Document:

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                                                                    EXHIBIT 10.6

                             SIMPLE TECHNOLOGY, INC.

                          EMPLOYEE STOCK PURCHASE PLAN

I.       PURPOSE OF THE PLAN

         This Employee Stock Purchase Plan is intended to promote the
interests of Simple Technology, Inc., a California corporation, by providing
eligible employees with the opportunity to acquire a proprietary interest in
the Corporation through participation in a payroll deduction-based employee
stock purchase plan designed to qualify under Section 423 of the Code.

         Capitalized terms herein shall have the meanings assigned to such
terms in the attached Appendix.

II.      ADMINISTRATION OF THE PLAN

         The Plan Administrator shall have full authority to interpret and
construe any provision of the Plan and to adopt such rules and regulations
for administering the Plan as it may deem necessary in order to comply with
the requirements of Code Section 423. Decisions of the Plan Administrator
shall be final and binding on all parties having an interest in the Plan.

III.     STOCK SUBJECT TO PLAN

         A. The stock purchasable under the Plan shall be shares of
authorized but unissued or reacquired Common Stock, including shares of
Common Stock purchased on the open market. The number of shares of Common
Stock initially reserved for issuance over the term of the Plan shall be
limited to 200,000 shares.

         B. The number of shares of Common Stock available for issuance under
the Plan shall automatically increase on the first trading day of January
each calendar year during the term of the Plan, beginning with calendar year
2001, by an amount equal to one percent (1%) of the total number of shares of
Common Stock outstanding on the last trading day in December of the
immediately preceding calendar year, but in no event shall any such annual
increase exceed 400,000 shares.

         C. Should any change be made to the Common Stock by reason of any
stock split, stock dividend, recapitalization, combination of shares,
exchange of shares or other change affecting the outstanding Common Stock as
a class without the Corporation's receipt of consideration, appropriate
adjustments shall be made to (i) the maximum number and class of securities
issuable under the Plan, (ii) the maximum number and class of securities
purchasable per Participant on any one Purchase Date, (iii) the maximum
number and class of securities purchasable in total by all Participants on
any one Purchase Date, (iv) the maximum number

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and/or class of securities by which the share reserve is to increase
automatically each calendar year pursuant to the provisions of Section III.B
of this Article One and (v) the number and class of securities and the price
per share in effect under each outstanding purchase right in order to prevent
the dilution or enlargement of benefits thereunder.

IV.      OFFERING PERIODS

         A. Shares of Common Stock shall be offered for purchase under the
Plan through a series of overlapping offering periods until such time as (i)
the maximum number of shares of Common Stock available for issuance under the
Plan shall have been purchased or (ii) the Plan shall have been sooner
terminated.

         B. Each offering period shall be of such duration (not to exceed
twenty-four (24) months) as determined by the Plan Administrator prior to the
start date of such offering period. Offering periods shall commence at
semi-annual intervals on the first business day of February and August each
year over the term of the Plan. Accordingly, two (2) separate offering
periods shall commence in each calendar year the Plan remains in existence.
However, the initial offering period shall commence at the Effective Time and
terminate on the last business day in July 2002.

         C. Each offering period shall consist of a series of one or more
successive Purchase Intervals. Purchase Intervals shall run from the first
business day in February to the last business day in July each year and from
the first business day in August each year to the last business day in
January in the following year. However, the first Purchase Interval in effect
under the initial offering period shall commence at the Effective Time and
terminate on the last business day in January 2001.

         D. Should the Fair Market Value per share of Common Stock on any
Purchase Date within a particular offering period be less than the Fair
Market Value per share of Common Stock on the start date of that offering
period, then that offering period shall automatically terminate immediately
after the purchase of shares of Common Stock on such Purchase Date, and a new
offering period shall commence on the next business day following such
Purchase Date. The new offering period shall have a duration of twenty (24)
months, unless a shorter duration is established by the Plan Administrator
within five (5) business days following the start date of that offering
period. All individuals participating in the terminated offering period shall
automatically be transferred to the new offering period.

