APPENDIX B
`
`TO DECLARATION OF
`JENNIFER RAY CRANE
`
`CROSSROADS NON-CONFIDENTIAL
`LICENSE AGREEMENTS
`
`
`
`1 of 58
`
` CROSSROADS EXHIBIT 2041
` Cisco Systems et al v Crossroads Systems, Inc.
` IPR2014-01544
`
`

`
`Settlement and License Agreement
`
`This Settlement and License Agreement (the “/Agreement”) sets forth the terms upon which
`Crossroads Systems, Inc., a Texas Corporation (“Crossroads”) and Advanced Digital
`information Corporation, a Washington corporation, and its majority owned subsidiaries
`including Pathlight Technology, Inc. (“Pathlight”), a Delaware corporation and a wholly—owned
`subsidiary of Advanced Digital information Corporation (collectively, “ADIC”), agree to settle
`the litigation currently pending before the U .S. District Court of the Western District of Texas,
`Austin Division, captioned Crossroads Systems, (Texas), Inc. vs. Pathlight Technology, Inc.
`Civil Action No. A-OOCA-248~SS (the “Patent Litigation”). This Agreement shall be effective
`as of the last execution date set forth below (the “Effective Date”).
`
`Background
`
`Crossroads is the owner of all right, title and interest in and to the ‘972 Patent. On or about April
`10, 1999, Crossroads filed a complaint in the Patent Litigation alleging the Accused Products
`infringe the ‘972 Patent and demandingjudgrnent against Pathlight for such infringement.
`During the Patent Litigation, Advanced Digital Information Corporation acquired Pathlight. It is
`now the desire and intention of Crossroads and ADIC to settle and resolve all disputes,
`differences and claims which exist in the Patent Litigation. To that end, Crossroads grants ADIC
`a license under the ‘972 Patent to develop, manufacture. use, and sell Licensed Product(s) in
`exchange for a lump sum payment from ADIC and acknowledgement by ADIC of both the
`validity of the ‘972 Patent and infringement of the ‘972 Patent by the Accused Products.
`
`In consideration of the mutual promises contained herein, and other good and valuable
`consideration, the adequacy of which is hereby acknowledged, the parties hereto agree as
`follows:
`
`1.
`
`Definitions
`
`1.1
`
`l.2
`
`1.3
`
`“’972 Patent” means (i) U.S. Patent No. 5,941,972 issued to Crossroads
`and (ii) for purposes of the license grant in Paragraph 3.1 only, any claims
`in a patent that issues from any continuation, divisional. reissue,
`reexamination or foreign counterpart applications of U.S. Patent No.
`5,941,972 that are directed to a system, apparatus or method that provides
`connectivity between fibre channel and SCSI.
`
`“Accused Products” mean any Pathlight SAN Router and Pathlight SAN
`Gateway products made, use-.d, -snlri, nr nffered for sale or imported by
`Pathlight or ADIC.
`
`“Licensed Product(s)” means any product, or part thereof. the
`manufacture, use, sale, otter for sale or import of which is or would be
`covered by any claim of the ‘972 Patent.
`
`1.4
`
`“Past Damages Payment” means the portion of the lump sum payment
`from ADIC to Crossroads that is allocated to the damages incurred by
`
`Gray Cury\AU\406l426.6
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`Crossroads based on Pathlight’s infringement of the ‘972 Patent due to its
`manufacture, use, sale and/or import of the Accused Products. Past
`Damages shall be equal to five million dollars ($5,000,000).
`
`1.5
`
`“Pre-paid Royalties” means the portion of the lump sum payment from
`ADIC to Crossroads that is allocated to an up-front royalty paid by ADIC
`IO Crossroads in exchange for the license rights in the ‘972 Patent granted
`by Crossroads to ADIC under this Agreement. Pre-Paid Royalties shall be
`equal to ten million dollars ($10,000,000).
`
`2.
