Document:

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                                                                   EXHIBIT 10.24

WELLS FARGO BANK                                   REVOLVING LINE OF CREDIT NOTE
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$15,000,000.00                                             SAN DIEGO, CALIFORNIA
                                                                FEBRUARY 6, 2001

         FOR VALUE RECEIVED, the undersigned DOT HILL SYSTEMS CORP. AND SILICON
ALLEY MANAGEMENT, INC. ("Borrower") promises to pay to the order of WELLS FARGO
BANK, NATIONAL ASSOCIATION ("Bank") at its office at SAN DIEGO RCBO, 401 B
STREET SUITE 2201, SAN DIEGO, CA 92101, or at such other place as the holder
hereof may designate, in lawful money of the United States of America and in
immediately available funds, the principal sum of $15,000,000.00, or so much
thereof as may be advanced and be outstanding, with interest thereon, to be
computed on each advance from the date of its disbursement as set forth herein.

DEFINITIONS:

     As used herein, the following terms shall have the meanings set forth after
each, and any other term defined in this Note shall have the meaning set forth
at the place defined:

     (a) "Business Day" means any day except a Saturday, Sunday or any other day
on which commercial banks in California are authorized or required by law to
close.

     (b) "Fixed Rate Term" means a period commencing on a Business Day and
continuing for 1, 2 OR 3 MONTHS, as designated by Borrower, during which all or
a portion of the outstanding principal balance of this Note bears interest
determined in relation to LIBOR; provided however, that no Fixed Rate Term may
be selected for a principal amount less than $100,000.00; and provided further,
that no Fixed Rate Term shall extend beyond the scheduled maturity date hereof.
If any Fixed Rate Term would and on a day which is not a Business Day, then such
Fixed Rate Term shall be extended to the next succeeding Business Day.

     (c) "LIBOR" means the rate per annum (rounded upward, if necessary, to the
nearest whole 1/8 of 1 %) determined by dividing Base LIBOR by a percentage
equal to 100% less any LIBOR Reserve Percentage.

         (i) "Base LIBOR" means the rate per annum for United States dollar
deposits quoted by Bank as the Inter-Bank Market Offered Rate, with the
understanding that such rate is quoted by Bank for the purpose of calculating
effective rates of interest for loans making reference thereto, on the first day
of a Fixed Rate Term for delivery of funds on said date for a period of time
approximately equal to the number of days in such Fixed Rate Term and in an
amount approximately equal to the principal amount to which such Fixed Rate Term
applies. Borrower understands and agrees that Bank may base its quotation of the
Inter-Bank Market Offered Rate upon such offers or other market indicators of
the Inter-Bank Market as Bank in its discretion deems appropriate including, but
not limited to, the rate offered for U.S. dollar deposits on the London
Inter-Bank Market.

         (ii) "LIBOR Reserve Percentage" means the reserve percentage prescribed
by the Board of Governors of the Federal Reserve System (or any successor) for
"Eurocurrency Liabilities" (as defined in Regulation D of the Federal Reserve
Board, as amended), adjusted by Bank for expected changes in such reserve
percentage during the applicable Fixed Rate Term.

     (d) "Prime Rate" means at any time the rate of interest most recently
announced within Bank at its principal office as its Prime Rate, with the
understanding that the Prime Rate is one of Bank's base rates and serves as the
basis upon which effective rates of interest are calculated for those loans
making reference thereto, and is evidenced by the recording thereof after its
announcement in such internal publication or publications as Bank may designate.

INTEREST:

     (a) INTEREST. The outstanding principal balance of this Note shall bear
interest (computed on the basis of a 360-day year, actual days elapsed) either
(i) at a fluctuating rate per annum EQUAL TO the Prime Rate in effect from time
to time, or (ii) at a fixed rate per annum determined by Bank to be .50000%
above LIBOR in effect on the first day of the applicable Fixed Rate Term. When
interest is determined in relation to the Prime Rate, each change in the rate of
interest

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hereunder shall become effective on the date each Prime Rate change is
announced within Bank. With respect to each LIBOR selection option selected
hereunder, Bank is hereby authorized to note the date, principal amount,
interest rate and Fixed Rate Term applicable thereto and any payments made
thereon on Bank's books and records (either manually or by electronic entry)
and/or on any schedule attached to this Note, which notations shall be prima
facie evidence of the accuracy of the information noted.

     (b) SELECTION OF INTEREST RATE OPTIONS. At any time any portion of this
Note bears interest determined in relation to LIBOR, it may be continued by
Borrower at the end of the Fixed Rate Term applicable thereto so that all or a
portion thereof bears interest determined in relation to the Prime Rate or to
LIBOR for a new Fixed Rate Term designated by Borrower. At any time any portion
of this Note bears interest determined in relation to the Prime Rate, Borrower
may convert all or a portion thereof so that it bears interest determined in
relation to LIBOR for a Fixed Rate Term designated by Borrower. At such time as
Borrower requests an advance hereunder or wishes to select a LIBOR option for
all or a portion of the outstanding principal balance hereof, and at the end of
each Fixed Rate Term, Borrower shall give Bank notice specifying: (i) the
interest rate option selected by Borrower; (ii) the principal amount subject
thereto; and (iii) for each LIBOR selection, the length of the applicable Fixed
Rate Term. Any such notice may be given by telephone (or such other electronic
method as Bank may permit) so long as, with respect to each LIBOR selection, (A)
if requested by Bank, Borrower provides to Bank written confirmation thereof not
later than three (3) Business Days after such notice is given, and (B) such
notice is given to Bank prior to 10:00 a.m. on the first day of the Fixed Rate
Term, or at a later time during any Business Day if Bank, at it's sole option
but without obligation to do so, accepts Borrower's notice and quotes a fixed
rate to Borrower. If Borrower does not immediately accept a fixed rate when
quoted by Bank, the quoted rate shall expire and any subsequent LIBOR request
from Borrower shall be subject to a redetermination by Bank of the applicable
fixed rate. If no specific designation of interest is made at the time any
advance is requested hereunder or at the end of any Fixed Rate Term, Borrower
shall be deemed to have made a Prime Rate interest selection for such advance or
the principal amount to which such Fixed Rate Term applied.

