EXHIBIT 12.1
August 22, 2002
Via Facsimile (facsimile no. 416-956-8989)
Xxxxxxxxxxx Limited Partnership
C/o Canaccord Capital Corporation
000 Xxx Xxxxxx, Xxxxx 0000
Xxxxxxx, XX X0X 0X0, Xxxxxx
Ladies and Gentlemen:
This letter is to evidence our agreement to amend the Subscription Agreement,
dated as of April 30, 2002, between SBE, Inc. and Xxxxxxxxxxx Limited
Partnership, in order to clarify our intent with respect to the calculation of
penalties pursuant to Section 8.4 of such agreement. The language set forth
below reflects our understanding as of and since April 30, 2002. The portion
of Section 8.4 of the Subscription Agreement beginning immediately following the
definition of "Non-Registration Event" therein is hereby amended, effective as
of April 30, 2002, to read as follows:
" then, for so long as such Non-Registration Event shall continue, the
Company shall pay in cash as Liquidated Damages to each holder of any
outstanding Company Shares an amount equal to one (1%) percent for the
first thirty (30) days or part thereof and two (2%) per month for each
month or part thereof thereafter, up to a maximum of twenty percent (20%)
per year, in the aggregate, during the pendency of such Non-Registration
Event, of one dollar and eighty cents ($1.80) for each Company Share (as
adjusted for stock splits, combinations and the like after the date of
issuance of each such share) owned of record by such holder as of or
subsequent to the occurrence of such Non-Registration Event. Payments to be
made pursuant to this Section 8.4 shall be due and payable within ten (10)
business days after demand in immediately available funds. The parties
agree that no penalty under this Section 8.4 shall be payable by the
Company in respect of Warrants or the Warrant Shares in the case of a
Non-Registration Event and that the sole penalty for a Non-Registration
Event in respect of the Warrants and the Warrant Shares shall be a
reduction in exercise price pursuant to Section 9 of the Warrants.
Please evidence your agreement with the foregoing amendment by signing where
provided below and faxing a copy back to me at (000) 000-0000.
Very truly yours, Accepted and Agreed:
SBE, Inc. Xxxxxxxxxxx Limited Partnership
By: /s/ Xxxxxxx X. Xxxx By: /s/ X.X. Xxxxxxx
------------------------ --------------------
Xxxxxxx X. Xxxx Name: X.X. Xxxxxxx
Chief Executive Officer Title: Chief Operating Officer
Cc: Xx Xxxxxxx
Xxxxxxx & Xxxxxxx (facsimile no. 212-697-3575)
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