`
`Dismissal and Release
`
`As soon as reasonably possible after receipt of the Lump Sum Payment pursuant to
`Paragraph 4 of this Agreement, counsel for Crossroads will cause to be filed with the
`U.S. District Court of the Western District of Texas, Austin Division a consent judgment
`that includes (i) a request for dismissal with prejudice all claims and counterclaims in the
`Patent Litigation lawsuit and (ii) an acknowledgement by ADIC that the Accused
`Products infringe the ‘972 Patent and that the ‘972 Patent is valid and enforceable.
`Crossroads does hereby release ADIC, including its customers, dealers, distributors {to
`the extent such customers, dealers and distributors use, sell or import ADIC products),
`from all past and future claims for infringement, including contributory infringement and
`inducement of infringement, of the ’972 Patent.
`
`3.
`
`License of ‘972 Patent
`
`3.1
`
`3.2
`
`Upon receipt of payment pursuant to Paragraph 4 of this Agreement,
`Crossroads hereby grants and ADIC, including its customers, dealers,
`distributors (to the extent such customers, dealers and distributors use, sell
`or import ADIC products), hereby accepts a paid up, non-exclusive, non-
`sublicensable, perpetual license to and under the ‘972 Patent to make, use,
`sell. offer for sale and import Licensed Product(s).
`
`ADIC agrees that the license granted in Paragraph 3.1 shall not restrict in
`any way Crossroads’ use of the ‘972 Patent, or Crossroads’ manufacture,
`use, sale, offering for sale or importation of any product, service, process,
`or method covered by the claims of the ‘972 Patent, for its own purposes
`or in collaboration with third parties.
`
`4.
`
`Lump Sum Payment
`
`In consideration for Crossroads’ agreements set forth in this Agreement, including
`Paragraphs 2 and 3 above, ADIC will pay Crossroads the sum of fifieen million dollars
`($15,000,000) which represents the total of the Past Damages Payment and the Pre-paid
`Gray Cary\AU\406l426.6
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`Royalties. This sum shall be paid to Crossroads in a lump sum amount, and shall be paid
`by wire transfer upon the execution ofthis Agreement to Crossroads’ account as follows:
`
`Chase Manhattan Bank, NYC, NY
`
`ABA 02l00002l
`
`FBO SalornonSmithBamey A/C 066-198038
`
`for further credit to 781-06626-14-403
`
`The parties acknowledge and agree that the release contained in Paragraph 2 and the
`license grant contained in Paragraph 3 shall only become effective upon completion and
`acknowledgement of the wire transfer of the Lump Sum Payment into the above-
`identified account.
`
`5.
`
`Infringement by Others
`
`5.1
`
`5.2
`
`ADIC shall have no right to institute any lawsuit or action against any
`third party based on actual or potential infringement of the ‘972 Patent.
`
`Crossroads shall not be obligated to take any actions to prevent
`unauthorized use or infringement of the ‘972 Patent.
`
`6.
`
`Publicity
`
`ADIC and Crossroads will coordinate with respect to the timing of issuing their
`respective press releases announcing this settlement of the Patent Litigation so that such
`press releases are issued by each party at substantially the same time. Notwithstanding
`the foregoing, each party acknowledges and agrees that the other party may issue press
`releases and public announcements regarding the settlement of the Patent Litigation
`within twenty-four hours of the execution ofthe consentjudgment by the court. The
`parties acknowledge and agree that any such press releases or public announcements shall
`not contain any information that is inconsistent with this Agreement or the consent
`judgment.
`
`7.
`
`Acknowledgement of Infringement and Validity
`
`ADIC and Pathlight each will and hereby does acknowledge that the Accused Products
`are within the claims and therefore infringed the ‘972 Patent prior to this Agreement.
`ADIC and Pathlight will and hereby docs further acknowledge that the ‘972 Patent is
`valid and fully enforceable. ADIC stipulates to the consent judgment presented to the
`court by Crossroads in which ADIC (i) acknowledges the ‘972 Potent is valid and
`enforceable, and (ii) acknowledges that Accused Products infringe the ‘972 Patent.
`
`Gray Cary\AU\406l426.6
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`8.