V.       ELIGIBILITY

         A. Each individual who is an Eligible Employee on the start date of
any offering period under the Plan may enter that offering period on such
start date. However, an Eligible Employees may participate in only one
offering period at a time.

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         B. Except as provided in Section IV.D. above, an Eligible Employee
must, in order to participate in a particular offering period, complete the
enrollment forms prescribed by the Plan Administrator (including a stock
purchase agreement and a payroll deduction authorization) and file such forms
with the Plan Administrator (or its designate) on or before the start date of
that offering period.

VI.      PAYROLL DEDUCTIONS

         A. The payroll deduction authorized by the Participant for purposes
of acquiring shares of Common Stock during an offering period may be any
multiple of one percent (1%) of the Cash Earnings paid to the Participant
during each Purchase Interval within that offering period, up to a maximum of
fifteen percent (15%). The deduction rate so authorized shall continue in
effect throughout the offering period, except to the extent such rate is
changed in accordance with the following guidelines:

            (i) The Participant may, at any time during the offering period,
         reduce his or her rate of payroll deduction to become effective as soon
         as possible after filing the appropriate form with the Plan
         Administrator. The Participant may not, however, effect more than one
         (1) such reduction per Purchase Interval.

            (ii) The Participant may, prior to the commencement of any new
         Purchase Interval within the offering period, increase the rate of his
         or her payroll deduction by filing the appropriate form with the Plan
         Administrator. The new rate (which may not exceed the fifteen percent
         (15%) maximum) shall become effective on the start date of the first
         Purchase Interval following the filing of such form.

         B. Payroll deductions shall begin on the first pay day
administratively feasible following the start date of the offering period and
shall (unless sooner terminated by the Participant) continue through the pay
day ending with or immediately prior to the last day of that offering period.
The amounts so collected shall be credited to the Participant's book account
under the Plan, but no interest shall be paid on the balance from time to
time outstanding in such account. The amounts collected from the Participant
shall not be required to be held in any segregated account or trust fund and
may be commingled with the general assets of the Corporation and used for
general corporate purposes.

         C. Payroll deductions shall automatically cease upon the termination
of the Participant's purchase right in accordance with the provisions of the
Plan.

         D. The Participant's acquisition of Common Stock under the Plan on
any Purchase Date shall neither limit nor require the Participant's
acquisition of Common Stock on any subsequent Purchase Date, whether within
the same or a different offering period.

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VII.     PURCHASE RIGHTS

         A. GRANT OF PURCHASE RIGHTS. A Participant shall be granted a
separate purchase right for each offering period in which he or she is
enrolled. The purchase right shall be granted on the start date of the
offering period and shall provide the Participant with the right to purchase
shares of Common Stock, in a series of successive installments during that
offering period, upon the terms set forth below. The Participant shall
execute a stock purchase agreement embodying such terms and such other
provisions (not inconsistent with the Plan) as the Plan Administrator may
deem advisable.

         Under no circumstances shall purchase rights be granted under the
Plan to any Eligible Employee if such individual would, immediately after the
grant, own (within the meaning of Code Section 424(d)) or hold outstanding
options or other rights to purchase, stock possessing five percent (5%) or
more of the total combined voting power or value of all classes of stock of
the Corporation or any Corporate Affiliate.

         B. EXERCISE OF THE PURCHASE RIGHT. Each purchase right shall be
automatically exercised in installments on each successive Purchase Date
within the offering period, and shares of Common Stock shall accordingly be
purchased on behalf of each Participant on each such Purchase Date. The
purchase shall be effected by applying the Participant's payroll deductions
for the Purchase Interval ending on such Purchase Date to the purchase of
whole shares of Common Stock at the purchase price in effect for the
Participant for that Purchase Date.

         C. PURCHASE PRICE. The purchase price per share at which Common
Stock will be purchased on the Participant's behalf on each Purchase Date
within the particular offering period in which he or she is enrolled shall be
equal to eighty-five percent (85%) of the lower of (i) the Fair Market Value
per share of Common Stock on the start date of that offering period or (ii)
the Fair Market Value per share of Common Stock on that Purchase Date.

