SECOND AMENDMENT TO
CREDIT AGREEMENT
This Second Amendment to Credit Agreement is entered into as of this
19th day of May, 2000, by and between COMERICA BANK, a Michigan banking
corporation ("Bank"), with offices at One Detroit Center, 000 Xxxxxxxx
Xxxxxx, Xxxxxxx, Xxxxxxxx 00000 and SIMPLE TECHNOLOGY, INC., a California
corporation ("Company"), whose principal office is located at 0000 Xxxxxxx
Xxxxxx, Xxxxx Xxx, XX 00000.
RECITALS:
A. Bank and Company entered into a certain Credit Agreement
dated as of August 3, 1999 (the "Credit Agreement"), as amended by First
Amendment to Credit Agreement dated as of December 29, 1999 (the "First
Amendment" together with the Credit Agreement, the "Agreement") and in
connection therewith, Company executed and delivered to Bank a certain
Revolving Note in the principal amount of $20,000,000 and Canadian
Subfacility Note in the principal amount of CAD $1,000,000 both of even date
therewith (collectively, the "Note").
B. The parties desire to further amend the Agreement, upon the
following terms and conditions.
NOW THEREFORE, for good and valuable consideration, the parties
agree as follows:
1. Section 1.26 of the Agreement is amended and restated in
its entirety as follows:
"1.26 "EUROCURRENCY-BASED RATE" shall mean a per annum
interest rate equal to the Eurocurrency Rate, plus two and
three-quarters percent (2.75%) per annum."
2. Clause (a) of Section 1.42 of the Agreement is amended and
restated in its entirety as follows:
"(a) delivery of desk top appraisals on DRAM and memory
modules on the first business day of each calendar quarter commencing
on July 1, 2000;"
3. Section 6.1(f) of the Agreement is amended and restated in
its entirety as follows:
"(f) furnish to the Bank, weekly, in form, content and
reporting basis satisfactory to Bank, a Borrowing Base Report provided,
however, that during any period when the principal amount of the Loans
outstanding exceeds eighty percent (80%) of the Facility Maximum then
in effect such Borrowing Base Reports shall be delivered (together with
such back-up materials and appraisals as Bank may require) more
frequently at such intervals as Bank, in its sole discretion, directs."
4. Section 6.1(i) of the Agreement is amended to:
(a) substitute the term "quarterly" for "monthly" immediately
preceding the phrase "DRAM desktop inventory appraisal
updates"; and
(b) insert the following at the end of such subsection:
"provided, however that during any period when the principal
amount of the Loans outstanding exceeds eighty percent (80%)
of the Facility Maximum then in effect more frequent reporting
may be required at such intervals as Bank, in its sole
discretion, directs."
5. Company hereby ratifies and reaffirms the representations,
warranties and covenants set forth in the Agreement.
6. Company certifies that no Event of Default or default (as
defined in the Agreement) has occurred and is continuing.
7. Company represents and warrants that its Articles of
Incorporation and Bylaws delivered to Bank as of March __, 2000 in connection
with the Agreement, are in full force and effect and have not been modified,
repealed or amended since the date thereof.
8. If any provision of this Amendment shall be held invalid or
unenforceable, such invalidity or unenforceability shall affect only such
provision and shall not in any manner affect or render invalid or
unenforceable any other provision of this Amendment, and this Amendment shall
be enforced as if any such invalid or unenforceable provision were not
contained herein.
9. Except as specifically amended hereby, the Agreement shall
remain unchanged and shall be in full force and effect, enforceable in
accordance with its terms.
IN WITNESS WHEREOF, this Amendment has been executed as of the day
first stated above.
SIMPLE TECHNOLOGY, INC.
By: /s/ Xxxxxxx Xxxxxxxxx
Its: Chief Executive Officer
COMERICA BANK
By: /s/ Xxxx X. Xxxxx
Its: Vice President
-2-
