8-K

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): January 5, 2009

Dell Inc.

(Exact name of registrant as specified in its charter)

Delaware	0-17017	74-2487834
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

One Dell Way, Round Rock, Texas 78682
(Address of principal executive offices) (zip code)

Registrant’s telephone number, including area code: (512) 338-4400

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o     Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o     Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o     Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o     Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 5.02 — Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

(e)	On December 31, 2008, the Company announced that Mr. Michael R. Cannon, President, Global Operations, will be leaving Dell in the current fiscal quarter. His departure date will be January 31, 2009. At the commencement of Mr. Cannon’s employment in February 2007, he entered into a Letter Agreement regarding severance benefits and a Protection of Sensitive Information, Noncompetition and Nonsolicitation Agreement. Under the terms of this agreement, Mr. Cannon will receive a cash severance payment of $10 million with $5 million to be paid on or before February 20, 2009, $2.5 million to be paid on or before April 20, 2009, and $2.5 million to be paid on or before July 31, 2009. As a condition to receiving his severance payments, Mr. Cannon executed a Separation Agreement and Release on January 5, 2009. A copy of the Separation Agreement and Release is attached as Exhibit 99.1.
	Mr. Cannon entered into a Consultancy Agreement with the company on January 5, 2009 (the “Consulting Agreement”). Commencing on February 1, 2009 and for a period ending January 31, 2011, the company will retain Mr. Cannon to serve as a consultant to the Company. The Company shall pay Mr. Cannon a consulting fee of $1.25 million to be paid within 15 days of January 31, 2010. The Consulting Agreement also amends the Protection of Sensitive Information, Noncompetition and Nonsolicitation Agreement to extend certain confidentiality, noncompetition, and nonsolicitation obligations through February 1, 2011. A copy of the Consulting Agreement is attached as Exhibit 99.2.
	On December 31, 2008, the Company announced that Mr. Mark Jarvis, Senior Vice President and Chief Marketing Officer, will be leaving Dell in the current fiscal quarter. His departure date will be January 23, 2009. At the commencement of Mr. Jarvis’ employment in October 2007, he entered into a Protection of Sensitive Information, Noncompetition and Nonsolicitation Agreement which provides for a standard severance arrangement for executive officers. Under this agreement, Mr. Jarvis will receive 12 months’ base salary and target bonus. As a condition to receiving his severance payments, Mr. Jarvis executed a Separation Agreement and Release on January 6, 2009. A copy of the Separation Agreement and Release is attached as Exhibit 99.3.

Item 9.01 — Financial Statements and Exhibits.

(d) Exhibits.

Exhibit 99.1	—	Separation Agreement and Release between Michael R. Cannon and Dell Inc.
Exhibit 99.2	—	Consultancy Agreement between Michael R. Cannon and Dell Inc.
Exhibit 99.3	—	Separation Agreement and Release between Mark Jarvis and Dell Inc.

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SIGNATURES

     Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	DELL INC.
Date: January 8, 2009	By:	/s/ Janet B. Wright
		Janet B. Wright
		Assistant Secretary

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EXHIBIT INDEX

Exhibit
No.	Description of Exhibit
99.1	Separation Agreement and Release between Michael R. Cannon and Dell Inc.
99.2	Consultancy Agreement between Michael R. Cannon and Dell Inc.
99.3	Separation Agreement and Release between Mark Jarvis and Dell Inc.

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EX-99.1

Exhibit 99.1

SEPARATION AGREEMENT AND RELEASE

     This Agreement sets forth the mutual agreement of Dell Inc., for itself and its subsidiaries (collectively, “Dell”), and Michael R. Cannon (“Executive”) regarding Executive’s separation from employment with Dell. Executive and Dell agree that this Agreement is entered into as an amicable resolution of any and all matters arising between them.

1. Separation Date. Executive’s employment with Dell will end on January 31, 2009 (the “Separation Date”).

2. Consideration from Dell. If Executive signs this Agreement and does not revoke it, Dell will provide Executive with the following valuable consideration, which is in addition to any consideration to which Executive is entitled, apart from this Agreement::

(a)

Continued Employment and Compensation. Until the Separation Date, Dell will continue to employ Executive and pay Executive compensation in the same amount and on the same terms as Dell is currently paying Executive, and Executive will continue to enjoy all the benefits to which Executive is entitled as of the date of this Agreement (provided Executive continues to make related employee contributions if necessary under Dell’s policies for the enjoyment of such benefits), subject to applicable tax and other withholdings.

(b)

Severance. Executive will receive the below payments, less applicable taxes and withholdings, as severance. Such severance payments are in lieu of any other payments (incentive bonus payments, long term incentive payments) to which Executive may be entitled.

(i)	$5,000,000, on or before February 20, 2009,
(ii)	$2,500,000, on or before April 30, 2009, and
(iii)	$2,500,000, on or before July 31, 2009.

(c) Security Monitoring. Until February 1, 2011, Dell Security will provide monitoring services for the security system in Executive’s home at the same service level it provides to the current members of Dell’s Executive Leadership Team.

3. Treatment of Employee Benefits including Stock and Stock Options. Executive understands and agrees that balances or vested balances Executive has in any Dell benefit plan will be available to Executive consistent with applicable laws, regulations, and the administrative provisions of the various plan documents. Executive further understands that Executive will not receive any grants of stock, stock units, or options from Dell in the future and that any current stock options, stock units, or restricted stock will expire or be exercisable in accordance with the terms and provisions of the applicable equity agreements and the Dell Incentive Plan(s).

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4. Complete Release. Executive hereby fully releases Dell and all of its owners, partners, shareholders, predecessors, successors, assigns, agents, directors, officers, employees, representatives, attorneys, subsidiaries, joint ventures, and affiliates (and agents, directors, officers, employees, representatives, and attorneys of such subsidiaries and affiliates) (collectively, “Released Parties”), from any and all known or unknown claims or demands Executive may have against any of them. Executive expressly waives and opts out of all claims, whether asserted on an individual or class action basis, against any Released Party arising out of any contract, express or implied, and whether executory or not, any covenant of good faith and fair dealing, express or implied, any tort (whether intentional or negligent, including claims arising out of the negligence or gross negligence of any Released Party and claims of express or implied defamation by any Released Party), and any federal, state, or other governmental statute, regulation, or ordinance, including, without limitation, those relating to qui tam, employment discrimination, termination of employment, payment of wages or provision of benefits, Title VII of the Civil Rights Act of 1964 as amended, the Civil Rights Act of 1991, the Americans with Disabilities Act, the Employee Retirement Income Security Act, the Family and Medical Leave Act, the Fair Labor Standards Act, the Age Discrimination in Employment Act, the Older Workers Benefit Protection Act (“OWBPA”), the Worker Adjustment and Retraining Notification (“WARN”) Act, the Consolidated Omnibus Budget Reconciliation Act (“COBRA”), and the Occupational Safety and Health Act. Executive represents that Executive has not assigned to any other person any of such claims and that Executive has the full right to grant this release. Notwithstanding any other provision herein, Dell and Executive agree that Executive is not waiving any claims that may arise in the future under the Age Discrimination in Employment Act, any claim for benefits under Dell’s health and welfare or retirement benefit plans, or any future claims based on Dell’s obligations and agreements set forth in this Agreement.

Executive acknowledges and understands that two alleged discrimination class action lawsuits have been filed against Dell and are currently pending in federal court in Texas. The captions of these cases are Hubley, et al. v. Dell, Inc., 1:08-cv-00804-JRN (W.D. Tex. Oct. 29, 2008) (the “Hubley action”); and Chapman, et al. v. Dell, Inc., CV-08-4945 (N.D. Cal. Oct. 29, 2008) (the “Chapman action”). The Chapman action has been transferred to Texas by court order. Executive acknowledges and understands that as an employee age 40 or older, Executive is a potential member of the alleged class in the Chapman action. No court has yet ruled on whether either case may proceed as a class action and Dell denies the allegations in both complaints. Executive understands that by signing this Agreement, Executive is releasing any and all claims Executive might have in either action. If Executive decides not to sign this Agreement, Dell will not retaliate against Executive.

5. Non-Admission of Liability. Executive and Dell understand and agree that they are entering into this Agreement to, among other things, resolve any claims or differences that may exist between them. By entering into this Agreement, neither Executive nor Dell admits any liability or wrongdoing.

