Exhibit 10.13

 

LOGO [g92114crossrd.jpg]

 

[Date]

 

[Name]

RE: Severance Benefit Plan

 

Dear                                 :

 

We are pleased to inform you that the Company’s Board of Directors has approved
a special severance benefit program for you. The purpose of this letter
agreement is to set forth the terms and conditions of your severance benefits
and to explain the limitations that will govern their overall value.

 

Your severance package will become payable should your employment terminate
under certain circumstances including certain terminations following a
substantial change in ownership or control of the Company. To understand the
full scope of your benefits, you should familiarize yourself with the
definitional provisions of Part One of this letter agreement. The benefits
comprising your severance package are detailed in Part Two, and the dollar
limitations on the overall value of your benefit package and other applicable
restrictions are specified in Parts Three and Four, respectively. Part Five
deals with ancillary matters affecting your severance arrangement.

 

PART ONE — DEFINITIONS

 

For purposes of this letter agreement, the following definitions will be in
effect:

 

Base Salary means the monthly rate of base salary in effect for you at the time
of your Involuntary Termination. In the event of your Involuntary Termination
following a Change in Control, Base Salary means the greater of your monthly
base salary immediately prior to the Change in Control or the monthly rate of
base salary in effect at the time of your Involuntary Termination.

 

Board means the Company’s Board of Directors.

 

Change in Control means a change in the ownership or control of the Company
effected through any of the following transactions:

 

(i) a merger, consolidation or reorganization approved by the Company’s
stockholders, unless securities representing more than fifty percent (50%) of
the total combined voting power of the voting securities of the successor
corporation are immediately thereafter beneficially owned, directly or
indirectly and in substantially the

 

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same proportion, by the persons who beneficially owned the Company’s outstanding
voting securities immediately prior to such transaction,

 

(ii) any stockholder-approved sale, transfer or other disposition of all or
substantially all of the Company’s assets,

 

(iii) the acquisition, directly or indirectly, by any person or related group of
persons (other than the Company or a person that directly or indirectly
controls, is controlled by or is under common control with, the Company) of
beneficial ownership (within the meaning of Rule 13d-3 of the Securities
Exchange Act of 1934, as amended) of securities possessing more than fifty
percent (50%) of the total combined voting power of the Company’s outstanding
securities pursuant to a tender or exchange offer made directly to the Company’s
stockholders; or

 

(iv) a change in the composition of the Board over a period of thirty-six (36)
consecutive months or less such that a majority of the Board members ceases, by
reason of one or more contested elections for Board membership, to be comprised
of individuals who either (A) have been Board members continuously since the
beginning of such period or (B) have been elected or nominated for election as
Board members during such period by at least a majority of the Board members
described in clause (A) who were still in office at the time the Board approved
such election or nomination.

 

Code means the Internal Revenue Code of 1986, as amended.

 

Common Stock means the Company’s common stock.

 

Company means Crossroads Systems, Inc., a Delaware corporation, or any successor
corporation, whether or not resulting from a Change in Control.

 

Disability means your inability to perform the normal and usual duties of your
position with the Company by reason of any physical or medical impairment which
is expected to result in death or continue for a period of twelve (12)
consecutive months or more.

 

Fair Market Value means, with respect to the shares of Common Stock subject to
any of your Options, the closing selling price per share of Common Stock on the
date in question, as such price is reported by the National Association of
Securities Dealers on the Nasdaq National Market and published in The Wall
Street Journal. If there is no closing selling price reported for the Common
Stock on the date in question, then the Fair Market Value will be the closing
selling price on the last preceding date for which such report exists.

 

Health Care Coverage means the continued coverage to which you and your eligible
dependents may become entitled under the Company’s health care plans pursuant to
the severance benefit provisions of Part Two of this letter agreement.

 

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Incentive Stock Option means an option which satisfies the requirements of Code
Section 422.

 

Involuntary Termination means (i) the involuntary termination of your employment
with the Company other than a Termination for Cause or (ii) your voluntary
resignation within six (6) months following (A) a change in your position with
the Company which materially reduces your duties and responsibilities or the
level of management to which you report, (B) a reduction in your level of
compensation (including Base Salary, fringe benefits and target bonus under any
corporate-performance based bonus or incentive programs) by more than fifteen
percent (15%) with the exception of compensation reductions that are applied to
all executive officers of the Company or (C) a relocation of your principal
place of employment by more than fifty (50) miles.

