UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 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): February 22, 2013
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) |
Registrants telephone number, including area code: (800) 289-3355
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:
¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
¨ | 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) In a Current Report on Form 8-K filed on December 5, 2012, Dell reported that Stephen F. Schuckenbrock has announced his resignation as Dells President, Services. In connection with the expected end of Mr. Schuckenbrocks employment with Dell on March 31, 2013, Mr. Schuckenbrock and Schuckenbrock Consulting, LLC, a company owned and controlled by Mr. Schuckenbrock (the Consultant), entered into a Consultancy Agreement with Dell on February 22, 2013. Pursuant to the Consultancy Agreement, the Consultant, through Mr. Schuckenbrock, will provide consulting services to Dell in the area of services and cloud computing through March 31, 2014, unless the agreement is terminated on an earlier date. The Consultant will be paid a lump sum of $500,000 on or before April 30, 2013 and a lump sum of $1,000,000 on April 1, 2014 unless, among other matters, the Consultant terminates the Consultancy Agreement for any reason, or unless Dell terminates the agreement upon the occurrence of an event constituting cause under the agreement, before the applicable payment date. Under the Consultancy Agreement, cause is defined to include Mr. Schuckenbrocks violation of his non-compete agreement with Dell, including in connection with his acceptance of full-time employment with another entity. If, after April 1, 2013, the Consultant terminates the Consultancy Agreement or Mr. Schuckenbrock begins full-time employment with another entity that does not violate his non-compete agreement, the consultancy will terminate and Dell will pay the Consultant on April 1, 2014 an amount equal to $19,231 for each week or part of a week that will have elapsed from April 1, 2013 through the earliest of the date on which the termination became effective, the date on which Mr. Schuckenbrock began his employment, or April 1, 2014. In the circumstances referred to in the preceding sentence, the Consultant will not be entitled to any other payments under the Consultancy Agreement. The Consultant and Mr. Schuckenbrock have agreed with Dell to comply with customary non-compete, non-solicitation, confidentiality and non-disparagement undertakings.
The foregoing description of the Consultancy Agreement is a summary only and is qualified in its entirety by the full text of the Consultancy Agreement, which is filed as Exhibit 10.1 to this report and incorporated by reference in this Item 5.02(e).
Item 9.01 | Financial Statements and Exhibits. |
Dell herewith files the following document as an exhibit to this report:
(d) | Exhibits |
Exhibit Number |
Description | |
10.1 | Consultancy Agreement among Dell Inc., Schuckenbrock Consulting, LLC, and Stephen F. Schuckenbrock, dated February 22, 2013 |
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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: February 28, 2013 | By: | /s/ Janet B. Wright | ||||
Janet B. Wright, | ||||||
Vice President and Assistant Secretary | ||||||
(Duly Authorized Officer) |
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EXHIBIT INDEX
Exhibit Number |
Description | |
10.1 | Consultancy Agreement among Dell Inc., Schuckenbrock Consulting, LLC, and Stephen F. Schuckenbrock, dated February 22, 2013 |
Exhibit 10.1
Consultancy Agreement
This Consultancy Agreement (Agreement) sets forth the mutual agreement of Dell Inc., for itself and its subsidiaries (collectively, Dell), Schuckenbrock Consulting, LLC (Consultant), and Stephen F. Schuckenbrock (Schuckenbrock) regarding the provision of consultant services by Consultant to Dell as described below.
Term of Agreement
1. The term of this Agreement will run from April 1, 2013 through March 31, 2014, unless terminated earlier by Consultant or Dell in accordance with the Termination Provisions contained in this Agreement.
Consultant Services
2. Consultant will, through Schuckenbrock, provide consulting services to Dell in the area of Services and Cloud Solutions and in an amount not to exceed, on average, 20% of the time Schuckenbrock devoted, on average, to providing services to Dell during the three years preceding March 31, 2013.
3. Dell and Consultant understand and intend that the relationship created between them by this Agreement is one of an independent contractor. Consultant and Schuckenbrock specifically acknowledge that, in providing services under this Agreement, neither Consultant nor Schuckenbrock is an employee of Dell and: (i) they have no authority to bind Dell or any of its affiliates or subsidiaries; (ii) no agent, employee or servant, if any, of Consultant, nor Schuckenbrock himself, will be or will be deemed to be an employee, agent or servant of Dell; (iii) they are not entitled to participate in any benefit plans, programs or arrangements offered, or which may in the future be provided, by Dell or any of its affiliates to its or their employees; and (iv) they will be responsible for, and agree to pay in a timely fashion, their own taxes and Dell will not withhold any taxes on their behalf.
