<PAGE 1>
AMENDMENT NUMBER TWO TO LOAN AGREEMENT
This Amendment Number Two to Loan Agreement (the
"Amendment") is made this 26th day of October, 1998 by and
between DATARAM CORPORATION, a New Jersey corporation, having an
address at Route 571, Princeton Road, West Windsor Township, New
Jersey (the "Borrower") and FIRST UNION NATIONAL BANK, successor
by merger to CORESTATES BANK, N.A., having an address at 370
Scotch Road, West Trenton, NJ 08628 (the "Bank").
BACKGROUND
WHEREAS, the Borrower and the Bank entered into a certain
Loan Agreement dated October 27, 1994 (the "Agreement"), as
amended by Amendment Number One to Loan Agreement dated November
1, 1996, and by the Letter Agreement dated October 22, 1997;
WHEREAS, the Borrower and the Bank have agreed to amend the
Agreement to maintain the amount of the Revolver Credit Advance
Limit at $12,000,000 until October 31, 1999, then decrease the
Revolver Credit Advance Limit to $6,000,000 on November 1, 1999,
extend the Revolving Credit Maturity Date to October 31, 2000 and
correct the Agreement as hereinafter set forth.
WHEREAS, all capitalized terms used herein and not otherwise
defined herein shall have the meaning assigned to them in the
Agreement.
NOW, THEREFORE, the parties hereto, intending to be legally
bound, hereby agree as follows:
1 The Revolving Credit Maturity Date is hereby extended
to October 31, 2000. To that end, the definition of Revolving
Credit Maturity Date contained in Section 1.02 of the Agreement
is hereby amended to read in its entirety as follows:
"Revolving Credit Maturity Date" means October 31, 2000.
2. The amount of the Revolver Credit Advance Limit is
maintained at $12,000,000 until October 31, 1999, then decreased
to $6,000,000 on November 1, 1999 until the Revolver Credit
Maturity Date. To that end, the definition of Revolving Credit
Advance Limit contained in Section 1.02 of the Agreement is
hereby amended to read in its entirety as follows:
"Revolving Credit Advance Limit" means the sum of
Twelve Million Dollars ($12,000,000) through October 31, 1999 and
the sum of Six Million Dollars ($6,000,000) from November 1, 1999
until the Revolving Credit Maturity Date.
<PAGE 2>
3. The Borrower shall execute and deliver to the Bank a
replacement revolver note of the Borrower in substantially the
form attached as Exhibit A-1 (the "Second Replacement Revolver
Note") to evidence the indebtedness of the Borrower for the
Revolving Credit Advances by the Bank. The Second Replacement
Revolver Note shall replace and supersede the Revolver Note and
the Replacement Revolver Note, but shall not extinguish the
Borrower's unconditional obligation to repay the indebtedness
evidenced by the Revolver Note of the Borrower to the Bank dated
October 27, 1994 and the Replacement Revolver Note of the
Borrower to the Bank dated November 1, 1996. All references in
the Agreement to the Revolver Note shall henceforth be deemed to
refer to the Second Replacement Revolver Note.
4. The effectiveness of this Amendment is conditioned
upon the Bank's receipt of the following documents:
(A) This Amendment Number Two to Loan Agreement;
(B) Second Replacement Revolver Note;
(C) Certified Resolutions of the Board of Directors of
the Borrowers authorizing the execution of this Amendment; and
5. Representations and Warranties. The Borrower has
taken all corporate action necessary to authorize the execution,
delivery and performance of this Amendment and the Second
Replacement Revolver Note. This Amendment and the Second
Replacement Revolver Note is, or when executed by the Borrower
and delivered to the Bank will be, duly executed and constitute
the valid and legally binding obligations of the Borrower,
enforceable against the Borrower in accordance with their
respective terms. The Borrower hereby ratifies and confirms the
representations and warranties of the Borrower set forth in
Article V of the Agreement (as updated to reflect Borrower's most
recent financial statements) as being true and correct on the
date hereof.
6. Borrower Remains Liable. Nothing contained herein
shall release, satisfy or extinguish any existing obligations of
Borrower to Bank. Borrower hereby confirms that each of the
existing loan documents and all collateral, liens, mortgages,
security interests and pledges created by Borrower and described
therein continue unimpaired and in full force and effect.
7. Indemnity. Borrower agrees to indemnify Bank from
and against any and all claims, losses and liabilities growing
out of or resulting from this Amendment.
8. Waivers. The Bank waives any default or Event of
Default existing on or prior to the date hereof which is cured or
which would not have occurred or arisen if the amendments set
forth herein had taken retroactive effect on the date of the
Agreement.
9. Incorporation of Amendment. The parties hereto
acknowledge and agree that this
<PAGE 3>
Amendment is incorporated into and made a part of the Agreement
and the other existing loan documents, the terms and provisions
of which, unless expressly modified herein, or unless no longer
applicable by their terms, continue unchanged and in full force
and effect. To the extent that any term or provision of this
Amendment is or may be deemed expressly inconsistent with any
term or provision in the Agreement and the other existing loan
documents, the terms and provisions hereof shall control.
10. Year 2000 Compatibility. Borrower shall take all
action necessary to assure that Borrower's computer based systems
are able to operate and effectively process data including dates
on and after January 1, 2000. At the request of Bank, Borrower
shall provide Bank assurance acceptable to Bank of Borrower's
Year 2000 compatibility.
11. Miscellaneous.
(a) Headings. The section headings contained in this
Amendment are included for convenience of reference only and
shall not be used to interpret any provision of this Amendment.
(b) Governing Law. The laws of the State of New Jersey
shall govern the construction of this Amendment and the rights
and remedies of the parties thereto. The provisions hereof are
severable and the validity or unenforceability of any provision
shall not effect or impair the remaining provisions which shall
continue in full force and effect. This Amendment shall bind the
parties hereto and their respective successors and assigns.
(c) Modifications. No modification hereof or any
agreement referred to herein shall be binding or enforceable
unless in writing and signed on behalf of the party against whom
enforcement is sought.
(d) Third Parties. No rights are intended to be created
hereunder for the benefit of any third party, creditor or
incidental beneficiary.
IN WITNESS WHEREOF, the parties have caused the Amendment to
be executed as of the date first above written.
ATTEST: DATARAM CORPORATION,
a New Jersey corporation
By:__________________________ By:____________________________
__________________________ ____________________________
Print Name and Title Print Name and Title
[Signatures Continued on Next Page]
ATTEST: FIRST UNION NATIONAL BANK
<PAGE 4>
By:__________________________ By:___________________________
__________________________ ____________________________
Print Name and Title Print Name and Title
<PAGE 5>
EXHIBIT A-1
SECOND
REPLACEMENT
REVOLVER NOTE
$12,000,000.00 Princeton, New Jersey
October 26, 1996
FOR VALUE RECEIVED, DATARAM CORPORATION, a New Jersey
corporation, having an address at Route 571, Princeton Road, West
Windsor Township, New Jersey 08543 ("Borrower") , promises to pay
to the order of FIRST UNION NATIONAL BANK, successor by merger to
NEW JERSEY NATIONAL BANK, a national banking association, having
its principal office at 360 Scotch Road, West Trenton, NJ 08628
("Bank"), at its offices or at such other address as may
hereafter be specified by Bank, in lawful money of the United
States of America, the principal sum of TWELVE MILLION DOLLARS
($12,000,000.00) (the "Loan"), together with interest thereon at
the rate or rates and in the installments and at the times
hereinafter provided.
1 . Definitions. Whenever used in this Second Replacement
Revolver Note, the following words and phrases shall have the
respective meanings ascribed to them below.
(A) "Adjusted LIBO Rate" - means the LIBO Rate plus the
Applicable Margin.
(B) "Adjusted Prime Rate" - means the Prime Rate minus
the Applicable Margin.
(C) "Applicable Margin" - means, for Prime Rate Tranches
0.75% per annum and for LIBOR Tranches 1.00% per annum.
(D) "Applicable Treasury Bond Obligation(s)" - means the
debt obligation(s) of the United States Treasury having a
maturity date(s) nearest in time to the maturity date(s) of the
principal being prepaid and the maturity date(s) and yield(s) to
maturity of such Applicable Treasury Bond Obligation(s) shall be
determined by Bank in its sole discretion on the basis of
quotations published in the Wall Street Journal (or comparable
source) on the date of prepayment.
(E) "Assessment Rate" - means, for any elected LIBOR
Interest Period for any LIBOR Tranche, the actual rate (rounded
upwards, if necessary, to the nearest 1/100 of 1%) at which
premiums for Federal deposit insurance (if any) are then charged
during such LIBOR Interest Period to First Union National Bank
for Dollar time deposits with the First Union National Bank at
its foreign branch.
(F) "Bank" as defined in the introductory paragraph
hereof.
<PAGE 6>
(G) "Borrower" - as defined in the introductory
paragraph hereof.
(H) "Business Day" - means any day other than a
Saturday, Sunday, or other day on which commercial banks in New
Jersey are authorized or required to close under the laws of the
State of New Jersey.
(I) "Contract Right" - as defined in Section
7 hereof.
(J) "Default" - means and refers to any event, act or
occurrence, which with the passing of time or the giving of
notice or both, would constitute an Event of Default as defined
in the Loan Agreement.
(K) "Default Rate" - as defined in Section 7 hereof.
(L) "Dollars" and "$" - mean lawful money of the
United States of America.
(M) "Effective Date" - means, for the Prime Rate
Tranche, the date on which a Prime Rate Interest Period
commences, pursuant to Section 3 hereof, for the LIBOR Tranche,
the date Borrower designates as the date on which a LIBOR
Interest Period is to commence pursuant to Section 3 hereof.
(N) "Eurocurrency Reserve Requirement" - means, for any
LIBOR Tranche for any LIBOR Interest Period relating thereto, the
daily average of the stated maximum rate (expressed as a decimal)
at which reserves (including any marginal, supplemental, or
emergency reserves) are required to be maintained during such
LIBOR Interest Period under Regulation D by a member bank of the
Federal Reserve System against "Eurocurrency liabilities" (as
such term is used in Regulation D) but without benefit of or
credit for proration, exemptions, or offsets that might otherwise
be available to such member bank from time to time under
Regulation D. Without limiting the effect of the foregoing, the
Eurocurrency Reserve Requirement shall reflect any other reserves
required to be maintained by such member bank against (1) any
category of liabilities which includes deposits by reference to
which the LIBOR Interest Rate for LIBOR Tranches is to be
determined or (2) any category of extension of credit or other
assets that include LIBOR Tranches.
(O) "Event of Default" - shall mean an Event of Default
as defined in the Loan Agreement.
(P) "Interest Period" - means any period during which
the Interest Rate is the Adjusted Prime Rate, or any Adjusted
LIBO Rate, as appropriate.
(Q) "Interest Rate" - means the Adjusted LIBO Rate and
the Adjusted Prime Rate, or the Default Rate, as appropriate.
<PAGE 7>
(R) "LIBOR Interest Period" - for a LIBOR Tranche means
a period of time, beginning on an Effective Date, of 30, 60 or 90
days in length, selected by Borrower - by telephone or in writing
(and if by telephone, confirmed by Borrower the same day by
facsimile), during which the Interest Rate for such LIBOR Tranche
is the Adjusted LIBO Rate. If a LIBOR Interest Period would
otherwise end on a day that is not a Business Day, such LIBOR
Interest Period shall be extended to the next Business Day,
unless such Business Day would fall in the next calendar month,
in which event such LIBOR Interest Period shall end on the
immediately preceding Business Day.
(S) "LIBO Rate" - means, for each LIBOR Tranche, the
rate per annum (rounded upwards, if necessary, to the nearest
1/16th of 1%) determined by Bank according to the following
formula:
R = X + Z
___
1-Y
where R = LIBO Rate
X = London Interbank Offered Rate for such
LIBOR Tranche for the applicable LIBOR
Interest Period
Y = Eurocurrency Reserve Requirement for
such LIBOR Tranche for the applicable
LIBOR Interest Period
Z - the Assessment Rate (if applicable).
(AA) "LIBOR Tranche" - means each portion of the Loan
to which an Adjusted LIBO Rate applies.
(AB) "Loan" - as defined in the introductory paragraph
hereof.
(AC) "Loan Documents" - means this Second Replacement
Revolver Note in the principal amount of Twelve Million Dollars
($12,000,000.00), that certain Amendment Number Two to Loan
Agreement dated of even date herewith between Borrower and Bank
and any and all other documents executed by Borrower in
connection with the Loan.
(AD) "London Business Day" - means any Business Day on
which commercial banks, are open for international business
(including dealing in Dollar deposits) in London, England and New
Jersey.
(AE) "London Interbank Offered Rate" - applicable to
any elected LIBOR Interest Period for a LIBOR Tranche means the
rate per annum (rounded upwards, if necessary, to the nearest
1/16th of 1%) quoted by the principal London branch of First
Union National Bank, two London Business Days prior to the first
day of such LIBOR Interest Period for the offering to leading
banks in the London interbank market of Dollar deposits in
immediately available funds for a period, and in an amount,
comparable to the LIBOR Interest Period and principal amount of
the LIBOR Tranche which shall be made by Bank and/or be
outstanding during such LIBOR Interest Period.
<PAGE 8>
(AF) "Material Adverse Effect" - has the meaning given
such term in the Loan Agreement.
(AG) "Maturity Date" - as defined in Section 3 hereof.
(AH) "Operating Account" - has the meaning given to such
term in Section 3 hereof.
(AI) "Person" - has the meaning given such term in the
Loan Agreement.
