OVERLAND DATA INC
EXHIBIT 10.3
<DOCUMENT>
<TYPE>EX-10.3
<SEQUENCE>5
<FILENAME>a2067931zex-10_3.txt
<DESCRIPTION>EXHIBIT 10.3
<TEXT>
<Page>
                                                                    Exhibit 10.3


                              MASTER REVOLVING NOTE
                 Variable Rate-Maturity Date-Obligatory Advances
                      (Business and Commercial Loans Only)

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AMOUNT           NOTE DATE            MATURITY DATE      TAX IDENTIFICATION #
$10,000,000.00   November 28, 2001    November 30, 2003   95-3535285
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On the Maturity Date, as stated above, for value received, the undersigned
promise(s) to pay to the order of COMERICA BANK-CALIFORNIA ("Bank"),at any
office of the Bank in the State of California, TEN MILLION AND NO/100 Dollars
(U.S.) (or that portion of it advanced by the Bank and not repaid as later
provided) with interest until maturity, whether by acceleration or otherwise, or
an Event of Default, as later defined, at a per annum rate equal to the Bank's
base rate from time to time in effect MINUS 0.250 % per annum and after that at
a rate equal to the rate of interest otherwise prevailing under this Note plus
3% per annum (but in no event in excess of the maximum rate permitted by law).
The Bank's "base rate" is that annual rate of interest so designated by the Bank
and which is changed by the Bank from time to time. Interest rate changes will
be effective for interest computation purposes as and when the Bank's base rate
changes. Interest shall be calculated on the basis of a 360-day year for the
actual number of days the principal is outstanding. Accrued interest on this
Note shall be payable on the 30TH day of each MONTH commencing DECEMBER 30,
2001, until the Maturity Date when all amounts outstanding under this Note shall
be due and payable in full. If the frequency of interest payments is not
otherwise specified, accrued interest on this Note shall be payable monthly on
the first day of each month. If any payment of principal or interest under this
Note shall be payable on a day other than a day on which the Bank is open for
business, this payment shall be extended to the next succeeding business day and
interest shall be payable at the rate specified in this Note during this
extension. A late payment charge equal to 5% of each late payment may be charged
on any payment not received by the Bank within 10 calendar days after the
payment due date, but acceptance of payment of this charge shall not waive any
Default under this Note.

The principal amount payable under this Note shall be the sum of all advances
made by the Bank to or at the request of the undersigned, less principal
payments actually received in cash by the Bank. The books and records of the
Bank shall be the best evidence of the principal amount and the unpaid interest
amount owing at any time under this Note and shall be conclusive absent manifest
error. No interest shall accrue under this Note until the date of the first
advance made by the Bank; after that interest on all advances shall accrue and
be computed on the principal balance outstanding from time to time under this
Note until the same is paid in full.

This Note and any other indebtedness and liabilities of any kind of the
undersigned (or any of them) to the Bank, and any and all modifications,
renewals or extensions of it, whether joint or several, contingent or absolute,
now existing or later arising, and however evidenced (collectively
"Indebtedness") are secured by and the Bank is granted a security interest in
all items deposited in any account of any of the undersigned with the Bank and
by all proceeds of these items (cash or otherwise), all account balances of any
of the undersigned from time to time with the Bank, by all property of any of
the undersigned from time to time in the possession of the Bank and by any other
collateral, rights and properties described in each and every deed of trust,
mortgage, security agreement, pledge, assignment and other security or
collateral agreement which has been, or will at any time(s) later be, executed
by any (or all) of the undersigned to or for the benefit of the Bank
(collectively "Collateral"). Notwithstanding the above, (i) to the extent that
any portion of the Indebtedness is a consumer loan, that portion shall not be
secured by any deed of trust or mortgage on or other security interest in any of
the undersigned's principal dwelling or any of the undersigned's real property
which is not a purchase money security interest as to that portion, unless
expressly provided to the contrary in another place, or (ii) if the undersigned
(or any of them) has(have) given or give(s) Bank a deed of trust or mortgage
covering real property, that deed of trust or mortgage shall not secure this
Note or any other indebtedness of the undersigned (or any of them), unless
expressly provided to the contrary in another place.

