Document:

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                                                                   EXHIBIT 10.18

                               SEVERANCE AGREEMENT

     This Severance Agreement (the "AGREEMENT") is made and entered into as of
the ___ day of _____, 1999, by and between McDATA Corporation, a Delaware
corporation (the "CORPORATION"), and ___________ ("EXECUTIVE").

     WHEREAS, Executive is currently serving as Vice President, _________ of the
Corporation and in such position Executive is considered to be a key employee of
the Corporation;

     WHEREAS, the Corporation and Executive acknowledge that in the event of a
Change in Control (as defined herein) Executive may be more vulnerable to
dismissal; and

     WHEREAS, the Corporation and Executive desire to set forth in writing the
terms of their agreement with respect to Executive's compensation in the event
of Executive's termination of employment other than for Cause or Constructive
Termination (as defined in Section 3 below) following a Change in Control;

     NOW, THEREFORE, the parties hereto agree as follows:

1.   TERMINATION.

          (a)  MUTUAL AGREEMENT. This Agreement may be terminated at any time by
the mutual written agreement of the Corporation and Executive.

          (b)  TERMINATION OTHER THAN FOR CAUSE OR CONSTRUCTIVE TERMINATION. If
within twelve (12) months following a Change of Control (as defined below),
Executive is terminated by the Corporation for any reason other than for Cause
(as defined in Section 4 below), or is Constructively Terminated by the
Corporation (as defined in Section 4 below), and in exchange for Executive
signing a waiver of claims against the Corporation as of the termination date in
the form attached as Exhibit A, Executive will receive the following:

               (i)  The Corporation shall pay to Executive four (4) times
Executive's Average Quarterly Compensation (as defined below), net of any
necessary taxes or deductions, payable in a lump sum or with the Corporation's
normal payroll timetable, at the Corporation's option;

               (ii) The Corporation shall pay Executive for all accrued but
unused vacation days, unreimbursed expenses to the date of termination as
provided herein, as well as any expenses incurred by the Executive with the
Corporation's prior written approval, such as expenses incurred in returning
Corporation records;

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               (iii) Pursuant to the provisions of COBRA, the Corporation shall
provide Executive and his or her family with all group health benefits which the
Corporation provided immediately prior to such termination; provided, however,
that such benefits will be terminated if Executive subsequently joins or becomes
employed by another organization which provides Executive and his family with
group health benefits comparable to those provided by the Corporation under this
paragraph. The Corporation shall be responsible for paying all COBRA premiums
for no more than twelve (12) months; and

               (iv) The vesting of all stock options held by Executive shall
automatically be accelerated to the date of termination and all options may be
exercised by Executive according to their terms.

          (c)  TERMINATION FOR CAUSE OR BY MUTUAL AGREEMENT; VOLUNTARY
RESIGNATION. The Corporation may terminate this Agreement at any time for Cause.
Such termination shall be effective immediately upon written notice to
Executive, except where advance notice and an opportunity to cure is required
under the definition of Cause set forth in Section 4 below. If the Corporation
terminates this Agreement for Cause, or if this Agreement is terminated by
Executive and the Corporation by mutual agreement, or if Executive voluntarily
resigns from the Corporation (other than as a result of a Constructive
Termination following a Change of Control) Executive shall not be entitled to
any further payments except (i) unreimbursed expenses to the date of termination
and (ii) any accrued compensation, including accrued benefits.

          (d)  DISABILITY OR DEATH. The Corporation may terminate this Agreement
upon the death or disability of Executive. For purposes of this Agreement,
Executive shall be considered disabled if he is unable to perform his duties
under this Agreement as a result of injury, illness or other disability for a
period of one hundred eighty (180) consecutive days, or one hundred eighty (180)
days in a three hundred sixty-five (365) day period, and shall not have returned
to the performance of duties within thirty (30) days after receiving written
notice of termination. If the Corporation terminates this Agreement upon the
death or disability of Executive the Corporation shall pay Executive or his
estate a lump sum equal to all accrued compensation, including accrued benefits,
and unreimbursed expenses to the date of termination as provided herein.