(AJ) "Prime Rate" - means for each day, the lending rate
set and announced by Bank from time to time for purposes of
fixing interest rates on various categories of loans which Bank
determines are to be tied to such Prime Rate. The Prime Rate is
not necessarily the lowest rate of interest which Bank charges
any of its customers.
(AK) "Prime Rate Interest Period" - for a Prime Rate
Tranche, means a period of time beginning with an Effective Date,
of 365 days in length, selected by Borrower by telephone or in
writing (and if by telephone, confirmed by Borrower the same day
by facsimile) during which the Interest Rate for such Prime Rate
Tranche is the Adjusted Prime Rate. If the Prime Rate Interest
Period would otherwise end on a day that is not a Business Day,
such Prime Rate Interest Period shall be extended to the next
Business Day, unless such Business Day would fall into the next
calendar month, in which event such Prime Rate Interest Period
shall end on the immediately preceding day.
(AL) "Prime Rate Tranche" - means each portion of the
Loan to which the Adjusted Prime Rate applies.
(AM) "Regulation D" - means Regulation D of the Board of
Governors of the Federal Reserve System as amended or
supplemented from time to time.
2. Interest Rate.
(A) The principal sum outstanding from time to time
hereunder shall bear interest from the date or dates advanced
until the date repaid at a rate equal to the Adjusted Prime Rate.
The Adjusted Prime Rate shall change simultaneously with each
change in the Prime Rate.
(B) Notwithstanding the foregoing, at any time up to
that date which is 90 days prior to the Maturity Date, provided
no Event of Default or Default has occurred, Borrower shall have
the option to fix the interest rate on portions of the Loan of
TWO HUNDRED THOUSAND DOLLARS ($200,000.00) or more, in a minimum
of TWO HUNDRED THOUSAND DOLLARS ($200,000.00) at the Adjusted
LIBO Rate, subject to Bank's ability to secure such funds for
such periods.
<PAGE 9>
(C) Borrower may exercise the option to have portions of
the Loan from time to time bear interest at the Adjusted LIBO
Rate by giving Bank written notice (which shall be irrevocable),
by telephone or in writing, by 10:00 A.M. at least two London
Business Days before each proposed LIBOR Tranche, specifying the
date and the amount of the proposed LIBOR Tranche and the length
of the proposed LIBOR Interest Period. Borrower will confirm any
telephonic notice of a proposed LIBOR Tranche the same day by
facsimile copy.
(D) The interest due on the Loan shall be payable as
provided in Section 3 below.
3. Interest and Principal Payments; Maturity Date.
(A) Prime Rate Loans. Borrower shall pay interest in
arrears on the unpaid principal amount of the Prime Rate Tranche,
from the date on which the Prime Rate Tranche is created until
such principal amount has been repaid in full, or converted to a
LIBOR Tranche, as the case may be, (1) every thirty (30) days
after the Effective Date of such Prime Rate Tranche and (2) on
the Maturity Date, at the Adjusted Prime Rate.
(B) Conversions to LIBOR Tranches. By notifying Bank at
least two (2) London Business Days prior to an Effective Date,
Borrower may convert into a LIBOR Tranche all or any part of any
Prime Rate Tranche at any time in a minimum principal amount of
$200,000.00. At the end of the applicable LIBOR Interest Period,
the LIBOR Tranche will convert to a Prime Rate Tranche unless
Borrower notifies Bank at least two (2) London Business Days
before the end of the existing LIBOR Interest Period that
Borrower is electing to continue all or any part of the tranche
as a LIBOR Tranche and is selecting a new LIBOR Interest Period.
(C) Libor Tranches. Borrower shall pay interest in
arrears on the unpaid principal amount of each LIBOR Tranche at
the Adjusted LIBO Rate for such LIBOR Tranche from the date on
which such LIBOR Tranche is created until such principal amount
has been paid in full, or converted to a Prime Rate Tranche, as
the case may be, (1) every 30 days after the Effective Date of
such LIBOR Tranche, and (2) on the Maturity Date at the adjusted
LIBO Rate.
(D) Principal Repayment. Borrower shall repay the
outstanding principal balance of the Loan, all accrued and unpaid
interest thereon and any other sums then outstanding hereunder or
under the Loan Documents on October 31, 2000 (the "Maturity
Date"). Notwithstanding the foregoing, any principal amount
outstanding hereunder in excess of $6,000,000 on October 31, 1999
shall be repaid on that date.
(E) Operating Account. Borrower covenants and agrees to
maintain an operating account with Bank at all times during which
any portion of the Loan remains outstanding (the "Operating
Account"). Borrower hereby authorizes Bank to charge the
Operating Account for all payments hereunder as they become due.
Borrower agrees to keep in the Operating Account sufficient
amount to make such payments as and when they come due. Bank's
failure to so charge the Operating Account in order to satisfy
Borrower's payment obligations hereunder shall not relieve
Borrower's obligations to make all such payments. In the event
that Borrower shall
<PAGE 10>
fail to maintain a sufficient balance in the Operating Account to
satisfy a payment obligation on the date such payment becomes
due, Borrower shall continue to be obligated to make such payment
and, if such payment is not made by Borrower in some other manner
on or before the date such payment becomes due, such failure
shall constitute an Event of Default hereunder. All payments
received by Bank from Borrower shall be applied in the following
order: (a) to the payment of fees and other costs and expenses
then due and owing from Borrower, (b) to the payment of accrued
and unpaid interest then due, (c) to the payment of any
outstanding principal hereunder.
(F) Interest Calculation. Both before and after any
default, interest shall be calculated on the basis of a 360 day
year but charged on the basis of the actual number of days
elapsed in any calendar year or part thereof.
4. Prepayments.
(A) Borrower may prepay the Prime Rate Tranches in whole
or in part at any time and from time to time in a minimum amount
of Two Hundred Thousand Dollars ($200,000.00).
(B) Borrower may, at any time, prepay the principal
balance of a LIBO Rate Tranche in whole or in part, provided that
Borrower simultaneously therewith pays to Bank a prepayment
premium equal to the amount, if any, by which (a) the principal
being prepaid plus the installments of interest which would have
been payable thereon when discounted to a present value at a rate
per annum equal to the yield to maturity of the Applicable
Treasury Bond Obligation(s) exceed(s) (b) the principal amount
being prepaid. Borrower agrees to pay prepayment premium as
calculated in the foregoing sentence upon any prepayment of the
LIBOR Tranche, whether voluntary, required by Bank in connection
with any acceleration of the indebtedness hereunder upon the
occurrence of an Event of Default, or as otherwise required under
this Second Replacement Revolver Note. A determination of Bank
as to the amounts payable pursuant to this Section 4(B) shall be
conclusive absent manifest error.
5. Late Charges. If any installment of principal or
interest or both hereunder or other payment required to be made
by Borrower under the other Loan Documents is not paid within ten
(10) days after becoming due, Borrower shall pay to Bank on
demand a late charge of five percent (5%) of such overdue amount
to reimburse Bank for the additional expenses to be incurred as a
result of such delinquency, but such late payment fee shall not
obligate Bank to accept any overdue payment hereunder nor limit
the rights and remedies available to Bank as a result of
Borrower's default, as hereinafter provided. The amount of any
such late charge not paid promptly following demand shall be
deemed outstanding and payable pursuant to this Replacement
Revolver Note.