6. Company Documents, Information or Property. Executive agrees that, on or before the Separation Date, Executive will return to Dell any and all documents relating to Dell or its business operations (and any and all copies thereof, whether in paper form or electronic form), computer equipment, badges, credit cards and any other Dell property in Executive’s possession or control. Executive agrees that Executive will not take any such documents or property from the control or premises of Dell and that if, at any time after the Separation Date, Executive should come into possession of any such documents or property, Executive will return such documents or property to Dell immediately.

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7. Employment and Other Agreements. Executive agrees that, except as otherwise provided in this Agreement, the provisions of Executive’s Dell Employment Agreement, any performance-based stock unit agreements, stock option agreements, restricted stock agreements, and confidentiality or non-competition agreements that Executive previously entered into with Dell, and that are intended to survive Executive’s termination, remain in full force and effect. Moreover, as a material inducement to Dell to enter into this Agreement, Executive reaffirms Executive’s intent to comply with Executive’s post-employment obligations to Dell under the foregoing agreements.

8. Confidentiality. Executive agrees that, except as may be required by law, court order, or to enforce this Agreement, Executive will keep the terms, amount and fact of this Agreement completely confidential. Notwithstanding the foregoing, Executive may disclose pertinent information concerning this Agreement to Executive’s attorneys, tax advisors and financial planners, and Executive’s spouse and other close family members, provided they have previously been informed of and have agreed to be bound by this confidentiality clause. Executive understands and agrees that a breach of this confidentiality clause by any of the above named individuals will be deemed a breach of this Agreement by Executive.

Dell will keep the terms of this Agreement confidential and will only disclose its contents to Dell, its accountants, attorneys or others as needed to effectuate a legitimate business purpose.

9. Non-disparagement. Executive agrees that, except as may be required by law or court order Executive will not, directly or indirectly, make any statement, oral or written, or perform any act or omission which is or could be detrimental in any material respect to the reputation or goodwill of Dell or any other Released Party. Executive understands that Executive’s compliance with a subpoena or other legally compulsive process or Executive’s participation as a witness in any lawsuit will not be a violation of this provision

Dell will remind the Dell Executive Leadership Team of the Dell practice of not providing employment references for former Dell employees or making any disparaging public statements about Executive.

10. Cooperation. Executive agrees that Executive will give Dell Executive’s full cooperation in connection with any claims, lawsuits, or proceedings that relate in any manner to Executive’s conduct or duties at Dell or that are based on facts about which Executive obtained personal knowledge while employed at Dell. In return, Dell agrees to reimburse Executive for direct and reasonable out of pocket expenses (including reasonable attorney’s fees) incurred with respect to rendering such cooperation.

11. Applicable Law and Venue. THIS AGREEMENT SHALL BE INTERPRETED IN ALL RESPECTS BY THE INTERNAL LAWS OF THE STATE OF TEXAS, AND THE VENUE FOR THE RESOLUTION OF ANY DISPUTES (LOCATION OF ANY LAWSUIT) SHALL BE SOLELY IN THE STATE AND FEDERAL COURTS OF WILLIAMSON COUNTY, TEXAS.

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12. Severability. The fact that one or more paragraphs (or portion thereof) of this Agreement may be deemed invalid or unenforceable by any court shall not invalidate the remaining paragraphs or portions of such paragraphs of this Agreement.

13. Certain Acknowledgments. Executive acknowledges that Executive is signing this Agreement voluntarily with full knowledge of its contents. Executive is not relying on any promise or representation not specifically and explicitly made in this Agreement. This Agreement may not be amended or modified except by a written agreement signed by Executive and Dell’s Chief Executive Officer.

14. Consideration and Revocation Periods. Executive may take up to 21 days to consider this Agreement. Executive may use as much or as little of this period as Executive chooses before signing the Agreement. Executive is advised to consult with an attorney before signing this Agreement. If Executive accepts this Agreement, Executive must sign it and return it to Andrew Esparza on or before the expiration of the 21 day period and/or Dell’s withdrawal of the offer contained in the Agreement. By signing this Agreement, Executive acknowledges that Executive was afforded a period of at least 21 days from the date Dell’s proposal was presented to Executive in which to consider it. Executive understands that any changes that the parties agree to make to this Agreement after it has been presented to Executive, whether such changes are material or non-material, will not extend the amount of time Executive has to consider the agreement. In addition, Executive has a period of seven days within which to revoke this Agreement after signing it. To revoke this Agreement, Executive must provide written notification of revocation to Andrew Esparza within seven days from the date Executive signed it.