`
`Negation of Warranties
`
`3.1
`
`Nothing in this Agreement is or shall be construed as:
`
`8.1.] A warranty or representation that anything made, used,
`sold, or otherwise disposed of under any license granted in
`this Agreement is or will be free from infringement of
`patents, copyrights, or other rights of third parties;
`
`8.1.2 An obligation to bring or prosecute actions or suits against
`third parties for infringement;
`
`8.1.3 Granting by implication, estoppel, or otherwise any
`licenses or rights under patents or other rights of
`Crossroads or other persons other than under the ‘972
`Patent, regardless of whether such patents or other rights
`are dominant or subordinate to the ‘972 Patent; or
`
`8,l.4 An obligation to furnish any technology, technological
`information or other support.
`
`8.2
`
`8.3
`
`Except as expressly set forth in this Agreement, CROSSROADS MAKES
`NO REPRESENTATIONS AND EXTENDS NO WARRANTIES OF
`ANY KIND, EITHER EXPRESS OR IMPLIED. THERE ARE NO
`EXPRESS OR IMPLIED WARRANTIES OF MERCHANTABILITY
`OR FITNESS FOR A PARTICULAR PURPOSE, OR THAT THE USE
`OF THE LICENSED PRODUCT(S) WILL NOT INFRINGE ANY
`PATENT, COPYRIGHT, TRADEMARK, OR OTHER RIGHTS OR
`ANY OTHER EXPRESS OR IMPLIED WARRANTIES.
`
`NEITHER PARTY SHALL BE LIABLE TO THE OTHER FOR ANY
`INDIRECT, SPECIAL, EXEMPLARY, PUNITIVE, CONSEQUENTIAL
`OR OTHER DAMAGES WHATSOEVER, WHETHER IN TORT,
`STRICT LIABILITY, CONTRACT OR OTHERWISE ARISING OUT
`OF THIS AGREEMENT. CROSSROADS SHALL NOT HAVE ANY
`RESPONSIBILITIES OR LIABILITIES WHATSOEVER WITH
`RESPECT TO THE LICENSED PRODUCTS.
`
`9.
`
`Indemnity
`
`ADIC agrees to indemnify, hold harmless, and defend Crossroads and its directors,
`officers, employees, and agents against any and all claims for death, illness, personal
`'
`'
`and improper business practices arising out of the manufacture,
`use, sale, offer for sale or other disposition of any Licensed Product or other tangible or
`intangible covered by the ‘972 Patent by ADIC or any of its customers, dealers or
`distributors.
`
`Gray
`Cary‘\AU\406I426.6
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`10. Marking
`
`ADIC agrees to mark Licensed Product(s) (or their containers or labels) within a
`reasonable time period which are made, used, sold, imported or otherwise disposed of by
`it under the license granted in this Agreement with the marking “US. Patent No.
`5,941 ,972”. Crossroads agrees that such marking by ADIC of the Licensed Products
`shall not require any specific reference to Crossroads.
`
`1].
`
`Names and Marks
`
`Each party agrees not to make any statements in any press releases, public
`announcements, promotional advertising or other promotional materials that expressly or
`implicitly indicate that the other party in any manner endorses or sponsors any such
`products or services. Each party further agrees not to use the name of any employee or
`any trademark, service mark, trade name, or symbol of the other party to market any
`product or service (other than comparative advertising in compliance with U.S. law)
`without such other party’s prior written consent.
`
`12.
`
`Tenn and Termination
`
`12.1
`
`The term of this Agreement shall be from the Effective Date until the
`expiration of the ‘972 Patent, unless earlier termination pursuant to this
`Paragraph 12.
`
`12.2
`
`Crossroads may terminate this Agreement if ADIC:
`
`12.2.1 Is in material breach of any provision hereof; or
`
`12.2.2 Voluntarily or involuntarily files a petition in bankruptcy or
`has a receiver appointed on its behalf.
`
`and ADIC fails to remedy any such breach or bankruptcy within thirty
`(30) days after written notice thereof by Crossroads.