If the undersigned (or any of them) or any guarantor under a guaranty of all or
part of the Indebtedness ("guarantor") (i) fail(s) to pay any of the
Indebtedness when due, by maturity, acceleration or otherwise, or fail(s) to pay
any Indebtedness owing on a demand basis upon demand; or (ii) fail(s) to comply
with any of the terms or provisions of any agreement between the undersigned (or
any of them) or any such guarantor and the Bank; or (iii) become(s) insolvent or
the subject of a voluntary or involuntary proceeding in bankruptcy, or a
reorganization, arrangement or creditor composition proceeding, (if a business
entity) cease(s) doing business as a going concern, (if a natural person) die(s)
or become(s) incompetent, (if a partnership) dissolve(s) or any general partner
of it dies, becomes incompetent or becomes the subject of a bankruptcy
proceeding or (if a corporation of a limited liability company) is the subject
of a dissolution, merger or consolidation; or (a) if any warranty or
representation made by any of the undersigned or any guarantor in connection
with this Note or any of the Indebtedness shall be discovered to be untrue or
incomplete; or (b) if there is any termination, notice of termination, or breach
of any guaranty, pledge, collateral assignment or subordination agreement
relating to all or any part of the Indebtedness; or (c) if there is any failure
by any of the undersigned or any guarantor to pay when due any of its
indebtedness (other than to the Bank) or in the observance or performance of any
term, covenant or condition in any document evidencing, securing or relating to
such indebtedness; or (d) if the Bank deems itself insecure believing that the
prospect of payment of this Note or any of the Indebtedness is impaired or shall
fear deterioration, removal or waste of any of the Collateral; or (e) if there
is filed or issued a levy or writ of attachment or garnishment or other like
judicial process upon the undersigned (or any of them) or any guarantor or any
of the Collateral, including without limit, any accounts of the undersigned (or
any of them) or any guarantor with the Bank, then the Bank, upon the occurrence
of any of these events (each a "Default"), may at its option and without prior
notice to the undersigned (or any of them), declare any or all of the
Indebtedness to be immediately due and payable (notwithstanding any provisions
contained in the evidence of it to the contrary), cease advancing money or
extending credit to or for the benefit of the undersigned under this Note or any
other agreement between the undersigned and Bank, terminate this Note as to any
future liability or obligation of Bank, but without affecting Bank's rights and
security interests in any Collateral and the Indebtedness of the undersigned to
Bank, sell or liquidate all or any portion of the Collateral, set off against
the Indebtedness any amounts owing by the Bank to the undersigned (or any of
them), charge interest at the default rate provided in the document evidencing
the relevant Indebtedness and exercise any one or more of the rights and
remedies granted to the Bank by any agreement with the undersigned (or any of
them) or given to it under applicable law. In addition, if this Note is secured
by a deed of trust or mortgage covering real property, then the trustor or
mortgagor shall not mortgage or pledge the mortgaged premises as security for
any other indebtedness or obligations. This Note, together with all other
indebtedness secured by said deed of trust or mortgage, shall become due and
payable immediately, without notice, at the option of the Bank, (a) if said
trustor or mortgagor shall mortgage or pledge the mortgaged premises for any
other indebtedness or obligations or shall convey, assign or transfer the
mortgaged premises by deed, installment sale contract instrument, or (b) if the
title to the mortgaged premises shall become vested in any other person or party
in any manner whatsoever, or (c) if there is any disposition (through one or
more transactions) of legal or beneficial title to a controlling interest of
said trustor or mortgagor. All payments under this Note shall be in immediately
available United States funds, without setoff or counterclaim.

If this Note is signed by two or more parties (whether by all as makers or by
one or more as an accommodation party or otherwise), the obligations and
undertakings under this Note shall be that of all and any two or more jointly
and also of each severally. This Note shall bind the undersigned, and the
undersigned's respective heirs, personal representatives, successors and
assigns.

