SETTLEMENT AGREEMENT AND GENERAL RELEASE. This Settlement Agreement and General Release ( AGREEMENT ) is made as of

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1 SETTLEMENT AGREEMENT AND GENERAL RELEASE This Settlement Agreement and General Release ( AGREEMENT ) is made as of March 29, 2004 by and between Defendant NETWORK ASSOCIATES, INC. ( NAI ) and Plaintiffs Carole Eustice and William Hansult on behalf of themselves and the CLASS (as defined in Section 1(D) below) (collectively PLAINTIFFS ). RECITALS A. Background of Matter PLAINTIFFS filed a lawsuit captioned Carole Eustice v. Network Associates, Inc., Civ , Superior Court of California, County of Ventura, (the Litigation ). In the Second Amended Complaint the operative Complaint PLAINTIFFS allege that Versions 3 and/or 4 of NAI s McAfee VirusScan software (collectively VERSION 3 AND/OR VERSION 4 OF THE MCAFEE VIRUSSCAN SOFTWARE ) contain representations by NAI that NAI would provide perpetual updates to the software program (the ALLEGED REPRESENTATIONS ). Plaintiffs further allege that NAI failed to provide the required updates thereby violating California Business and Professions Code et seq.; breaching NAI s contracts with PLAINTIFFS and violating the Consumer Legal Remedies Act (California Civil Code 1770 et seq.). NAI denies these allegations and specifically denies that it made the Alleged Representations. In the Litigation, PLAINTIFFS seek to certify two classes of plaintiffs: (1) all consumers who licensed a copy of VERSION 3 AND/OR VERSION 4 OF THE MCAFEE VIRUSSCAN SOFTWARE; and (2) a subclass of consumers who licensed replacement virus protection software after learning that updates were no longer available for VERSION 3 AND/OR VERSION 4 OF THE MCAFEE VIRUSSCAN SOFTWARE.

2 B. PLAINTIFFS Claims PLAINTIFFS have claimed, and continue to claim, that the contentions made by them in the Litigation have merit. Nothing in this AGREEMENT may be construed as, or may be used as, an admission by PLAINTIFFS that any of their claims is without merit. C. NAI s Denial of Wrongdoing NAI denies each and all of the claims and contentions alleged by PLAINTIFFS in the Litigation. Nothing in this AGREEMENT may be construed as, or may be used as, an admission by NAI of any fault, wrongdoing or liability. D. Investigation, Discovery and Research in the Litigation Counsel for PLAINTIFFS and counsel for NAI have conducted sufficient discovery, investigation and research during the prosecution of the Litigation to reach this AGREEMENT. The discovery has included, inter alia, examination and investigation of McAfee software packaging, the depositions of two NAI witnesses and Plaintiff Carole Eustice, and the exchange of written discovery. Counsel have investigated and evaluated the applicable law and facts regarding the claims presented in the Litigation and the potential defenses thereto. E. PLAINTIFFS Reasons for Settlement PLAINTIFFS recognize the substantial risks associated with further litigation against NAI through trial and through likely appeals. In this regard, PLAINTIFFS recognize the difficulty and expense in pursuing litigation which involves: (1) limited damages per putative class member; (2) the difficulty in establishing ownership of the VERSION 3 AND/OR VERSION 4 OF THE MCAFEE VIRUSSCAN SOFTWARE; (3) complex questions of consumer understanding of the meaning of the Alleged Representations; and (4) extensive discovery relating to industry practices with regard to updates and the considerations behind 2

3 decisions to end of life older versions of software programs. PLAINTIFFS also have taken into account the uncertainty and the risk of the outcome of the Litigation and of succeeding on the merits of the various causes of action alleged in the Litigation. PLAINTIFFS also have considered the difficulties and uncertainties of establishing that there was an attempt by NAI to mislead consumers or make false claims about the features of the McAfee software, through expert testimony or otherwise. PLAINTIFFS therefore deem it desirable and beneficial that the Litigation be settled upon the terms and conditions set forth herein. F. NAI s Reasons for Settlement NAI has concluded that further litigation would be protracted and expensive for all and that settlement is desirable. NAI has also taken into account that, while the number of consumers who can establish lawful ownership of the software and who might have understood the Alleged Representation in the manner PLAINTIFFS allege makes any award unlikely, there is always uncertainty as to the outcome of litigation. NAI therefore deems it desirable and beneficial that the Litigation be settled upon the terms and conditions set forth herein. AGREEMENT NOW THEREFORE, it is agreed by and between the undersigned that the Litigation be settled as among PLAINTIFFS (on behalf of themselves and the CLASS) and NAI, conditioned upon approval of the Court, on the following terms and conditions: 1. DEFINITIONS A. AGREEMENT As used herein, the term AGREEMENT shall refer to this document and all of the Exhibits hereto. 3