`
`12.3 Any cause of action or claim of Crossroads having to do with any uncured
`breach or default by ADIC and the provisions of Paragraphs l, 7, 8 and 9
`shall survive the termination of this Agreement.
`
`13.
`
`Successors and Assignment
`
`ADIC may not assign this Agreement or any of its rights and obligations herein.
`Notwithstanding the foregoing, the rights granted to ADIC, including the license in
`Paragraph 3 above, may be assigned by ADIC to any successor in interest in ADIC’s
`storage network business, including purchasers of substantially all the assets relating to
`the production or sale ofthe accused products lines in the Patent Litigation, provided,
`however, that the benefits of the license granted in Paragraph 3.1 shall inure to such
`successor in interest only in connection with the products and assets purchased from
`
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`ADIC and the natural expansion thereof, and the license would not apply to any pre-
`existing products, services or liabilities of such successor in interest or any products,
`services or liabilities developed independently of the purchased business. , Upon such
`permitted assignment, ADIC shall become unlicensed under the ‘972 Patent. Any
`attempted assignment in derogation of the foregoing shall be void. This Agreement shall
`be binding upon and inure to the benefit of the parties, permitted assigns and legal
`representatives.
`
`14.
`
`Notices
`
`All notices under this Agreement shall be deemed to have been fully given when done in
`writing and deposited in the United States mail, registered or certified, and addressed as
`follows:
`
`To CROSSROADS:
`Crossroads Systems, Inc.
`8300 N. MoPac Expressway
`Austin, TX 78759
`Attention: General Counsel
`
`To ADIC:
`
`Advanced Digital Information Corporation
`11431 Willows Road NE.
`Redmond, WA 98052
`Attention: General Counsel
`
`Either party may change its address upon written notice to the other party.
`
`15.
`
`Relationship of Parties
`
`Nothing in this Agreement shall be construed as creating a partnership, joint venture, or
`agency relationship between the parties, or as authorizing either party to act as agent for
`the other.
`
`16.
`
`Entire Agreement; Modifications
`
`This Agreement constitutes the entire agreement between the parties with respect to the
`subject matter hereof and supersedes all prior negotiations and agreements, whether
`written or oral. This Agreement may not be altered or amended except by an instrument
`in writing executed by both parties. No waiver of or amendment to any ofthe terms
`hereof subsequent to the execution hereof claimed to have been made by any
`representative of either party shall have force or effect unless in a writing signed by duly
`authorized representatives of the parties.
`
`Gray Cary\AU\406|426.6
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`17.
`
`Construction
`
`The language of this Agreement shall be construed as a whole according to its fair
`meaning, and not strictly for or against either of the parties.
`
`18.
`
`Governing Law
`
`This Agreement will be governed by the laws of the State of Texas.
`
`19.
`
`Inndmissibility of Payment Terms
`
`The parties acknowledge and agree that the lump sum payment (the Pre-paid Royalties
`and Past Damages Payment) shall not be used by either party against the other in any
`future litigation or arbitration for the purpose of establishing a “reasonable royalty” rate.
`Notwithstanding the foregoing, and unless Crossroads provides contrary instructions, the
`parties agree that Vis-£1-via third parties, the lump sum payment (the Pre~paid Royalties
`Past Damages Payment) shall be considered a reasonable royalty rate for a license of the
`‘972 Patent.
`
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`Crossroads Systems, Inc.
`
`
`
`Name: Brian Smith
`
`Its: Chairman and Chief Executive Officer
`
`Date: June, 12, 2001
`
`Advanced Digital Information Corporation
`
`
`
`By:
`
`Name: Linda Schoemaker
`
`Its: Senior Vice President and General
`Counsel
`
`Date: June, 12,2001
`
`Gray Cary\AU\406I426.6
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`Crossroads Systems, Inc.
`
`Dy.