The undersigned waive(s) presentment, demand, protest, notice of dishonor,
notice of demand or intent to demand, notice of acceleration or intent to
accelerate, and all other notices and agree(s) that no extension or indulgence
to the undersigned (or any of them) or release, substitution or nonenforcement
of any security, or release or substitution of any of the undersigned, any
guarantor or any other party, whether with or without notice, shall affect the
obligations of any of the undersigned. The undersigned waive(s) all defenses or
right to discharge available under Section 3-605 of the California Uniform
Commercial Code and waive(s) all other suretyship defenses or right to
discharge. The undersigned agree(s) that the Bank has the right to sell, assign,
or grant participations, or any interest, in any or all of the Indebtedness, and
that, in connection with this right, but without limiting its ability to make
other disclosures to the full extent allowable, the Bank may disclose all
documents and information which the Bank now or later has relating to the
undersigned or the Indebtedness. The undersigned agree(s) that the Bank may
provide information relating to the Note or to the undersigned to the Bank's
parent, affiliates, subsidiaries and service providers.


<Page>


The undersigned agree(s) to reimburse the holder or owner of this Note for any
and all costs and expenses (including without limit, court costs, legal expenses
and reasonable attorney fees, whether inside or outside counsel is used, whether
or not suit is instituted and, if suit is instituted, whether at the trial court
level, appellate level, in a bankruptcy, probate or administrative proceeding or
otherwise) incurred in collecting or attempting to collect this Note or incurred
in any other matter or proceeding relating to this Note.

The undersigned acknowledge(s) and agree(s) that there are no contrary
agreements, oral or written, establishing a term of this Note and agree(s) that
the terms and conditions of this Note may not be amended, waived or modified
except in a writing signed by an officer of the Bank expressly stating that the
writing constitutes an amendment, waiver or modification of the terms of this
Note. As used in this Note, the word "undersigned" means, individually and
collectively, each maker, accommodation party, indorser and other party signing
this Note in a similar capacity. If any provision of this Note is unenforceable
in whole or part for any reason, the remaining provisions shall continue to be
effective. THIS NOTE IS MADE IN THE STATE OF CALIFORNIA AND SHALL BE GOVERNED BY
AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF CALIFORNIA,
WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES.

The maximum interest rate shall not exceed the highest applicable usury ceiling.

THE UNDERSIGNED AND THE BANK ACKNOWLEDGE THAT THE RIGHT TO TRIAL BY JURY IS A
CONSTITUTIONAL ONE, BUT THAT IT MAY BE WAIVED, EACH PARTY, AFTER CONSULTING (OR
HAVING HAD THE OPPORTUNITY TO CONSULT) WITH COUNSEL OF THEIR CHOICE, KNOWINGLY
AND VOLUNTARILY, AND FOR THEIR MUTUAL BENEFIT, WAIVES ANY RIGHT TO TRIAL BY JURY
IN THE EVENT OF LITIGATION REGARDING THE PERFORMANCE OR ENFORCEMENT OF, OR IN
ANY WAY RELATED TO, THIS NOTE OR THE INDEBTEDNESS.

1) This Note is subject to the provisions of the Business Loan Agreement
   November 28, 2001 and all amendments thereto and replacements therefor.

2) See Libor Addendum and Addendum "A" attached hereto and made a part hereof.

INITIAL HERE _______

Overland Data, Inc.