          (e)  DATE OF TERMINATION; PAYMENT. In each of the foregoing cases,
except those provisions where termination is automatic upon notice to Executive,
termination is the date of actual termination, not the date notice of
termination is given. All payments for unpaid monthly compensation shall be made
based upon the normal payroll processing schedule and all payments for
reimbursement shall be made within forty-five (45) days after the end of the
month following the month in which termination occurred.

2.   NO CONFLICTS OR SOLICITATION

     Executive agrees that during the period of Executive's employment by the
Corporation, Executive will not, without the Corporation's express written
consent, engage in any other employment or business activity directly related to
the business in which the Corporation is now involved or becomes involved during
the course of Executive's employment, nor will Executive

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engage in any other activities which conflict with his or her obligations to the
Corporation. For the period of Executive's employment by the Corporation and for
one (1) year after the date of termination of Executive's employment by the
Corporation, Executive will not (a) induce any employee of the Corporation to
leave the employ of the Corporation or (b) solicit the business (as it relates
to the business in which the Corporation is now involved or becomes involved
during the course of Executive's employment) of any customer of the Corporation
(other than on behalf of the Corporation and its subsidiaries).

3.   COVENANT NOT TO COMPETE

          (a)  For the period of Executive's employment by the Corporation and
for one (1) year following termination of Executive's employment, Executive will
not directly or indirectly engage in (whether as an employee, consultant,
proprietor, sales representative, partner, director or otherwise), or have any
ownership interest in, or participate in the financing, operation, management or
control of, any person, firm, corporation or business that engages in a
"Restricted Business" in a "Restricted Territory" (as defined below). It is
agreed that ownership of (i) no more than one percent (1%) of the outstanding
voting stock of a publicly traded corporation or (ii) any stock Executive owned
on or before Executive accepted employment with the Corporation, or (iii) any
options or other rights to acquire shares of the Corporation's capital stock
shall not constitute a violation of this provision.

          (b)  As used herein, the terms:

               (i)  "Restricted Business" shall mean any business selling any
products or services in competition with the business of the Corporation as of
the date hereof and/or as of the date of termination of Executive's employment.

               (ii) Restricted Territory" shall mean anywhere in the United
States or the world where the Corporation or any subsidiary of the Corporation
conducts business.

          (c)  Executive agrees and acknowledges that the time limitation on the
restrictions in this Section 3, combined with the geographic scope, is
reasonable. Executive also acknowledges and agrees that this Section 3 is
reasonably necessary for the protection of the Corporation, that through this
Agreement Executive shall receive adequate consideration for any loss of
opportunity associated with the provisions herein, and that these provisions
provide a reasonable way of protecting the Corporation's business value which
was imparted to him. If any restriction set forth in this Section 3 is found by
any court of competent jurisdiction to be unenforceable because it extends for
too long a period of time or over too great a range of activities or in too
broad a geographic area, it shall be interpreted to extend only over the maximum
period of time, range of activities or geographic area as to which it may be
enforceable. Executive acknowledges and agrees that the provisions in this
Section 3 are essential and material to this Agreement, and that upon breach of
this Section 3 by him, the Company is entitled to recover any payments or other
consideration made pursuant to this Agreement, to withhold providing additional
payments or consideration, to equitable relief to prevent continued breach, to
recover damages and to seek any other remedies available to the Company.

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4.   DEFINITIONS.

     As used herein, the following terms shall have the following meanings:

          (a)  "AFFILIATE" shall mean any person, corporation or other entity
controlling, controlled by or under common control with another person,
corporation, or other entity.