     (c) TAXES AND REGULATORY COSTS. Borrower shall pay to Bank immediately upon
demand, in addition to any other amounts due or to become due hereunder, any and
all (i) withholdings, interest equalization taxes, stamp taxes or other taxes
(except income and franchise taxes) imposed by any domestic or foreign
governmental authority and related in any manner to LIBOR, and (ii) future,
supplemental, emergency or other changes in the LIBOR Reserve Percentage,
assessment rates imposed by the Federal Deposit Insurance Corporation, or
similar requirements or costs imposed by any domestic or foreign governmental
authority or resulting from compliance by Bank with any request or directive
(whether or not having the force of law) from any central bank or other
governmental authority and related in any manner to LIBOR to the extent they are
not included in the calculation of LIBOR. In determining which of the foregoing
are attributable to any LIBOR option available to Borrower hereunder, any
reasonable allocation made by Bank among its operations shall be conclusive and
binding upon Borrower.

     (d) PAYMENT OF INTEREST. Interest accrued on this Note shall be payable on
the LAST day of each MONTH, commencing FEBRUARY 28, 2001.

     (e) DEFAULT INTEREST. From and after the maturity date of this Note, or
such earlier date as all principal owing hereunder becomes due and payable by
acceleration or otherwise, the outstanding principal balance of this Note shall
bear interest until paid in full at an increased rate per annum (computed on the
basis of a 360-day year, actual days elapsed) equal to 2% above the rate of
interest from time to time applicable to this Note.

BORROWING AND REPAYMENT:

     (a) BORROWING AND REPAYMENT. Borrower may from time to time during the term
of this Note borrow, partially or wholly repay its outstanding borrowings, and
reborrow, subject to all of the limitations, terms and conditions of this Note
and of the Credit Agreement between Borrower and Bank defined below; provided
however, that the total outstanding borrowings under this Note shall not at any
time exceed the principal amount stated above. The unpaid principal balance of
this obligation at any time shall be the total amounts advanced hereunder by the
holder hereof less the amount of principal payments made hereon by or for any
Borrower, which balance may be endorsed hereon from time to time by the holder.
The outstanding principal balance of this Note shall be due and payable in full
on DECEMBER 31, 2002.

     (b) ADVANCES. Advances hereunder, to the total amount of the principal sum
available hereunder, may be made by the holder at the oral or written request of
(i) JAMES LAMBERT OR BENJAMIN MONDERER OR PRESTON ROMM, any one acting alone,
who are authorized to request advances and direct the disposition of any
advances until written notice of the revocation of such authority is received by
the holder at the office designated above, or (ii) any person, with respect to
advances deposited to the credit of any deposit account of any Borrower, which
advances, when so deposited, shall be conclusively presumed to have been made to
or for the benefit of each Borrower regardless of the fact that persons other

                                       2.

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than those authorized to request advances may have authority to draw against
such account. The holder shall have no obligation to determine whether any
person requesting an advance is or has been authorized by any Borrower.

     (c) APPLICATION OF PAYMENTS. Each payment made on this Note shall be
credited first, to any interest then due and second, to the outstanding
principal balance hereof. All payments credited to principal shall be applied
first, to the outstanding principal balance of this Note which bears interest
determined in relation to the Prime Rate, if any, and second, to the outstanding
principal balance of this Note which bears interest determined in relation to
LlBOR, with such payments applied to the oldest Fixed Rate Term first.

PREPAYMENT:

     (a) PRIME RATE. Borrower may prepay principal on any portion of this Note
which bears interest determined in relation to the Prime Rate at any time, in
any amount and without penalty.

     (b) LIBOR. Borrower may prepay principal on any portion of this Note which
bears interest determined in relation to LlBOR at any time and in the minimum
amount of $100,000.00; provided however, that if the outstanding principal
balance of such portion of this Note is less than said amount, the minimum
prepayment amount shall be the entire outstanding principal balance thereof. In
consideration of Bank providing this prepayment option to Borrower, or if any
such portion of this Note shall become due and payable at any time prior to the
last day of the Fixed Rate Term applicable thereto by acceleration or otherwise,
Borrower shall pay to Bank immediately upon demand a fee which is the sum of the
discounted monthly differences for each month from the month of prepayment
through the month in which such Fixed Rate Term matures, calculated as follows
for each such month:

         (i) DETERMINE the amount of interest which would have accrued each
month on the amount prepaid at the interest rate applicable to such amount had
it remained outstanding until the last day of the Fixed Rate Term applicable
thereto.

         (ii) SUBTRACT from the amount determined in (i) above the amount of
interest which would have accrued for the same month on the amount prepaid for
the remaining term of such Fixed Rate Term at LIBOR in effect on the date of
prepayment for new loans made for such term and in a principal amount equal to
the amount prepaid.

         (iii) If the result obtained in (ii) for any month is greater than
zero, discount that difference by LIBOR used in (ii) above.

Each Borrower acknowledges that prepayment of such amount may result in Bank
incurring additional costs, expenses and/or liabilities, and that it is
difficult to ascertain the full extent of such costs, expenses and/or
liabilities. Each Borrower, therefore, agrees to pay the above-described
prepayment fee and agrees that said amount represents a reasonable estimate of
the prepayment costs, expenses and/or liabilities of Bank. If Borrower fails to
pay any prepayment fee when due, the amount of such prepayment fee shall
thereafter bear interest until paid at a rate per annurn 2.000% above the Prime
Rate in effect from time to time (computed on the basis of a 360-day year,
actual days elapsed). Each change in the rate of interest on any such past due
prepayment fee shall become eff6ctive on the date each Prime Rate change is
announced within Bank.

EVENTS OF DEFAULT:

     This Note is made pursuant to and is subject to the terms and conditions of
that certain Credit Agreement between Borrower and Bank dated as of FEBRUARY 6,
2001, as amended from time to time (the "Credit Agreement"). Any default in the
payment or performance of any obligation under this Note, or any defined event
of default under the Credit Agreement, shall constitute an "Event of Default"
under this Note.