`
`Name: Brian Smith
`
`Its: Chairman and Chief Executive Officer
`
`Date: June, 12, 2001
`
`Advanced Digital Information Corporation
`I
`
`Name: Linda Schoemaker
`
`Its: Senior Vice President and General
`Counsel
`
`Date: June, 12, 2001
`
`Gray Cary\AU\A061426,6
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`SETTLEMENT AND LICENSE AGREEMENT
`
`This Settlement and License Agreement (“Agreement”) sets forth the terms upon which
`Crossroads Systems,
`Inc., a Delaware Corporation, and all
`its subsidiaries and affiliates
`(“Crossroads”) and Dot Hill Systems Corp., a Delaware corporation, and all its subsidiaries and
`affiliates (“Dot Hill”), agree to settle the litigation pending before the U.S. District Court of the
`Western District of Texas, Austin Division (the “Court”), captioned Crossroads Systems,
`(Texas), Inc., Plaintiff V. Dot Hill Systems Corporation, Defendant, Case No. A-03-CV—754-SS
`(“Patent Litigation”). Crossroads and Dot Hill are individually referred to in this Agreement as
`a “Party” and collectively as the “Parties.” This Agreement shall be effective as of June 27,
`2006 (“Effective Date”). if
`
`BACKGROUND
`
`Crossroads is the owner of the ‘972 Patent Family. Crossroads filed the Patent Litigation
`alleging the Accused Products infringe US. Patent Nos. 5,941,972 and 6,425,035 and
`demanding judgment against Dot Hill.
`It is now the desire and intention of Crossroads and Dot
`Hill to settle and resolve all disputes, differences and claims which exist in the Patent Litigation.
`
`1 In consideration of the mutual promises contained herein, and other good and valuable
`consideration,
`the adequacy of which is hereby acknowledged,
`the Parties hereto agree as
`follows:
`
`I .
`
`0
`
`DEFINITIONS.
`
`“’972 Patent Family” means U.S. Patent Nos. 5,941,972, 6,763,419,
`1.1
`6,738,854, 6,425,036, and 6,425,035, and any other U.S. patents, U.S. patent applications or
`foreign counterparts which claim priority to any of the foregoing patents or to any applications
`from which any of the foregoing patents issued,
`including all
`reissues,
`reexaminations,
`divisionals, continuations, continuations—in-part, and extensions of any of the foregoing issued
`patents or pending patent applications.
`
`1.2 . “Accused Products” means the products accused by Crossroads of
`infringement in the Patent Litigation as of June 5, 2006, that perform RAID including without
`limitation the following: SANnet II PC, SANnet II SATA, SANnet II SATA Special Edition,
`SANnet I 7000 Series (including without limitation SANnet I 7124 and SANnet I 7128), SANnet
`I 4000 Series (including without limitation SANnet I 4300, SANnet I 4200, SANnet I 4210, and
`SANnet I 4220), RIO (including without limitation RIO Xtreme Storage Server, RIO RAID eXp
`R3200/RFF244 and RIO RAID eXp R3400/RFF28 8), RIVA (including without limitation RIVA
`I and RIVA FC R2500), and the following products in the StratisRAID Series, StratisRAID
`SRFl12, StratisRAID SRF2l2, StratisRAID SRFII6-01, StratisRAID SRF116—22, StratisRAID
`SRFZI6-01 and Stratis_RAID SRF216—23.
`'
`
`including
`“Extraterratorial Products” means Dot Hill products,
`1.3
`Accused Products, Sold to a Third Party located outside the United States that are (i)
`manufactured by or on behalf of Dot Hill entirely outside of the United States, (ii) shipped to a
`location outside the United States without entering the United States (iii) at no time subsequently
`
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`imported, shipped or delivered into the United States, and (iv) are covered by the ‘972 Patent
`Family.
`
`“JBOD” has its ordinary meaning as understood in the storage industry,
`1.4
`including “just a bunch of disks.”
`
`“Licensed Product(s)” means any product manufactured by or for Dot
`1.5
`Hill, based on designs or specifications created by Dot Hill, and which is Sold by Dot Hill, that is
`covered by any claim of any patent in the ‘972 Patent Family. A JBOD, in and of itself, is not a
`Licensed Product. Accused Products, follow-on products based on those Accused Products, and
`Accused Products that have undergone a name change shall be Licensed Products provided such
`products contain the same functionality as the functionality in the Accused Products as of the
`Effective Date.