If the foregoing accurately sets forth your agreement with Dell, please signify by signing below and returning this Agreement to Andrew Esparza on or before the close of business on the 21st day after this Agreement was presented to you. If Dell has not received a signed copy of this Agreement by that time, the offer reflected in this Agreement will automatically terminate and expire without further notice from Dell.

Date:
	Michael R. Cannon
	“Executive”
Date:
	For Dell
	Andrew Esparza
	Senior Vice President, Human Resources

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EX-99.2

Exhibit 99.2

Consultancy Agreement

This Consultancy Agreement (“Agreement”) sets forth the mutual agreement of Dell Inc., for itself and its subsidiaries (collectively, “Dell”), and Michael R. Cannon (“Consultant”) regarding the provision of consultant services to Dell as described below.

Term of Agreement

1. The Term of this Agreement will run from February 1, 2009 until January 31, 2011, unless terminated earlier in accordance with the Termination provisions contained in this Agreement.

Consultant Services

2. Dell and Consultant understand and intend that the relationship created between them by this Agreement is one of an independent contractor. No agent, employee or servant, if any, of Consultant, nor Consultant himself, will be or will be deemed to be the employee, agent or servant of Dell.

3. During the Term of this Agreement, Consultant will provide consulting services to Dell in the operations area and will perform such duties as will be determined by Dell’s Vice Chairman, Global Operations, or his designee.

4. Consultant will furnish services diligently and professionally, and in a manner consistent with the good public image of Dell. Consultant will not directly or indirectly make any statement, oral or written, or perform any act or omission which is or could be detrimental in any material respect to the reputation or goodwill of Dell, either while consulting for Dell or thereafter.

Payment and Expenses

5. Consultant will be paid pursuant to the following schedule:

a. $1,500,000 will be paid within 15 business days of January 31, 2010.

6. Dell will also reimburse Consultant for any reasonable expenses actually incurred in the furtherance of Dell business and pursuant to this Agreement, if accompanied by appropriate documentation, and if approved in advance by Dell or otherwise in accordance with Dell’s reimbursement policy.

7. Consultant acknowledges that he is responsible for payment of any and all income taxes, including estimated quarterly payments. Dell’s only responsibility in this regard is the issuance of an IRS Form 1099, if applicable, and filing thereof with the appropriate IRS office.

8. Consultant understands that during the term of this Agreement, Consultant is not eligible to participate in Dell’s 401K plan, or any other Dell bonus, benefit, stock, or stock option plan available to employees of Dell.

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Protection of Sensitive Information, Noncompetition and Nonsolicitation Agreement

9. Dell will provide consultant with confidential and/or proprietary information and trade secrets during the term of this Agreement. In consideration of Dell’s promises in this Agreement, and so as to protect Dell’s confidential and proprietary information, trade secrets and goodwill, the term of the Protection of Sensitive Information, Noncompetition and Nonsolicitation Agreement which Consultant has previously signed with Dell is extended to include the period of this Consultancy. In addition, the Protection of Sensitive Information, Noncompetition and Nonsolicitation Agreement is modified as follows:

10. Paragraph 4 a through e of the Protection of Sensitive Information, Noncompetition and Nonsolicitation Agreement is amended to now read as follows:

     a. Prior to February 1, 2011, Executive will not, except as required to perform Executive’s duties for Dell, in any geographic region for which Executive had direct or indirect responsibility on behalf of Dell or in any geographic region for which Executive had Sensitive Information, perform duties or services for a Direct Competitor, whether as an employee, consultant, principal, advisor, board member or any other capacity, that are substantially similar to the duties or services Executive performed for Dell at any time during the last twenty-four months of Executive’s relationship with Dell. Executive further agrees that because of Executive’s comprehensive knowledge regarding Dell’s business relationships with its vendors and suppliers, Executive will not, prior to February 1, 2011, without Dell’s express written consent, perform duties or services in any capacity for a supplier, business partner, or vendor of Dell with whom Executive had any business dealings on behalf of Dell.