MISCELLANEOUS:

     (a) REMEDIES. Upon the occurrence of any Event of Default, the holder of
this Note, at the holder's option, may declare all sums of principal and
interest outstanding hereunder to be immediately due and payable without
presentment, demand, notice of nonperformance, notice of protest, protest or
notice of dishonor, all of which are expressly waived by each Borrower, and the
obligation, if any, of the holder to extend any further credit hereunder shall
immediately cease and terminate. Each Borrower shall pay to the holder
immediately upon demand the full amount of all payments, advances, charges,
costs and expenses, including reasonable attorneys' fees (to include outside
counsel fees and all allocated costs of the holder's in-house counsel), expended
or incurred by the holder in connection with the enforcement of the holder's
rights and/or the collection of any amounts which become due to the holder under
this Note, and the prosecution or

                                       3.

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defense of any action in any way related to this Note, including without
limitation, any action for declaratory relief, whether incurred at the trial or
appellate level, in an arbitration proceeding or otherwise, and including any of
the foregoing incurred in connection with any bankruptcy proceeding (including
without limitation, any adversary proceeding, contested matter or motion brought
by Bank or any other person) relating to any Borrower or any other person or
entity.

     (b) OBLIGATIONS JOINT AND SEVERAL. Should more than one person or entity
sign this Note as a Borrower, the obligations of each such Borrower shall be
joint and several.

     (c) GOVERNING LAW. This Note shall be governed by and construed in
accordance with the laws of the State of California.

DOT HILL SYSTEMS CORP.

By:   /s/ JAMES LAMBERT
      ------------------------------------------
      James Lambert, President  and Chief
      Executive Officer

By:   /s/ PRESTON ROMM
      ------------------------------------------
      Preston Romm, Vice President
      Finance and CFO

SILICON ALLEY MANAGEMENT, INC.

By:   /s/ BENJAMIN MONDERER
      ------------------------------------------
      Benjamin Monderer,
      President

By:   /s/ PRESTON ROMM
      ------------------------------------------
      Preston  Romm,  Vice President and
      Secretary

                                       4.<PAGE>

                                                                   EXHIBIT 10.25

                                                  THIRD PARTY SECURITY AGREEMENT
WELLS FARGO BANK                                              SECURITIES ACCOUNT
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     1. GRANT OF SECURITY INTEREST. In consideration of any credit or other
financial accommodation heretofore, now or hereafter extended or made to DOT
HILL SYSTEMS CORP. AND SILICON ALLEY MANAGEMENT, INC. ("Borrowers"), or any of
them, by WELLS FARGO BANK NATIONAL ASSOCIATION ("Bank"), and for other valuable
consideration, as security for the payment of all Indebtedness of Borrowers to
Bank, the undersigned DOT HILL SYSTEMS CORP. ("Owner") hereby grants and
transfers to Bank a security interest in (a) Owner's Investment Management
Account Account No. 10671900 (whether held in Owner's name or as a Bank
collateral account for the benefit of Owner), and all replacements or
substitutions therefor, including any account resulting from a renumbering or
other administrative re-identification thereof (collectively, the "Securities
Account") maintained with WELLS FARGO BANK, NATIONAL ASSOCIATION, acting through
its Investment Group ("Intermediary"), (b) all financial assets credited to the
Securities Account, (c) all security entitlements with respect to the financial
assets credited to the Securities Account, and (d) any and all other investment
property or assets maintained or recorded in the Securities Account (with all
the foregoing defined as "Collateral"), together with whatever is receivable or
received when any of the Collateral or proceeds thereof are sold, collected,
exchanged or otherwise disposed of, whether such disposition is voluntary or
involuntary, including without limitation, (i) all rights to payment, including
returned premiums, with respect to any insurance relating to any of the
foregoing, (ii) all rights to payment with respect to any cause of action
affecting or relating to any of the foregoing, and (iii) all stock rights,
rights to subscribe, stock splits, liquidating dividends, cash dividends,
dividends paid in stock, new securities or other property of any kind which
Owner is or may hereafter be entitled to receive on account of any securities
pledged hereunder, including without limitation, stock received by Owner due to
stock splits or dividends paid in stock or sums paid upon or in respect of any
securities pledged hereunder upon the liquidation or dissolution of the issuer
thereof (hereinafter called "Proceeds"). Except as otherwise expressly permitted
herein, in the event Owner receives any such Proceeds, Owner will hold the same
in trust on behalf of and for the benefit of Bank and will immediately deliver
all such Proceeds to Bank in the exact form received, with the endorsement of
Owner if necessary and/or appropriate undated stock powers duly executed in
blank, to be held by Bank as part of the Collateral, subject to all terms
hereof. As used herein, the terms "security entitlement," "financial asset" and
"investment property" shall have the respective meanings set forth in the
California Uniform Commercial Code. The word "Indebtedness" is used herein in
its most comprehensive sense and includes any and all advances, debts,
obligations and liabilities of Borrowers, or any of them, heretofore, now or
hereafter made, incurred or created, whether voluntary or involuntary and
however arising, whether due or not due, absolute or contingent, liquidated or:
unliquidated, determined or undetermined, and whether Borrowers may be liable
individually or jointly with others, or whether recovery upon such Indebtedness
may be or hereafter becomes unenforceable.

     2. CONTINUING AGREEMENT; REVOCATION; OBLIGATION UNDER OTHER AGREEMENTS.
This is a continuing agreement and all rights, powers and remedies hereunder
shall apply to all past, present and future Indebtedness of each of the
Borrowers to Bank, including that arising under successive transactions which
shall either continue the Indebtedness, increase or decrease it, or from time to
time create new Indebtedness after all or any prior Indebtedness has been
satisfied, and notwithstanding the death, incapacity, dissolution, liquidation
or bankruptcy of any of the Borrowers or Owner or any other event or proceeding
affecting any of the Borrowers or Owner. This Agreement shall not apply to any
new Indebtedness created after actual receipt by Bank of written notice of its
revocation as to such new Indebtedness; provided however, that loans or advances
made by Bank to any of the Borrowers after revocation under commitments existing
prior to receipt by Bank of such revocation, and extensions, renewals or
modifications, of any kind, of Indebtedness incurred by any of the Borrowers or
committed by Bank prior to receipt by Bank of such revocation, shall not be
considered new Indebtedness. Any such notice must be sent to Bank by registered
U.S. mail, postage prepaid, addressed to its office at SAN DIEGO RCBO, 401 B
STREET SUITE 2201, SAN DIEGO, CA 92101, or at such other address as Bank shall
from time to time designate. The obligations of Owner hereunder shall be in
addition to any obligations of Owner under any other grants or pledges of
security for any liabilities or obligations of any of the Borrowers or any other
persons heretofore or hereafter given to Bank unless said other grants or
pledges of security are expressly modified or revoked in writing; and this
Agreement shall not, unless expressly herein provided, affect or invalidate any
such other grants or pledges of security.