4 B. ALLEGED REPRESENTATION As used herein, the term ALLEGED REPRESENTATION shall refer to the language Update Immediately for Life, Lifetime Virus Updates and any other language referring to the availability of updates to VERSION 3 AND/OR VERSION 4 OF THE MCAFEE VIRUSSCAN SOFTWARE. C. CLAIM As used herein, the term CLAIM shall refer to the alleged circumstances and events which PLAINTIFFS believe give rise to the claims asserted in the Litigation including alleged improper advertisements, statements, promises or representations made in connection with the distribution of VERSION 3 AND/OR VERSION 4 OF THE MCAFEE VIRUSSCAN SOFTWARE, alleged breaches of contract, alleged violations of California Business and Professions Code et seq., alleged violations of the Consumer Legal Remedies Act (California Civil Code 1770 et seq.) and all events and matters that were alleged or could have been alleged in the Litigation against NAI. D. CLASS As used herein, the term CLASS shall refer to all persons encompassed within the allegations in the Complaint including all U.S. licensees of VERSION 3 AND/OR VERSION 4 OF THE MCAFEE VIRUSSCAN SOFTWARE. 4

5 E. CLASS COUNSEL/PLAINTIFFS COUNSEL As used herein, the terms CLASS COUNSEL or PLAINTIFFS COUNSEL shall refer to the following attorneys who are counsel for all of the PLAINTIFFS: ROBERT CHATENEVER WILLIAM JOHN WEILBACHER ATTORNEYS AT LAW 3639 HARBOR BLVD., SUITE 103 VENTURA, CA TELEPHONE: (805) F. CLASS MEMBER As used herein, the term CLASS MEMBER shall refer to each member of the CLASS. G. CLASS NOTICE As used herein, the term CLASS NOTICE shall refer to notice of the AGREEMENT provided to the CLASS, including the right to opt out. H. EFFECTIVE DATE As used herein, the term EFFECTIVE DATE shall mean the date when the SUPERIOR COURT s Judgment and Order of Dismissal (Exhibit A) granting final approval of this AGREEMENT and the settlement contained herein on behalf of the CLASS is final under California law, pursuant to the California Code of Civil Procedure, in that the time for the filing of any appeal or request for appellate review of said order has expired or all appeals or appellate procedures for review of said order have concluded. I. NOTICE As used herein, the term NOTICE shall refer to an to be sent within 30 days of the PUBLICATION NOTICE to those CLASS MEMBERS (i) for whom NAI has an e- mail address, (ii) who have not told NAI to not send them s and (iii) who have not placed themselves on the Direct Marketing Association s Do Not list. Subject to these same 5

6 conditions, NAI will also send the to persons who licensed McAfee VirusScan version 5. The shall include information concerning the AGREEMENT and a link to the LANDING PAGE. J. FIRST NOTICE As used herein, the term FIRST NOTICE shall refer to the first time notice of this AGREEMENT is provided to the CLASS. Specifically, it shall be the earlier of the first PUBLICATION NOTICE or the NOTICE. K. INTERNAL LANDING PAGE As used herein, the term INTERNAL LANDING PAGE or LANDING PAGE shall refer to an internet webpage established and maintained by NAI. The LANDING PAGE will display the CLASS NOTICE and provide information on how to obtain the Compensation to the CLASS (as defined in Section 7(a) below). The address (url) of the LANDING PAGE will be listed in the PUBLICATION NOTICE and in the NOTICE. Further, on the McAfee AntiVirus (DAT) Updates webpage, NAI will place a link to the LANDING PAGE entitled: Notice to VirusScan versions 3 or 4 users. L. NAI As used herein, the term NAI shall refer to NETWORK ASSOCIATES, INC. and its predecessors (including companies it has purchased and absorbed), affiliates, successors, officers, directors, employees, attorneys, agents, and their respective assigns, representatives, heirs, executors and administrators and any individual or entity formerly or currently involved in the distribution of VERSION 3 AND/OR VERSION 4 OF THE MCAFEE VIRUSSCAN SOFTWARE. 6

7 M. NAI S COUNSEL As used herein, the term NAI S COUNSEL shall refer to the following attorneys who are counsel for NAI: IAN N. FEINBERG SHIRISH GUPTA MAYER, BROWN, ROWE & MAW LLP TWO PALO ALTO SQUARE, SUITE EL CAMINO REAL PALO ALTO, CA TELEPHONE: (650) FACSIMILE: (650) N. PARTY As used herein, the term PARTY shall refer to any of the PLAINTIFFS or NAI. O. PLAINTIFFS As used herein, the term PLAINTIFFS shall refer to Plaintiffs Carole Eustice and William Hansult and the CLASS they purport to represent. P. PUBLICATION NOTICE As used herein, the term PUBLICATION NOTICE shall refer to publication of the CLASS NOTICE in PC World magazine. The date of PUBLICATION NOTICE is the subscriber ship date. According to PC World magazine, the subscriber ship date for the June 2004 issue is April 30, 2004 and the subscriber ship date for the July 2004 issue is June 1, Q. SETTLED CLAIMS As used herein, the term SETTLED CLAIMS shall refer to any and all CLAIMS, demands, damages, attorneys fees, costs, remedies, actions, causes of action, suits in equity, including those subsumed by California Civil Code 1542, which any of the PLAINTIFFS had or has, whether known CLAIMS or UNKNOWN CLAIMS, asserted or unasserted, direct, individual, class, representative, derivative or in any other capacity. 7