     b. Prior to February 1, 2011, Executive will not, except as required to perform Executive’s duties for Dell, directly or indirectly, solicit (or assist another in soliciting) (i) any of Dell’s customers or prospective customers with whom Executive had contact on behalf of Dell during the last twelve months of Executive’s relationship with Dell; or (ii) any of Dell’s customers or prospective customers about whom Executive had any Sensitive Information during the last twenty-four months of Executive’s relationship with Dell.

     c. Prior to February 1, 2011, Executive will not, except as required to perform Executive’s duties for Dell, encourage (or assist another in encouraging) any supplier, business partner, or vendor of Dell with whom Executive had any contact on behalf of Dell within the last twenty-four months of Executive’s relationship with Dell or about whom Executive had any Sensitive Information to terminate or diminish its relationship with Dell.

     d. Prior to February 1, 2011, Executive will not, except as required to perform Executive’s duties for Dell, directly or indirectly solicit (or assist another in soliciting) for employment, consulting, or other service engagement any employee, contractor, or consultant of Dell or any person who was an employee, contractor, or consultant of Dell at any time during the last twenty-four months of Executive’s relationship with Dell.

     e. Prior to February 1, 2011, Executive will not, except as required to perform Executive’s duties for Dell, directly or indirectly advise, assist, attempt to influence or otherwise induce or persuade (or assist another in advising, attempting to influence or otherwise inducing or persuading) any person employed by Dell to end his or her employment relationship with Dell.

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11. All other provisions of Consultant’s Protection of Sensitive Information, Noncompetition and Nonsolicitation Agreement shall remain in full force and effect. All confidential information, proprietary information and trade secrets provided to Consultant pursuant to this Agreement are subject to the provisions of Consultant’s Protection of Sensitive Information, Noncompetition and Nonsolicitation Agreement, including but not limited to Consultant’s promise not to disclose or misuse such information.

Termination

12. With cause. Dell may terminate this Agreement at any time, with no advance notice, if Dell determines that Consultant violated any of the terms of this Agreement, or any of the provisions of any other agreement Consultant may have with Dell or Dell’s Code of Conduct, or other policies. If Dell terminates this Agreement with Cause, Consultant will not be entitled to the payment referenced in paragraph 5a above.

13. Without Cause. Dell may terminate this Agreement at any time without cause. If Dell terminates this Agreement without Cause, Consultant shall be entitled to the payment referenced in paragraph 5a above.

Intellectual Property

14. Except for pre-existing intellectual property (including Consultant’s Intellectual Property as defined below) incorporated in or used in the performance of the services under this Agreement, Consultant agrees that the deliverables produced under this Agreement shall constitute the work product of Dell (the “Dell Work Product”). Additionally, other than Consultant’s Intellectual Property, Work Product shall further include without limitation: all tools, data (including without limitation specifications) and/or methods used to design, create, generate or otherwise develop the deliverables and/or perform the services; and all patent, copyright, trade secret or other proprietary or intellectual property rights developed with respect to the creation of deliverables or performance of the services.

15. To the extent that the Dell Work Product requires for use pre-existing works owned by or licensed to Consultant (the “Licensed Materials”), Dell hereby acknowledges Consultant’s ownership of the Licensed Materials; and Dell acknowledges that it does not have any ownership interest in such Licensed Materials. Notwithstanding the foregoing, with respect to the Licensed Materials, unless otherwise set forth in an Addendum or Schedule, Consultant hereby grants to Dell an irrevocable, non-exclusive, worldwide, royalty-free license to: (i) use, execute, produce, display, perform, copy, distribute (internally or externally) copies of, and prepare derivative works based upon the Licensed Materials and their derivative works, and (ii) authorize others to do any, some, or all of the foregoing.

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16. All Dell Work Product is solely and exclusively the property of Dell. To the extent any Dell Work Product qualifies as a “work made for hire” under applicable copyright law, it will be considered a work made for hire and the copyright will be owned solely and exclusively by Dell. To the extent that any Dell Work Product is not considered a “work made for hire” under applicable copyright law, Consultant hereby assigns and transfers all of its right, title and interest in and to the Dell Work Product to Dell. Furthermore, Consultant shall ensure that its employees, subcontractors, representatives, agents or other contractors engaged to perform Services hereunder comply with the terms of this Agreement particularly this Section.