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     3. OBLIGATIONS JOINT AND SEVERAL; SEPARATE ACTIONS; WAIVER OF STATUTE OF
LIMITATIONS; REINSTATEMENT OF LIABILITY. The obligations hereunder are joint and
several and independent of the obligations of Borrowers, and a separate action
or actions may be brought and prosecuted against Owner whether action is brought
against any of the Borrowers or any other person, or whether any of the
Borrowers or any other person is joined in any such action or actions. Owner
acknowledges that this Agreement is absolute and unconditional, there are no
conditions precedent to the effectiveness of this Agreement, and this Agreement
is in full force and effect and is binding on Owner as of the date written
below, regardless of whether Bank obtains collateral or any guaranties from
others or takes any other action contemplated by Owner. Owner waives the benefit
of any statute of limitations affecting Owner's liability hereunder or the
enforcement thereof, and Owner agrees that any payment of any Indebtedness or
other act which shall toll any statute of limitations applicable thereto shall
similarly operate to toll such statute of limitations applicable to Owner's
liability hereunder. The liability of Owner hereunder shall be reinstated and
revived and the rights of Bank shall continue if and to the extent that for any
reason any amount at any time paid on account of any Indebtedness secured hereby
is rescinded or must otherwise be restored by Bank, whether as a result of any
proceedings in bankruptcy or reorganization or otherwise, all as though such
amount had not been paid. The determination as to whether any amount so paid
must be rescinded or restored shall be made by Bank in its sole discretion;
provided however, that if Bank chooses to contest any such matter at the request
of Owner, Owner agrees to indemnify and hold Bank harmless from and against all
costs and expenses, including reasonable attorneys' fees, expended or incurred
by Bank in connection therewith, including without limitation, in any litigation
with respect thereto.

     4. OBLIGATIONS OF BANK. Bank shall have no duty to take any steps necessary
to preserve the rights of Owner against prior parties, or to initiate any action
to protect against the possibility of a decline in the market value of the
Collateral or Proceeds. Bank shall not be obligated to take any actions with
respect to the Collateral or Proceeds requested by Owner unless such request is
made in writing and Bank determines, in its sole discretion, that the requested
action would not unreasonably jeopardize the value of the Collateral and
Proceeds as security for the Indebtedness.

     5. REPRESENTATIONS AND WARRANTIES. (a) Owner represents and warrants to
Bank that: (i) Owner is the sole owner of the Collateral and Proceeds; (ii)
Owner has the right to grant a security interest in the Collateral and Proceeds;
(iii) all Collateral and Proceeds are genuine, free from liens, adverse claims,
setoffs, default, prepayment, defenses and conditions precedent of any kind or
character, except the lien created hereby or as otherwise agreed to by Bank, or
heretofore disclosed by Owner to Bank, in writing; (iv) all statements contained
herein and, where applicable, in the Collateral are true and complete in all
material respects; (v) no financing statement or control agreement covering any
of the Collateral or Proceeds, and naming any secured party other than Bank,
exists or is on file in any public office or remains in effect; (vi) no person
or entity, other than Owner, Bank and Intermediary, has any interest in or
control over the Collateral; and (vii) specifically with respect to Collateral
and Proceeds consisting of investment securities, instruments, chattel paper,
documents, contracts, insurance policies or any like property, all persons
appearing to be obligated thereon have authority and capacity to contract and
are bound as they appear to be, and the same comply with applicable laws
concerning form, content and manner of preparation and execution.

     (b) Owner further represents and warrants to Bank that: (i) the Collateral
pledged hereunder is so pledged at Borrowers' request; (ii) Bank has made no
representation to Owner as to the creditworthiness of any of the Borrowers; and
(iii) Owner has established adequate means of obtaining from each of the
Borrowers on a continuing basis financial and other information pertaining to
Borrowers' financial condition. Owner agrees to keep adequately informed from
such means of any facts, events or circumstances which might in any way affect
Owner's risks hereunder, and Owner further agrees that Bank shall have no
obligation to disclose to Owner any information or material about any of the
Borrowers which is acquired by Bank in any manner.

     6. COVENANTS OF OWNER.

     (a) Owner agrees in general: (i) to indemnify Bank against all losses,
claims, demands, liabilities and expenses of every kind caused by property
subject hereto; (ii) to pay all costs and expenses, including reasonable
attorneys' fees, incurred by Bank in the perfection and preservation of the
Collateral or Bank's interest therein and/or the realization, enforcement and
exercise of Bank's rights, powers and remedies hereunder; (iii) to permit Bank
to exercise its powers; (iv) to execute and deliver such documents as Bank deems
necessary to create,

                                                                          Page 2

<PAGE>

perfect and continue the security interests contemplated hereby; and (v) not to
change Owner's chief place of business (or personal residence, if applicable) or
the places where Owner keeps any of the Collateral or Owner's records concerning
the Collateral and Proceeds without first giving Bank written notice of the
address to which Owner is moving same.