Payments
4. Consultant will be paid a lump sum of $500,000 on or before April 30, 2013, unless (i) Consultant or Schuckenbrock shall have (x) committed a non-trivial breach of Dells Code of Conduct, of this Consultancy Agreement, or of other agreements with Dell, including without limitation, Schuckenbrocks Protection of Sensitive Information, Non-compete and Non-solicitation Agreement between Schuckenbrock and Dell (Non-compete Agreement), which breach, if curable, is not cured within 5 business days after Consultant received a written notice from Dell describing the breach in reasonable detail and requesting cure or (y) committed an act that constitutes a felony (any such uncured breach, or act, being Cause under this Consultancy Agreement), or (ii) this Consultancy has been terminated by Dell for Cause, or by Consultant for any reason, prior to the payment date.
5. Consultant will be paid a lump sum of $1,000,000 on April 1, 2014, provided that this Consultancy has not been terminated by Dell for Cause, as a result of Schuckenbrocks full time employment, or by Consultant for any reason, prior to the payment date.
Consultant and Schuckenbrock acknowledge that they are responsible for payment of any and all income taxes, including estimated quarterly payments. Dells only responsibility in this regard is the issuance of an IRS Form 1099, if applicable, and filing thereof with the appropriate IRS office.
Expenses
6. Consultant will be reimbursed, within 30 days of submission, for any expenses that it reasonably incurs in connection with its work for Dell and that comply with Dell expense reimbursement policies.
Termination
7. Termination Generally. Either Dell or Consultant may terminate this Consultancy at any time for any reason whatsoever so long as 30 days advance written notice is provided. In the event of any termination of this Consultancy by Consultant under this paragraph, Consultant will be entitled to the payments provided for in paragraph 4 (if already paid, or due to be paid, to Consultant), and to the payment (if any) provided for in paragraph 9, and will be reimbursed for any expenses already incurred to the extent provided in paragraph 6 of this Agreement, but will not be entitled to any other payments under this Agreement. In the event of a termination of this Consultancy without Cause by Dell, Consultant will be entitled to the payments provided for in paragraphs 4 and 5 of this Agreement and will be reimbursed for any expenses already incurred to the extent provided in paragraph 6 above.
8. Termination With Cause. Dell may terminate this Consultancy at any time, with no advance notice, for Cause. In the event of a termination of this Consultancy by Dell for Cause, Consultant will not be entitled to any payments under this Agreement.
9. Termination Due to Employment. If, after April 1, 2013, Consultant terminates this Consultancy in accordance with Section 7, above, or if, after April 1, 2013, Schuckenbrock begins full time employment with an entity which does not violate his Non-compete Agreement, this Consultancy will end and Dell will, on April 1, 2014, pay Consultant $19,231 for each week or part of a week that elapses from April 1, 2013 through the earliest of the date that such termination becomes effective, the date that such employment commences, and April 1, 2014, and will reimburse Consultant for any expenses already incurred to the extent provided in paragraph 6 above, but Consultant will not be entitled to any other payments under this Agreement. If Schuckenbrock begins or intends to begin employment with an entity which would violate his Non-compete Agreement, Dell shall be entitled to terminate this Consultancy Agreement for Cause under paragraph 8 above.
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Intellectual Property
10. Except for pre-existing intellectual property (including Schuckenbrocks and Consultants Licensed Materials as defined below) incorporated in or used in the performance of the services under this Agreement, Consultant and Schuckenbrock agree that the deliverables produced under this Agreement shall constitute the work product of Dell (the Dell Work Product). Additionally, other than Consultants and Schuckenbrocks 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.
11. To the extent that the Dell Work Product requires for use pre-existing works owned by or licensed to Consultant or Schuckenbrock (the Licensed Materials), Dell hereby acknowledges their 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 and Schuckenbrock hereby grant 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.
12. 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 and Schuckenbrock hereby assign and transfer all of its rights, 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.
13. Consultant and Schuckenbrock 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 and Schuckenbrock shall, upon request, provide to Dell any or all of the Dell Work Product.
14. Consultant and Schuckenbrock agree that, upon reasonable request by Dell and at Dells sole expense, they will take any action, and fully cooperate with Dell, to effect the provisions of paragraphs 10 through 15 of this Agreement or to defend a lawsuit involving Consultants or Schuckenbrocks work for Dell.