 

An Involuntary Termination will not be deemed to occur in the event your
employment terminates by reason of your death or Disability or a Termination for
Cause.

 

Option means any outstanding option you hold under the Plan at the time of your
Involuntary Termination. For purposes of this Agreement, your Options will be
divided into two (2) separate categories as follows:

 

Acquisition-Accelerated Options: any outstanding Option (or installment thereof)
which automatically accelerates, pursuant to the acceleration provisions of the
agreement evidencing that Option, upon a Change in Control.

 

Severance-Accelerated Options: any outstanding Option (or installment thereof)
which, pursuant to Part Two of this letter agreement, accelerates upon an
Involuntary Termination.

 

Option Parachute Payment means, with respect to any Acquisition-Accelerated
Option or any Severance-Accelerated Option, the portion of that Option deemed to
be a parachute payment under Code Section 280G and the Treasury Regulations
issued thereunder. The portion of such Option which is categorized as an Option
Parachute Payment will be calculated in accordance with the valuation provisions
established under Code Section 280G and the applicable Treasury Regulations and
will include an appropriate dollar adjustment to reflect the lapse of your
obligation to remain in the Company’s employ as a condition to the vesting of
the accelerated installment. In no event, however, will the Option Parachute
Payment attributable to any Acquisition-Accelerated Option or
Severance-Accelerated Option (or accelerated installment) exceed the spread (the
excess of the Fair Market Value of the accelerated option shares over the option
exercise price payable for those shares) existing at the time of acceleration.

 

Other Parachute Payment means any payment in the nature of compensation (other
than the benefits to which you become entitled under Part Two of this letter
agreement) which are made to you in connection with the Change in Control and
which accordingly qualify as parachute payments within the meaning of Code
Section 280G(b)(2) and the Treasury Regulations issued thereunder. Your Other
Parachute Payment will include (without limitation) the Present Value, measured
as of the Change in Control, of the Stock Bonus Parachute Payment

 

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and the aggregate Option Parachute Payment attributable to your
Acquisition-Accelerated Options (if any).

 

Parachute Payment means any payment or benefit provided you under Part Two of
this letter agreement (other than the Option Parachute Payment attributable to
your Severance-Accelerated Options) which is deemed to constitute a parachute
payment within the meaning of Code Section 280G(b)(2) and the Treasury
Regulations issued thereunder.

 

Plan means (i) the Company’s 1996 Stock Option/Stock Issuance Plan, (ii) the
Company’s 1999 Stock Incentive Plan, as amended or restated from time to time,
and (ii) any successor stock incentive plan subsequently implemented by the
Company.

 

Present Value means the value, determined as of the date of the Change in
Control, of any payment in the nature of compensation to which you become
entitled in connection with the Change in Control or your subsequent Involuntary
Termination, including (without limitation) the Option Parachute Payment
attributable to your Severance-Acceleration Options, the additional benefits to
which you become entitled under Part Two of this letter agreement, the Stock
Bonus Parachute Payment attributable to your Stock Bonus and the Option
Parachute Payment attributable to your Acquisition-Accelerated Options. The
Present Value of each such payment will be determined in accordance with the
provisions of Code Section 280G(d)(4), utilizing a discount rate equal to one
hundred twenty percent (120%) of the applicable Federal rate in effect at the
time of such determination, compounded semi-annually to the effective date of
the Change in Control.

 

Severance Period means the number of months for which you will receive severance
payments pursuant to Paragraph A.2 of Part Two of this letter agreement.

 

Stock Bonus means the stock bonus payment you become entitled to upon a Change
in Control as described in Paragraph B of Part Two of this letter agreement.

 

Stock Bonus Parachute Payment means, with respect to the Stock Bonus payment,
the portion of those shares deemed to be a parachute payment under Code Section
280G and the Treasury Regulations issued thereunder. The amount of such
parachute payment will be calculated in accordance with the valuation provisions
established under Code Section 280G and the applicable Treasury Regulations and
will include an appropriate dollar adjustment to reflect the lapse of your
obligation to remain in the Company’s employ as a condition to the vesting of
the stock.