         D. NUMBER OF PURCHASABLE SHARES. The number of shares of Common
Stock purchasable by a Participant on each Purchase Date during the
particular offering period in which he or she is enrolled shall be the number
of whole shares obtained by dividing the amount collected from the
Participant through payroll deductions during the Purchase Interval ending
with that Purchase Date by the purchase price in effect for the Participant
for that Purchase Date. However, the maximum number of shares of Common Stock
purchasable per Participant on any one Purchase Date shall not exceed 500
shares, subject to periodic adjustments in the event of certain changes in
the Corporation's capitalization. In addition, the maximum number of shares
of Common Stock purchasable in total by all Participants in the Plan on any
one Purchase Date shall not exceed 50,000 shares, subject to periodic
adjustments in the event of certain changes in the Corporation's
capitalization. However, the Plan Administrator shall have the discretionary
authority, exercisable prior to the start of any offering period under the
Plan, to increase or decrease the limitations to be in effect for the number
of shares purchasable per Participant and in total by all Participants
enrolled in that particular offering period on each Purchase Date which
occurs during that offering period.

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         E.  EXCESS PAYROLL DEDUCTIONS. Any payroll deductions not applied to
the purchase of shares of Common Stock on any Purchase Date because they are
not sufficient to purchase a whole share of Common Stock shall be held for
the purchase of Common Stock on the next Purchase Date. However, any payroll
deductions not applied to the purchase of Common Stock by reason of the
limitation on the maximum number of shares purchasable per Participant or in
total by all Participants on the Purchase Date shall be promptly refunded.

         F.  TERMINATION OF PURCHASE RIGHT. The following provisions shall
govern the termination of outstanding purchase rights:

             (i)    A Participant may, at any time prior to the next
     scheduled Purchase Date in the offering period in which he or she is
     enrolled, terminate his or her outstanding purchase right by filing the
     appropriate form with the Plan Administrator (or its designate), and no
     further payroll deductions shall be collected from the Participant with
     respect to the terminated purchase right. Any payroll deductions
     collected during the Purchase Interval in which such termination occurs
     shall, at the Participant's election, be immediately refunded or held
     for the purchase of shares on the next Purchase Date. If no such
     election is made at the time such purchase right is terminated, then the
     payroll deductions collected with respect to the terminated right shall
     be refunded as soon as possible.

             (ii)   The termination of such purchase right shall be
     irrevocable, and the Participant may not subsequently rejoin the
     offering period for which the terminated purchase right was granted. In
     order to resume participation in any subsequent offering period, such
     individual must re-enroll in the Plan (by making a timely filing of the
     prescribed enrollment forms) on or before the start date of that
     offering period.

             (iii)  Should the Participant cease to remain an Eligible
     Employee for any reason (including death, disability or change in
     status) while his or her purchase right remains outstanding, then that
     purchase right shall immediately terminate, and all of the Participant's
     payroll deductions for the Purchase Interval in which the purchase right
     so terminates shall be immediately refunded. However, should the
     Participant cease to remain in active service by reason of an approved
     unpaid leave of absence, then the Participant shall have the right,
     exercisable up until the last business day of the Purchase Interval in
     which such leave commences, to (a) withdraw all the payroll deductions
     collected to date on his or her behalf for that Purchase Interval or (b)
     have such funds held for the purchase of shares on his or her behalf on
     the next scheduled Purchase Date. In no event, however, shall any
     further payroll deductions be collected on the Participant's behalf
     during such leave. Upon the Participant's return to active service (x)
     within ninety (90) days following the commencement of such leave or (y)
     prior to the expiration of any longer period for which such
     Participant's right

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         to reemployment with the Corporation is guaranteed by statute or
         contract, his or her payroll deductions under the Plan shall
         automatically resume at the rate in effect at the time the leave began,
         unless the Participant withdraws from the Plan prior to his or her
         return. An individual who returns to active employment following a
         leave of absence that exceeds in duration the applicable (x) or (y)
         time period will be treated as a new Employee for purposes of
         subsequent participation in the Plan and must accordingly re-enroll in
         the Plan (by making a timely filing of the prescribed enrollment forms)
         on or before the start date of any subsequent offering period in which
         he or she wishes to participate.