          (b)  "AVERAGE QUARTERLY COMPENSATION" shall mean Executive's average
quarterly total compensation for the eight complete calendar quarters preceding
the date of Executive's termination, computed as the sum of the following for
such eight quarters, divided by eight:

               (i)  Executive's base salary at the rate(s) in effect for such
quarters;

               (ii) Commissions that Executive is entitled to be paid with
respect to his performance of services during such period under the terms of any
applicable commission plans (regardless of when paid);

               (iii) Bonuses that Executive is entitled to be paid as a result
of Executive's achievement of quarterly MBOs during such period (regardless of
when paid); and

               (iv) Profit-sharing bonuses that Executive is entitled to be paid
with respect to any complete calendar year, and a pro rated profit sharing bonus
with respect to any other quarters included in such period. The pro rated profit
sharing will be based on the extent to which quarterly profit sharing goals were
met. (For example, if Executive were eligible for a profit sharing bonus of 10%
of base compensation for 1999, and if the Corporation achieved its quarterly
profit targets for two completed calendar quarters prior to termination in July
1999, Executive would be entitled to a profit sharing bonus equal to 5% of
Executive's 1999 base salary).

          Average Quarterly Compensation will not include any income or gain
upon exercise of stock options, or upon sale of stock, nor will it include the
value of any benefits.

          (c)  "CAUSE" shall mean: (i) dishonesty which is not the result of an
inadvertent or innocent mistake of Executive with respect to the Corporation or
any of its subsidiaries; (ii) willful misfeasance or nonfeasance of duty by
Executive that materially injures the reputation, business or business
relationships of the Corporation or any of its subsidiaries or any of their
respective officers, directors or executives; (iii) any conduct which would be
sufficient to criminally charge executive with the commission of a crime
involving moral turpitude or a crime other than a vehicle offense which could
reflect in some material fashion unfavorably upon the business or business
relationships of the Corporation or any of its subsidiaries or any of their
respective officers, directors or Executives; (iv) willful or prolonged absence
from work by Executive (other than by reason of disability due to physical or
mental illness) or failure, neglect or refusal by Executive to perform his
duties and responsibilities without the same being corrected upon thirty (30)
days prior written notice; (v) if Executive materially violates any term of this
Agreement or the Corporation's employment policies and procedures (including but
not limited to the Corporation's policies with respect to sexual

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harassment and discrimination) and such action or failure is not remedied within
thirty (30) days of written notice; or (vi) if Executive violates any Agreement,
policy or procedure described in Section 4(b) a second time following a notice
from the Corporation, even if the first violation was remedied.

          (d)  "CONSTRUCTIVE TERMINATION" shall mean: (i) if the Corporation
materially violates any term of this Agreement and such violation is not
remedied within thirty (30) days after written notice of such violation by
Executive, or (ii) if, after a Change of Control of the Corporation (as defined
below): (A) the Corporation moves the Executive's primary work site more than 35
miles from the Corporation's current location in Broomfield, Colorado; or (B) if
the Corporation materially reduces the Executive's job responsibilities or
materially reduces Executive's compensation and benefits and such action is not
remedied within thirty (30) days after written notice is given by Executive. In
the case of (ii)(A), Executive must give written notice to the Corporation
within thirty (30) days of the date the Corporation notifies Executive of the
change in primary work site that Executive has elected to treat such action as a
Constructive Termination. In the case of (ii)(B), if Executive gives notice that
he or she considers a change of responsibilities or change in compensation to
constitute a Constructive Termination, and if Corporation does not address the
matter by taking such actions as may be necessary to avoid such change being
deemed a Constructive Termination within thirty (30) days after Executive's
notice, Executive must elect whether to treat such change as a Constructive
Termination within thirty (30) days thereafter.