`
`1.6
`
`“License” means
`
`the license grant
`
`from Crossroads described in
`
`Paragraph 4. l.
`
`“Net Sales” means the gross revenues received by Dot Hill from the Sale
`1.7
`of Licensed Products less sales and/or use taxes actually paid, import and/or export duties
`actually paid, outbound transportation prepaid or allowed, other similar types of expenses typical
`in the storage industry, rebates and cash discounts, and amounts allowed or credited due to
`returns (not to exceed the original billing or invoice amount).
`
`“RAID” has its ordinary meaning as understood in the storage industry,
`1.8
`including the following RAID levels: RAID 0 (striping), RAID l(mirroring), RAID 2 (Error—
`Correcting Coding), RAID 3 (Bit—Interleaved Parity), RAID 4 (Dedicated Parity Drive), RAID 5
`(Block Interleaved Distributed Parity), RAID 6 (Independent Disk With Double Parity), RAID
`0+1 (Mirror of Stripes), RAID l0 (Stripe of Mirrors), RAID 7 (Storage Computer Corporation
`proprietary), RAID S (EMC proprietary) and to-be developed RAID levels.
`
`1.9
`
`“Release” means the release by Crossroads as described in Paragraph 3.1.
`
`“Sale or Sold” means the transfer, distribution or disposition of a
`1.10
`Licensed Product for value to a Third Party.
`
`“Third Party” means any individual, group of individuals, corporation,
`l.ll
`partnership, joint venture, trust, association, unincorporated organization, governmental body or
`any entity of any kind or nature other than Dot Hill and Crossroads, provided, however, that a
`Party changing its name shall remain a Party for purposes of this Agreement.
`
`Attorneys‘ Eyes Only
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`DISMISSAL. Upon actual receipt by Crossroads of payment as set forth in
`2.
`Paragraph 5.1, Crossroads shall file with the Court a request for dismissal of all claims and
`counterclaims in the Patent Litigation by filing the Stipulation and Order of Dismissal attached
`hereto as Exhibit A. Each Party will appear in court, perform all acts, sign all necessary
`documents and cooperate with one another as necessary to facilitate the dismissal of the claims.
`
`3.
`
`RELEASES.
`
`Release of Dot Hill. Subject to actual receipt by Crossroads of payment
`3.1
`as set forth in Paragraph 5.1, Crossroads, with the intention of binding itself,
`its affiliates,
`successors and assigns, does hereby irrevocably release, forever discharge, and agrees not to
`assert or assist any third party in asserting any action, claim, liability or demand (“Crossroads
`Claims”) against Dot Hill, and its affiliates,
`successors, directors, officers, employees,
`predecessors, successors, customers (but only with respect to Licensed Products ), and agents,
`from any and all Crossroads Claims Crossroads had or may have had on or before the Effective
`Date arising out of or relating to infringement of any of the ‘972 Patent Family based on the
`manufacture, having manufactured, use, sale, marketing, offer for sale, lease, licensing, export,
`design, development, distribution, importation, or other disposition of the Licensed Products,
`including all claims asserted by Crossroads in the Patent Litigation. Such release shallpertain to
`Crossroads Claims whether now known or unknown. Notwithstanding the foregoing and except
`as provided herein, the Release granted in this Paragraph 3.1 shall not extend to any claims,
`damages and/or liability Crossroads has or may have arising out of or relating to any products,
`processes, designs, methodologies or technology acquired by Dot Hill, its affiliates or successors
`after the Effective Date, including Without limitation as part of the acquisition of a Third Party or
`the acquisition of any asset(s) of a Third Party.
