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EXHIBIT 10.47

LETTER AGREEMENT

March 28, 2003

Special Devices, Incorporated
14370 White Sage Road
Moorpark, CA 93021

Ladies and Gentlemen:

        This letter agreement is entered into by and between Special Devices,
Incorporated, a Delaware corporation (the "Company"), and Foothill Capital
Corporation (the "Lender") (this "Letter Agreement"). Reference is made to that
certain Loan and Security Agreement dated as of June 27, 2001, between the
Company and Lender, as amended by that certain letter agreement dated as of
July 17, 2002, and that certain letter agreement dated as of October 23, 2002
(as amended, the "Loan Agreement"). Capitalized terms used but not otherwise
defined in this Letter Agreement shall have the meanings ascribed to them in the
Loan Agreement. The term "Loan Documents" as defined in the Loan Agreement is
hereby amended and supplemented to include this Letter Agreement.

        The Company and Lender desire to amend the Loan Agreement to permit
Interest Periods of four (4) months for LIBOR Rate Loans (in addition to
permitting 1, 2, 3 and 6 month Interest Periods).

        Therefore, the Loan Agreement is hereby amended as follows:

        1.    Section 1.1 of the Loan Agreement.    The definition of "Interest
Period" appearing in Section 1.1 of the Loan Agreement is hereby amended by
replacing the clause "1, 2, 3, or 6 months" where it appears in both places of
such definition with the clause "1, 2, 3, 4 or 6 months."

        2.    Section 2.13(a) of the Loan Agreement.    Section 2.13(a) of the
Loan Agreement is hereby amended by replacing the clause "1, 2 or 3 months" with
the clause "1, 2, 3 or 4 months."

        Except as specifically set forth above and as set forth in other
amendments and agreements in writing between the parties in accordance with
Section 15.1 of the Loan Agreement, the respective rights and obligations of the
parties under the Loan Agreement shall remain unchanged.

        This Letter Agreement may be executed in counterparts, each of which
shall constitute an original, but all of which taken together shall constitute
one and the same instrument. The terms and conditions of the Loan Agreement are
hereby incorporated by reference into this Letter Agreement.

        This Letter Agreement shall become effective upon the Company returning
a executed copy of this Letter Agreement to Lender.

        Please indicate your agreement by signing as indicated below.

Very truly yours,

FOOTHILL CAPITAL CORPORATION  
/s/  JOHN NOCITA      

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Agreed and Acknowledged:
 
SPECIAL DEVICES, INCORPORATED
 
By:
/s/  JAMES E. REEDER      

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  Name: JAMES E. REEDER

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  Title: VICE PRESIDENT FINANCE

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  Date: MARCH 28, 2003

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EXHIBIT 10.47