17. Consultant will, as part of the Dell Work Product, disclose promptly in writing to Dell all of the Dell Work Product and document all intellectual property rights as Dell personnel may direct. Furthermore, Consultant shall, upon request, provide to Dell any or all of the Dell Work Product.

18. Consultant agrees to take any action and fully cooperate with Dell, as Dell may request to effect the provisions of this Section.

19. Consultant will not use the name of Dell nor any Dell trademarks, trade names, service marks, or quote the opinion of any Dell employee in any advertising, presentations or otherwise without first obtaining the prior written consent of an officer of Dell.

Other Provisions

20. At all times while on Dell’s premises and while performing the services under this Agreement, Consultant will observe Dell’s rules, policies, and practices with respect to conduct, health and safety, and protection of persons and property, including but not limited to the Dell Code of Conduct.

21. Consultant agrees that his name, voice, picture, and likeness may be used in Dell’s advertising, training aids and other materials without payment of separate compensation. Dell will notify Consultant and obtain his consent before any use occurs under this paragraph.

22. When this Agreement terminates, Consultant will promptly deliver to a designated Dell representative all originals and copies of all materials, documents and property of Dell which are in Consultant’s possession or control.

23 Except as otherwise provided in this Agreement, the provisions of Consultant’s Dell Employment Agreement, any performance-based stock unit agreements, stock option agreements, restricted stock agreements, and confidentiality or non-competition agreements (as modified herein) that Consultant previously entered into with Dell, and that are intended to survive Consultant’s termination, remain in full force and effect. Moreover, as a material inducement to Dell to enter into this Agreement, Executive reaffirms Executive’s intent to comply with Executive’s post-employment obligations to Dell under the aforementioned agreements.

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24. The laws of the State of Texas govern this Agreement and all disputes will be resolved in Williamson County, Texas. This Agreement may be changed only by a written document signed by Consultant and the Chief Executive officer of Dell. If any provision of this Agreement is held by a court of law to be illegal, invalid, or unenforceable, the legality, validity and enforceability of the remaining provisions of this Agreement will not be affected or impaired thereby.

Accepted and Agreed:
[Printed name]	Dell Inc.
	By:
Date
		Its:
		Date:

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EX-99.3

Exhibit 99.3

SEPARATION AGREEMENT AND RELEASE

     This Agreement sets forth the mutual agreement of Dell Inc., for itself and its subsidiaries (collectively, “Dell”), and Mark Jarvis (“Executive”) regarding Executive’s separation from employment with Dell. Executive and Dell agree that this Agreement is entered into as an amicable resolution of any and all matters arising between them.

1. Separation Date. Executive’s employment with Dell will end on January 23, 2009 (the “Separation Date”).

2. Consideration from Dell. If Executive signs this Agreement and does not revoke it, Dell will provide Executive with the following valuable consideration, which is in addition to any consideration to which Executive is entitled, apart from this Agreement:

(a)

Continued Employment and Compensation. Until the Separation Date, Dell will continue to employ Executive and pay Executive compensation in the same amount and on the same terms as Dell is currently paying Executive, and Executive will continue to enjoy all the benefits to which Executive is entitled as of the date of this Agreement (provided Executive continues to make related employee contributions if necessary under Dell’s policies for the enjoyment of such benefits), subject to applicable tax and other withholdings.

(b)

Severance. Executive will receive the below payments, less applicable taxes and withholdings, as severance. Such severance payments are in lieu of any other payments (incentive bonus payments, long term incentive payments) to which Executive may be entitled.

a.

Severance Pay. Within 15 business days of Dell’s receipt of this signed Agreement, Dell will pay Executive the amount of $625,000. Dell and Executive agree that this amount is designed to compensate Executive for the equivalent value of one year of additional base salary.

b.

Prorated Incentive Plan Payment. Within 15 business days of Dell’s receipt of this signed Agreement, Dell agrees to pay Executive the amount of $625,000. Dell and Executive agree that this amount is designed to compensate Executive for the equivalent value of Executive’s target incentive bonus payout for Fiscal Year 2009. Executive agrees that Executive is not eligible to receive any other incentive bonus payout for FY09 or FY10.

3. Treatment of Employee Benefits including Stock and Stock Options. Executive understands and agrees that balances or vested balances Executive has in any Dell benefit plan will be available to Executive consistent with applicable laws, regulations, and the administrative provisions of the various plan documents. Executive further understands that Executive will not receive any grants of stock, stock units, or options from Dell in the future and that any current stock options, stock units, or restricted stock will expire or be exercisable in accordance with the terms and provisions of the applicable equity agreements and the Dell Incentive Plan(s).

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4. Complete Release. Executive hereby fully releases Dell and all of its owners, partners, shareholders, predecessors, successors, assigns, agents, directors, officers, employees, representatives, attorneys, subsidiaries, joint ventures, and affiliates (and agents, directors, officers, employees, representatives, and attorneys of such subsidiaries and affiliates) (collectively, “Released Parties”), from any and all known or unknown claims or demands Executive may have against any of them. Executive expressly waives and opts out of all claims, whether asserted on an individual or class action basis, against any Released Party arising out of any contract, express or implied, and whether executory or not, any covenant of good faith and fair dealing, express or implied, any tort (whether intentional or negligent, including claims arising out of the negligence or gross negligence of any Released Party and claims of express or implied defamation by any Released Party), and any federal, state, or other governmental statute, regulation, or ordinance, including, without limitation, those relating to qui tam, employment discrimination, termination of employment, payment of wages or provision of benefits, Title VII of the Civil Rights Act of 1964 as amended, the Civil Rights Act of 1991, the Americans with Disabilities Act, the Employee Retirement Income Security Act, the Family and Medical Leave Act, the Fair Labor Standards Act, the Age Discrimination in Employment Act, the Older Workers Benefit Protection Act (“OWBPA”), the Worker Adjustment and Retraining Notification (“WARN”) Act, the Consolidated Omnibus Budget Reconciliation Act (“COBRA”), and the Occupational Safety and Health Act. Executive represents that Executive has not assigned to any other person any of such claims and that Executive has the full right to grant this release. Notwithstanding any other provision herein, Dell and Executive agree that Executive is not waiving any claims that may arise in the future under the Age Discrimination in Employment Act, any claim for benefits under Dell’s health and welfare or retirement benefit plans, or any future claims based on Dell’s obligations and agreements set forth in this Agreement.

Executive acknowledges and understands that two alleged discrimination class action lawsuits have been filed against Dell and are currently pending in federal court in Texas. The captions of these cases are Hubley, et al. v. Dell, Inc., 1:08-cv-00804-JRN (W.D. Tex. Oct. 29, 2008) (the “Hubley action”); and Chapman, et al. v. Dell, Inc., CV-08-4945 (N.D. Cal. Oct. 29, 2008) (the “Chapman action”). The Chapman action has been transferred to Texas by court order. Executive acknowledges and understands that as an employee age 40 or older, Executive is a potential member of the alleged class in the Chapman action. No court has yet ruled on whether either case may proceed as a class action and Dell denies the allegations in both complaints. Executive understands that by signing this Agreement, Executive is releasing any and all claims Executive might have in either action. If Executive decides not to sign this Agreement, Dell will not retaliate against Executive.

5. Claims under California Law. Executive understands and agrees that the complete release in paragraph 4 above also includes claims made under the California Fair Employment and Housing Act and California Labor Code Section 970-972, etc. Executive expressly waives all the rights and benefits of Section 1542 of the California Civil Code, which section reads as follows:

A general release does not extend to claims which the creditor does not know or suspect to exist in his or her favor at the time of executing the release, which if known by him or her must have materially affected his or her settlement with the debtor.

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6. Non-Admission of Liability. Executive and Dell understand and agree that they are entering into this Agreement to, among other things, resolve any claims or differences that may exist between them. By entering into this Agreement, neither Executive nor Dell admits any liability or wrongdoing.

7. Company Documents, Information or Property. Executive agrees that, on or before the Separation Date, Executive will return to Dell any and all documents relating to Dell or its business operations (and any and all copies thereof, whether in paper form or electronic form), computer equipment, badges, credit cards and any other Dell property in Executive’s possession or control. Executive agrees that Executive will not take any such documents or property from the control or premises of Dell and that if, at any time after the Separation Date, Executive should come into possession of any such documents or property, Executive will return such documents or property to Dell immediately.

