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EXHIBIT 4.1.1
AMENDMENT TO CONVERTIBLE DEBENTURE
This Amendment to Convertible Debenture (the "Amendment") is entered
into as of April 20, 2001 between Procom Technology, Inc., a California
corporation (the "Company"), and Montrose Investments Ltd., a Cayman Islands
corporation (the "Holder").
The Company and the Holder are parties to a Securities Purchase
Agreement dated as of October 31, 2000 (the "Purchase Agreement"), pursuant to
which the Company issued to the Holder a 6% Convertible Debenture due October
31, 2003 in the original principal amount of $15,000,000 (the "Debenture"). The
Company and the Holder desire to amend the Debenture as set forth herein. Terms
not otherwise defined herein shall have the meanings given such terms in the
Purchase Agreement or the Debenture.
Accordingly, the Company and the Holder agree that Section 7(b) of the
Debenture is hereby amended and restated in its entirety as follows:
"(b) May 15, 2001 shall be the first "RESET DATE" and thereafter
each six month anniversary of the Original Issue Date shall constitute
a Reset Date hereunder, and the "APPLICABLE PORTION" shall equal (i) on
the first Reset Date, one-third of the original principal amount of
this Debenture; (ii) on the second Reset Date, two-thirds of the
original principal amount of this Debenture, and (iii) on the third
Reset Date and each Reset Date thereafter, 100% of the original
principal amount of this Debenture.
(i) For a period of five Trading Days beginning on and
including each Reset Date (a "RESET PERIOD"), the Conversion Price
applicable to the Applicable Portion of this Debenture shall be
reset to the lesser of (A) the Conversion Price that would
otherwise apply or (B) 90% of the average of the Closing Prices
over the ten Trading Days preceding such Reset Date (the "RESET
CONVERSION PRICE").
(ii) If the Holder delivers a Conversion Notice during any
Reset Period with respect to all or any portion of the Applicable
Portion of this Debenture (the "RESET PORTION"), the Company shall
have the right, upon irrevocable notice delivered to the Holder
within two Trading Days after receipt of such Conversion Notice, to
repurchase all or any portion of the Reset Portion at a price equal
to 100% of the outstanding principal amount thereof plus all
accrued but unpaid interest thereon to the date of payment (the
"RESET REPURCHASE PRICE"), and any portion of this Debenture so
repurchased shall not be converted into Common Stock pursuant to
such Conversion Notice. The Company shall pay the entire Reset
Repurchase Price in immediately available funds (free of any claim
of subordination) no later than 20 Trading Days after the Reset
Date. Upon receipt of such payment, the Holder will deliver the
original Debenture so repurchased to the Company, unless such
Holder is awaiting receipt of a New Debenture from the Company
pursuant to another provision hereof.
(iii) If the Company fails to pay the Reset Repurchase Price
in full when due, then, in addition to any other remedies available
to the Holder under the Transaction Documents, the Holder shall
have the right (by notice to the Company) to (A) declare such
repurchase to be void ab initio and (B) to convert all or any
portion of the Reset Portion into Common Stock at the Reset
Conversion Price."
Except as expressly set forth above, the Debenture and all of the other
Transaction Documents (as defined in the Purchase Agreement) remain in full
force and effect in accordance with their terms, and any reference therein to
the "Debenture" shall mean the Debenture as amended by this Amendment. This
Amendment effects an amendment and a modification of the Debenture and not a
replacement or substitution thereof.
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IN WITNESS WHEREOF, the parties hereto have executed this Amendment as
of the date first above written.
PROCOM TECHNOLOGY, INC.
By: /s/ XXXX XXXXXXX
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Name: Xxxx Xxxxxxx
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Title: President
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MONTROSE INVESTMENTS LTD.
By: /s/ XXXXX X'XXXX
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Name: Xxxxx X'Xxxx
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Title: Authorized Signatory
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