6. Event of Default. An Event of Default shall mean an
Event of Default as defined in the Loan Agreement .
7. Default Rate. Upon the occurrence of an Event of Default
hereunder, the interest rate
<PAGE 11>
otherwise payable hereunder (the "Contract Rate") shall increase
immediately and without notice and thereafter shall be payable at
a rate of three percent (3%) per annum in excess of the Contract
Rate (said higher rate is hereinafter called the "Default Rate"),
until the Event of Default has been cured, or in the event the
principal of this Second Replacement Revolver Note has been
accelerated, until this Second Replacement Revolver Note is paid
in full, including the period following entry of any judgment on
or relating to this Second Replacement Revolver Note or the other
Loan Documents. Interest on any such judgment shall accrue and
be payable at the Default Rate, and not at the statutory rate of
interest, after judgment, any execution thereon, and until actual
receipt by the holder of payment in full of this Second
Replacement Revolver Note and said judgment. Interest at the
Default Rate shall be collectible as part of any judgment
hereunder and shall be secured by the other Loan Documents.
8. Remedies. Upon the occurrence of an Event of Default,
the Bank shall be entitled to exercise all remedies available to
it under the terms of the Loan Agreement.
9. Accounts. Borrower hereby covenants and agrees that while
the Loan is outstanding it will maintain all of its bank accounts
with Bank.
10. Waivers by Borrower, Cumulative Remedies.
(A) Borrower hereby waives presentment for payment,
demand, notice of non-payment, notice of protest and protest of
this Second Replacement Revolver Note. The Borrower hereby
consents to any and all extensions of time, renewals, waivers or
modifications that may be granted by the Bank with respect to the
payment or other provisions of this Second Replacement Revolver
Note, and agrees that additional obligors may become parties
hereto without notice to the Borrower without affecting the
Borrower's liability hereunder.
(B) Borrower hereby waives-the benefit of any laws which
now or hereinafter might otherwise authorize the stay of any
execution to be issued on any judgment covered on this Second
Replacement Revolver Note. Borrower hereby waives its right to
trial by jury in connection with a portion of this Second
Replacement Revolver Note or under the loan agreement or any
other document executed in connection with this Loan and any
legal proceeding arising hereunder or thereunder.
(C) No failure or delay on the part of the Bank in
exercising any right, power or privilege under this Second
Replacement Revolver Note and no course of dealing between the
Borrower and the Bank shall operate as a waiver thereof. No
single or partial exercise of any right, power or privilege
hereunder shall preclude any other or further exercise of any
right, power or privilege that the Bank would otherwise have. No
notice to, or demand on, the Borrower in any case shall entitle
the Borrower to any other or further notice or demand in similar
or other circumstances would constitute a waiver of the right of
the Bank to any other or further action and any circumstances
without notice or demand.
11. Costs and Expenses. The Borrower agrees, in accordance
with the terms of the Loan
<PAGE 12>
Agreement, to pay all costs and expenses of the Bank incurred in
order to enforce any remedy available to the Bank under this
Second Replacement Revolver Note, the Loan Agreement or any Loan
Document.
12. Reimbursement to Bank for Increased Costs Due to Capital
Adequacy Requirements. If after the date hereof any change in
law or regulation or the interpretation thereof by any court or
administrative or governmental authority charged with the
administration thereof, or compliance by Bank with any request or
directive (whether or not having the force of law) of any such
authority, applicable from time to time now or after the date
hereof to banks in general, shall (A) impose, modify, deem
applicable or result in the application of any capital
maintenance, capital ratio or similar requirements against loan
commitments or other facilities made by Bank and the result
thereof shall be to impose upon Bank a fee or a requirement to
increase any capital requirement applicable as a result of the
making or maintenance of the Loan (which imposition of or
increase in capital requirements may be determined by Bank's
reasonable allocation of the aggregate of such capital
impositions or increases), or (B) subject Bank to any tax, duty
or other charge with respect to the Loan, the Second Replacement
Revolver Note, or change the basis of taxation of payments to
Bank of the principal of or interest on the Loan or any other
amounts due under this Agreement, in respect of the Loan (except
for changes in the rate of tax on the overall net income of Bank
imposed by any jurisdiction in which Bank is obligated to pay
taxes), then, upon demand by Bank, Borrower shall immediately pay
to Bank from time to time as specified by Bank, such additional
amounts or fees which shall be sufficient to compensate Bank for
such impositions of or increases in capital requirements or taxes
from the date of such change, together with interest on each such
amount from the date demanded until payment in full thereof at
the Default Rate with respect to amounts or fees not paid when
due. Upon the occurrence of any event referred to above, a
certificate setting forth- in reasonable detail the amounts
necessary to compensate Bank as a result of an imposition of or
increase in capital requirements or taxes submitted by Bank to
Borrower shall be conclusive, absent manifest error or bad faith,
as to the amount thereof.
13. Special Provisions of LIBOR Tranches.
(A) Unavailability of Funds and Indeterminate Interest
Rates. If on or before the date Bank is to make any LIBOR
Tranche or on or before any Effective Date (1) Bank determines in
good faith that it is unable to obtain funds at the LIBO Rate for
the elected Interest Period for any reason, including, but not
limited to the unavailability of funds at such rate, any change
in existing law, any new law, the length of such Interest Period,
or otherwise or (2) Bank determines in good faith that no
adequate means exists to determine the LIBO Rate for such
Interest Period, then, at Bank's option, Borrower shall be deemed
to have requested a Prime Rate Tranche or shall be required to
elect an Interest Period of a length for which Bank may obtain
funds at the rate the adjustment of which determines the LIBO
Rate.
(B) Changes Affecting Ability to Maintain Funds. If,
during any Interest Period, any change in existing law, any new
law, or any other factor beyond the control of Bank prevents Bank
in its good faith determination from maintaining funds at the
rate the adjustment of which
<PAGE 13>
determines the LIBO Rate for such Interest Period and requires
Bank to cease so maintaining funds actually so maintained prior
to termination of such Interest Period, then on the date of such
required cessation, Borrower shall be required to specify a
different Interest Rate for such Interest Period or, in the
alternative, to elect an Interest Period of a length for which
Bank may maintain funds at the rate the adjustment of which
determines the LIBO Rate. In addition, within five days after
Bank notifies Borrower of such required conversion, Borrower
shall reimburse Bank for any loss or expense Bank has certified
in writing to Borrower that Bank has incurred as a result of any
such required cessation.
