EXHIBIT 10.17
Data Return Corporation
000 Xxxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxx, Xxxxx 00000
July 29, 1999
Compaq Computer Corporation
00000 XX 000
Xxxxxxx, Xxxxx 00000
Dear Sirs and Madames:
This letter agreement (this "Agreement"), when executed by you in the space
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provided below, will evidence our mutual agreement with respect to the matters
contained herein.
Compaq ASP Program. For a three-year period beginning on the date of this
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Agreement and ending on the third anniversary thereof (such period, the
"Inclusion and Purchase Period"), if Compaq Computer Corporation ("Compaq") in
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its sole discretion implements a program pursuant to or under which it approves
for recommendation to its customers a specified group of Application Service
Providers (any such program, a "Compaq ASP Program"), then, during the remainder
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of the Inclusion and Purchase Period, for so long as Data Return Corporation
(the "Company") meets all criteria for inclusion in such Compaq ASP Program
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(which criteria shall be as established from time to time in the sole discretion
of Compaq), Compaq agrees to include the Company in such Compaq ASP Program,
and further agrees to include the Company at the highest level at which the
Company qualifies if such Compaq ASP Program involves more than one level of
Application Service Provider designation. It is understood and agreed that
Compaq is under no obligation to implement any Compaq ASP Program and that any
Compaq ASP Program implemented may be modified or discontinued at any time by
Compaq in its sole discretion without notice. If Compaq does implement a Compaq
ASP Program during the Inclusion and Purchase Period, Compaq will not
unreasonably single out the Company for exclusion therefrom. For purposes
hereof, "Application Service Provider" shall mean any for-profit entity
organized within the United States whose principal business involves the
provision to its customers for a fee, of access to, or deployment, Web and/or
enterprise application hosting, managing, maintenance and leasing of, Internet
services and software.
Server Purchases. The Company agrees that, during the Inclusion and
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Purchase Period, it will purchase (either from Compaq, a wholly-owned subsidiary
thereof or a Compaq-approved reseller or distributor) that number of Compaq
servers equal to the lesser of (i) 2,000, and (ii) that number necessary (as
reasonably determined by the Company's management) to adequately operate the
Company's business consistent with the Company's business plan; provided that,
with respect to any such purchase, (a) Compaq or a wholly-owned subsidiary
thereof provides financing therefor on terms mutually agreeable to Compaq or
such subsidiary, as the case may be, and to the Company (in this regard, the
Company agrees that it will not refuse to agree to terms so long as the terms
offered by Compaq or such subsidiary are competitive with those that would be
available to the Company from Compaq's globally-recognized peers in the server
business); and (b) the price, performance and quality of the Compaq server(s) is
reasonably satisfactory to the Company; and provided, further, that the Company
shall only be obligated to purchase that amount that Compaq, such wholly-owned
subsidiary or Compaq-approved reseller or distributor commits to providing in a
reasonably acceptable time frame. Notwithstanding the immediately preceding
sentence, the Company agrees that, until it has purchased 2,000 servers from
Compaq, unless either of the conditions specified in clauses (a) and (b) above
are not met, it will not purchase any non-Compaq server during the Inclusion and
Purchase Period. It is understood and agreed that neither Compaq nor any of its
subsidiaries is under any obligation to provide financing to the Company, and
further are under no limitations or restrictions with respect to selling or
otherwise providing any products or services (including without limitation
servers) to any other persons or entities, regardless of whether such persons or
entities compete with the Company.
Please execute this letter in the space provided below to evidence
your agreement with the foregoing.
Sincerely,
Data Return Corporation
By: /s/ SUNNY X. XXXXXXXXXX,
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Sunny X. Xxxxxxxxxx,
Chief Executive Officer
Compaq Computer Corporation
By: /s/ X. XXXXXXXX
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Name: X. Xxxxxxxx
Title: Senior Vice President
Corporate Development