          (e)  "CHANGE OF CONTROL" shall mean one or a series of related
transactions resulting in (i) the consummation of a sale, transfer or other
disposition of all or substantially all of the assets of the Corporation
(determined on a consolidated basis) after the date of this Agreement to any
person other than the Corporation or any of its direct or indirect subsidiaries
or Affiliates, (ii) any transfer of voting power with respect to the
Corporation's capital stock after the date of this Agreement (whether effected
by agreement among stockholders, irrevocable proxy, voting trust, issuance or
transfer of capital stock, merger, consolidation or other reorganization or
means, including a reorganization under bankruptcy or insolvency laws) if, as a
result of such transfer, a person or group (as defined in Section 13(d)(3) of
the Securities Exchange Act of 1934, as amended, and related regulations) who
are not stockholders of the Corporation as of the date of this Agreement, become
beneficial owners of shares of capital stock possessing voting power sufficient
to elect a majority of the Board of Directors of the Corporation.
Notwithstanding anything to the contrary herein, a "Change of Control" shall not
include (i) any transfer by EMC of any or all of its capital stock in the
Corporation to any Affiliate of EMC, (ii) any acquisition of additional capital
stock or other securities in the Corporation by EMC and/or any of its
Affiliates, (iii) any sale by EMC and/or any of the Corporation's stockholders
of capital stock or other securities of the Corporation or of any Affiliate of
the Corporation to the public pursuant to a public offering registered under the
Securities Act of 1933, as amended, or (iv) any "spin-out" or other distribution
by EMC of shares of capital stock or other securities of the Corporation or of
any Affiliate of the Corporation to EMC's stockholders.

          (f)  "EMC" shall mean EMC Corporation.

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5.   CERTAIN REDUCTIONS IN PAYMENTS.

          (a)  Anything in this Agreement to the contrary notwithstanding, in
the event that any payment, distribution or other benefit provided by the
Corporation to or for the benefit of Executive (whether paid or payable or
provided or to be provided pursuant to the terms of this Agreement or otherwise)
(a "Payment") would (i) constitute a "parachute payment" within the meaning of
Section 280G of the Code and (ii) but for this Section 5, be subject to the
excise tax imposed by Section 4999 of the Code (the "Excise Tax"), then, in
accordance with this Section 5, such Payments shall be reduced to the maximum
amount that would result in no portion of the Payments being subject to the
Excise Tax, but only if and to the extent that such a reduction would result in
Executive's receipt of Payments that are greater than the net amount Executive
would receive (after application of the Excise Tax) if no reduction is made. The
amount of required reduction, if any, shall be the smallest amount so that the
Executive's net proceeds with respect to the Payments (after taking into account
payment of any Excise Tax and all federal, state and local income, employment or
other taxes) shall be maximized. If, notwithstanding any reduction described in
this Section 5 (or in the absence of any such reduction), the IRS determines
that a Payment is subject to the Excise Tax (or subject to a different amount of
the Excise Tax than determined by the Corporation or the Executive), then
Section 5(c) shall apply. If the Excise Tax is not eliminated pursuant to this
Section 5, Executive shall pay the Excise Tax.

          (b)  All determinations required to be made under this Section 5 shall
be made by the Corporation's independent auditors. Such auditors shall provide
detailed supporting calculations both to the Corporation and Executive. Any such
reasonable determination by the Corporation's independent auditors shall be
binding upon the Corporation and Executive. The Executive shall determine which
and how much of the Payments, including without limitation any option
acceleration benefits provide under this Agreement or any option ("Option
Benefits"), as the case may be, shall be eliminated or reduced consistent with
the requirements of this Section 5, provided that, if Executive does not make
such determination within ten business days of the receipt of the calculations
made by the Corporation's independent auditors, the Corporation shall elect
which and how much of the Option Benefits or other Payments, as the case may be,
shall be eliminated or reduced consistent with the requirements of this Section
5, and then the Corporation shall notify Executive promptly of such election.
Within five business days thereafter, the Corporation shall pay to or distribute
to or for the benefit of Executive such amounts as are then due to Executive
under this Agreement.