8 The PARTIES agree to mutually release one another, and their respective counsel, of and from any and all claims arising from the bringing or pursuit of the Litigation. R. SUPERIOR COURT As used herein, unless otherwise specified, the term SUPERIOR COURT shall refer to the Superior Court of the State of California for the County of Ventura. S. UNKNOWN CLAIMS As used in the definition of SETTLED CLAIMS, UNKNOWN CLAIMS, shall refer to claims which a PARTY or PARTIES does not know or suspect to exist at the time of the release of the opposing Parties which if known by them would have materially affected their settlement decision. Solely with respect to any and all SETTLED CLAIMS, it is the intention of the PARTIES hereto that each of the PARTIES hereby expressly waives and relinquishes, to the fullest extent permitted by law, the provisions, rights, and benefits of Section 1542 of the California Civil Code, which statute provides: A general release does not extend to claims which the creditor does not know or suspect to exist in his favor at the time of executing the release, which if known by him must have materially affected his settlement with the debtor. and any and all provisions, rights, and benefits of any similar statute or law of California or of any other jurisdiction. T. VERSION 3 AND/OR VERSION 4 OF THE MCAFEE SOFTWARE As used herein, the term VERSION 3 AND/OR VERSION 4 OF THE MCAFEE VIRUSSCAN SOFTWARE shall refer to all copies of Version 3 and/or Version 4 of the McAfee VirusScan software licensed or otherwise distributed in the United States to end-users. 8

9 2. CLASS CERTIFICATION AND CLASS NOTICE A. Application to SUPERIOR COURT for Preliminary Approval, Certification of the CLASS, Approval of CLASS COUNSEL and Procedures for Notice and Objections Each of the PARTIES hereby stipulates and agrees, solely for purposes of consummation and fulfillment of this AGREEMENT, to the certification of the CLASS. The PARTIES agree to present the AGREEMENT promptly to the SUPERIOR COURT for preliminary approval. The PARTIES shall seek from the SUPERIOR COURT an Order certifying the CLASS for settlement purposes only, approving the appointment of CLASS COUNSEL, providing for Notice to the CLASS and a hearing for final approval of the proposed settlement (the Preliminary Approval Order ), substantially in the form of Exhibit B hereto, which shall specifically include provisions that: (1) Conditionally certify the CLASS; (2) Preliminarily approve this AGREEMENT ( Preliminary Approval ); (3) Approve the CLASS NOTICE substantially in the form of Exhibit C; (4) Direct NAI to cause the CLASS NOTICE to be provided as follows: (A) by PUBLICATION NOTICE in two consecutive editions of PC World magazine; (B) by posting on the LANDING PAGE; (C) by NOTICE; 1 (5) Find that the CLASS NOTICE constitutes the best notice practicable under the circumstances and is due and sufficient notice of the matters set forth in the AGREEMENT to all members of the CLASS, and that the CLASS NOTICE fully satisfies the 1 Additionally, under the same conditions as with NOTICE, NAI agrees to licensees of VirusScan Versions 6, 7 and 8 with a link to the LANDING PAGE. 9

10 requirements of due process and of the California Code of Civil Procedure and any other applicable law; (6) Schedule a hearing (the Settlement Fairness Hearing ) for June 29, 2004, or as soon thereafter as the SUPERIOR COURT may hear the matter for final approval of the settlement, as set forth more specifically in this AGREEMENT, and for final approval of the motion for an award of CLASS COUNSEL s attorneys fees and costs; (7) Provide that any person who wishes to be excluded from the CLASS must submit a written request for exclusion, postmarked on or before a date to be specified in the Preliminary Approval Order to be sent to CLASS COUNSEL. The request for exclusion must include all of the following: (A) (B) (C) the person s name and address; a statement that such person is a member of the CLASS; and a statement requesting exclusion from the CLASS. (8) Provide that any objections to the proposed Settlement must be filed with the Clerk of the SUPERIOR COURT and served by first class mail on CLASS COUNSEL and NAI S COUNSEL on or before the date specified in the Preliminary Approval Order in order for the objections to be received and considered by the SUPERIOR COURT at the Settlement Fairness Hearing. B. Distribution of Requests for Exclusion from Class CLASS COUNSEL shall file with the SUPERIOR COURT all requests for exclusion from any CLASS MEMBER 7 days prior to the date of the Settlement Fairness Hearing. CLASS COUNSEL shall submit monthly summary lists of CLASS MEMBERS who have requested exclusion from the CLASS. 10