By:  /s/ Christopher Calisi                       Its:   President and CEO
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    SIGNATURE OF                                      TITLE

By: /s/ Vernon A. LoForti                         Its:   VP and CFO
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    SIGNATURE OF                                      TITLE

By:                                               Its:
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    SIGNATURE OF                                      TITLE

By:                                               Its:
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    SIGNATURE OF                                      TITLE


8975 Balboa Ave.          San Diego     California     USA            92123
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STREET ADDRESS            CITY          STATE          (COUNTRY)      ZIP CODE


<Page>


         Addendum "A" attached to that certain Master Revolving Note ("Note")
dated November 28, 2001, by and between OVERLAND DATA, INC. ("Borrower"), and
Comerica Bank-California ("Bank") in the original principal amount of Ten
Million Dollars ($10,000,000) ("Note Amount") and made a part thereof:

The Note is hereby amended as follows:

1.       LETTERS OF CREDIT

         (a)      In addition to advances under the Note, at Bank's sole
discretion, Bank may, from time to time until the maturity date of the Note,
issue or cause to be issued letters of credit for the account of Borrower in the
aggregate outstanding face amount not to exceed the Note Amount MINUS the then
outstanding aggregate principal balance of advances under the Note; PROVIDED,
HOWEVER, that the face amount of all outstanding letters of credit (including
drawn but unreimbursed letters of credit and letter of credit reserve) shall not
in any case exceed One Million Dollars ($1,000,000). Each letter of credit shall
have an expiration date no later than the maturity date of the Note. All letters
of credit shall be in a form and substance acceptable to Bank in its sole
discretion and shall be subject to the terms and conditions of Bank's form of
standard Letter of Credit Application and Agreement.

         (b)      The obligation of Borrower to immediately reimburse Bank for
drawings made under letters of credit shall be absolute, unconditional and
irrevocable in accordance with the terms of this Note and such letters of
credit, under all circumstances whatsoever. Borrower shall indemnify, defend,
protect and hold Bank harmless from any loss, cost, expense, or liability,
including, without limitation, reasonable attorneys' fees, arising out of or in
connection with any letters of credit.

         (c)      If at any time for any reason, the amount of Indebtedness owed
by Borrower to Bank pursuant to this Addendum is greater than the aggregate
amount available to be drawn under the Note, Borrower shall immediately pay to
Bank, in cash, the amount of such excess.

2.       FOREIGN EXCHANGE FORWARD CONTRACT RESERVE

         Subject to the availability of advances under the Note, at any time and
from time to time from the date hereof through the banking day immediately prior
to the maturity date of the Note, Bank shall reserve against the revolving line
of credit under the Note, 10% of any Foreign Exchange Forward Contracts totaling
up to One Million Dollars ($1,000,000). The Foreign Exchange Forward Contracts
shall be utilized by Borrower for hedging against its foreign accounts payable.
Borrower will pay any standard issuance and other fees that Bank notifies
Borrower will be charged for issuing and processing Foreign Exchange Contracts
for Borrower. Foreign Exchange Contracts shall expire no later than the maturity
date of the Note.

3.       All initially capitalized terms used but not defined in this Addendum
shall have the meanings assigned to such terms in the Note.



                                               OVERLAND DATA, INC.


                                               By:   /s/ Christopher Calisi
                                                     ---------------------------
                                               Title:  President & CEO


                                               By:  /s/  Vernon A. LoForti
                                                    ----------------------------
                                               Title:  VP & CFO




<Page>


                                      LIBOR
                       ADDENDUM TO MASTER REVOLVING NOTE

         This Addendum to Master Revolving Note (this "Addendum") is entered
into as of this 28th day of November, 2001, by and between Comerica
Bank-California ("Bank") and Overland Data, Inc. ("Borrower"). This Addendum
supplements the terms of the Master Revolving Note of even date herewith.

1.       DEFINITIONS.

         a.       ADVANCE. As used herein, "ADVANCE" means a borrowing requested
by Borrower and made by Bank under the Note, including a LIBOR Option Advance
and/or a Base Rate Option Advance.

         b.       BUSINESS DAY. As used herein, "BUSINESS DAY" means any day
except a Saturday, Sunday or any other day designated as a holiday under Federal
or California statute or regulation.

         c.       LIBOR. As used herein, "LIBOR" means the rate per annum
(rounded upward if necessary, to the nearest whole 1/8 of 1%) and determined
pursuant to the following formula:

              LIBOR =                         Base LIBOR
                           ------------------------------------------------
                           100% - LIBOR Reserve Percentage

                  (1)      "Base LIBOR" means the rate per annum determined by
                           Bank at which deposits for the relevant LIBOR Period
                           would be offered to Bank in the approximate amount of
                           the relevant LIBOR Option Advance in the inter-bank
                           LIBOR market selected by Bank, upon request of Bank
                           at 10:00 a.m. California time, on the day that is the
                           first day of such LIBOR Period.