          (c)  As a result of the uncertainty in the application of Section 280G
of the Code at the time of the initial determination by the Corporation's
independent auditors hereunder, it is possible that Option Benefits or other
Payments, as the case may be, will have been made by the Corporation which
should not have been made ("Overpayment") or that additional Option Benefits or
other Payments, as the case may be, which will not have been made by the
Corporation could have been made ("Underpayment"), in each case, consistent with
the calculations required to be made hereunder. In the event that the
Corporation's independent auditors, based upon the assertion of a deficiency by
the IRS against Executive or the Corporation which the Corporation's independent
auditors believe has a high probability of success, determine that an
Overpayment has been made, any such Overpayment paid or

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distributed by the Corporation to or for the benefit of Executive shall be
treated for all purposes as a loan ab initio to Executive which Executive shall
repay to the Corporation within 30 days of receipt by Executive of written
notice from the Corporation setting forth the amount of the Overpayment,
together with interest at the applicable federal rate provided for in Section
7872(f)(2) of the Code; provided, however, that no such loan shall be deemed to
have been made and no amount shall be payable by Executive to the Corporation if
and to the extent such deemed loan and payment would not either reduce the
amount on which Executive is subject to tax under Section 1 and Section 4999 of
the Code or generate a refund of such taxes. In the event that the Corporation's
independent auditors, based upon controlling precedent or other substantial
authority, determine that an Underpayment has occurred, any such Underpayment
shall be promptly paid by the Corporation to or for the benefit of Executive
together with interest at the applicable federal rate provided for in Section
7872(f)(2) of the Code.

6.   MISCELLANEOUS.

          (a)  ASSIGNMENT. This Agreement may not be assigned by any party
hereto; provided, however, that the Corporation may assign this Agreement in
connection with a Change of Control of the Corporation so long as the assignee
assumes all of the Corporation's obligations thereunder.

          (b)  NOTICES. Any notices provided hereunder must be in writing and
shall be deemed effective upon the earlier of personal delivery (including
personal delivery by telex) or the third day after mailing by first class mail
to the recipient at the address indicated below:

     To the Corporation:

               McDATA Corporation
               310 Interlocken Boulevard
               Broomfield, CO  80021

               Attention: CFO
               Phone: (303) 460-4343
               Fax: (303) 465-4996

     To Executive:

or to such other address or to the attention of such other person as the
recipient party will have specified by prior written notice to the sending
party.

          (c)  WAIVER. A waiver by the Corporation or Executive of a breach of
any provision of this Agreement by the other party shall not operate or be
construed as a waiver of any subsequent breach by the other party.

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          (d)  GOVERNING LAW. This Agreement shall be deemed a contract made
under, and for all purposes shall be construed in accordance with, the laws of
the State of Colorado (without giving effect to conflict of laws principles).

          (e)  SEVERABILITY. In the event that any provision or portion of this
Agreement shall be determined to be invalid or unenforceable for any reason, the
remaining provisions or portions of this Agreement shall be unaffected thereby
and shall remain in full force and effect to the fullest extent permitted by
law.

          (f)  ENTIRE AGREEMENT. This Agreement contains the entire agreement of
the parties with respect to the subject matter hereof. This Agreement may be
changed only by an agreement in writing signed by the parties.

          (g)  COUNTERPARTS. This Agreement may be executed in several
counterparts, each of which shall be deemed to be an original but all of which
together shall constitute one and the same instrument.

          (h)  EMPLOYMENT STATUS. This Agreement does not constitute a contract
of employment or impose on the Executive or the Corporation any obligation to
retain the Executive as an employee, to change the status of the Executive's
employment or to change the Corporation's policies regarding termination of
employment.

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
day and year first above written.

   MCDATA CORPORATION                      EXECUTIVE

   By:
      ----------------------------         --------------------------------

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                                    EXHIBIT A
                         EMPLOYEE AGREEMENT AND RELEASE

     I understand and agree completely to the terms set forth in the foregoing
agreement.

     I hereby confirm my obligations under the Corporation's proprietary
information and inventions agreement.