     (b) Owner agrees with regard to the Collateral and Proceeds, unless Bank
agrees otherwise in writing: (i) not to permit any security interest in or lien
on the Collateral or Proceeds, except in favor of Bank and except liens in favor
of Intermediary to the extent expressly permitted by Bank in writing; (ii) not
to hypothecate or permit the transfer by operation of law of any of the
Collateral or Proceeds or any interest therein; (iii) to keep, in accordance
with generally accepted accounting principles, complete and accurate records
regarding all Collateral and Proceeds, and to permit Bank to inspect the same
and make copies thereof at any reasonable time; (iv) if requested by Bank, to
receive and use reasonable diligence to collect Proceeds, in trust and as the
property of Bank, and to immediately endorse as appropriate and deliver such
Proceeds to Bank daily in the exact form in which they are received together
with a collection report in form satisfactory to Bank; (v) in the event Bank
elects to receive payments of Proceeds hereunder, to pay all expenses incurred
by Bank in connection therewith, including expenses of accounting,
correspondence, collection efforts, reporting to account or contract debtors,
filing, recording, record keeping and expenses incidental thereto; (vi) to
provide any service and do any other acts which may be necessary to keep all
Collateral and Proceeds free and clear of all defenses, rights of offset and
counterclaims; and (vii) if the Collateral or Proceeds consists of securities
and so long as no Event of Default exists, to vote said securities and to give
consents, waivers and ratifications with respect thereto, provided that no vote
shall be cast or consent, waiver or ratification given or action taken which
would impair Bank's interest in the Collateral and Proceeds or be inconsistent
with or violate any provisions of this Agreement. Owner further agrees that any
party now or at any time hereafter authorized by Owner to advise or otherwise
act with respect to the Securities Account shall be subject to all terms and
conditions contained herein and in any control, custodial or other similar
agreement at any time in effect among Bank, Owner and Intermediary relating to
the Collateral.

     7. POWERS OF BANK. Owner appoints Bank its true attorney in fact to perform
any of the following powers, which are coupled with an interest, are irrevocable
until termination of this Agreement and may be exercised from time to time by
Bank's officers and employees, or any of them, whether or not any of the
Borrowers or Owner is in default: (a) to perform any obligation of Owner
hereunder in Owner's name or otherwise; (b) to notify any person obligated on
any security, instrument or other document subject to this Agreement of Bank's
rights hereunder; (c) to collect by legal proceedings or otherwise all
dividends, interest, principal or other sums now or hereafter payable upon or on
account of the Collateral or Proceeds; (d) to enter into any extension,
reorganization, deposit, merger or consolidation agreement, or any other
agreement relating to or affecting the Collateral or Proceeds, and in connection
therewith to deposit or surrender control of the Collateral and Proceeds, to
accept other property in exchange for the Collateral and Proceeds, and to do and
perform such acts and things as Bank may deem proper, with any money or property
received in exchange for the Collateral or Proceeds, at Bank's option, to be
applied to the Indebtedness or held by Bank under this Agreement; (e) to make
any compromise or settlement Bank deems desirable or proper in respect of the
Collateral and Proceeds; (f) to insure, process and preserve the Collateral and
Proceeds; (g) to exercise all rights, powers and remedies which Owner would
have, but for this Agreement, with respect to all Collateral and Proceeds
subject hereto; and (h) to do all acts and things and execute all documents in
the name of Owner or otherwise, deemed by Bank as necessary, proper and
convenient in connection with the preservation, perfection or enforcement of its
rights hereunder. To effect the purposes of this Agreement or otherwise upon
instructions of Owner, Bank may cause any Collateral and/or Proceeds to be
transferred to Bank's name or the name of Bank's nominee. If an Event of Default
has occurred and is continuing, any or all Collateral and/or Proceeds consisting
of securities may be registered, without notice, in the name of Bank or its
nominee, and thereafter Bank or its nominee may exercise, without notice, all
voting and corporate rights at any meeting of the shareholders of the issuer
thereof, any and all rights of conversion, exchange or subscription, or any
other rights, privileges or options pertaining to such Collateral and/or
Proceeds, all as if it were the absolute owner thereof. The foregoing shall
include, without limitation, the right of Bank or its nominee to exchange, at
its discretion, any and all Collateral and/or Proceeds upon the merger,
consolidation, reorganization, recapitalization or other readjustment of the
issuer thereof, or upon the exercise by the issuer thereof or Bank of any right,
privilege or option pertaining to any shares of the Collateral and/or Proceeds,
and in connection therewith, the right to deposit and deliver any and all of the
Collateral and/or Proceeds with any committee, depository, transfer agent,
registrar or other designated agency upon such terms and conditions as Bank may
determine. All of the foregoing rights, privileges or options may be

                                                                          Page 3

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exercised without liability on the part of Bank or its nominee except to account
for property actually received by Bank. Bank shall have no duty to exercise any
of the foregoing, or any other rights, privileges or options with respect to the
Collateral or Proceeds and shall not be responsible for any failure to do so or
delay in so doing.

     8. OWNER'S WAIVERS.

     (a) Owner waives any right to require Bank to: (i) proceed against any of
the Borrowers or any other person; (ii) marshal assets or proceed against or
exhaust any security held from any of the Borrowers or any other person; (iii)
give notice of the terms, time and place of any public or private sale of
personal property security held from any of the Borrowers or any other person,
or otherwise comply with the provisions of Section 9504 of the California
Uniform Commercial Code; (iv) take any action or pursue any other remedy in
Bank's power; or (v) make any presentment or demand for performance, or give any
notice of nonperformance, protest, notice of protest or notice of dishonor
hereunder or in connection with any obligations or evidences of indebtedness
held by Bank as security for or which constitute in whole or in part the
Indebtedness secured hereunder, or in connection with the creation of new or
additional Indebtedness.