11 3. CONDITIONS OF SETTLEMENT, EFFECT OF DISAPPROVAL, CANCELLATION AND TERMINATION a. This AGREEMENT is expressly conditioned on the occurrence of each and all of the following events: (1) Entry of and finality, under California law, of the SUPERIOR COURT s Judgment and Order of Dismissal by June 29, 2004, granting final approval of the AGREEMENT; and (2) Fewer than 200 CLASS MEMBERS opting out of the settlement. If 200 or more CLASS MEMBERS opt-out, NAI may, at any time three days or more prior to the final fairness hearing, terminate the AGREEMENT by sending written notice thereof to CLASS COUNSEL. b. Only the failure of the occurrence of any of these conditions is grounds for cancellation and termination of this AGREEMENT. This AGREEMENT cannot otherwise be cancelled or terminated in whole or in part. c. An appeal, modification, or reversal on appeal of any amount of fees or costs awarded by the SUPERIOR COURT to Plaintiffs Eustice and Hansult or to CLASS COUNSEL up to the maximum sum agreed to by the PARTIES herein shall not constitute grounds for cancellation and termination of this AGREEMENT. d. In the event this AGREEMENT is cancelled and terminated, all events, obligations or portions of this AGREEMENT shall automatically be terminated and cancelled. With the exception of those CLASS MEMBERS who have availed of the CONSIDERATION FROM NAI, the PARTIES shall be deemed to have reverted to their respective status and position in the Litigation, and shall proceed as if this AGREEMENT and/or related orders concerning a proposed settlement and certification of a settlement class had not been executed. 11

12 Any and all claims of the CLASS MEMBERS who have availed of the Consideration from NAI shall be deemed satisfied and extinguished. e. In the event this AGREEMENT is cancelled or terminated, this AGREEMENT, all discussions concerning this AGREEMENT, all filings, draft documents and any other material related to this AGREEMENT shall be deemed confidential settlement materials which cannot be used in evidence, or for any purpose, against or by any PARTY. f. In the event this AGREEMENT is cancelled, the PARTIES shall, within two (2) weeks of such cancellation, jointly move for a status conference with the SUPERIOR COURT to be held on the SUPERIOR COURT s first available date. 4. SETTLEMENT FAIRNESS HEARING After Preliminary Approval of the Settlement, notice to the CLASS and an opportunity for objection, a Settlement Fairness Hearing shall be held on June 29, 2004 or as soon thereafter as the SUPERIOR COURT can hear the matter. In connection with the Settlement Fairness Hearing, the PARTIES to this AGREEMENT shall file such papers with the SUPERIOR COURT as their counsel or the SUPERIOR COURT determine to be necessary. Before the Settlement Fairness Hearing, proof of publication and mailing of the CLASS NOTICE shall be filed by NAI. 5. JUDGMENT After final approval of the settlement and of this AGREEMENT is granted, the PARTIES shall obtain entry of a Proposed Judgment and Order of Dismissal with prejudice of the Litigation substantially in the form of Exhibit A hereto. 12

13 6. CONTINUING JURISDICTION It is expressly agreed by the PARTIES that the SUPERIOR COURT will retain jurisdiction to enforce the terms of this AGREEMENT pursuant to California Code of Civil Procedure It is further agreed that Judge William J. Cahill (Ret.) will be appointed Special Master to resolve all disputes. 7. CONSIDERATION FROM NAI In full and complete settlement of the Litigation and for all of PLAINTIFFS CLAIMS and UNKNOWN CLAIMS, and subject to all of the terms and conditions of this AGREEMENT, NAI agrees to provide the following consideration: (a) Compensation to the CLASS: Each CLASS member will be offered a coupon for a free download of the perpetual version of one of the following: (i) McAfee VirusScan version 8, (ii) AntiSpyware version 1.0 or (iii) QuickClean version 4.01 (or the most recent versions at the time of download) software from mcafee.com. i) The coupon will be available for 60 days from the FIRST NOTICE. To obtain the coupon, each CLASS member must complete an on-line form located on the LANDING PAGE to certify membership in the CLASS. No credit card information will be required for completion of the form or for redemption of the coupon. ii) Regardless of the when obtained, the coupon may only be redeemed within 60 days from the FIRST NOTICE. iii) The coupon may not be used in conjunction with any other promotional offer or coupon and may only be used on mcafee.com. A maximum of one coupon may be redeemed per household. 13