`
`Release of Crossroads. Dot Hill, with the intention of binding itself, its
`3.2
`affiliates, successors and assigns, does hereby irrevocably release and forever discharge and
`agrees not to assert or assist any third party in asserting any action, claim, liability or demand
`(“Dot Hill Claims”) against Crossroads, and its affiliates, successors, directors, officers,
`employees, predecessors, successors, customers (only to the extent that such customers have
`used or sold products purchased from Crossroads) and agents, from any and all Dot Hill Claims
`Dot Hill had or may have had on or before the Effective Date arising out of or relating to the
`‘972 Patent Family, including all claims asserted by Dot Hill in the Patent Litigation. Such
`release shall pertain to Dot Hill Claims whether now known or unknown.
`
`Release of Vendors of Dot Hill. Crossroads hereby releases lnfortrend
`3.3
`Technology, inc. and Solectron Corporation (and/or any other third party manufacturers used by
`Dot Hill) (collectively, “Vendors”) from any liability for any infringement of any of the ‘972
`Patent Farnily, either direct or indirect, based on sales by such Vendors of components to Dot
`Hill that were used in any Accused Product sold prior to the Effective Date, however, such
`release is limited expressly to sales of Vendor components by such Vendors where the
`components were actually used in Accused Products. Crossroads also releases such Vendors
`from any liability for selling any component to Dot Hill that is actually used by Dot Hill in any
`Licensed Product, manufacturing any component of any Licensed Product for Dot Hill or
`manufacturing any Licensed Product for Dot Hill for which Dot Hill has paid the royalty
`pursuant to Paragraph 5.2 hereof. The Vendor release in this Paragraph 3.3 is limited to sales to
`
`3
`
`L
`_ \°
`K-)\{6>
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`Dot Hill only and does not in any way operate to release such Vendors from any liability for
`patent infringement for sales to any party other than Dot Hill. Furthermore, the release in this
`Paragraph 3.3 does not provide any release of liability beyond that of patent infringement with
`respect to the ‘972 Patent Family for sales of components to Dot Hill as described in this
`Paragraph 3.3. Additionally, the parties acknowledge and agree that the release in this Paragraph
`3.3 only arises for Vendor components in Licensed Products upon payment by Dot Hill of the
`royalty due pursuant to Paragraph 5.2 upon the Sale of such Licensed Product, and further that
`the release in this Paragraph 3.3 does not in any way operate, under any theory of law including
`contract or patent law, to relieve Dot Hill from its obligations to pay the royalty pursuant to
`Paragraph 5.2 of this Agreement (e. g., the release in this Paragraph 3.3 of Infortrend for the sale
`of a component to Dot Hill used in a Licensed Product cannot release Dot Hill from its
`obligation to pay Crossroads the royalty defined in Paragraph 5.2 of this Agreement upon the
`subsequent Sale of such Licensed Product and does not arise until Dot Hill pays such royalty).
`Dot Hill agrees that this Paragraph 3.3 represents the confidential information of Crossroads and
`further agrees not to disclose the terms of this Paragraph 3.3 to any Third Party, unless required
`to disclose such information in response to a Valid order by a court or as otherwise required by
`law.
`
`— California -Civil Code. Each party waives all rights under Section 1542
`3.4
`of the California Civil Code as such rights may relate to any Claims. Each party acknowledges
`that it has consulted with legal counsel regarding the import of Section l542 of the California
`Civil Code, which provides as follows:
`
`A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE
`CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT
`
`THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM,
`MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE
`DEBTOR.
`
`4.
`
`LICENSE GRANT.
`
`Crossroads License Grant. Subject to actual receipt by Crossroads of
`4.l
`payment as set forth in Paragraph 5 of this Agreement, Crossroads hereby grants to Dot Hill a
`non—exclusiVe, personal, non—sublicensable, non—transferable, non-assignable (except as provided
`herein), indivisible, worldwide, royalty-bearing license under the ‘972 Patent Family to make,
`have made (for Dot Hill only), use, lease, license, design, develop, distribute, market, sell, offer
`for sale, export, import and otherwise dispose of Licensed Products, as well as to make, use or
`perform any method or process claimed in the ’972 Patent Family after the Effective Date. Dot
`Hill acknowledges and agrees that it has only the patent license rights granted in the License and
`that all other rights are expressly reserved to Crossroads.