         G.  CHANGE IN CONTROL. Each outstanding purchase right shall
automatically be exercised, immediately prior to the effective date of any
Change in Control, by applying the payroll deductions of each Participant for
the Purchase Interval in which such Change in Control occurs to the purchase
of whole shares of Common Stock at a purchase price per share equal to
eighty-five percent (85%) of the lower of (i) the Fair Market Value per share
of Common Stock on the start date of the offering period in which such
individual is enrolled at the time of such Change in Control or (ii) the Fair
Market Value per share of Common Stock immediately prior to the effective
date of such Change in Control. However, the applicable limitation on the
number of shares of Common Stock purchasable per Participant shall continue
to apply to any such purchase, but not the limitation applicable to the
maximum number of shares of Common Stock purchasable in total by all
Participants in the Plan on any one Purchase Date.

         The Corporation shall use its best efforts to provide at least ten
(10) days' prior written notice of the occurrence of any Change in Control,
and Participants shall, following the receipt of such notice, have the right
to terminate their outstanding purchase rights prior to the effective date of
the Change in Control.

         H.  PRORATION OF PURCHASE RIGHTS. Should the total number of shares
of Common Stock to be purchased pursuant to outstanding purchase rights on
any particular date exceed the number of shares then available for issuance
under the Plan, the Plan Administrator shall make a pro-rata allocation of
the available shares on a uniform and nondiscriminatory basis, and the
payroll deductions of each Participant, to the extent in excess of the
aggregate purchase price payable for the Common Stock pro-rated to such
individual, shall be refunded.

         I.  ASSIGNABILITY. The purchase right shall be exercisable only by
the Participant and shall not be assignable or transferable by the
Participant.

         J.  STOCKHOLDER RIGHTS. A Participant shall have no stockholder
rights with respect to the shares subject to his or her outstanding purchase
right until the shares are purchased on the Participant's behalf in
accordance with the provisions of the Plan and the Participant has become a
holder of record of the purchased shares.

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     I.  ACCRUAL LIMITATIONS

         A.  No Participant shall be entitled to accrue rights to acquire
Common Stock pursuant to any purchase right outstanding under this Plan if
and to the extent such accrual, when aggregated with (i) rights to purchase
Common Stock accrued under any other purchase right granted under this Plan
and (ii) similar rights accrued under other employee stock purchase plans
(within the meaning of Code Section 423)) of the Corporation or any Corporate
Affiliate, would otherwise permit such Participant to purchase more than
Twenty-Five Thousand Dollars ($25,000.00) worth of stock of the Corporation
or any Corporate Affiliate (determined on the basis of the Fair Market Value
per share on the date or dates such rights are granted) for each calendar
year such rights are at any time outstanding.

         B.  For purposes of applying such accrual limitations to the
purchase rights granted under the Plan, the following provisions shall be in
effect:

             (i)   The right to acquire Common Stock under each outstanding
         purchase right shall accrue in a series of installments on each
         successive Purchase Date during the offering period on which such
         right remains outstanding.

             (ii)  No right to acquire Common Stock under any outstanding
         purchase right shall accrue to the extent the Participant has
         already accrued in the same calendar year the right to acquire
         Common Stock under one or more other purchase rights at a rate equal
         to Twenty-Five Thousand Dollars ($25,000.00) worth of Common Stock
         (determined on the basis of the Fair Market Value per share on the
         date or dates of grant) for each calendar year such rights were at
         any time outstanding.

         C.  If by reason of such accrual limitations, any purchase right of
a Participant does not accrue for a particular Purchase Interval, then the
payroll deductions that the Participant made during that Purchase Interval
with respect to such purchase right shall be promptly refunded.

         D.  In the event there is any conflict between the provisions of
this Article and one or more provisions of the Plan or any instrument issued
thereunder, the provisions of this Article shall be controlling.