14. Interest Limitation; Severability.
(A) Nothing herein contained nor any transaction related
hereto shall be construed or shall operate either presently or
prospectively to require Borrower to pay interest at a rate
greater than is now lawful in such case to contract for, but
shall require payment of interest only to the extent of such
lawful rate. Any interest paid in excess of the lawful rate
shall be refunded to Borrower. Such refund shall be made by
application of the excessive amount of interest paid against any
sums outstanding hereunder, in which event any applicable
prepayment premium shall be waived with respect to the amount so
prepaid, and shall be applied in such order as Bank may
determine. If the excessive amount of interest paid exceeds the
sums outstanding hereunder, the portion exceeding the said sums
outstanding hereunder shall be refunded in cash by Bank. Any
such crediting or refund shall not cure or waive any default by
Borrower hereunder or under the other Loan Documents. Borrower
agrees, however, that in determining whether or not any interest
payable hereunder exceeds the highest rate permitted by law, any
non-principal amount (except payments specifically stated herein
to be "interest"), including, without limitation, late charges,
shall be deemed, to the extent permitted by law, to be an
expense, fee, premium or penalty rather than interest.
(B) In the event that for any reason one or more of the
provisions of this Second Replacement Revolver Note or their
application to any person or circumstance shall be held to be
invalid, illegal or unenforceable in any respect or to any
extent, such provisions shall, to such extent, be held for naught
as though not herein contained but shall nevertheless remain
valid, legal and enforceable in all such other respects and to
such extent as may be permissible. In addition, any such
invalidity, illegality or unenforceability shall not affect any
other provisions of this Second Replacement Revolver Note, but
this Second Replacement Revolver Note shall be construed as if
such invalid, illegal or unenforceable provisions had never been
contained herein.
15. Notices. All notices, requests, demands or other
communications to or upon the Borrower or the Bank shall be
deemed to have been given or made when hand delivered or
deposited in the mail by certified mail, return receipt
requested, postage prepaid, addressed to the Borrower or the
Bank, as the case may be, at their respective addresses indicated
herein or at such other addresses as the Borrower or the Bank may
hereafter specify in writing to the other, except that any
communication with respect to a change of address shall be deemed
to be given or made when received by the Borrower or the Bank to
whom such communication was sent.
<PAGE 14>
16. Successors and Assigns. This Second Replacement Revolver
Note is binding upon the Borrower and its successors and assigns
except that Borrower shall not have the right to assign its
rights or obligations hereunder or any interest herein.
17. Amendment. This Second Replacement Revolver Note may not
be changed orally, but only by an agreement in writing signed by
the party against whom enforcement of any waiver, change,
modification or discharge is sought.
18. Governing Law. This Second Replacement Revolver Note has
been executed and delivered in the State of New Jersey and shall
be construed and enforced in accordance with the laws of the
State of New Jersey.
19. Captions. The captions or headings of the sections in
this Second Replacement Revolver Note are for convenience only
and shall not control or effect the meaning or construction of
any term or provision of this Second Replacement Revolver Note.
IN WITNESS WHEREOF, the Borrower has executed this Second
Replacement Revolver Note as of the date and year first above
written.
ATTEST: DATARAM CORPORATION,
a New Jersey corporation
By:__________________________ By:__________________________
__________________________ __________________________
Print Name and Title Print Name and Title
<PAGE 15>
SCHEDULE TO SECOND REPLACEMENT REVOLVER NOTE
Unpaid
Principal
Amount of Balance of Name of
Amount of Principal Revolving Person Making
Date Loan Prepaid Credit Note Notation
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
<PAGE 1>
SECOND
REPLACEMENT
REVOLVER NOTE
$12,000,000.00 Princeton, New Jersey
October 26, 1996
FOR VALUE RECEIVED, DATARAM CORPORATION, a New Jersey
corporation, having an address at Route 571, Princeton Road, West
Windsor Township, New Jersey 08543 ("Borrower") , promises to pay
to the order of FIRST UNION NATIONAL BANK, successor by merger to
NEW JERSEY NATIONAL BANK, a national banking association, having
its principal office at 360 Scotch Road, West Trenton, NJ 08628
("Bank"), at its offices or at such other address as may
hereafter be specified by Bank, in lawful money of the United
States of America, the principal sum of TWELVE MILLION DOLLARS
($12,000,000.00) (the "Loan"), together with interest thereon at
the rate or rates and in the installments and at the times
hereinafter provided.
1. Definitions. Whenever used in this Second Replacement
Revolver Note, the following words and phrases shall have the
respective meanings ascribed to them below.
(A) "Adjusted LIBO Rate" - means the LIBO Rate plus the
Applicable Margin.
(B) "Adjusted Prime Rate" - means the Prime Rate minus the
Applicable Margin.
(C) "Applicable Margin" - means, for Prime Rate Tranches
0.75% per annum and for LIBOR Tranches 1.00% per annum.
(D) "Applicable Treasury Bond Obligation(s)" - means the
debt obligation(s) of the United States Treasury having a
maturity date(s) nearest in time to the maturity date(s) of the
principal being prepaid and the maturity date(s) and yield(s) to
maturity of such Applicable Treasury Bond Obligation(s) shall be
determined by Bank in its sole discretion on the basis of
quotations published in the Wall Street Journal (or comparable
source) on the date of prepayment.
(E) "Assessment Rate" - means, for any elected LIBOR
Interest Period for any LIBOR Tranche, the actual rate (rounded
upwards, if necessary, to the nearest 1/100 of 1%) at which
premiums for Federal deposit insurance (if any) are then charged
during such LIBOR Interest Period to First Union National Bank
for Dollar time deposits with the First Union National Bank at
its foreign branch.
(F) "Bank" as defined in the introductory paragraph hereof.
(G) "Borrower" - as defined in the introductory paragraph
hereof.
<PAGE 2>
(H) "Business Day" - means any day other than a Saturday,
Sunday, or other day on which commercial banks in New Jersey are
authorized or required to close under the laws of the
State of New Jersey.
(I) "Contract Right" - as defined in Section 7
hereof.
(J) "Default" - means and refers to any event, act or
occurrence, which with the passing of time or the giving of
notice or both, would constitute an Event of Default as defined
in the Loan Agreement.
(K) "Default Rate" - as defined in Section 7 hereof.
(L) "Dollars" and "$" - mean lawful money of the United
States of America.
(M) "Effective Date" - means, for the Prime Rate Tranche,
the date on which a Prime Rate Interest Period commences,
pursuant to Section 3 hereof, for the LIBOR Tranche, the date
Borrower designates as the date on which a LIBOR Interest Period
is to commence pursuant to Section 3 hereof.
(N) "Eurocurrency Reserve Requirement" - means, for any
LIBOR Tranche for any LIBOR Interest Period relating thereto, the
daily average of the stated maximum rate (expressed as a decimal)
at which reserves (including any marginal, supplemental, or
emergency reserves) are required to be maintained during such
LIBOR Interest Period under Regulation D by a member bank of the
Federal Reserve System against "Eurocurrency liabilities" (as
such term is used in Regulation D) but without benefit of or
credit for proration, exemptions, or offsets that might otherwise
be available to such member bank from time to time under
Regulation D. Without limiting the effect of the foregoing, the
Eurocurrency Reserve Requirement shall reflect any other reserves
required to be maintained by such member bank against (1) any
category of liabilities which includes deposits by reference to
which the LIBOR Interest Rate for LIBOR Tranches is to be
determined or (2) any category of extension of credit or other
assets that include LIBOR Tranches.