`
`After—Acquired Products. The License shall not apply to any products,
`4.2
`processes, designs, methodologies or technology acquired by Dot Hill,
`its affiliates and
`successors after the Effective Date, including without limitation as part of the acquisition of a
`Third Party or the acquisition of any asset(s) of a Third Party, covered by any claim of the ‘972
`‘ Patent Family that was made, used, sold, offered for sale or imported by the Third Party prior to
`the date acquired by Dot Hill.
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`this Agreement by
`No license is granted under
`Combinations.
`4.3
`to any Third Parties
`Crossroads, either directly or by implication, estoppel or otherwise,
`acquiring items from Dot Hill for the combination of such acquired items with other item(s),
`where the use, manufacture, sale, offer for sale or import of such combination infringes any
`claim of the ‘972 Patent Family based on the other item. For purposed of clarity, if a Third Party
`combines a product from Dot Hill that is covered by the License with another item, such
`combination is covered by the License as long as such other item does not independently infringe
`the ‘972 Patent Family.
`
`No Challenges. For as long as the License remains in effect, Dot Hill
`4.4
`agrees that it will not challenge, participate in any challenge to, or aid any Third Party in
`challenging the validity or enforceability of any patent in the ‘972 Patent Family, except as
`required by subpoena, by law, or by any governmental or regulatory authority.
`If this license is
`terminated for any reason, including, but not limited to those reasons set forth in paragraph 8.2
`below, Dot Hill expressly reserves the right to challenge the validity and enforceability of any of
`the patents in the ‘972 Patent Family.
`
`shall have no obligation
`Crossroads
`No Obligation to Enforce.
`4.5
`hereunder to institute any action or suit against any Third Party for infringement of any patent
`within the ‘972 Patent Family or to defend any action or suit brought by a Third Party which
`challenges or concerns the validity or enforceability of any such patent.
`In addition, Dot Hill
`shall have no right to institute any action or suit against Third Parties for infringement of any
`patent in the ‘972 Patent Family.
`
`No Restriction. Dot Hill agrees that the License shall in no way restrict
`4.6
`Crossroads’ use of the ‘972 Patent Family, or Crossroads’ manufacture, use, sale, offering for
`sale or importation of any product, service, process, or method covered by the claims of the ‘972
`Patent Family, for its own purposes or in collaboration with Third Parties.
`
`No Patent Laundering. Dot Hill agrees that the License is not intended
`4.7
`to and does not cover manufacturing activities that Dot Hill may undertake (either itself or by
`another under the have made grant in Paragraph 4.1) on behalf of any Third Party for the purpose
`of providing such Third Parties with coverage under the patent license granted by Crossroads to
`Dot Hill in this Agreement. The provisions of this Paragraph 4.7 shall not limit Dot Hill’s ability
`to manufacture products on behalf of its OEM customers, for the purpose of providing such
`OEM customers with private-label versions of products primarily designed and manufactured by
`Dot Hill, and, subject to all other duties and obligations of this Agreement, including without
`limitation Paragraph 4.3, such manufacture or sales shall continue to be covered by the License if
`applicable.
`
`5.
`
`FEES.
`
`Dot Hill will pay Crossroads a non-refundable
`Up Front Payment.
`5.1
`payment of ten million, five hundred thousand United States dollars ($10,500,000). Dot Hill’s
`payment obligation under this Paragraph 5.1 shall become due and payable within twenty (20)
`days. of the Effective Date. Part of the payment may be made by a Third Party on Dot Hill’s
`behalf, provided, however, that failure by any such Third Party to provide payment within the
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`required time frame of this Paragraph 5.1 shall be a breach of this Agreement by Dot Hill and
`shall provide Crossroads a basis to terminate pursuant to Paragraph 8.2. Dot Hill anticipates that
`of the $lO.5M payment obligation under this Paragraph 5.1, Dot Hill shall pay Crossroads
`$3.35M and a Third