                  (2)      "LIBOR Reserve Percentage" means the reserve
                           percentage prescribed by the Board of Governors of
                           the Federal Reserve System (or any successor) for
                           "Eurocurrency Liabilities" (as defined in Regulation
                           D of the Federal Reserve Board, as amended), adjusted
                           by Bank for expected changes in such reserve
                           percentage during the applicable LIBOR Period.

         d.       LIBOR BUSINESS DAY. As used herein, "LIBOR Business Day" means
a Business day on which dealings in Dollar deposits may be carried out in the
interbank LIBOR market.

         e.       LIBOR PERIOD. As used herein, "LIBOR PERIOD" means, with
respect to a LIBOR Option Advance:

                  (1)      initially, the period commencing on, as the case may
                           be, the date the Advance is made or the date on which
                           the Advance is converted to a LIBOR Option Advance,
                           and continuing for, in every case, a thirty (30),
                           sixty (60) or ninety (90) days thereafter so long as
                           the LIBOR Option is quoted for such period in the
                           applicable interbank LIBOR market, as such period is
                           selected by Borrower in the notice of Advance as
                           provided in the Note or in the notice of conversion
                           as provided in this Addendum; and

                  (2)      thereafter, each period commencing on the last day of
                           the next preceding LIBOR Period applicable to such
                           LIBOR Option Advance and continuing for, in every
                           case, a _thirty (30), sixty (60) or ninety (90) days
                           thereafter so long as the LIBOR Option is quoted for
                           such period in the applicable interbank LIBOR market,
                           as such period is selected by Borrower in the notice
                           of continuation as provided in this Addendum.


                                       1

<Page>


         f.       NOTE. As used herein, "NOTE" means the Master Revolving Note
of even date herewith.

         g.       REGULATION D. As used herein, "REGULATION D" means Regulation
D of the Board of Governors of the Federal Reserve System as amended or
supplemented from time to time.

         h.       REGULATORY DEVELOPMENT. As used herein, "REGULATORY
DEVELOPMENT" means any or all of the following: (i) any change in any law,
regulation or interpretation thereof by any public authority (whether or not
having the force of law); (ii) the application of any existing law, regulation
or the interpretation thereof by any public authority (whether or not having the
force of law); and (iii) compliance by Bank with any request or directive
(whether or not having the force of law) of any public authority.

2.       INTEREST RATE OPTIONS. Borrower shall have the following options
regarding the interest rate to be paid by Borrower on Advances under the Note:

         a.       A rate equal to two and one quarter percent (2.25%) above
                  above Bank's LIBOR, (the "LIBOR Option"), which LIBOR Option
                  shall be in effect during the relevant LIBOR Period; or

         b.       A rate equal to one quarter percent (0.25%) below the "Base
                  Rate" as referenced in the Note and quoted from time to time
                  by Bank as such rate may change from time to time (the "Base
                  Rate Option").

3.       LIBOR OPTION ADVANCE. The minimum LIBOR Option Advance will not be less
than Five Hundred Thousand and 00/100 Dollars ($500,000.00) for any LIBOR Option
Advance.

4.       PAYMENT OF INTEREST ON LIBOR OPTION ADVANCES. Interest on each LIBOR
Option Advance shall be payable pursuant to the terms of the Note. Interest on
such LIBOR Option Advance shall be computed on the basis of a 360-day year and
shall be assessed for the actual number of days elapsed from the first day of
the LIBOR Period applicable thereto but not including the last day thereof.