 

Termination for Cause means the Company’s termination of your employment for any
of the following reasons: (i) your commission of any act of fraud, embezzlement
or dishonesty, (ii) your unauthorized use or disclosure of any confidential
information or trade secrets of the Company, (iii) any intentional misconduct by
you, whether by omission or commission, which has an adverse effect upon the
Company’s business or affairs as determined in the sole discretion of the
Company’s Board of Directors, (iv) your breach of the Company’s Confidentiality,
Proprietary Information and Inventions Agreement, (v) your continued failure to
perform the major duties, functions and responsibilities of your position after
written notice from the

 

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Company identifying the deficiencies in your performance and a reasonable cure
period of not less than thirty (30) days.

 

PART TWO – TERMINATION/CHANGE IN CONTROL BENEFITS

 

Your benefits under this Part Two will in all events be subject to the benefit
limitations of Part Three and the restrictive covenants of Part Four of this
letter agreement and will be in lieu of all other severance benefits to which
you might otherwise be entitled upon termination of your employment.

 

A. Severance Benefits Upon An Involuntary Termination Prior To A Change In
Control.

 

Should your employment with the Company terminate by reason of an Involuntary
Termination at any time prior to and not in connection with a Change in Control,
you will become entitled to receive the following severance benefits, provided
you execute and deliver to the Company, at the time of such Involuntary
Termination, a General Release in substantially the form of attached Exhibit A:

 

1. Accelerated Vesting of Outstanding Options Upon an Involuntary Termination.

 

Each outstanding Option which you hold at the time of your Involuntary
Termination, to the extent not otherwise exercisable for all the shares of
Common Stock subject to that Option as fully vested shares, will immediately
vest and become exercisable for the number of additional shares in which you
would have vested had you remained in the Company’s employ for a period of
twelve (12) months following the Involuntary Termination. Each such accelerated
Option will remain exercisable until the earlier of (x) the expiration of the
option term or (y) the end of the six (6)-month period following the date of
your Involuntary Termination. Any Options not exercised prior to the expiration
of the applicable post-service exercise period will lapse and cease to remain
exercisable. As a result of the extension of the post-termination exercise
periods for Options outstanding on the date of this agreement, those Options, to
the extent designated as Incentive Options, will no longer be treated as
Incentive Options for Federal tax purposes; instead, such Options will be
treated as Non-Statutory Options for Federal tax purposes and accordingly you
will recognize ordinary income upon exercise of such Options. All such income
will be subject to applicable income and employment withholding taxes.

 

2. Severance Payment.

 

Following your Involuntary Termination, you will receive severance payments from
the Company equal to your monthly rate of Base Salary for a period of one (1)
month plus an additional month for each completed quarter of service to the
Company measured from June 22, 1998 (the date of your hire) up to a maximum of
twelve (12) months. The salary continuation payments shall be paid to you in
equal installments following your Involuntary Termination in accordance with the
Company’s normal payroll practices and subject to all

 

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applicable withholding taxes. The payments will immediately terminate in the
event you fail to abide by the restrictive covenants set forth in Part Four of
this letter agreement.

 

3. Health Care Coverage.

 

The Company will, at its expense, continue to provide you and your eligible
dependents with the Company’s paid portion of health care coverage under the
Company’s medical/dental plan until the earlier of (i) the expiration of that
number of months equal to one-half of the Severance Period measured from the
first day of the first month following the effective date of your Involuntary
Termination or (ii) the first date that you are covered under another employer’s
health benefit program which provides substantially the same level of benefits
without exclusion for pre-existing medical conditions. Such Health Care Coverage
will be in lieu of any other continued health care coverage to which you or your
dependents would otherwise be entitled at your own cost under Code Section 4980B
by reason of your termination of employment.

 

B. Accelerated Vesting Of Stock Bonus Upon A Change In Control

 

In accordance with the terms of the 2003 Stock Bonus Plan specified in the
letter dated November 4, 2002 (the “Stock Bonus Letter”), immediately following
the effective date of a Change in Control (as such term is defined in the Stock
Bonus Letter), you will be entitled to receive the shares of Common Stock under
your stock bonus grant. This payment will be made provided you remain an
employee of the Company through the effective date of such Change in Control.
Upon the Change in Control, you will recognize taxable income equal to the fair
market value of the shares which vest at such time; all such income will be
subject to the applicable income and employment withholding taxes.