     (b) Owner waives any defense to its obligations hereunder based upon or
arising by reason of: (i) any disability or other defense of any of the
Borrowers or any other person; (ii) the cessation or limitation from any cause
whatsoever, other than payment in full, of the Indebtedness of any of the
Borrowers or any other person; (iii) any lack of authority of any officer,
director, partner, agent or any other person acting or purporting to act on
behalf of any of the Borrowers which is a corporation, partnership or other type
of entity, or any defect in the formation of any of such Borrower; (iv) the
application by any of the Borrowers of the proceeds of any Indebtedness for
purposes other than the purposes represented by Borrowers to, or intended or
understood by, Bank or Owner; (v) any act or omission by Bank which directly or
indirectly results in or aids the discharge of any of the Borrowers or any
portion of the Indebtedness by operation of law or otherwise, or which in any
way impairs or suspends any rights or remedies of Bank against any of the
Borrowers; (vi) any impairment of the value of any interest in any security for
the Indebtedness or any portion thereof, including without limitation, the
failure to obtain or maintain perfection or recordation of any interest in any
such security, the release of any such security without substitution, and/or the
failure to preserve the value of, or to comply with applicable law in disposing
of, any such security; (vii) any modification of the Indebtedness, in any form
whatsoever, including any modification made after revocation hereof to any
Indebtedness incurred prior to such revocation, and including without limitation
the renewal, extension, acceleration or other change in time for payment of, or
other change in the terms of, the Indebtedness or any portion thereof, including
increase or decrease of the rate of interest thereon; or (viii) any requirement
that Bank give any notice of acceptance of this Agreement. Until all
Indebtedness shall have been paid in full, Owner shall have no right of
subrogation, and Owner waives any right to enforce any remedy which Bank now has
or may hereafter have against any of the Borrowers or any other person, and
waives any benefit of, or any right to participate in, any security now or
hereafter held by Bank. Owner further waives all rights and defenses Owner may
have arising out of (A) any election of remedies by Bank, even though that
election of remedies, such as a non-judicial foreclosure with respect to any
security for any portion of the Indebtedness, destroys Owner's rights of
subrogation or Owner's rights to proceed against any of the Borrowers for
reimbursement, or (B) any loss of rights Owner may suffer by reason of any
rights, powers or remedies of any of the Borrowers in connection with any
anti-deficiency laws or any other laws limiting, qualifying or discharging
Borrowers' Indebtedness, whether by operation of Sections 726, 580a or 580d of
the Code of Civil Procedure as from time to time amended, or otherwise,
including any rights Owner may have to a Section 580a fair market value hearing
to determine the size of a deficiency following any trustee's foreclosure sale
or other disposition of any real property security for any portion of the
Indebtedness.

     9. AUTHORIZATIONS TO BANK. Owner authorizes Bank either before or after
revocation hereof, without notice to or demand on Owner, and without affecting
Owner's liability hereunder, from time to time to: (a) alter, compromise, renew,
extend, accelerate or otherwise change the time for payment of, or otherwise
change the terms of, the Indebtedness or any portion thereof, including increase
or decrease of the rate of interest thereon; (b) take and hold security, other
than the Collateral and Proceeds, for the payment of the Indebtedness or any
portion thereof, and exchange, enforce, waive, subordinate or release the
Collateral and Proceeds, or any part thereof, or any such other security; (c)
apply the Collateral and Proceeds or such other security and direct the order or
manner of sale thereof, including without limitation, a non-judicial sale
permitted by the terms of the controlling security agreement, mortgage or deed
of trust, as Bank in its discretion may determine; (d) release or

                                                                          Page 4

<PAGE>

substitute any one or more of the endorsers or guarantors of the Indebtedness,
or any portion thereof, or any other party thereto; and (e) apply payments
received by Bank from any of the Borrowers to any Indebtedness of any of the
Borrowers to Bank, in such order as Bank shall determine in its sole discretion,
whether or not such Indebtedness is covered by this Agreement, and Owner hereby
waives any provision of law regarding application of payments which specifies
otherwise. Bank may without notice assign this Agreement in whole or in part.

     10. PAYMENT OF PREMIUMS, TAXES, CHARGES, LIENS AND ASSESSMENTS. Owner
agrees to pay, prior to delinquency, all insurance premiums, taxes, charges,
liens and assessments against the Collateral and Proceeds, and upon the failure
of Owner to do so, Bank at its option may pay any of them and shall be the sole
judge of the legality or validity thereof and the amount necessary to discharge
the same. Any such payments made by Bank shall be obligations of Owner to Bank,
due and payable immediately upon demand, together with interest at a rate
determined in accordance with the provisions of Section 15 hereof, and shall be
secured by the Collateral and Proceeds, subject to all terms and conditions of
this Agreement.

     11. EVENTS OF DEFAULT. The occurrence of any of the following shall
constitute an "Event of Default" under this Agreement: (a) any default in the
payment or performance of any obligation, or any defined event of default, under
(i) any contract or instrument evidencing any Indebtedness, (ii) any other
agreement between any of the Borrowers and Bank, including without limitation
any loan agreement, relating to or executed in connection with any Indebtedness,
or (iii) any control, custodial or other similar agreement in effect among Bank,
Owner and Intermediary relating to the Collateral; (b) any representation or
warranty made by Owner herein shall prove to be incorrect in any material
respect when made; (c) Owner shall fail to observe or perform any obligation or
agreement contained herein; (d) any attachment or like levy on any property of
Owner; and (e) Bank, in good faith, believes any or all of the Collateral and/or
Proceeds to be in danger of misuse, dissipation, commingling, loss, theft,
damage or destruction, or otherwise in jeopardy or unsatisfactory in character
or value.

     12. REMEDIES. Upon the occurrence of any Event of Default, Bank shall have
and may exercise without demand any and all rights, powers, privileges and
remedies granted to a secured party upon default under the California Uniform
Commercial Code or otherwise provided by law, including without limitation, the
right to contact all persons obligated to Owner on any Collateral or Proceeds
and to instruct such persons to deliver all Collateral and/or Proceeds directly
to Bank. All rights, powers, privileges and remedies of Bank shall be
cumulative. No delay, failure or discontinuance of Bank in exercising any right,
power, privilege or remedy hereunder shall affect or operate as a waiver of such
right, power, privilege or remedy; nor shall any single or partial exercise of
any such right, power, privilege or remedy preclude, waive or otherwise affect
any other or further exercise thereof or the exercise of any other right, power,
privilege or remedy. Any waiver, permit, consent or approval of any kind by Bank
of any default hereunder, or any such waiver of any provisions or conditions
hereof, must be in writing and shall be effective only to the extent set forth
in writing. It is agreed that public or private sales, for cash or on credit, to
a wholesaler or retailer or investor, or user of property of the types subject
to this Agreement, or public auction, are all commercially reasonable since
differences in the sales prices generally realized in the different kinds of
sales are ordinarily offset by the differences in the costs and credit risks of
such sales.