5.       BANK'S RECORDS RE: LIBOR OPTION ADVANCES. With respect to each LIBOR
Option Advance, Bank is hereby authorized to note the date, principal amount,
interest rate and LIBOR Period applicable thereto and any payments made thereon
on Bank's books and records (either manually or by electronic entry) and/or on
any schedule attached to the Note, which notations shall be prima facie evidence
of the accuracy of the information noted.

6.       SELECTION/CONVERSION OF INTEREST RATE OPTIONS. At the time any Advance
is requested under the Note and/or Borrower wishes to select the LIBOR Option
for all or a portion of the outstanding principal balance of the Note, and at
the end of each LIBOR Period, Borrower shall give Bank notice specifying (a) the
interest rate option selected by Borrower; (b) the principal amount subject
thereto; and (c) if the LIBOR Option is selected, the length of the applicable
LIBOR Period. Any such notice may be given by telephone so long as, with respect
to each LIBOR Option selected by Borrower, (i) Bank receives written
confirmation from Borrower not later than three (3) LIBOR Business Days after
such telephone notice is given; and (ii) such notice is given to Bank prior to
10:00 a.m., California time, on the first day of the LIBOR Period. For each
LIBOR Option requested hereunder, Bank will quote the applicable fixed LIBOR
Rate to Borrower at approximately 10:00 a.m., California time, on the first day
of the LIBOR Period. If Borrower does not immediately accept the rate quoted by
Bank, any subsequent acceptance by Borrower shall be subject to a
redetermination of the rate by Bank; provided, however, that if Borrower fails
to accept any such quotation given, then the quoted rate shall expire and Bank
shall have no obligation to permit a LIBOR Option to be selected on such day. If
no specific designation of interest is made at the time any Advance is requested
under the Note or at the end of any LIBOR Period, Borrower shall be deemed to
have selected the Base Rate Option for such Advance or the principal amount to
which such LIBOR Period applied. At any time the LIBOR Option is in effect,
Borrower may, at the end of the applicable LIBOR Period, convert to the Base
Rate Option. At any time the Base Rate Option is in effect, Borrower may convert
to the LIBOR OPTION, and shall designate a LIBOR Period.


                                       2

<Page>


7.       DEFAULT INTEREST RATE. From and after the maturity date of the Note, or
such earlier date as all principal owing hereunder becomes due and payable by
acceleration or otherwise, the outstanding principal balance of the Note shall
bear interest until paid in full at an increased rate per annum (computed on the
basis of a 360-day year, actual days elapsed) equal to three percent (3.00%)
above the rate of interest from time to time applicable to the Note.

8.       PREPAYMENT. Bank is not under any obligation to accept any prepayment
of any LIBOR Option Advance except as described below or as required under
applicable law. Borrower may prepay a Base Rate Option Advance at any time,
without paying any Prepayment Amount, as defined below. Borrower may prepay an
LIBOR Option Advance in increments of Five Hundred Dollars ($500.00) prior to
the end of the LIBOR Period, as long as (i) Bank is provided written notice of
such prepayment at least five (5) LIBOR Business Days prior to the date thereof
(the "Prepayment Date"); and (ii) Borrower pays the Prepayment Amount. The
notice of prepayment shall contain the following information: (a) the Prepayment
Date; and (b) the LIBOR Option Advance which will be prepaid. On the Prepayment
Date, Borrower shall pay to Bank, in addition to any other amount that may then
be due on the Note, the Prepayment Amount. Bank, in its sole discretion, may
accept any prepayment of a LIBOR Option Advance even if not required to do so
under the Note and may deduct from the amount to be applied against the LIBOR
Option Advance any other amounts required to be paid as part of the Prepayment
Amount.

         The Prepaid Principal Amount (as defined below) will be applied to the
LIBOR Option Advance being prepaid as Bank shall determine in its sole
discretion.

         If Bank exercises its right to accelerate the payment of the Note prior
to maturity based upon an Event of Default under the Note, Borrower shall pay to
Bank, in addition to any other amounts that may then be due on the Note, on the
date specified by Bank as the Prepayment Date, the Prepayment Amount.