(O) "Event of Default" - shall mean an Event of Default as
defined in the Loan Agreement.
(P) "Interest Period" - means any period during which the
Interest Rate is the Adjusted Prime Rate, or any Adjusted LIBO
Rate, as appropriate.
(Q) "Interest Rate" - means the Adjusted LIBO Rate and the
Adjusted Prime Rate, or the Default Rate, as appropriate.
(R) "LIBOR Interest Period" - for a LIBOR Tranche means a
period of time, beginning on an Effective Date, of 30, 60 or 90
days in length, selected by Borrower - by
<PAGE 3>
telephone or in writing (and if by telephone, confirmed by
Borrower the same day by facsimile), during which the Interest
Rate for such LIBOR Tranche is the Adjusted LIBO Rate. If a
LIBOR Interest Period would otherwise end on a day that is not a
Business Day, such LIBOR Interest Period shall be extended to the
next Business Day, unless such Business Day would fall in the
next calendar month, in which event such LIBOR Interest Period
shall end on the immediately preceding Business Day.
(S) "LIBO Rate" - means, for each LIBOR Tranche, the rate
per annum (rounded upwards, if necessary, to the nearest 1/16th
of 1%) determined by Bank according to the following formula:
R = X + Z
_____
1-Y
where R = LIBO Rate
X = London Interbank Offered Rate for
such LIBOR Tranche for the
applicable LIBOR Interest Period
Y = Eurocurrency Reserve Requirement
for such LIBOR Tranche for the
applicable LIBOR Interest Period
Z - the Assessment Rate (if
applicable).
(AA) "LIBOR Tranche" - means each portion of the Loan to
which an Adjusted LIBO Rate applies.
(AB) "Loan" - as defined in the introductory paragraph
hereof.
(AC) "Loan Documents" - means this Second Replacement
Revolver Note in the principal amount of Twelve Million Dollars
($12,000,000.00), that certain Amendment Number Two to Loan
Agreement dated of even date herewith between Borrower and Bank
and any and all other documents executed by Borrower in
connection with the Loan.
(AD) "London Business Day" - means any Business Day on
which commercial banks, are open for international business
(including dealing in Dollar deposits) in London, England and New
Jersey.
(AE) "London Interbank Offered Rate" - applicable to any
elected LIBOR Interest Period for a LIBOR Tranche means the rate
per annum (rounded upwards, if necessary, to the nearest 1/16th
of 1%) quoted by the principal London branch of First Union
National Bank, two London Business Days prior to the first day of
such LIBOR Interest Period for the offering to leading banks in
the London interbank market of Dollar deposits in immediately
available funds for a period, and in an amount, comparable to the
LIBOR Interest Period and principal amount of the LIBOR Tranche
which shall be made by Bank and/or be outstanding during such
LIBOR Interest Period.
(AF) "Material Adverse Effect" - has the meaning given such
term in the Loan Agreement.
<PAGE 4>
(AG) "Maturity Date" - as defined in Section 3 hereof.
(AH) "Operating Account" - has the meaning given to such
term in Section 3 hereof.
(AI) "Person" - has the meaning given such term in the Loan
Agreement.
(AJ) "Prime Rate" - means for each day, the lending rate
set and announced by Bank from time to time for purposes of
fixing interest rates on various categories of loans which Bank
determines are to be tied to such Prime Rate. The Prime Rate is
not necessarily the lowest rate of interest which Bank charges
any of its customers.
(AK) "Prime Rate Interest Period" - for a Prime Rate
Tranche, means a period of time beginning with an Effective Date,
of 365 days in length, selected by Borrower by telephone or in
writing (and if by telephone, confirmed by Borrower the same day
by facsimile) during which the Interest Rate for such Prime Rate
Tranche is the Adjusted Prime Rate. If the Prime Rate Interest
Period would otherwise end on a day that is not a Business Day,
such Prime Rate Interest Period shall be extended to the next
Business Day, unless such Business Day would fall into the next
calendar month, in which event such Prime Rate Interest Period
shall end on the immediately preceding day.
(AL) "Prime Rate Tranche" - means each portion of the Loan
to which the Adjusted Prime Rate applies.
(AM) "Regulation D" - means Regulation D of the Board of
Governors of the Federal Reserve System as amended or
supplemented from time to time.
2. Interest Rate.
(A) The principal sum outstanding from time to time
hereunder shall bear interest from the date or dates advanced
until the date repaid at a rate equal to the Adjusted Prime Rate.
The Adjusted Prime Rate shall change simultaneously with each
change in the Prime Rate.
(B) Notwithstanding the foregoing, at any time up to that
date which is 90 days prior to the Maturity Date, provided no
Event of Default or Default has occurred, Borrower shall have the
option to fix the interest rate on portions of the Loan of TWO
HUNDRED THOUSAND DOLLARS ($200,000.00) or more, in a minimum of
TWO HUNDRED THOUSAND DOLLARS ($200,000.00) at the Adjusted LIBO
Rate, subject to Bank's ability to secure such funds for such
periods.
(C) Borrower may exercise the option to have portions of
the Loan from time to time bear interest at the Adjusted LIBO
Rate by giving Bank written notice (which shall be irrevocable),
by telephone or in writing, by 10:00 A.M. at least two London
Business Days before each proposed LIBOR Tranche, specifying the
date and the amount of the proposed
<PAGE 5>
LIBOR Tranche and the length of the proposed LIBOR Interest
Period. Borrower will confirm any telephonic notice of a
proposed LIBOR Tranche the same day by facsimile copy.
(D) The interest due on the Loan shall be payable as
provided in Section 3 below.
3. Interest and Principal Payments; Maturity Date.
(A) Prime Rate Loans. Borrower shall pay interest in
arrears on the unpaid principal amount of the Prime Rate Tranche,
from the date on which the Prime Rate Tranche is created until
such principal amount has been repaid in full, or converted to a
LIBOR Tranche, as the case may be, (1) every thirty (30) days
after the Effective Date of such Prime Rate Tranche and (2) on
the Maturity Date, at the Adjusted Prime Rate.
(B) Conversions to LIBOR Tranches. By notifying Bank at
least two (2) London Business Days prior to an Effective Date,
Borrower may convert into a LIBOR Tranche all or any part of any
Prime Rate Tranche at any time in a minimum principal amount of
$200,000.00. At the end of the applicable LIBOR Interest Period,
the LIBOR Tranche will convert to a Prime Rate Tranche unless
Borrower notifies Bank at least two (2) London Business Days
before the end of the existing LIBOR Interest Period that
Borrower is electing to continue all or any part of the tranche
as a LIBOR Tranche and is selecting a new LIBOR Interest Period.