 

C. Accelerated Vesting of Outstanding Options Upon An Involuntary Termination In
Connection With A Change in Control.

 

Should your employment with the Company terminate by reason of an Involuntary
Termination (i) immediately prior to and in connection with, (ii) upon or (iii)
within the twelve (12) months following a Change in Control, provided you
execute and deliver to the Company, at the time of such Involuntary Termination,
a General Release in substantially the form of attached Exhibit A, each
outstanding Option which you hold upon the effective date of your Involuntary
Termination, to the extent not otherwise exercisable for all the shares of
Common Stock subject to that Option as fully vested shares, will immediately
vest in full and become exercisable. Each such accelerated Option will remain
exercisable until the earlier of (x) the expiration of the option term or (y)
the end of the six (6)-month period following the date of your Involuntary
Termination. Any Options not exercised prior to the expiration of the applicable
post-service exercise period will lapse and cease to remain exercisable. As a
result of the extension of the post-termination exercise periods for Options
outstanding on the date of this agreement, those Options, to the extent
designated as Incentive Options, will no longer be treated as Incentive Options
for Federal tax purposes; instead, such Options will be treated as Non-Statutory
Options for Federal tax purposes and accordingly you will recognize ordinary
income

 

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upon exercise of such Options. All such income will be subject to applicable
income and employment withholding taxes.

 

PART THREE — LIMITATION ON BENEFITS

 

A. Benefit Limit.

 

The aggregate Present Value (measured as of the Change in Control) of the
benefits to which you become entitled under Part Two at the time of your
Involuntary Termination, namely, the salary continuation payments, the Option
Parachute Payment attributable to your Severance-Accelerated Options and your
Health-Care Coverage, will in no event exceed in amount the dollar amount (the
“Benefit Limit”) which yields you the greatest after-tax amount of benefits
under Part Two of this letter agreement after taking into account any excise tax
imposed under Code Section 4999 on the payments and benefits which are provided
you under Part Two or which constitute Other Parachute Payments.

 

The Stock Bonus Parachute Payment and the Option Parachute Payment attributable
to the accelerated vesting of your Acquisition-Accelerated Options (if any) at
the time of the Change in Control shall also be subject to the Benefit Limit.

 

For purposes of applying the Benefit Limit to your benefits under Part Two, the
value of your non-competition covenant under Part Four of this letter agreement
shall be determined through independent appraisal by a nationally-recognized
independent accounting firm acceptable to both you and the Company and obtained
solely at the Company’s cost, and a portion of your Part Two benefits shall, to
the extent of such appraised value, be specifically allocated as reasonable
compensation for your non-competition covenant.

 

B. Resolution Procedure.

 

In the event there is any disagreement between you and the Company as to whether
one or more payments to which you become entitled in connection with either the
Change in Control or your subsequent Involuntary Termination constitute
Parachute Payments, Option Parachute Payments or Other Parachute Payments or as
to the determination of the Present Value of any of those payments, such dispute
will be resolved as follows:

 

(i) In the event temporary, proposed or final Treasury Regulations in effect at
the time under Code Section 280G (or applicable judicial decisions) specifically
address the status of any such payment or the method of valuation therefor, the
characterization afforded to such payment by the Regulations (or such decisions)
will, together with the applicable valuation methodology, be controlling.

 

(ii) In the event Treasury Regulations (or applicable judicial decisions) do not
address the status of any payment in dispute, the matter will be submitted for
resolution to independent tax counsel mutually acceptable to you and the Company
(“Independent Counsel”). The resolution reached by Independent Counsel will be
final and controlling; provided, however, that if in the judgment of Independent
Counsel the status of the payment in dispute can be

 

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resolved through the obtainment of a private letter ruling from the Internal
Revenue Service, a formal and proper request for such ruling will be prepared
and submitted by Independent Counsel, and the determination made by the Internal
Revenue Service in the issued ruling will be controlling. All expenses incurred
in connection with the retention of Independent Counsel and (if applicable) the
preparation and submission of the ruling request will be shared equally by you
and the Company.

 

(iii) In the event Treasury Regulations (or applicable judicial decisions) do
not address the appropriate valuation methodology for any payment in dispute,
the Present Value thereof will, at the Independent Counsel’s election, be
determined through an independent third-party appraisal, and the expenses
incurred in obtaining such appraisal will be shared equally by you and the
Company.