14 (b) CLASS COUNSEL s Attorneys Fees and Costs: CLASS COUNSEL will receive $227, in attorneys fees, costs, and expenses ( Fees ) subject to SUPERIOR COURT approval. The Fees shall be paid within 30 days after the EFFECTIVE DATE. In the event that an appeal is taken from any portion of this settlement, the award to CLASS COUNSEL shall be stayed pending resolution of the appeal. (c) Class Representatives Fees: Class representatives Carole Eustice and William Hansult will each receive $5,000, subject to SUPERIOR COURT approval. These fees shall be paid within 30 days after the EFFECTIVE DATE. In the event that an appeal is taken from any portion of this settlement, the award of Class Representatives fees shall be stayed pending resolution of the appeal. (d) Cost of Notice and Administration of Compensation: NAI shall bear the cost of administering, and distributing the above consideration, as well as the cost of providing CLASS NOTICE. (e) Reporting: NAI shall send a total of 4 quarterly reports to CLASS COUNSEL regarding the status of the settlement administration. (f) Settlement Monitoring: CLASS COUNSEL may falsely apply for a maximum of ten (10) coupons. If any of the false applications is rejected, CLASS COUNSEL shall promptly notify NAI. Only if NAI agrees or if the Special Master decides that more than one (1) false application was improperly rejected, may CLASS COUNSEL submit up to forty (40) more false applications. Any coupons falsely obtained by CLASS COUNSEL may not be redeemed. 8. AGREEMENT TO COOPERATE All of the PARTIES hereto agree to cooperate with one another to effectuate this AGREEMENT. 14

15 9. CHOICE OF LAW In determining the rights of the PARTIES hereto, this AGREEMENT shall be governed by, construed, and interpreted in accordance with the internal laws of the State of California, without regard to the conflict of laws principles thereof. 10. WARRANTIES Each signatory to this AGREEMENT hereby warrants that (s)he has the authority to execute this AGREEMENT and thereby bind the respective party. 11. BINDING EFFECT OF THE AGREEMENT The terms of this AGREEMENT shall inure to the benefit of, and be binding upon, the PARTIES and their respective heirs, legal representatives, executors, administrators, successors, and assigns. 12. INTEGRATION CLAUSE This AGREEMENT and its Exhibits state the entire agreement of the PARTIES with respect to the matters discussed herein, and supersede all prior or contemporaneous oral or written understandings, agreements, statements or promises. 13. MODIFICATIONS IN WRITING ONLY This AGREEMENT may not be amended or modified in any respect except by a written instrument duly executed by all of the PARTIES to this AGREEMENT or their counsel and with the approval of the Court. 14. HEADINGS The headings and captions contained in this AGREEMENT are inserted only as a matter of convenience and in no way define, limit, extend or describe the scope of this AGREEMENT or the intent of any provision thereof. 15

16 15. COUNTERPARTS This AGREEMENT may be executed in one or more counterparts, each of which shall be an original, and this AGREEMENT is effective upon execution of at least one counterpart by each party to this AGREEMENT. 16. NO ADMISSIONS If this AGREEMENT does not become effective or is cancelled or terminated for any reason, it shall be deemed negotiation for settlement purposes only and will not be admissible in evidence or usable for any purposes whatsoever in connection with any proceedings arising from the underlying facts hereto. 17. TERMINOLOGY AND CONSTRUCTION All personal pronouns used in this AGREEMENT, whether used in the masculine. feminine or neuter gender, shall include all other genders, and the singular shall included the plural and vice versa. 18. AGREEMENT DRAFTED BY ALL PARTIES This AGREEMENT has been, and shall be construed to have been, drafted by all the PARTIES to it so that any rule which construes ambiguities against the drafter shall have no force or effect. 16

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21 EXHIBIT A

22 MAYER, BROWN, ROWE & MAW LLP IAN N. FEINBERG (SBN 88324) SHIRISH GUPTA (SBN ) Two Palo Alto Square Suite 300 Palo Alto, California Telephone: (650) Facsimile: (650) Attorneys for Defendant NETWORK ASSOCIATES, INC SUPERIOR COURT OF THE STATE OF CALIFORNIA FOR THE COUNTY OF VENTURA CAROLE EUSTICE, WILLIAM HANSULT, v. Plaintiffs, NETWORK ASSOCIATES, INC. and DOES 1-100, Defendants. CASE NO. CIV [PROPOSED] JUDGMENT AND ORDER OF DISMISSAL Judge: Hon. Henry J. Walsh [PROPOSED] JUDGMENT AND ORDER OF DISMISSAL