     IX. EFFECTIVE DATE AND TERM OF THE PLAN

A The Plan was adopted by the Board on June 29, 2000, and shall become
effective at the Effective Time, provided no purchase rights granted under
the Plan shall be exercised, and no shares of Common Stock shall be issued
hereunder, until (i) the Plan shall have been approved by the stockholders of
the Corporation and (ii) the Corporation shall have complied with all
applicable requirements of the 1933 Act (including the registration of the
shares of Common Stock issuable under the Plan on a Form S-8 registration
statement filed with the Securities and Exchange Commission), all applicable
listing requirements of any stock

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exchange (or the Nasdaq National Market, if applicable) on which the Common
Stock is listed for trading and all other applicable requirements established
by law or regulation. In the event such stockholder approval is not obtained,
or such compliance is not effected, within twelve (12) months after the date
on which the Plan is adopted by the Board, the Plan shall terminate and have
no further force or effect, and all sums collected from Participants during
the initial offering period hereunder shall be refunded.

         B.  Unless sooner terminated by the Board, the Plan shall terminate
upon the earliest of (i) the last business day in July 2010, (ii) the date on
which all shares available for issuance under the Plan shall have been sold
pursuant to purchase rights exercised under the Plan or (iii) the date on
which all purchase rights are exercised in connection with a Change in
Control. No further purchase rights shall be granted or exercised, and no
further payroll deductions shall be collected, under the Plan following such
termination.

     X.  AMENDMENT OF THE PLAN

         A.  The Board may alter, amend, suspend or terminate the Plan at any
time to become effective immediately following the close of any Purchase
Interval. However, the Plan may be amended or terminated immediately upon
Board action, if and to the extent necessary to assure that the Corporation
will not recognize, for financial reporting purposes, any compensation
expense in connection with the shares of Common Stock offered for purchase
under the Plan, should the financial accounting rules applicable to the Plan
at the Effective Time be subsequently revised so as to require the
Corporation to recognize compensation expense in the absence of such
amendment or termination.

         B.  In no event may the Board effect any of the following amendments
or revisions to the Plan without the approval of the Corporation's
stockholders: (i) increase the number of shares of Common Stock issuable
under the Plan, except for permissible adjustments in the event of certain
changes in the Corporation's capitalization, (ii) alter the purchase price
formula so as to reduce the purchase price payable for the shares of Common
Stock purchasable under the Plan or (iii) modify the eligibility requirements
for participation in the Plan.

     XI. GENERAL PROVISIONS

         A.  All costs and expenses incurred in the administration of the
Plan shall be paid by the Corporation; however, each Plan Participant shall
bear all costs and expenses incurred by such individual in the sale or other
disposition of any shares purchased under the Plan.

         B.  Nothing in the Plan shall confer upon the Participant any right
to continue in the employ of the Corporation or any Corporate Affiliate for
any period of specific duration or interfere with or otherwise restrict in
any way the rights of the Corporation (or any Corporate Affiliate employing
such person) or of the Participant, which rights are hereby expressly
reserved by each, to terminate such person's employment at any time for any
reason, with or without cause.

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         C.  The provisions of the Plan shall be governed by the laws of the
State of California without resort to that State's conflict-of-laws rules.

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                                   SCHEDULE A

                          CORPORATIONS PARTICIPATING IN
                          EMPLOYEE STOCK PURCHASE PLAN
                            AS OF THE EFFECTIVE TIME
                            ------------------------

                             Simple Technology, Inc.

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                                    APPENDIX

         The following definitions shall be in effect under the Plan:

         A.   BOARD shall mean the Corporation's Board of Directors.

         B.   CASH EARNINGS shall mean (i) the regular base salary paid to a
Participant by one or more Participating Companies during such individual's
period of participation in one or more offering periods under the Plan plus
(ii) all overtime payments, bonuses, commissions, profit-sharing
distributions or other incentive-type payments received during such period.
Such Cash Earnings shall be calculated before deduction of (A) any income or
employment tax withholdings or (B) any contributions made by the Participant
to any Code Section 401(k) salary deferral plan or any Code Section 125
cafeteria benefit program now or hereafter established by the Corporation or
any Corporate Affiliate. However, Cash Earnings shall NOT include any
contributions made by the Corporation or any Corporate Affiliate on the
Participant's behalf to any employee benefit or welfare plan now or hereafter
established (other than Code Section 401(k) or Code Section 125 contributions
deducted from such Cash Earnings).