 

C. Status of Benefits.

 

(i) No benefits shall be provided you under Part Two of this letter agreement
(including the accelerated vesting of your outstanding Options, the salary
continuation payments and the Company-paid Health Care Coverage) until the
Present Value of the Option Parachute Payment attributable to both your
Severance-Accelerated Options and your Acquisition-Accelerated Options and the
Stock Bonus Payment has been determined and the status of any payments in
dispute under Paragraph 2 above has been resolved in accordance therewith. The
post-service exercise period in effect for your Options shall be stayed and
shall not run until the resolution process hereunder is completed.

 

(ii) Once the requisite determinations under Paragraph 2 have been made, then to
the extent the aggregate Present Value, measured as of the Change in Control, of
(i) the Option Parachute Payment attributable to your Severance-Accelerated
Options (or installments thereof) plus (ii) the Parachute Payment attributable
to your other benefit entitlements under Part Two of this letter agreement
would, when added to the Present Value of all your Other Parachute Payments
(including the Stock Bonus Parachute Payment and the Option Parachute Payment
attributable to your Acquisition-Accelerated Options), exceed the Benefit Limit,
first your salary continuation payments will be reduced and then the period of
your Company-paid Health Care Coverage will be shortened, to the extent
necessary to assure that such Benefit Limit is not exceeded. To the extent such
Benefit Limit is still exceeded following such reductions, then the number of
shares for which your Options are to vest on an accelerated basis pursuant to
Part Two (based on the amount of the Option Parachute Payment attributable to
each Option) shall be reduced to the extent necessary to eliminate such excess.

 

PART FOUR — SPECIAL RESTRICTIVE COVENANTS

 

Your entitlement to your salary continuation payments and Company-paid Health
Care Coverage under this letter agreement will immediately cease, should you:

 

(i) render, anywhere in the United States, any services or provide any advice or
assistance to any Competing Business, whether as an employee, consultant,
partner, principal, agent, representative, equity holder or in any other
capacity, without the express prior written consent of the Company. However,
nothing in Part Four, subpart

 

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1(a) will limit your making any passive investment representing an interest of
less than two percent (2%) of an outstanding class of publicly-traded securities
of any corporation or other enterprise;

 

(ii) solicit customers, clients, suppliers, agents or other persons or entities
under contract or otherwise associated or doing business with the Company and/or
its controlled affiliates to reduce or alter any such association or business
with the Company and/or its controlled affiliates on behalf of any Competing
Business; and/or

 

(iii) solicit any employee or contractor of the Company and/or its controlled
affiliates to (a) alter or reduce such relationship with the Company, and/or (b)
accept employment, or enter into any consulting arrangement, with any person
other than Company and/or its controlled affiliates.

 

A “Competing Business” shall mean the five (5) companies designated by the
Company on the list attached hereto as Exhibit B. The Company may revise Exhibit
B at any time by adding names to, or subtracting names from, such list;
provided, however, that the Company must comply with the following requirements
in making any changes to Exhibit B: 1) absent your express written consent, any
such change to Exhibit B must be made at least ninety days before termination of
your employment for any reason; 2) any change must be made in writing and either
personally delivered to you or sent to your last known address by certified mail
return receipt requested; and 3) the Company can never include more than five
(5) company names on Exhibit 2. (Thus, if Exhibit B contains five (5) company
names and the Company adds one or more company names to Exhibit B, then it must
delete a like number. If the Company publishes a version of Exhibit B with more
than five (5) names, then such list will not be binding and the last version of
Exhibit B with five (5) Company names will be binding.)

 

PART FIVE — MISCELLANEOUS

 

1. Amendment and Termination.

 

This letter agreement may only be amended by written instrument signed by you
and an authorized officer of the Company. This letter agreement shall remain in
effect through December 31, 2005 or any earlier termination of your employment
with the Company. Provided you continue in the Company’s employ, this letter
agreement shall automatically be renewed for successive one (1)-year terms,
beginning January 1, 2006, unless the Company provides you with written notice
of termination of this letter agreement at least thirty (30) days prior to the
start of any such one (1)-year renewal period. Once a Change in Control occurs,
this letter agreement may not be terminated at any time prior to the expiration
of the twelve (12)-month period following the effective date of that Change of
Control, and no subsequent termination of this letter agreement shall adversely
affect your right to receive any benefits to which you may have previously
become entitled hereunder in connection with your Involuntary Termination
following that Change in Control.