23 This action came on for hearing pursuant to the Preliminary Order of this Court filed, 2004, on the application of the parties for approval of the settlement set forth in the Settlement Agreement and General Release dated as of March 29, 2004 ( the Settlement Agreement ). The Court, by the, 2004 Order, had previously granted preliminary approval of the Settlement Agreement. Due and adequate notice having been given to the Class as required in said Order, and the Court having considered all papers filed and proceeding had herein and otherwise being fully informed in the premises and good cause appearing therefore, IT IS HEREBY ORDERED, ADJUDGED AND DECREED that: This Judgment incorporates by reference the definitions in the Settlement Agreement, and all terms used herein shall have the same meaning as set forth in the Settlement Agreement. This Court has jurisdiction over the subject matter of the Litigation and over all parties to the Litigation, including all members of the Class. Pursuant to California Code of Civil Procedure 382, this Court has certified the Class. The Class is defined as all U.S. residents who licensed versions 3 or 4 of McAfee VirusScan software. This Court hereby finally approves the settlement set forth in the Settlement Agreement and finds that said settlement is, in all respects, fair, just, reasonable and adequate to the Class. The Parties are hereby directed to perform its terms. Except as to any individual claim of those Persons (identified in Exhibit A hereto) who have validly and timely requested exclusion from the Class, the Litigation and all claims contained therein are dismissed with prejudice as to the Class. The parties are to bear their own costs, except as otherwise provided in the Settlement Agreement. Upon the Effective Date hereof, NAI shall be deemed to have, and by operation of this Judgment shall have fully, finally and forever be released and discharged from each and all of the Class claims (including Unknown Claims) arising out of, relating to, or in connection with the Litigation and the claims asserted therein. The notice given to the Class fully complied with California Rules of Court 1859(f) and 1860(c) and the requirements of due process. The Class was given adequate notice of this action, A-2 [PROPOSED] JUDGMENT AND ORDER OF DISMISSAL

24 the proposed settlement, the right to opt out of the class and the right to object to the proposed settlement. Neither the Settlement Agreement nor the settlement contained therein, nor any act performed or document executed pursuant to or in furtherance of the Settlement Agreement or the settlement: (i) is or may be deemed to be or may be used as an admission of, or evidence of, the validity of the claims asserted in the Litigation or of any wrongdoing or liability of NAI, or (ii) is or may be deemed to be or may be used as an admission of, or evidence of, any fault or omission of NAI in any civil, criminal or administrative proceeding in any court, administrative agency or other tribunal. NAI may file the Settlement Agreement and/or the Judgment from this action in any other action that may be brought against it in order to support a defense or counterclaim based on principles of res judicata, collateral estoppel, release, good faith settlement, judgment bar or reduction, or any theory of claim preclusion or issue preclusion or similar defense or counterclaim. Without affecting the finality of this Judgment in any way, this Court hereby retains continuing jurisdiction over (a) implementation and administration of this settlement, (b) hearing and determining Class counsel s application for attorneys fees and costs and (c) all parties hereto for the purpose of construing, enforcing and administering the Settlement Agreement. In order to assist the Court, the Honorable William Cahill (Ret.) is appointed as Special Master. All disputes over the administration or settlement of the matter should first be submitted to the Special Master. In the event that the settlement does not become effective in accordance with the terms of the Settlement Agreement, then this Judgment shall be rendered null and void, to the extent provided by and in accordance with the Settlement Agreement, and shall be vacated. IT IS SO ORDERED Dated:, 2004 A-3 Honorable Henry J. Walsh Judge of the Superior Court [PROPOSED] JUDGMENT AND ORDER OF DISMISSAL

25 EXHIBIT B

26 MAYER, BROWN, ROWE & MAW LLP IAN N. FEINBERG (SBN 88324) SHIRISH GUPTA (SBN ) Two Palo Alto Square Suite 300 Palo Alto, California Telephone: (650) Facsimile: (650) Attorneys for Defendant NETWORK ASSOCIATES, INC SUPERIOR COURT OF THE STATE OF CALIFORNIA FOR THE COUNTY OF VENTURA CAROLE EUSTICE, WILLIAM HANSULT, v. Plaintiffs, NETWORK ASSOCIATES, INC. and DOES 1-100, Defendants. CASE NO. CIV [PROPOSED] ORDER GRANTING PRELIMINARY APPROVAL OF SETTLEMENT AGREEEMENT Judge: Hon. Henry J. Walsh [PROPOSED] ORDER RE: PRELIMINARY APPROVAL OF SETTLEMENT

27 On March 30, 2004, the parties Application for Preliminary Approval of the Settlement Agreement and General Release dated as of March 29, 2004 ( the AGREEMENT ) was submitted to the above referenced court. This Order incorporates by reference the definitions in the AGREEMENT, and all terms used herein shall have the same meaning as set forth in the AGREEMENT. Having considered the Application and papers submitted in support thereof, having heard argument from counsel and for good cause shown, IT IS HEREBY ORDERED that: 1. The application for preliminary approval of the AGREEMENT is GRANTED; 2. Thus, the AGREEMENT is PRELIMINARILY APPROVED purposes only: AS SET FORTH IN THE AGREEMENT, IT IS ORDERED that, for settlement 1. Pursuant to California Code of Civil Procedure 382, the Court hereby certifies a class of all U.S. residents who licensed versions 3 or 4 of McAfee VirusScan software; 2. The Court hereby approves Robert Chatenever and William John Weilbacher as class counsel; 3. Defendant Network Associates, Inc. ( NAI ) shall provide notice to the CLASS in the following manner: a. by PUBLICATION NOTICE in two consecutive editions of PC World magazine; b. by posting on the LANDING PAGE; c. by NOTICE; 4. The CLASS NOTICE shall be substantially in the form of Exhibit C, attached to the Settlement Agreement; 5. The CLASS NOTICE constitutes the best notice practicable under the circumstances and is due and sufficient notice of the matters set forth in the AGREEMENT to all members of the CLASS; B-2 [PROPOSED] ORDER RE: PRELIMINARY APPROVAL OF SETTLEMENT

