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Cadex Response to Patent Suit

Posted on May 18, 2013

Cadex

CADEX retains production and sales rights to its Strike Dual Rifle Chassis
design following the settlement of Ashbury suit

Quebec, Canada – May 16, 2013 – CADEX Inc. (CADEX Defence, Inc.) and Ashbury International
Group, Inc. recently settled a nearly 18-month legal battle concerning modular sniper rifle stock design
elements. Following the May 2 settlement, CADEX retains the production and sales rights to its existing
Strike Dual Rifle Chassis design and will continue manufacturing and selling the dual rail rifle chassis
system in the United States and globally.

CADEX announces the end to a patent infringement suit brought by Ashbury, who alleged that the earlier
generation single rail CADEX Strike rifle chassis had infringed an Ashbury patent. CADEX ceased
production of its single rail rifle chassis in mid 2012 when CADEX unveiled the Strike Dual Rifle
Chassis design. During the litigation and settlement agreement between the two parties, Ashbury
acknowledged that CADEX’s current Strike Dual Rifle Chassis design does not infringe the U.S.
patent rights Ashbury holds on its single rail design. In the settlement agreement, Ashbury also agreed
that CADEX will not be required to pay Ashbury any royalty or other license fees for CADEX’s
continued manufacture and sale of its Strike Dual Rifle Chassis System and further agreed that CADEX’s
distributors will not be required to pay any royalty or license fees related to such sales.

“CADEX intended to fight this case until realizing that there was a superior design – the CADEX Strike
Dual Rifle Chassis – and that it was not infringing technology. Once CADEX realized having a superior
technology, that clearly did not infringe the Ashbury patent, CADEX had to make the best business
decision as to how to settle the lawsuit”, said CADEX CEO Serge Dextraze. “CADEX’s priority was to
make sure that CADEX can continue to move forward with its Strike Dual Rifle Chassis product line in
the United States and globally, and CADEX has accomplished this goal. CADEX’s second priority was
to settle the lawsuit over technology, which had become irrelevant to CADEX’s product line, and
CADEX was able to do that inexpensively. It is already well known that the CADEX Strike Dual Rifle
Chassis is the best product ever shown and offered on the market. With its mitigation capabilities recoil
and its attractive and unique style, we are not surprised the CADEX Strike Dual Rifle Chassis attracts that
much attention. The CADEX Strike Dual Rifle Chassis is the most unique high end product ever
produced and available on the market.”

As a condition for settlement, Ashbury insisted that CADEX consent to a final judgment stating that
Ashbury’s U.S. patent rights on the single rail design are valid and that CADEX’s older single rail chassis
design infringed these U.S. patent claims. To entice CADEX’s consent to the judgment, Ashbury offered
to settle for a single payment of $50,000 rather its previous demand of $325,000. The wording of the
final judgment was carefully tailored to make it clear that only the CADEX Strike single rail design was
capable of infringing Ashbury’s U.S. patent, which requires a single, unified or monolithic rail across the
top of the chassis which is not the case with the CADEX Strike Dual Rifle Chassis.

“The average patent case costs in excess of a million dollars to resolve through trial, making these
nuisance value settlements attractive. To be clear, there was no trial or court hearing on the merits of

anyone’s claims in this case. The resolution was entered into voluntarily. Happily and a great relief for
everyone, it is now clearly established that CADEX has and keeps all his patents rights for the CADEX
Strike Dual Rifle Chassis product line”, said Steven G. Hill of Hill, Kertscher & Wharton, LLP, who
acted as lead counsel for CADEX during the case.

As of today, CADEX proclaims that both CADEX and its distributors will no longer be distracted by the
now-settled litigation and instead may concentrate on the manufacture and sale of CADEX Strike Dual
Rifle Chassis system. CADEX has designed and manufactured various chassis style stocks since 2005,
which have been and continue to be used by multiple military and law enforcement agencies. Many of
CADEX’s early generation design elements were also chosen for incorporation into the current US Army
XM 2010 sniper weapon system.

CADEX’s current Strike Dual Rifle Chassis design features major enhancements that provide operators a
solid, accurate chassis-type firing system that requires no tools to adjust the stock for length and comb
height. The CADEX Strike Dual Rifle Chassis also features a unique ability to be disassembled for
operator-level field maintenance. The keys to this capability are a two-piece top rail and a removable
lower frame with magazine well: these advancements simplify disassembly without the need to remove
either the rifle action from the chassis, the day sight or rear portion of the receiver rail. Since introducing
its first sniper rifle chassis system, CADEX continues to develop improvements and innovative state-of-
the-art rifle chassis designs. These are and will continue to be exemplified by the current CADEX Strike
Dual Rifle Chassis.

About CADEX Inc (CADEX Defence, Inc.)

A Canada-based company, CADEX has been offering customers a complete solution from design and
prototype to a full production capability with high end quality and service for 15 years. Serving a
worldwide military, law enforcement and civilian base, CADEX’s mission is to provide top quality
equipment.

CADEX Corporate Headquarters

755 Avenue Montrichard Iberville Industrial Parc

St. Jean sue Richelieu Quebec

Canada J2X 5K8

Tel: 1-450-348-6774

Fax: 1-450-348-7157

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