     While an Event of Default exists: (a) Owner will not dispose of any of the
Collateral or Proceeds except on terms approved by Bank; (b) Bank may
appropriate the Collateral and apply all Proceeds toward repayment of the
Indebtedness in such order as Bank may from time to time elect; (c) Bank may
take any action with respect to the Collateral contemplated by any control,
custodial or other similar agreement then in effect among Bank, Owner and
Intermediary; and (d) at Bank's request, Owner will assemble and deliver all
books and records pertaining to the Collateral to Bank at a reasonably
convenient place designated by Bank. For any Collateral or Proceeds consisting
of securities, Bank shall be under no obligation to delay a sale of any portion
thereof for the period of time necessary to permit the issuer thereof to
register such securities for public sale under any applicable state or federal
law, even if the issuer thereof would agree to do so.

     13. DISPOSITION OF COLLATERAL AND PROCEEDS. Upon the transfer of all or any
part of the Indebtedness, Bank may transfer all or any part of the Collateral or
Proceeds and shall be fully discharged thereafter from all liability and
responsibility with respect to any of the foregoing so transferred, and the
transferee shall be vested with all rights and powers of Bank hereunder with
respect to any of the foregoing so transferred; but with respect to any
Collateral or Proceeds not so transferred, Bank shall retain all rights, powers,
privileges and remedies herein given. Any proceeds of any disposition of any of
the Collateral or Proceeds, or any part

                                                                          Page 5

<PAGE>

thereof, may be applied by Bank to the payment of expenses incurred by Bank in
connection with the foregoing, including reasonable attorneys' fees, and the
balance of such proceeds may be applied by Bank toward the payment of the
Indebtedness in such order of application as Bank may from time to time elect.

     14. NOTICES. All notices, requests and demands required under this
Agreement must be in writing, addressed to Bank at the address specified in
Section 2 hereof and to Owner at the address of its chief executive office (or
personal residence, if applicable) specified below or to such other address as
any party may designate by written notice to each other party, and shall be
deemed to have been given or made as follows: (a) if personally delivered, upon
delivery; (b) if sent by mail, upon the earlier of the date of receipt or 3 days
after deposit in the U.S. mail, first class and postage prepaid; and (c) if sent
by telecopy, upon receipt.

     15. COSTS, EXPENSES AND ATTORNEYS' FEES. Owner shall pay to Bank
immediately upon demand the full amount of all payments, advances, charges,
costs and expenses, including reasonable attorneys' fees (to include outside
counsel fees and all allocated costs of Bank's in-house counsel), expended or
incurred by Bank in exercising any right, power, privilege or remedy conferred
by this Agreement or in the enforcement thereof, whether incurred at the trial
or appellate level, in an arbitration proceeding or otherwise, and including any
of the foregoing incurred in connection with any bankruptcy proceeding
(including without limitation, any adversary proceeding, contested matter or
motion brought by Bank or any other person) relating to Owner or in any way
affecting any of the Collateral or Bank's ability to exercise any of its rights
or remedies with respect thereto. All of the foregoing shall be paid by Owner
with interest from the date of demand until paid in full at a rate per annum
equal to the greater of ten percent (10%) or Bank's Prime Rate in effect from
time to time.

     16. SUCCESSORS; ASSIGNMENT. This Agreement shall be binding upon and inure
to the benefit of the heirs, executors, administrators, legal representatives,
successors and assigns of the parties; provided however, that Owner may not
assign or transfer any of its interests or rights hereunder without Bank's prior
written consent. Owner acknowledges that Bank has the right to sell, assign,
transfer, negotiate or grant participations in all or any part of, or any
interest in, any Indebtedness of Borrowers to Bank and any obligations with
respect the thereto, including this Agreement. In connection therewith, Bank may
disclose all documents and information which Bank now has or hereafter acquires
relating to Owner and/or this Agreement, whether furnished by Borrowers, Owner
or otherwise. Owner further agrees that Bank may disclose such documents and
information to Borrowers.

     17. AMENDMENT. This Agreement may be amended or modified only in writing
signed by Bank and Owner.

     18. APPLICATION OF SINGULAR AND PLURAL. In all cases where there is but a
single Borrower, then all words used herein in the plural shall be deemed to
have been used in the singular where the context and construction so require;
and when there is more than one Borrower named herein, or when this Agreement is
executed by more than one Owner, the word "Borrowers" and the word "Owner"
respectively shall mean all or any one or more of them as the context requires.

     19. SEVERABILITY OF PROVISIONS. If any provision of this Agreement shall be
held to be prohibited by or invalid under applicable law, such provision shall
be ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of such provision or any remaining provisions of this
Agreement.

     20. GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of California.

     21. ADDENDUM. Additional terms and conditions relating to the Securities
Account are set forth in an Addendum attached hereto and incorporated herein by
this reference.

     22. ARBITRATION.

     (a) ARBITRATION. The parties hereto agree, upon demand by any party, to
submit to binding arbitration all claims, disputes and controversies between or
among them (and their respective employees, officers, directors, attorneys, and
other agents), whether in tort, contract or otherwise arising out of or relating
to in any way (i) the loan and related loan and security documents which are the
subject of this Agreement and its negotiation,

                                                                          Page 6

<PAGE>

execution, collateralization, administration, repayment, modification,
extension, substitution, formation, inducement, enforcement, default or
termination; or (ii) requests for additional credit.

     (b) GOVERNING RULE. Any arbitration proceeding will (i) proceed in a
location in California selected by the American Arbitration Association ("AAA");
(ii) be governed by the Federal Arbitration Act (Title 9 of the United States
Code), notwithstanding any conflicting choice of law provision in any of the
documents between the parties; and (iii) be conducted by the AAA, or such other
administrator as the parties shall mutually agree upon, in accordance with the
AAA's commercial dispute resolution procedures, unless the claim or counterclaim
is at least $1,000,000.00 exclusive of claimed interest, arbitration fees and
costs in which case the arbitration shall be conducted in accordance with the
AAA's optional procedures for large, complex commercial disputes (the commercial
dispute resolution procedures or the optional procedures for large, complex
commercial disputes to be referred to, as applicable, as the "Rules"). If there
is any inconsistency between the terms hereof and the Rules, the terms and
procedures set forth herein shall control. Any party who fails or refuses to
submit to arbitration following a demand by any other party shall bear all costs
and expenses incurred by such other party in compelling arbitration of any
dispute. Nothing contained herein shall be deemed to be a waiver by any party
that is a bank of the protections afforded to it under 12 U.S.C. Section 91 or
any similar applicable state law.