         C.    CHANGE IN CONTROL shall mean a change in ownership of the
Corporation pursuant to any of the following transactions:

         (i)   a merger or consolidation in which securities possessing more
         than fifty percent (50%) of the total combined voting power of the
         Corporation's outstanding securities are transferred to a person or
         persons different from the persons holding those securities
         immediately prior to such transaction, or

         (ii)  the sale, transfer or other disposition of all or substantially
         all of the assets of the Corporation in complete liquidation or
         dissolution of the Corporation, or

         (iii) the acquisition, directly or indirectly, by a person or
         related group of persons (other than the Corporation or a person
         that directly or indirectly controls, is controlled by or is under
         common control with the Corporation) of beneficial ownership (within
         the meaning of Rule 13d-3 of the 1934 Act) of securities possessing
         more than fifty percent (50%) of the total combined voting power of
         the Corporation's outstanding securities pursuant to a tender or
         exchange offer made directly to the Corporation's stockholders.

         D.    CODE shall mean the Internal Revenue Code of 1986, as amended.

         E.    COMMON STOCK shall mean the Corporation's common stock.

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         F.    CORPORATE AFFILIATE shall mean any parent or subsidiary
corporation of the Corporation (as determined in accordance with Code Section
424), whether now existing or subsequently established.

         G.    CORPORATION shall mean Simple Technology, Inc., a California
corporation, and any corporate successor to all or substantially all of the
assets or voting stock of Simple Technology, Inc. that shall by appropriate
action adopt the Plan.

         H.    EFFECTIVE TIME shall mean the time at which the Underwriting
Agreement is executed and the Common Stock priced for the initial public
offering of such Common Stock. Any Corporate Affiliate that becomes a
Participating Corporation after such Effective Time shall designate a
subsequent Effective Time with respect to its employee-Participants.

         I.    ELIGIBLE EMPLOYEE shall mean any person who is employed by a
Participating Corporation on a basis under which he or she is regularly
expected to render more than twenty (20) hours of service per week for more
than five (5) months per calendar year for earnings considered wages under
Code Section 3401 (a).

         J.    FAIR MARKET VALUE per share of Common Stock on any relevant
date shall be determined in accordance with the following provisions:

               (i)   If the Common Stock is at the time traded on the Nasdaq
         National Market, then the Fair Market Value shall be the closing
         selling price per share of Common Stock on the date in question, as
         such price is reported by the National Association of Securities
         Dealers on the Nasdaq National Market and as published in THE WALL
         STREET JOURNAL. If there is no closing selling price for the Common
         Stock on the date in question, then the Fair Market Value shall be
         the closing selling price on the last preceding date for which such
         quotation exists.

               (ii)  If the Common Stock is at the time listed on any Stock
         Exchange, then the Fair Market Value shall be the closing selling
         price per share of Common Stock on the date in question on the Stock
         Exchange determined by the Plan Administrator to be the primary
         market for the Common Stock, as such price is officially quoted in
         the composite tape of transactions on such exchange and as published
         in THE WALL STREET JOURNAL. If there is no closing selling price for
         the Common Stock on the date in question, then the Fair Market Value
         shall be the closing selling price on the last preceding date for
         which such quotation exists.

               (iii) For purposes of the initial offering period that begins
         at the Effective Time, the Fair Market Value shall be deemed to be
         equal to the price per share at which the Common Stock is sold in
         the initial public offering pursuant to the Underwriting Agreement.

         K.    1933 ACT shall mean the Securities Act of 1933, as amended.

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         L.    PARTICIPANT shall mean any Eligible Employee of a Participating
Corporation who is actively participating in the Plan.