         Bank's determination of the Prepayment Amount shall be conclusive in
the absence of obvious error or fraud. If requested in writing by Borrower, Bank
shall provide Borrower a written statement specifying the Prepayment Amount.

         The following (the "Prepayment Amount") shall be due and payable in
full on the Prepayment Date:

         a.       If the principal amount of the LIBOR Option Advance being
prepaid exceeds Seven Hundred Fifty Thousand Dollars ($750,000), then the
Prepayment Amount is the sum of: (i) the amount of the principal balance of the
LIBOR Option Advance which Borrower has elected to prepay or the amount of the
principal balance of the LIBOR Option Advance which Bank has required Borrower
to prepay because of acceleration, as the case may be (the "Prepaid Principal
Amount"); (ii) interest accruing on the Prepaid Principal Amount up to, but not
including, the Prepayment Date; (iii) Five Hundred Dollars ($500.00); plus (iv)
the present value, discounted at the Reinvestment Rates (as defined below) of
the positive amount by which (A) the interest Bank would have earned had the
Prepaid Principal Amount not been paid prior to the end of the LIBOR Period at
the Note's interest rate exceeds (B) the interest Bank would earn by reinvesting
the Prepaid Principal Amount at the Reinvestment Rates.

         b.       If the principal amount of the LIBOR Option Advance being
prepaid is Seven Hundred Fifty Thousand Dollars ($750,000) or less, then the
Prepayment Amount is the sum of: (i) the principal amount of the LIBOR Option
Advance which Borrower has elected to prepay or the principal amount of the
LIBOR Option Advance which Bank has required Borrower to prepay because of
acceleration due to an Event of Default under the Note, as the case may be (the
"Prepaid Principal Amount"); (ii) interest accruing on the Prepaid Principal
Amount up to, but not including, the Prepayment Date; plus (iii) an amount equal
to two percent (2%) of the Prepaid Principal Amount.


                                       3

<Page>


         "Reinvestment Rates" mean the per annum rates of interest equal to one
half percent (1/2%) above the rates of interest reasonably determined by Bank to
be in effect not more than seven (7) days prior to the Prepayment Date in the
secondary market for United States Treasury Obligations in amount(s) and with
maturity(ies) which correspond (as closely as possible) to the LIBOR Option
Advance being prepaid.

         BY INITIALING BELOW, BORROWER ACKNOWLEDGE(S) AND AGREE(S) THAT: (A)
THERE IS NO RIGHT TO PREPAY ANY LIBOR OPTION ADVANCE , IN WHOLE OR IN PART,
WITHOUT PAYING THE PREPAYMENT AMOUNT, EXCEPT AS OTHERWISE REQUIRED UNDER
APPLICABLE LAW; (B) BORROWER SHALL BE LIABLE FOR PAYMENT OF THE PREPAYMENT
AMOUNT IF BANK EXERCISES ITS RIGHT TO ACCELERATE PAYMENT OF ANY LIBOR OPTION
ADVANCE AS PART OR ALL OF THE OBLIGATIONS OWING UNDER THE NOTE, INCLUDING
WITHOUT LIMITATION, ACCELERATION UNDER A DUE-ON-SALE PROVISION; (C) BORROWER
WAIVES ANY RIGHTS UNDER SECTION 2954.10 OF THE CALIFORNIA CIVIL CODE, OR ANY
SUCCESSOR STATUTE; AND (D) BANK HAS MADE EACH LIBOR OPTION ADVANCE PURSUANT TO
THE NOTE IN RELIANCE ON THESE AGREEMENTS.


------------------
BORROWER'S INITIALS


9.       HOLD HARMLESS AND INDEMNIFICATION. Borrower agrees to indemnify Bank
and to hold Bank harmless from, and to reimburse Bank on demand for, all losses
and expenses which Bank sustains or incurs as a result of (i) any payment of a
LIBOR Option Advance prior to the last day of the applicable LIBOR Period for
any reason, including, without limitation, termination of the Note, whether
pursuant to this Addendum or the occurrence of an Event of Default; (ii) any
termination of a LIBOR Period prior to the date it would otherwise end in
accordance with this Addendum; or (iii) any failure by Borrower, for any reason,
to borrow any portion of a LIBOR Option Advance.

