InfoStor : Dot Hill in Negotiations With Ciprico Inc. to Acquire Certain Intellectual Property Assets, August 2008

CARLSBAD, Calif., Aug 27, 2008 /PRNewswire-FirstCall via COMTEX/ -- Dot Hill Systems Corp. (the "Company") announced today that it is in negotiations with Ciprico Inc. to purchase Ciprico's RAIDCore(TM) and NAS (Networked Attached Storage) intellectual property assets. Ciprico previously announced that, on July 28, 2008, it filed a voluntary petition pursuant to Chapter 11 of Title 11 of the United States Code (the "Bankruptcy Code") in the United States Bankruptcy Court for the District of Minnesota (the "Bankruptcy Court").

Under the proposed asset purchase ("Asset Purchase"), the Company would acquire all of Ciprico's rights to the RAIDCore(TM) technology. In addition, the Company would acquire a joint ownership interest with Ciprico in the NAS intellectual property.

The Company is also negotiating to provide Ciprico with a debtor-in-possession ("DIP") loan ("DIP Loan") in an amount not to exceed $225,000. The terms of the DIP Loan would provide Dot Hill with a first priority security interest in all of Ciprico's assets.

The proposed Asset Purchase and DIP Loan remain subject to Bankruptcy Court approval. Ciprico has filed motions seeking authority pursuant to Section 363 of the Bankruptcy Code to approve the proposed Asset Purchase pursuant to certain proposed sale procedures, and separately a motion to approve the DIP Loan from the Company.

About Dot Hill Systems Corp.

Delivering innovative technology and global support, Dot Hill (Nasdaq: HILL) empowers the OEM community to bring unique storage solutions to market, quickly, easily and cost-effectively. Offering high performance and industry-leading uptime, Dot Hill's RAID technology is the foundation for best-in-class storage solutions offering enterprise-class security, availability and data protection. The company's products are in use today by the world's leading service and equipment providers, common carriers, advanced technology and telecommunications companies as well as government agencies. Dot Hill solutions are certified to meet rigorous industry standards and military specifications, as well as RoHS and WEEE international environmental standards. Headquartered in Carlsbad, Calif., Dot Hill has offices and/or representatives in China, Germany, Japan, United Kingdom and the United States. For more information, visit us at http://www.dothill.com/.

Statements contained in this press release regarding matters that are not historical facts are "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act. Because such statements are subject to risks and uncertainties, actual results may differ materially from those expressed or implied by such forward-looking statements. Such statements include statements regarding the proposed Asset Purchase and DIP Loan. The risks that contribute to the uncertain nature of the forward-looking statements include, among other things, the risk that the Bankruptcy Court may not approve the proposed Asset Purchase and DIP Loan, the risk that the negotiations with Ciprico may fail; and the additional risks set forth in the forms 8-K, 10-K and 10-Q most recently filed by Dot Hill. All forward-looking statements contained in this press release speak only as of the date on which they were made. Dot Hill undertakes no obligation to update such statements to reflect events that occur or circumstances that exist after the date on which they were made.

SOURCE Dot Hill Systems Corp.

URL: http://www.dothill.com www.prnewswire.com

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