15. Neither Consultant nor Schuckenbrock will 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.
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Confidentiality
16. Neither Consultant nor Schuckenbrock will use, publish, misappropriate, or disclose any Confidential or Proprietary Information, during or after the term of this Agreement, except as required by the provision of services under this Agreement or as authorized in writing by Dell. Any confidential information that will be disclosed by any party related to this Agreement will be disclosed pursuant to the terms and conditions of the Non-Disclosure Agreement between Schuckenbrock and Dell, which is specifically incorporated by reference herein. Notwithstanding anything contrary in the terms of the applicable Non-Disclosure Agreement, any trade secrets or other proprietary information of Dell, whether oral, visual or written, shall constitute confidential information of Dell even if not marked as such. For written deliverables provided pursuant to any performance of services, Consultant shall mark such deliverables, including without limitation any interim or final status reports, updates, or presentations, exclusively as Dell Confidential and shall not mark, or jointly-mark, such deliverables as Consultant Confidential. Further, Consultants and Schuckenbrocks obligation to preserve the confidentiality of such trade secrets or proprietary information shall continue in perpetuity. The terms and conditions of this Agreement will be considered confidential, provided, however, that Schuckenbrock shall be permitted to disclose his post employment restrictions, under this Agreement and other Dell arrangements, in confidence to any potential new employer.
Non- Disparagement
17. Consultant and Schuckenbrock agree that they will not, directly or indirectly, make any statement, oral or written, or perform any act or omission that criticizes, denigrates, disparages or is, or could be, detrimental to the reputation or goodwill of Dell or to the reputation (personal or professional) or goodwill of any Executive of Dell, including without limitation any member of Dells Board of Directors or Executive Leadership Team. Consultant and Schuckenbrock understands that Consultants and/or Schuckenbrocks good faith and truthful compliance with a subpoena or other legally compulsive process, including being required to provide testimony as a witness in a lawsuit, will not be in violation of this provision. However, Consultant and Schuckenbrock agree that in the event they are subject to compulsive legal process such as a subpoena or court order to testify as a witness, within three days of receipt of said subpoena or other legal process, they shall provide Dell notice of said process by faxing or emailing a copy of the subpoena or other legal process to Dells General Counsel. By way of emphasis and not limitation to any other termination reason, any breach of this Paragraph will result in immediate termination of this Agreement and Consultant will not be entitled to any payments due under this Consultancy Agreement after the date of termination.
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Non-compete and Non-Solicitation
18. Schuckenbrock hereby acknowledges and reaffirms that the Protection of Sensitive Information, Non-compete and Non-solicitation Agreement with Dell (Non-compete Agreement) he previously executed with Dell remains in full force and effect. Schuckenbrock acknowledges and affirms in this Agreement that his pre-existing Non-compete is reasonable, and necessary to protect Dells legitimate business interests and is a material inducement to Dells decision to enter into this Consultancy Agreement. Accordingly, Schuckenbrock will fully comply with each and every provision of his pre-existing Non-compete Agreement and understands and acknowledges that violations will, to the extent set forth in this Agreement, lead to forfeiture of any right to receive the payments described in this Agreement. By way of emphasis and not limitation to any other termination reason, any non-trivial uncured breach of the Non-compete Agreement will result in immediate termination of this Agreement and Consultant will not be entitled to any payments under this Consultancy Agreement that are not already due to be paid. Dell confirms that Consultants service under this Consultancy Agreement will not act to lengthen the time periods during which Schuckenbrock is subject to post-employment restrictions under the Non-compete Agreement or under any other Dell arrangement (with the exception of Consultants and Schuckenbrocks confidentiality obligations under law or agreement), and that all such post-employment restricted periods shall begin to run no later than April 1, 2013.
Other Provisions
19. At all times while on Dells premises and while performing the services under this Agreement, Consultant and Schuckenbrock will observe Dells 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.
20. Schuckenbrock agrees that his name, voice, picture, and likeness may be used in Dells advertising, training aids and other materials without payment of separate compensation.
21. When this Agreement terminates, Consultant and Schuckenbrock will promptly deliver to a designated Dell representative all originals and copies of all materials, documents and property of Dell which are in their possession or control, other than (x) documents relating to Consultants or Schuckenbrocks personal entitlements and obligations and (y) Schuckenbrocks personal rolodex (and electronic equivalents) .
22. This Agreement constitutes the entire Agreement among Consultant, Schuckenbrock and Dell concerning the topics covered herein. This document replaces any earlier or contemporaneous communication or agreement with Dell about these topics, except those provisions of Consultants and Schuckenbrocks agreements with Dell which are intended to survive the termination of employment with Dell, expressly including Schuckenbrocks Protection of Sensitive Information, Non-compete and Non-solicitation Agreement.
23. 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, Schuckenbrock and by a duly authorized 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.
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Accepted and Agreed: | ||||
/s/ Stephen Schuckenbrock |
/s/ Steve Price | |||
Schuckenbrock Consulting, LLC | Dell, Inc. | |||
Stephen F. Schuckenbrock | By: Steve Price | |||
Principal | ||||
February 22, 2013 |
February 22, 2013 | |||
Date | Date | |||
/s/ Stephen Schuckenbrock |
||||
Stephen F. Schuckenbrock | ||||
February 22, 2013 |
||||
Date |
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