 

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2. Termination for Cause.

 

Should your employment cease by reason of a Termination for Cause, then the
Company will only be required to pay you (i) any unpaid compensation earned for
services previously rendered through the date of such termination and (ii) any
accrued but unpaid vacation benefits or sick days, and no benefits will be
payable to you under Part Two of this letter agreement.

 

3. Death.

 

Should you die before receipt of one or more salary continuation payments to
which you become entitled under this letter agreement, then those payments will
be made to the executors or administrators of your estate. Should you die before
you exercise all your outstanding Options as accelerated hereunder, then such
Options may be exercised, within twelve (12) months after your death, by the
executors or administrators of your estate or by persons to whom the Options are
transferred pursuant to your will or in accordance with the laws of inheritance.
In no event, however, may any such Option be exercised after the specified
expiration date of the option term.

 

4. Miscellaneous.

 

This letter agreement will be binding upon the Company, its successors and
assigns (including, without limitation, the surviving entity in any Change in
Control) and is to be construed and interpreted under the laws of the State of
Texas. This letter agreement supersedes all prior agreements between you and the
Company relating to the subject of severance benefits payable upon an
Involuntary Termination, and you will not be entitled to any other severance
benefits upon such a termination other than those that are provided in this
letter agreement. If any provision of this letter agreement as applied to you or
the Company or to any circumstance should be adjudged by a court of competent
jurisdiction to be void or unenforceable for any reason, the invalidity of that
provision will in no way affect (to the maximum extent permissible by law) the
application of such provision under circumstances different from those
adjudicated by the court, the application of any other provision of this letter
agreement, or the enforceability or invalidity of this letter agreement as a
whole. Should any provision of this letter agreement become or be deemed
invalid, illegal or unenforceable in any jurisdiction by reason of the scope,
extent or duration of its coverage, then such provision will be deemed amended
to the extent necessary to conform to applicable law so as to be valid and
enforceable or, if such provision cannot be so amended without materially
altering the intention of the parties, then such provision will be stricken and
the remainder of this letter agreement will continue in full force and effect.

 

5. General Creditor Status.

 

All cash payments to which you become entitled hereunder will be paid, when due,
from the general assets of the Company, and no trust fund, escrow arrangement or
other segregated account will be established as a funding vehicle for such
payment. Accordingly, your right (or the right of the personal representatives
or beneficiaries of your estate) to receive such cash payments hereunder will at
all times be that of a general creditor of the Company and will have no priority
over the claims of other general creditors.

 

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6. At Will Employment.

 

Nothing in this letter agreement is intended to provide you with any right to
continue in the employ of the Company (or any subsidiary) for any period of
specific duration or interfere with or otherwise restrict in any way your rights
or the rights of the Company (or any subsidiary), which rights are hereby
expressly reserved by each, to terminate your employment at any time and for any
reason, with or without cause.

 

[SIGNATURE PAGE FOLLOWS]

 

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Please indicate your agreement with the foregoing terms and conditions of your
severance package (including, without limitation, the conversion of any
Incentive Options into Non-Statutory Options) by signing the Acceptance section
of the enclosed copy of this letter and returning it to the Company.

 

    Very truly yours,     CROSSROADS SYSTEMS, INC. By:    

Title:

   

 

ACCEPTANCE

 

I hereby agree to all the terms and provisions of the foregoing letter agreement
governing the special benefits to which I may become entitled in the event my
employment should terminate under certain prescribed circumstances including
certain terminations following a substantial change in control or ownership of
the Company.

 

Signature:     Dated:    

Address

   

 

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EXHIBIT A

GENERAL RELEASE

 

