He should offer a free upgrade to v4.1 so all the users can still use the software once the company closes down their activation servers. Maybe not a free source code version, but a free upgrade to v4.1 would be in order.
All of the older version users have to activate their version of the software and it will be useless once the activation servers go offline.
Not for free, he is forcing users to pay an upgrade price. EXTREMELY shady in my opinion.
The concern I'm talking about is ending up with an entirely orphaned product, which is pretty much what this guy is potentially doing since he's not allowing for the possibility of a community developing.
This is particularly bad since his product is an embedded .NET database. The .NET ecosystem is evolving at a healthy rate (compare to the RSN Java 7), especially WRT databases and I suspect it won't continue to be useful after very long. That was also an issue with CityDesk, which is an HTML etc. editor/lightweight CMS, since that is evolving at a healthy clip as well.