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Exhibit 10.5
April 19, 1999
McDATA Holdings Corporation
c/o EMC Corporation
Attn: Paul Dacier
General Counsel
35 Parkwood
Hopkinton, MA 01748-9103
RE: Letter Agreement for Silvercreek Fibre Channel Port Card Revenues
Effective November 1, 1998
Dear Paul:
On October 1, 1997, pursuant to the Asset Transfer Agreement among EMC
Corporation ("EMC"), McDATA Holdings Corporation ("Holdings") and McDATA
Corporation ("McDATA"), Holdings retained the manufacturing and marketing ESCON
Contracts then in existence with IBM Corporation ("IBM") for the ESCON Business.
(ESCON Contracts and ESCON Business are defined in the Asset Transfer
Agreement). Pursuant to Section 6 of the Services Agreement among these parties
of the same date, all revenues under the ESCON contracts are to be paid directly
to Holdings.
Among the ESCON Contracts retained by Holdings is OEM Purchase and Software
License Agreement No. 40-96-0106-05 for the "Monarch" Director. McDATA has
developed a Fibre Channel feature for use with the Monarch Director, the
"Silvercreek Fibre Channel Port Card". Since the Silvercreek Fibre Channel Port
Card is not part of the ESCON Business but part of the New McDATA Fibre Channel
business, EMC (Paul Noble and Bill Teuber) has agreed that all revenues
generated from the sale of such feature shall be paid to McDATA.
By signature hereon, the undersigned hereby agree that effective November 1,
1998, McDATA shall be entitled to all revenues generated from the purchase of
the Silvercreek Fibre Channel Port Card by IBM. The undersigned further
understand and agree that all other ESCON-related revenues generated under the
ESCON Contracts shall continue to be paid to Holdings pursuant to the Services
Agreement. Further, the undersigned agree that Section 6 of the Services
Agreement is hereby amended by replacing this section with the following: "All
revenues under the ESCON Contracts shall be paid directly to Holdings, with the
exception of any and all revenues generated by the sale of the Silvercreek Fibre
Channel Port Card to IBM. All of such Silvercreek Fibre Channel Port Card
revenues shall be paid directly to New McDATA."
Regards,
McDATA Corporation
Dee J. Perry
CFO and Vice President of Finance and Administration
cc: Paul Noble, Jr., EMC Corporation
Bill Teuber, EMC Corporation
John F. McDonnell, McDATA Corporation
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Letter Agreement
Silvercreek Fibre Channel Port Card Revenues
April 19, 1999
Page 2
Effective November 1, 1998, the undersigned hereby agree to the foregoing.
EMC Corporation
By: _________________________________
Name:
Title:
Date:
McDATA Holdings Corporation
By: _________________________________
Name:
Title:
Date:
McDATA Corporation
By: __________________________________
Name:
Title:
Date:
