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                                                                   EXHIBIT 10.16


                        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-00CA-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 demanding
judgment 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      "'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.

         1.2      "ACCUSED PRODUCTS" mean any Pathlight SAN Router and Pathlight
                  SAN Gateway products made, used, sold, or offered for sale or
                  imported by Pathlight or ADIC.

         1.3      "LICENSED PRODUCT(S)" means any product, or part thereof, the
                  manufacture, use, sale, offer 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


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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 to 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      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).

         3.2      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 fifteen million dollars ($15,000,000) which represents the
         total of the Past Damages Payment and the Pre-paid


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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 of this Agreement
         to Crossroads' account as follows:

                          Chase Manhattan Bank, NYC, NY

                                  ABA 021000021

                      FBO SalomonSmithBarney 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      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.

                  5.2      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 of the
         consent judgment 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 does
         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 Patent is
         valid and enforceable, and (ii) acknowledges that Accused Products
         infringe the `972 Patent.


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         8.       NEGATION OF WARRANTIES

                  8.1      Nothing in this Agreement is or shall be construed
                           as:

                           8.1.1    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

                           8.1.4    An obligation to furnish any technology,
                                    technological information or other support.

                  8.2      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.

                  8.3      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 injury, property damage, 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.


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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 "U.S. Patent No. 5,941,972". Crossroads agrees that
         such marking by ADIC of the Licensed Products shall not require any
         specific reference to Crossroads.

         11.      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.      TERM 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 1, 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 of the 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 N.E.
                                       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 of the 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.


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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.      INADMISSIBILITY 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-a-vis 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.



        By: /s/ Brian R. Smith
            -------------------------------------------
        Name:  Brian Smith

        Its:  Chairman and Chief Executive Officer

        Date:  June, 12, 2001




        Advanced Digital Information Corporation



        By: /s/ Linda Schoemaker
            -------------------------------------------


        Name:  Linda Schoemaker

        Its:  Senior Vice President and General Counsel

        Date:  June, 12, 2001


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