     In granting the release herein, I acknowledge that I understand that I am
waiving the benefit of any provision of law in any jurisdiction to the effect
that a general release does not extend to claims which the person executing the
release does not know or suspect to exist in his favor at the time of executing
the release, which if known by such person must have materially affected his or
her settlement with the debtor. I hereby expressly waive and relinquish all
rights and benefits under any such law or legal principle effect in any
jurisdiction with respect to the release of unknown and unsuspected claims
granted in this Agreement.

     Except as otherwise set forth in this Agreement, I hereby release, acquit
and forever discharge the Corporation, its parents and subsidiaries, and its and
their respective officers, directors, agents, servants, employees, shareholders,
successors, assigns and affiliates, of and from any and all claims, liabilities,
demands, causes of action, costs, expenses, attorneys fees, damages, indemnities
and obligations of every kind and nature, in law, equity, or otherwise, known
and unknown, suspected and unsuspected, disclosed and undisclosed (other than
any claim for indemnification I may have as a result of any third party action
against me based on my employment with the Corporation), arising out of or in
any way related to agreements, events, acts or conduct at any time prior to the
date I execute this Agreement, including but not limited to: all such claims and
demands directly or indirectly arising out of or in any way connected with my
employment with the Corporation or the termination of that employment, including
but not limited to, claims of intentional and negligent infliction of emotional
distress, any and all tort claims for personal injury, claims or demands related
to salary, bonuses, commissions, stock, stock options, or any other ownership
interests in the Corporation, vacation pay, fringe benefits, expense
reimbursements, severance pay, or any other form of compensation; claims
pursuant to any federal, state or local law or cause of action including, but
not limited to, the federal Civil Rights Act of 1964, as amended; the federal
Age Discrimination in Employment Act of 1967, as amended ("ADEA"); the federal
Employee Retirement Income Security Act of 1974, as amended; the federal
Americans with Disabilities Act of 1990; tort law; contract law; wrongful
discharge; harassment; discrimination; fraud; defamation; emotional distress;
and breach of the implied covenant of good faith and fair dealing; provided,
however, that nothing in this paragraph shall be construed in any way to release
the Corporation from its obligation to indemnify me pursuant to any
indemnification agreement or bylaw.

     I acknowledge that I am knowingly and voluntarily waiving and releasing any
rights I may have under ADEA. I also acknowledge that the consideration given
for the waiver and release in the preceding paragraph hereof is in addition to
anything of value to which I was already entitled. I further acknowledge that I
have been advised by this writing, as required by the ADEA, that: (A) my waiver
and release do not apply to any rights or claims that may arise on or after the
date I execute this Agreement; (B) I have the right to consult with an attorney
prior to executing this Agreement; (C) I have twenty-one (21) days to consider
this Agreement (although I may choose to voluntarily execute this Agreement
earlier); (D) I have seven (7) days following the execution of this Agreement by
the parties to revoke the Agreement; and (E) this Agreement shall not be
effective until the date upon which the revocation period has expired, which
shall be the eighth day after this Agreement is executed by me, provided that
the Corporation has also executed this Agreement by that date (the "Effective
Date").

MCDATA CORPORATION

By:
   --------------------------------         ------------------------------------
Title:                                      Date:
      -----------------------------              -------------------------------<PAGE>   1
                                                                   EXHIBIT 10.21

Summary of the Management Bonus Program for McDATA Corporation

All of our executive officers and many of our other senior employees are
eligible for a bonus based upon achievement of specified annual or quarterly
objectives. There is no formal agreement with respect to this program and
objectives for bonuses are set annually by the board of directors. Currently the
bonus is calculated as a percentage of base compensation and can range from 10%
to 35% for non-executive officers and from 25% to 50% for executive officers.
For non-executive officers, the bonus is tied to achievement of quarterly
objectives agreed to by the employee and their manager. For executive officers,
the bonus is tied to achievement of annual planned operating profit or revenue
and achievement of quarterly objectives. Typically, 70% of an executive
officer's bonus is tied to achievement of annual planned profit and 30% to
achievement of quarterly objectives. To date, no executive officer has received
any portion of a bonus tied to operating profitability.

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