(C) Libor Tranches. Borrower shall pay interest in arrears
on the unpaid principal amount of each LIBOR Tranche at the
Adjusted LIBO Rate for such LIBOR Tranche from the date on which
such LIBOR Tranche is created until such principal amount has
been paid in full, or converted to a Prime Rate Tranche, as the
case may be, (1) every 30 days after the Effective Date of such
LIBOR Tranche, and (2) on the Maturity Date at the adjusted LIBO
Rate.
(D) Principal Repayment. Borrower shall repay the
outstanding principal balance of the Loan, all accrued and unpaid
interest thereon and any other sums then outstanding hereunder or
under the Loan Documents on October 31, 2000 (the "Maturity
Date"). Notwithstanding the foregoing, any principal amount
outstanding hereunder in excess of $6,000,000 on October 31, 1999
shall be repaid on that date.
(E) Operating Account. Borrower covenants and agrees to
maintain an operating account with Bank at all times during which
any portion of the Loan remains outstanding (the "Operating
Account"). Borrower hereby authorizes Bank to charge the
Operating Account for all payments hereunder as they become due.
Borrower agrees to keep in the Operating Account sufficient
amount to make such payments as and when they come due. Bank's
failure to so charge the Operating Account in order to satisfy
Borrower's payment obligations hereunder shall not relieve
Borrower's obligations to make all such payments. In the event
that Borrower shall fail to maintain a sufficient balance in the
Operating Account to satisfy a payment obligation on the date
such payment becomes due, Borrower shall continue to be obligated
to make such payment and, if such payment is not made by Borrower
in some other manner on or before the date such payment becomes
due, such failure shall constitute an Event of Default hereunder.
All
<PAGE 6>
payments received by Bank from Borrower shall be applied in the
following order: (a) to the payment of fees and other costs and
expenses then due and owing from Borrower, (b) to the payment of
accrued and unpaid interest then due, (c) to the payment of any
outstanding principal hereunder.
(F) Interest Calculation. Both before and after any
default, interest shall be calculated on the basis of a 360 day
year but charged on the basis of the actual number of days
elapsed in any calendar year or part thereof.
4. Prepayments.
(A) Borrower may prepay the Prime Rate Tranches in whole or
in part at any time and from time to time in a minimum amount of
Two Hundred Thousand Dollars ($200,000.00).
(B) Borrower may, at any time, prepay the principal balance
of a LIBO Rate Tranche in whole or in part, provided that
Borrower simultaneously therewith pays to Bank a prepayment
premium equal to the amount, if any, by which (a) the principal
being prepaid plus the installments of interest which would have
been payable thereon when discounted to a present value at a rate
per annum equal to the yield to maturity of the Applicable
Treasury Bond Obligation(s) exceed(s) (b) the principal amount
being prepaid. Borrower agrees to pay prepayment premium as
calculated in the foregoing sentence upon any prepayment of the
LIBOR Tranche, whether voluntary, required by Bank in connection
with any acceleration of the indebtedness hereunder upon the
occurrence of an Event of Default, or as otherwise required under
this Second Replacement Revolver Note. A determination of Bank
as to the amounts payable pursuant to this Section 4(B) shall be
conclusive absent manifest error.
5. Late Charges. If any installment of principal or
interest or both hereunder or other payment required to be made
by Borrower under the other Loan Documents is not paid within ten
(10) days after becoming due, Borrower shall pay to Bank on
demand a late charge of five percent (5%) of such overdue amount
to reimburse Bank for the additional expenses to be incurred as a
result of such delinquency, but such late payment fee shall not
obligate Bank to accept any overdue payment hereunder nor limit
the rights and remedies available to Bank as a result of
Borrower's default, as hereinafter provided. The amount of any
such late charge not paid promptly following demand shall be
deemed outstanding and payable pursuant to this Replacement
Revolver Note.
6. Event of Default. An Event of Default shall mean an Event
of Default as defined in the Loan Agreement .
7. Default Rate. Upon the occurrence of an Event of Default
hereunder, the interest rate otherwise payable hereunder (the
"Contract Rate") shall increase immediately and without notice
and thereafter shall be payable at a rate of three percent (3%)
per annum in excess of the Contract Rate (said higher rate is
hereinafter called the "Default Rate"), until the Event of
Default has been cured, or in the event the principal of this
Second Replacement Revolver Note has been
<PAGE 7>
accelerated, until this Second Replacement Revolver Note is paid
in full, including the period following entry of any judgment on
or relating to this Second Replacement Revolver Note or the other
Loan Documents. Interest on any such judgment shall accrue and
be payable at the Default Rate, and not at the statutory rate of
interest, after judgment, any execution thereon, and until actual
receipt by the holder of payment in full of this Second
Replacement Revolver Note and said judgment. Interest at the
Default Rate shall be collectible as part of any judgment
hereunder and shall be secured by the other Loan Documents.
8. Remedies. Upon the occurrence of an Event of Default, the
Bank shall be entitled to exercise all remedies available to it
under the terms of the Loan Agreement.
9. Accounts. Borrower hereby covenants and agrees that while
the Loan is outstanding it will maintain all of its bank accounts
with Bank.
10. Waivers by Borrower, Cumulative Remedies.
(A) Borrower hereby waives presentment for payment, demand,
notice of non-payment, notice of protest and protest of this
Second Replacement Revolver Note. The Borrower hereby consents
to any and all extensions of time, renewals, waivers or
modifications that may be granted by the Bank with respect to the
payment or other provisions of this Second Replacement Revolver
Note, and agrees that additional obligors may become parties
hereto without notice to the Borrower without affecting the
Borrower's liability hereunder.
(B) Borrower hereby waives-the benefit of any laws which
now or hereinafter might otherwise authorize the stay of any
execution to be issued on any judgment covered on this Second
Replacement Revolver Note. Borrower hereby waives its right to
trial by jury in connection with a portion of this Second
Replacement Revolver Note or under the loan agreement or any
other document executed in connection with this Loan and any
legal proceeding arising hereunder or thereunder.
(C) No failure or delay on the part of the Bank in
exercising any right, power or privilege under this Second
Replacement Revolver Note and no course of dealing between the
Borrower and the Bank shall operate as a waiver thereof. No
single or partial exercise of any right, power or privilege
hereunder shall preclude any other or further exercise of any
right, power or privilege that the Bank would otherwise have. No
notice to, or demand on, the Borrower in any case shall entitle
the Borrower to any other or further notice or demand in similar
or other circumstances would constitute a waiver of the right of
the Bank to any other or further action and any circumstances
without notice or demand.
11. Costs and Expenses. The Borrower agrees, in accordance
with the terms of the Loan Agreement, to pay all costs and
expenses of the Bank incurred in order to enforce any remedy
available to the Bank under this Second Replacement Revolver
Note, the Loan Agreement or any Loan Document.