By signing this General Release (this “Release”) and accepting the severance
being offered to                      (“you” or “You”) in the Severance Offer
and General Release Letter Agreement to which this Release is an exhibit, you
agree to waive, release, and forever discharge Crossroads Systems, Inc. (the
“Company”) and its parents, successors, assigns, divisions, subsidiaries,
affiliates, partners, officers, directors, executives, investors, shareholders,
managers, supervisors, employees, agents, attorneys and representatives
(collectively the “Released Parties” or “Releasees”), from any and all claims,
demands, and causes of action which you have or claim to have, whether known or
unknown, of whatever nature, which exist or may exist as of the date of your
execution of this Release. “Claims,” “demands,” and “causes of action” include,
but are not limited to, those based on contract, fraud, equity, tort,
discrimination, sexual harassment, retaliation, personal injury, constructive
discharge, emotional distress, public policy, wage and hour law, defamation,
claims for debts, accounts, attorneys’ fees, compensatory damages, punitive
damages, and/or liquidated damages, claims for vesting or accelerated vesting of
options to purchase the Company’s Common Stock, claims for any additional shares
of the Company’s Common Stock, and any and all claims arising under the
Americans with Disabilities Act, the Family and Medical Leave Act, or any other
federal or state statute governing employment, including but not limited to
Title VII of the Civil Rights Act of 1964, the Employee Retirement Income
Security Act of 1974, the Worker Adjustment Retraining and Notification Act, the
Texas Labor Code, and the Texas Commission on Human Rights Act, as such statutes
may have been or may be amended from time to time.

 

You understand and agree, in compliance with any statute or ordinance which
requires a specific release of unknown claims or benefits, that this Release
includes a release of unknown claims, and you hereby expressly waive and
relinquish any and all claims, rights or benefits that you may have which are
unknown to you at the time of the execution of this Release. You understand and
agree that if, hereafter, you discover facts different from or in addition to
those which you now know or believe to be true, that the waivers and releases of
this Release shall be and remain effective in all respects notwithstanding such
different or additional facts or the discovery of such fact(s).

 

You represent and warrant that you do not presently have on file, and further
represent and warrant to the maximum extent allowed by law that you will not
hereafter file, any lawsuits, claims, charges, grievances or complaints against
the Company and/or the Released Parties in or with any administrative, state,
federal or governmental entity, agency, board or court, or before any other
tribunal or panel or arbitrators, public or private, based upon any actions or
omissions by the Company and/or the Released Parties occurring prior to the
Effective Date of this Release. You understand that nothing in this Release
prevents you from filing a charge or complaint with or from participating in an
investigation or proceeding conducted by the EEOC or any other federal, state or
local agency charged with the enforcement of any employment laws. To the extent
that you are still entitled to file an administrative charge with any
governmental agency, you hereby release any personal entitlement to
reinstatement, back pay, or any other types of

 

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damages or injunctive relief in connection with any civil action brought on your
behalf after your filing of any administrative charge.

 

The only claims that this Release does not include are claims related to your
rights under the employment benefits plans of the Company, (as applicable to you
on the date of your termination) and any claims that controlling law clearly
states may not be released by settlement.

 

Nothing in this Release shall constitute or be treated as an admission of any
wrongdoing or liability on your part or on the part of the Company and/or the
Released Parties. You acknowledge that you have been advised to consult with an
attorney of your choosing prior to entering into this Release.

 

Nothing in this Release is intended to alter, modify or waive the Company’s and
your continuing rights and obligations under the Company’s Confidentiality,
Proprietary Information and Inventions Agreement or its Indemnity Agreement,
each signed by you and each incorporated herein by this reference. You
understand and agree that a breach of any continuing obligation contained in the
above agreements shall also constitute a breach of this Release.

 

Finally, you represent and agree that you are the sole and lawful owner of all
rights, title and interest in and to all released matters, claims and demands
arising out of or in any way related to your employment with the Company and/or
the termination thereof.

 

You acknowledge that you have until [date] to consider this Release and that you
received this Release on [date]. You must execute and deliver this Release to
[company representative] at the Company on [date] (the “Delivery Deadline). This
Release will be deemed “delivered” to the Company when you have dated, signed
and faxed or hand-delivered it to [company representative] at the Company’s
office located at 8300 North MoPac Expressway, Austin, Texas 78759, on or before
5:00 p.m. on the Delivery Deadline. Should you desire to fax the executed
Release to the Company instead, you should use the following fax number: [fax
#]. This Release will become effective on the date the executed document is
delivered to the Company (herein, the “Release Effective Date”).

 

[Signature Page Follows]

 

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[NAME]      

Dated:

   

 

ACCEPTED AND ACKNOWLEDGED:

CROSSROADS SYSTEMS, INC.

By:

   

Name:

   

Title:

   

Dated:

   

 

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EXHIBIT B

COMPETING BUSINESS LIST

 

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EXHIBIT C

PROPRIETARY INFORMATION AND INVENTIONS AGREEMENT

(See Attached)