28 The CLASS NOTICE fully satisfies the requirements of due process and of the California Code of Civil Procedure and any other applicable law; 7. The Court will hold a hearing (the Settlement Fairness Hearing ) on June 29, 2004 for final approval of the settlement, as set forth more specifically in the AGREEMENT, and for final approval of the motion for an award of CLASS COUNSEL s attorneys fees and costs; 8. Any person who wishes to be excluded from the CLASS must submit, to CLASS COUNSEL, a written request for exclusion, postmarked on or before June 18, The request for exclusion must include all of the following: a. the person s name and address; b. a statement that such person is a member of the CLASS; and c. a statement requesting exclusion from the CLASS. 9. Any objections to the proposed Settlement must be filed with the Clerk of the Superior Court and served by first class mail on CLASS COUNSEL and NAI S COUNSEL on or before June 18, 2004 in order for the objections to be received and considered by the Court at the Settlement Fairness Hearing. 10. CLASS COUNSEL shall file with the Court all requests for exclusion from any CLASS MEMBER 7 days prior to the date of the Settlement Fairness Hearing IT IS SO ORDERED. Dated:, 2004 Honorable Henry J. Walsh Judge of the Superior Court 28 B-3 [PROPOSED] ORDER RE: PRELIMINARY APPROVAL OF SETTLEMENT

29 EXHIBIT C

30 NOTICE OF PROPOSED CLASS ACTION SETTLEMENT This notice pertains to a class action lawsuit called Carole Eustice v. Network Associates, Inc., Case No. CIV , pending in the Superior Court of California, County of Ventura. IF YOU ARE A U.S. RESIDENT AND YOU LICENSED VERSIONS 3 OR 4 OF MCAFEE VIRUSSCAN SOFTWARE, YOU MAY BE A MEMBER OF THE CLASS FOR WHOM RELIEF IS BEING SOUGHT AND YOU SHOULD READ THIS NOTICE. On April 7, 2004, the Court certified a class that includes all U.S. residents who licensed versions 3 or 4 of McAfee VirusScan software. The Class does not include U.S. residents who did not license versions 3 or 4 of McAfee VirusScan software. The Class also does not include non-u.s. residents. WHAT IS THIS CLASS ACTION ABOUT? Plaintiffs allege that Network Associates has violated California state law and breached their license agreements by failing to provide free lifetime updates to purchasers of versions 3 and/or 4 of McAfee VirusScan software. The class action asserts claims under California Business and Professions Code et seq. and California Civil Code 1770 et seq. Network Associates denies the allegations. The Court has not made any determination about the merits of Plaintiffs claims or the denials and other defenses of Network Associates. The Court has ruled that the named Plaintiffs in this class action (Carole Eustice and William Hansult) may represent the Class described above. The parties have come to a settlement. Network Associates agrees to give each Class member a coupon for a free download of the perpetual version of one of the following: (i) McAfee VirusScan version 8, (ii) AntiSpyware version 1.0 or (iii) QuickClean version 4.01 (or the most recent versions at the time of download) software from mcafee.com. The coupon will be available until June 29, To obtain the coupon, go to and complete an on-line form certifying that you are a member of the Class. The coupon must be redeemed by June 29, The coupon may not be used in conjunction with any other promotional offer or coupon and may only be used on mcafee.com. A maximum of one coupon may be redeemed per household. Under the settlement, Class Counsel will receive $227,000 in attorneys fees, costs and expenses from Network Associates. Class Members are not personally liable for any such fees or expenses. C-1