8. Employment and Other Agreements. Executive agrees that, except as otherwise provided in this Agreement, the provisions of Executive’s Dell Employment Agreement, any performance-based stock unit agreements, stock option agreements, restricted stock agreements, and confidentiality or non-competition agreements that Executive previously entered into with Dell, and that are intended to survive Executive’s termination, remain in full force and effect. Moreover, as a material inducement to Dell to enter into this Agreement, Executive reaffirms Executive’s intent to comply with Executive’s post-employment obligations to Dell under the foregoing agreements.

9. Confidentiality. Executive agrees that, except as may be required by law, court order, or to enforce this Agreement, Executive will keep the terms, amount and fact of this Agreement completely confidential. Notwithstanding the foregoing, Executive may disclose pertinent information concerning this Agreement to Executive’s attorneys, tax advisors and financial planners, and Executive’s spouse and other close family members, provided they have previously been informed of and have agreed to be bound by this confidentiality clause. Executive understands and agrees that a breach of this confidentiality clause by any of the above named individuals will be deemed a breach of this Agreement by Executive.

10. Non-disparagement. Executive agrees that, except as may be required by law or court order Executive will not, directly or indirectly, make any statement, oral or written, or perform any act or omission which is or could be detrimental in any material respect to the reputation or goodwill of Dell or any other Released Party. Executive understands that Executive’s compliance with a subpoena or other legally compulsive process or Executive’s participation as a witness in any lawsuit will not be a violation of this provision

11. Cooperation. Executive agrees that Executive will give Dell Executive’s full cooperation in connection with any claims, lawsuits, or proceedings that relate in any manner to Executive’s conduct or duties at Dell or that are based on facts about which Executive obtained personal knowledge while employed at Dell. In return, Dell agrees to reimburse Executive for direct and reasonable out of pocket expenses (including reasonable attorney’s fees) incurred with respect to rendering such cooperation.

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12. Applicable Law and Venue. THIS AGREEMENT SHALL BE INTERPRETED IN ALL RESPECTS BY THE INTERNAL LAWS OF THE STATE OF TEXAS, AND THE VENUE FOR THE RESOLUTION OF ANY DISPUTES (LOCATION OF ANY LAWSUIT) SHALL BE SOLELY IN THE STATE AND FEDERAL COURTS OF WILLIAMSON COUNTY, TEXAS.

13. Severability. The fact that one or more paragraphs (or portion thereof) of this Agreement may be deemed invalid or unenforceable by any court shall not invalidate the remaining paragraphs or portions of such paragraphs of this Agreement.

14. Certain Acknowledgments. Executive acknowledges that Executive is signing this Agreement voluntarily with full knowledge of its contents. Executive is not relying on any promise or representation not specifically and explicitly made in this Agreement. This Agreement may not be amended or modified except by a written agreement signed by Executive and Dell’s Chief Executive Officer.

15. Consideration and Revocation Periods. Executive may take up to 21 days to consider this Agreement. Executive may use as much or as little of this period as Executive chooses before signing the Agreement. Executive is advised to consult with an attorney before signing this Agreement. If Executive accepts this Agreement, Executive must sign it and return it to Andrew Esparza on or before the expiration of the 21 day period and/or Dell’s withdrawal of the offer contained in the Agreement. By signing this Agreement, Executive acknowledges that Executive was afforded a period of at least 21 days from the date Dell’s proposal was presented to Executive in which to consider it. Executive understands that any changes that the parties agree to make to this Agreement after it has been presented to Executive, whether such changes are material or non-material, will not extend the amount of time Executive has to consider the agreement. In addition, Executive has a period of seven days within which to revoke this Agreement after signing it. To revoke this Agreement, Executive must provide written notification of revocation to Andrew Esparza within seven days from the date Executive signed it.

If the foregoing accurately sets forth your agreement with Dell, please signify by signing below and returning this Agreement to Andrew Esparza on or before the close of business on the 21st day after this Agreement was presented to you. If Dell has not received a signed copy of this Agreement by that time, the offer reflected in this Agreement will automatically terminate and expire without further notice from Dell.

Date:
	Mark Jarvis
	“Executive”

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