10.      FUNDING LOSSES. The indemnification and hold harmless provisions set
forth in this Addendum shall include, without limitation, all losses and
expenses arising from interest and fees that Bank pays to lenders of funds it
obtains in order to fund the loans to Borrower on the basis of the LIBOR
Option(s) and all losses incurred in liquidating or re-deploying deposits from
which such funds were obtained and loss of profit for the period after
termination. A written statement by Bank to Borrower of such losses and expenses
shall be conclusive and binding, absent manifest error, for all purposes. This
obligation shall survive the termination of this Addendum and the payment of the
Note.

11.      REGULATORY DEVELOPMENTS OR OTHER CIRCUMSTANCES RELATING TO ILLEGALITY
OR IMPRACTICALITY OF LIBOR. If any Regulatory Development or other circumstances
relating to the interbank Euro-dollar markets shall, at any time, in Bank's
reasonable determination , make it unlawful or impractical for Bank to fund or
maintain, during any LIBOR Period, to determine or charge interest rates based
upon LIBOR, Bank shall give notice of such circumstances to Borrower and:

         (i)      In the case of a LIBOR Period in progress, Borrower shall, if
                  requested by Bank, promptly pay any interest which had accrued
                  prior to such request and the date of such request shall be
                  deemed to be the last day of the term of the LIBOR Period; and

         (ii)     No LIBOR Period may be designated thereafter until Bank
                  determines that such would be practical.

12.      ADDITIONAL COSTS. Borrower shall pay to Bank from time to time, upon
Bank's request, such amounts as Bank determines are needed to compensate Bank
for any costs it incurred which are attributable to Bank having made or
maintained a LIBOR Option Advance or to Bank's obligation to make a LIBOR Option
Advance, or any reduction in any amount receivable by Bank hereunder with
respect to any LIBOR Option or such obligation (such increases in costs and
reductions in amounts receivable being herein called "ADDITIONAL COSTS"),
resulting from any Regulatory Developments, which (i) change the basis of
taxation of any amounts payable to Bank hereunder with respect to


                                       4

<Page>


taxation of any amounts payable to Bank hereunder with respect to any LIBOR
Option Advance (other than taxes imposed on the overall net income of Bank for
any LIBOR Option Advance by the jurisdiction where Bank is headquartered or the
jurisdiction where Bank extends the LIBOR Option Advance; (ii) impose or modify
any reserve, special deposit, or similar requirements relating to any extensions
of credit or other assets of, or any deposits with or other liabilities of, Bank
(including any LIBOR Option Advance or any deposits referred to in the
definition of LIBOR); or (iii) impose any other condition affecting this
Addendum (or any of such extension of credit or liabilities). Bank shall notify
Borrower of any event occurring after the date hereof which entitles Bank to
compensation pursuant to this paragraph as promptly as practicable after it
obtains knowledge thereof and determines to request such compensation.
Determinations by Bank for purposes of this paragraph, shall be conclusive,
provided that such determinations are made on a reasonable basis.

13.      LEGAL EFFECT. Except as specifically modified hereby, all of the terms
and conditions of the Note remain in full force and effect.

         IN WITNESS WHEREOF, the parties have agreed to the foregoing as of the
date first set forth above.

OVERLAND DATA, INC.                          COMERICA BANK-CALIFORNIA
Borrower

By:      /s/ Christopher Calisi              By:      /s/ Tracy Fredricks
       -----------------------------               -----------------------------
                                                       Tracy Fredricks
Title:   President & CEO                     Title:    Vice President


By:      /s/ Vernon A. LoForti
       -----------------------------

Title:   VP & CFO
       -----------------------------


                                       5

</TEXT>
</DOCUMENT>