31 This notice is intended to inform you of the Court s ruling and your rights in this class action. If you wish to be included in this class action, you need do nothing. You will automatically be in the Class. However, if you do NOT wish to be included in the Class, you should complete and sign the opt-out form available at and mail it to: ROBERT CHATENEVER WILLIAM JOHN WEILBACHER ATTORNEYS AT LAW 3639 HARBOR BLVD., SUITE 103 VENTURA, CA Alternatively, you may send a letter of your own to the address listed above. In the letter, state your name, your address, that you are a member of the Class and that you wish to be excluded from the Class. Your opt-out form or letter must be postmarked by June 18, As a Class member you will be bound by all orders and judgments of the Court. Claims of Class members will be determined by the final resolution of this case. Class members who do not validly and timely request to be excluded from the Class shall be deemed to have released and forever discharged all of the Settled Claims against Network Associates. You do not have to pay the attorneys representing the named plaintiffs and Class members. You also may seek the Court s permission to intervene or personally appear in the class action. If you hire your own attorney, you must make pay arrangements with that attorney. If you opt-out of the class action you will not be bound by any Court orders or judgments, and you will not participate in the relief granted to the Class. On June 29, 2004, the Court will hold a settlement fairness hearing. If you object to the proposed settlement, you may file an objection with the Clerk of the Ventura County Superior Court. The objection must contain a statement of your reasons for objecting. In order for the objection to be received and considered by the Superior Court at the settlement fairness hearing, your objection must be filed with the Court and mailed to Class Counsel no later than June 18, Only members of the Class who have submitted written objections in this manner will be entitled to be heard at the settlement hearing, unless the Court orders otherwise. If you have questions about this class action or would like a copy of the settlement agreement, you may contact the following attorneys for the Plaintiffs and the Class: ROBERT CHATENEVER WILLIAM JOHN WEILBACHER ATTORNEYS AT LAW 3639 HARBOR BLVD., SUITE 103 VENTURA, CA TELEPHONE: (805) FACSIMILE: (805) C-2

32 The proposed settlement and the pleadings filed in the class action are available for inspection during business hours at the Superior Court for the County of Ventura. Please DO NOT telephone the Court concerning this Notice. Dated: April 7, 2004 The Honorable Henry A. Walsh Judge of the California Superior Court for Ventura County C-3

33 SUMMARY NOTICE TO BE PUBLISHED IN PC WORLD MAGAZINE: NOTICE OF PROPOSED CLASS ACTION SETTLEMENT: Eustice v. Network Associates, Inc., Case No. CIV , Superior Court of California, County of Ventura. IF YOU ARE A U.S. RESIDENT AND YOU LICENSED VERSIONS 3 OR 4 OF MCAFEE VIRUSSCAN SOFTWARE, YOU MAY BE A MEMBER OF THE CLASS FOR WHOM RELIEF IS BEING SOUGHT AND YOU SHOULD READ THIS NOTICE. A detailed class notice is at Plaintiffs allege that Network Associates has violated California state law and breached their license agreements by failing to provide free lifetime updates to purchasers of versions 3 and/or 4 of McAfee VirusScan software. Without determining the merits of Plaintiffs claims, the Court has ruled that the named Plaintiffs in this class action may represent the Class described above. Each Class member may obtain a coupon for a free download of the perpetual version of one of the following: (i) McAfee VirusScan version 8, (ii) AntiSpyware version 1.0 or (iii) QuickClean version 4.01 software from mcafee.com. The coupon will be available until June 29, To obtain the coupon, go to and complete an on-line form. If you wish to be included in this class action, you need do nothing. You will automatically be in the Class and may immediately participate in the settlement. However, if you do NOT wish to be included in the Class, you should complete and sign the opt-out form available at and mail it to the attorneys for the Class (identified below). Alternatively, you may send a letter of your own. In the letter, state your name, your address, that you are a member of the Class and that you wish to be excluded from the Class. Your opt-out form or letter must be postmarked by June 18, If you opt-out of the class action you will not be bound by any Court orders or judgments, and you will not participate in the relief granted to the Class. As a Class member you will be bound by all orders and judgments of the Court. Class members who do not validly and timely request to be excluded from the Class shall be deemed to have released and forever discharged all of the Settled Claims against Network Associates. Under the settlement, Class Counsel will receive $227,000 in attorneys fees, costs and expenses from Network Associates. Class Members are not personally liable for any such fees or expenses. You also may seek the Court s permission to intervene or personally appear in the class action. If you hire your own attorney, you must make pay arrangements with that attorney. On June 29, 2004, the Court will hold a settlement fairness hearing. You may file an objection with the Clerk of the Ventura County Superior Court and mail it to Class Counsel no later than June18, Only members of the Class who have submitted timely written objections will be entitled to be heard at the settlement hearing, unless the Court orders otherwise. This is only a summary of the proposed settlement. In order to receive a copy of the detailed notice of the Settlement or a claim form, go to If you have questions about this class action or would like a copy of the settlement agreement, you may contact the following attorneys for the Plaintiffs and the Class: ROBERT CHATENEVER WILLIAM JOHN WEILBACHER ATTORNEYS AT LAW 3639 HARBOR BLVD., SUITE 103 VENTURA, CA TELEPHONE: (805) FACSIMILE: (805) The proposed settlement and the pleadings filed in the class action are available for inspection during business hours at the Superior Court for the County of Ventura. Please DO NOT telephone the Court concerning this Notice. April 7, 2004 The Honorable Henry A. Walsh Judge of California Superior Court for Ventura County C-4

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