AGREEMENT

GEOCLUSTER LICENSE AGREEMENT

This purchased version may be used on only one server. NSI Software hereby grants you, the user, a
limited, non-transferable license to use this copy of the Software as specified by this license
agreement. By opening, installing, and using this Software you signify agreement to all terms of
this license. You agree that this Software remains the property of NSI Software and that you only
have a license to use this Software. NSI Software reserves all other rights to the software.

PERMITTED USES-YOU MAY:

	•	 	Use the Software on a computer used as a server or its replacement.
	 
	•	 	Install the Software onto a permanent storage device, such as a hard disk, for use by you on your server.
	 
	•	 	Make and maintain backup copies of the Software, provided they are used only for your own backup purposes and
you keep possession of all backup copies. This license grants usage of GeoCluster for only one server.

USES NOT PERMITTED-YOU MAY NOT:

	•	 	Copy the Software except as permitted herein.
	 
	•	 	Make copies of the manual.
	 
	•	 	Rent, lease, sub-license, time-share or sell the Software or the manual.

Export Restrictions. You acknowledge that this Software is subject to the export laws of the United
States and agree to comply at all times with such laws. This Software or any components, data, code
or technology thereof may not be exported except in full compliance with all United States and
other applicable laws and regulations. You hereby represent and warrant that you: (A) are not a
citizen or resident of Cuba, Iraq, Libya, Sudan, North Korea, Iran, or Syria, and if a legal
entity, (B) are not an entity formed under the laws of Cuba, Iraq, Libya, Sudan, North Korea, Iran,
or Syria, or (C) are not included on the U.S. Treasury Department’s list of Specially Designated
nationals or the U.S. Commerce Department’s Table of Deny Orders.

Any breach of one or more of the provisions of this agreement shall constitute an immediate
termination of your license under this Agreement. You may not reverse

 
 

			
	*	 	Denotes confidential information that has been omitted from the exhibit and filed
separately, accompanied by a confidential treatment request, with the Securities and Exchange
Commission pursuant to Rule 406 of the Securities Act of 1933.

13

 

engineer, decompile, disassemble, or otherwise attempt directly or indirectly to discover, use,
disclose or transfer any source code or other confidential information contained in the Software.

NSI SOFTWARE MAKES AND YOU RECEIVE NO WARRANTIES, EXPRESS OR IMPLIED, INCLUDING WITHOUT LIMITATION
THE WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. IN NO EVENT SHALL NSI
SOFTWARE OR ITS SUPPLIERS BE LIABLE FOR ANY CONSEQUENTIAL, SPECIAL, INCIDENTAL, INDIRECT OR
PUNITIVE DAMAGES RELATED TO THE SOFTWARE OR ITS USE. EVEN IF NSI SOFTWARE IS ADVISED OF THE
POSSIBILITY OF SUCH DAMAGES.

NSI and Double-Take are registered trademarks of Network Specialists Inc. Double-Take GeoCluster
and GeoCluster are trademarks of NSI Software. All other products are trademarks of their
respective companies.

(c) 2000-2001 NSI Software

 
 

			
	*	 	Denotes confidential information that has been omitted from the exhibit and filed
separately, accompanied by a confidential treatment request, with the Securities and Exchange
Commission pursuant to Rule 406 of the Securities Act of 1933.

14

 

EXHIBIT C

ESCALATION CONTACT LIST

	 	 	 	 	 	 	 
	Ø

	 	Sales/Customer Service:	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	NSI Operations:	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Global Account Manager
	 	Bruce Shubrook
	 	512-418-1278
	 

	 	Inside Sales:
	 	Rob Dutkiewicz
	 	317-572-1826
	 

	 	Billing/Accounting:
	 	Tushar Hefa
	 	201-656-2121
	 

	 	Shipping:
	 	Yvonne Parkins
	 	201-656-2121
	 

	 	Tech Support:
	 	 	 	1-800-775-8674

	 	 	 	 	 	 	 
	Ø

	 	Dell Operations:
	 	 
	 	 
	 
	 	 	 	 	 	 
	 

	 	Casey Burns, Product Marketing Manager
(512) 723-3907
Casey_burns@dell.com	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	Linda Chance
Dell S&P Operations
(512) 728-8527
Linda_chance@dell.com	 	 	 	 

 
 

			
	*	 	Denotes confidential information that has been omitted from the exhibit and filed
separately, accompanied by a confidential treatment request, with the Securities and Exchange
Commission pursuant to Rule 406 of the Securities Act of 1933.

15

 

EXHIBIT D

VOLUME REBATE SCHEDULE

     *.

 

			
	*	 	Denotes confidential information that has been omitted from the exhibit and filed
separately, accompanied by a confidential treatment request, with the Securities and Exchange
Commission pursuant to Rule 406 of the Securities Act of 1933.

16

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