<PAGE 8>
12. Reimbursement to Bank for Increased Costs Due to Capital
Adequacy Requirements. If after the date hereof any change in
law or regulation or the interpretation thereof by any court or
administrative or governmental authority charged with the
administration thereof, or compliance by Bank with any request or
directive (whether or not having the force of law) of any such
authority, applicable from time to time now or after the date
hereof to banks in general, shall (A) impose, modify, deem
applicable or result in the application of any capital
maintenance, capital ratio or similar requirements against loan
commitments or other facilities made by Bank and the result
thereof shall be to impose upon Bank a fee or a requirement to
increase any capital requirement applicable as a result of the
making or maintenance of the Loan (which imposition of or
increase in capital requirements may be determined by Bank's
reasonable allocation of the aggregate of such capital
impositions or increases), or (B) subject Bank to any tax, duty
or other charge with respect to the Loan, the Second Replacement
Revolver Note, or change the basis of taxation of payments to
Bank of the principal of or interest on the Loan or any other
amounts due under this Agreement, in respect of the Loan (except
for changes in the rate of tax on the overall net income of Bank
imposed by any jurisdiction in which Bank is obligated to pay
taxes), then, upon demand by Bank, Borrower shall immediately pay
to Bank from time to time as specified by Bank, such additional
amounts or fees which shall be sufficient to compensate Bank for
such impositions of or increases in capital requirements or taxes
from the date of such change, together with interest on each such
amount from the date demanded until payment in full thereof at
the Default Rate with respect to amounts or fees not paid when
due. Upon the occurrence of any event referred to above, a
certificate setting forth- in reasonable detail the amounts
necessary to compensate Bank as a result of an imposition of or
increase in capital requirements or taxes submitted by Bank to
Borrower shall be conclusive, absent manifest error or bad faith,
as to the amount thereof.
13. Special Provisions of LIBOR Tranches.
(A) Unavailability of Funds and Indeterminate Interest
Rates. If on or before the date Bank is to make any LIBOR
Tranche or on or before any Effective Date (1) Bank determines in
good faith that it is unable to obtain funds at the LIBO Rate for
the elected Interest Period for any reason, including, but not
limited to the unavailability of funds at such rate, any change
in existing law, any new law, the length of such Interest Period,
or otherwise or (2) Bank determines in good faith that no
adequate means exists to determine the LIBO Rate for such
Interest Period, then, at Bank's option, Borrower shall be deemed
to have requested a Prime Rate Tranche or shall be required to
elect an Interest Period of a length for which Bank may obtain
funds at the rate the adjustment of which determines the LIBO
Rate.
(B) Changes Affecting Ability to Maintain Funds. If,
during any Interest Period, any change in existing law, any new
law, or any other factor beyond the control of Bank prevents Bank
in its good faith determination from maintaining funds at the
rate the adjustment of which determines the LIBO Rate for such
Interest Period and requires Bank to cease so maintaining funds
actually so maintained prior to termination of such Interest
Period, then on the date of such required cessation, Borrower
shall be required to specify a different Interest Rate for such
Interest Period or, in the alternative, to elect an Interest
Period of a length for which Bank may
<PAGE 9>
maintain funds at the rate the adjustment of which determines the
LIBO Rate. In addition, within five days after Bank notifies
Borrower of such required conversion, Borrower shall reimburse
Bank for any loss or expense Bank has certified in writing to
Borrower that Bank has incurred as a result of any such required
cessation.
14. Interest Limitation; Severability.
(A) Nothing herein contained nor any transaction related
hereto shall be construed or shall operate either presently or
prospectively to require Borrower to pay interest at a rate
greater than is now lawful in such case to contract for, but
shall require payment of interest only to the extent of such
lawful rate. Any interest paid in excess of the lawful rate
shall be refunded to Borrower. Such refund shall be made by
application of the excessive amount of interest paid against any
sums outstanding hereunder, in which event any applicable
prepayment premium shall be waived with respect to the amount so
prepaid, and shall be applied in such order as Bank may
determine. If the excessive amount of interest paid exceeds the
sums outstanding hereunder, the portion exceeding the said sums
outstanding hereunder shall be refunded in cash by Bank. Any
such crediting or refund shall not cure or waive any default by
Borrower hereunder or under the other Loan Documents. Borrower
agrees, however, that in determining whether or not any interest
payable hereunder exceeds the highest rate permitted by law, any
non-principal amount (except payments specifically stated herein
to be "interest"), including, without limitation, late charges,
shall be deemed, to the extent permitted by law, to be an
expense, fee, premium or penalty rather than interest.
(B) In the event that for any reason one or more of the
provisions of this Second Replacement Revolver Note or their
application to any person or circumstance shall be held to be
invalid, illegal or unenforceable in any respect or to any
extent, such provisions shall, to such extent, be held for naught
as though not herein contained but shall nevertheless remain
valid, legal and enforceable in all such other respects and to
such extent as may be permissible. In addition, any such
invalidity, illegality or unenforceability shall not affect any
other provisions of this Second Replacement Revolver Note, but
this Second Replacement Revolver Note shall be construed as if
such invalid, illegal or unenforceable provisions had never been
contained herein.
15. Notices. All notices, requests, demands or other
communications to or upon the Borrower or the Bank shall be
deemed to have been given or made when hand delivered or
deposited in the mail by certified mail, return receipt
requested, postage prepaid, addressed to the Borrower or the
Bank, as the case may be, at their respective addresses indicated
herein or at such other addresses as the Borrower or the Bank may
hereafter specify in writing to the other, except that any
communication with respect to a change of address shall be deemed
to be given or made when received by the Borrower or the Bank to
whom such communication was sent.
16. Successors and Assigns. This Second Replacement Revolver
Note is binding upon the Borrower and its successors and assigns
except that Borrower shall not have the right to assign its
rights or obligations hereunder or any interest herein.
<PAGE 10>
17. Amendment. This Second Replacement Revolver Note may not
be changed orally, but only by an agreement in writing signed by
the party against whom enforcement of any waiver, change,
modification or discharge is sought.
18. Governing Law. This Second Replacement Revolver Note has
been executed and delivered in the State of New Jersey and shall
be construed and enforced in accordance with the laws of the
State of New Jersey.
19. Captions. The captions or headings of the sections in
this Second Replacement Revolver Note are for convenience only
and shall not control or effect the meaning or construction of
any term or provision of this Second Replacement Revolver Note.
IN WITNESS WHEREOF, the Borrower has executed this Second
Replacement Revolver Note as of the date and year first above
written.
ATTEST: DATARAM CORPORATION,
a New Jersey corporation
By:__________________________ By:____________________________
__________________________ ____________________________
Print Name and Title Print Name and Title
<PAGE 11>
SCHEDULE TO SECOND REPLACEMENT REVOLVER NOTE
Unpaid
Principal
Amount of Balance of Name of
Amount of Principal Revolving Person Making
Date Loan Prepaid Credit Note Notation
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
_________________________________________________________________
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