     (c) NO WAIVER OF PROVISIONAL REMEDIES, SELF-HELP AND FORECLOSURE. The
arbitration requirement does not limit the right of any party to (i) foreclose
against real or personal property collateral; (ii) exercise self-help remedies
relating to collateral or proceeds of collateral such as setoff or repossession;
or (iii) obtain provisional or ancillary remedies such as replevin, injunctive
relief, attachment or the appointment of a receiver, before during or after the
pendency of any arbitration proceeding. This exclusion does not constitute a
waiver of the right or obligation of any party to submit any dispute to
arbitration or reference hereunder, including those arising from the exercise of
the actions detailed in sections (i), (ii) and (iii) of this paragraph.

     (d) ARBITRATOR QUALIFICATIONS AND POWERS. Any arbitration proceeding in
which the amount in controversy is $5,000,000.00 or less will be decided by a
single arbitrator selected according to the Rules, and who shall not render an
award of greater than $5,000,000.00. Any dispute in which the amount in
controversy exceeds $5,000,000.00 shall be decided by majority vote of a panel
of three arbitrators; provided however, that all three arbitrators must actively
participate in all hearings and deliberations. The arbitrator will be a neutral
attorney licensed in the State of California or a neutral retired judge of the
state or federal judiciary of California, in either case with a minimum of ten
years experience in the substantive law applicable to the subject matter of the
dispute to be arbitrated. The arbitrator will determine whether or not an issue
is arbitratable and will give effect to the statutes of limitation in
determining any claim. In any arbitration proceeding the arbitrator will decide
(by documents only or with a hearing at the arbitrator's discretion) any
pre-hearing motions which are similar to motions to dismiss for failure to state
a claim or motions for summary adjudication. The arbitrator shall resolve all
disputes in accordance with the substantive law of California and may grant any
remedy or relief that a court of such state could order or grant within the
scope hereof and such ancillary relief as is necessary to make effective any
award. The arbitrator shall also have the power to award recovery of all costs
and fees, to impose sanctions and to take such other action as the arbitrator
deems necessary to the same extent a judge could pursuant to the Federal Rules
of Civil Procedure, the California Rules of Civil Procedure or other applicable
law. Judgment upon the award rendered by the arbitrator may be entered in any
court having jurisdiction. The institution and maintenance of an action for
judicial relief or pursuit of a provisional or ancillary remedy shall not
constitute a waiver of the right of any party, including the plaintiff, to
submit the controversy or claim to arbitration if any other party contests such
action for judicial relief.

     (e) DISCOVERY. In any arbitration proceeding discovery will be permitted in
accordance with the Rules. All discovery shall be expressly limited to matters
directly relevant to the dispute being arbitrated and must be completed no later
than 20 days before the hearing date and within 180 days of the filing of the
dispute with the AAA. Any requests for an extension of the discovery periods, or
any discovery disputes, will be subject to final determination by the arbitrator
upon a showing that the request for discovery is essential for the party's
presentation and that no alternative means for obtaining information is
available.

     (f) CLASS PROCEEDINGS AND CONSOLIDATIONS. The resolution of any dispute
arising pursuant to the terms of this Agreement shall be determined by a
separate arbitration proceeding and such dispute shall not be consolidated with
other disputes or included in any class proceeding.

                                                                          Page 7

<PAGE>

     (g) PAYMENT OF ARBITRATION COSTS AND FEES. The arbitrator shall award all
costs and expenses of the arbitration proceeding.

     (h) REAL PROPERTY COLLATERAL; JUDICIAL REFERENCE. Notwithstanding anything
herein to the contrary, no dispute shall be submitted Ito arbitration if the
dispute concerns indebtedness secured directly or indirectly, in whole or in
part, by any real property unless (i) the holder of the mortgage, lien or
security interest specifically elects in writing to proceed with the
arbitration, or (ii) all parties to the arbitration waive any rights or benefits
that might accrue to them by virtue of the single action rule statute of
California, thereby agreeing that all indebtedness and obligations of the
parties, and all mortgages, liens and security interests securing such
indebtedness and obligations, shall remain fully valid and enforceable. If any
such dispute is not submitted to arbitration, the dispute shall be referred to a
referee in accordance with California Code of Civil Procedure Section 638 et
seq., and this general reference agreement is intended to be specifically
enforceable in accordance with said Section 638. A referee with the
qualifications required herein for arbitrators shall be selected pursuant to the
AAA's selection procedures. Judgment upon the decision rendered by a referee
shall be entered in the court in which such proceeding was commenced in
accordance with California Code of Civil Procedure Sections 644 and 645.

     (i) MISCELLANEOUS. To the maximum extent practicable, the AAA, the
arbitrators and the parties shall take all action required to conclude any
arbitration proceeding within 180 days of the filing of the dispute with the
AAA. No arbitrator or other party to an arbitration proceeding may disclose the
existence, content or results thereof, except for disclosures of information by
a party required in the ordinary course of its business, by applicable law or
regulation, or to the extent necessary to exercise any judicial review rights
set forth herein. If more than one agreement for arbitration by or between the
parties potentially applies to a dispute, the arbitration provision most
directly related to the documents between the parties or the subject matter of
the dispute shall control. This arbitration provision shall survive termination,
amendment or expiration of any of the documents or any relationship between the
parties.

     Owner warrants that its chief executive office (or personal residence, if
applicable) is located at the following address: 6305 EL CAMINO REAL, CARLSBAD,
CA 92009

     IN WITNESS WHEREOF, this Agreement has been duly executed as of FEBRUARY 6,
2001.

DOT HILL SYSTEMS CORP.

By: /s/ JAMES LAMBERT
    --------------------------------------------------------
    James Lambert, President and Chief Executive
    Officer

By: /s/ PRESTON ROMM
    --------------------------------------------------------
     Preston Romm, Vice President, Finance and
     CFO

                                                                          Page 8

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