         M.    PARTICIPATING CORPORATION shall mean the Corporation and such
Corporate Affiliate or Affiliates as may be authorized from time to time by
the Board to extend the benefits of the Plan to their Eligible Employees. The
Participating Corporations in the Plan are listed in attached Schedule A.

         N.    PLAN shall mean the Corporation's Employee Stock Purchase
Plan, as set forth in this document.

         O.    PLAN ADMINISTRATOR shall mean the committee of two (2) or more
Board members appointed by the Board to administer the Plan.

         P.    PURCHASE DATE shall mean the last business day of each
Purchase Interval. The initial Purchase Date shall be January 31, 2001.

         Q.    PURCHASE INTERVAL shall mean each successive six (6)-month
period within a particular offering period at the end of which there shall be
purchased shares of Common Stock on behalf of each Participant.

         R.    STOCK EXCHANGE shall mean either the American Stock Exchange
or the New York Stock Exchange.

         S.    UNDERWRITING AGREEMENT shall mean the agreement between the
Corporation and the underwriter or underwriters managing the initial public
offering of the Common Stock.

                                      A-3<PAGE>

                                                                 EXHIBIT 10.7

                            INDEMNIFICATION AGREEMENT

     THIS INDEMNIFICATION AGREEMENT (the "AGREEMENT") is made and entered into
this ___ day of _________, ____, between Simple Technology, Inc., a California
corporation (the "COMPANY"), and [_________] ("INDEMNITEE").

     A. Indemnitee, as a member of the Company's Board of Directors and/or an
officer of the Company, performs valuable services for the Company;

     B. The Company and Indemnitee recognize the continued difficulty in
obtaining liability insurance for corporate directors, officers, employees,
controlling persons, agents and fiduciaries, the significant increases in the
cost of such insurance and the general reductions in the coverage of such
insurance.

     C. The Company and Indemnitee further recognize the substantial increase in
corporate litigation in general, subjecting directors, officers, employees,
controlling persons, agents and fiduciaries to expensive litigation risks at the
same time as the availability and coverage of liability insurance has been
severely limited.

     D. The shareholders of the Company have adopted Bylaws (the "BYLAWS")
providing for the indemnification of the officers, directors, agents and
employees of the Company to the maximum extent authorized by the California
Corporations Code, as amended ("CODE").

     E. Indemnitee does not regard the current protection available for the
Company's directors, officers, employees, controlling persons, agents and
fiduciaries as adequate under the present circumstances, and Indemnitee and
other directors, officers, employees, controlling persons, agents and
fiduciaries of the Company may not be willing to serve or continue to serve in
such capacities without additional protection.

     F. The Bylaws and the Code, by their non-exclusive nature, permit contracts
between the Company and its directors, officers, employees, controlling persons,
agents and fiduciaries with respect to indemnification of such directors.

     G. The Company (i) desires to attract and retain the involvement of highly
qualified individuals, such as Indemnitee, to serve the Company and, in part, in
order to induce Indemnitee to be involved with the Company, and (ii) wishes to
provide for the indemnification and advancing of expenses to Indemnitee to the
maximum extent permitted by law.

     H. In view of the considerations set forth above, the Company desires that
Indemnitee be indemnified by the Company as set forth herein.

     NOW, THEREFORE, in consideration of Indemnitee's service to the Company,
the parties hereto agree as follows:

<PAGE>

     1. INDEMNITY OF INDEMNITEE. The Company hereby agrees to indemnify
Indemnitee to the fullest extent permitted by law, even if such indemnification
is not specifically authorized by the other provisions of this Agreement, the
Company's Articles of Incorporation, the Company's Bylaws or by statute. In the
event of any change after the date of this Agreement in any applicable law,
statute or rule which expands the right of a California corporation to indemnify
a member of its Board of Directors or an officer, employee, controlling person,
agent or fiduciary, it is the intent of the parties hereto that Indemnitee shall
enjoy by this Agreement the greater benefits afforded by such change. In the
event of any change in any applicable law, statute or rule which narrows the
right of a California corporation to indemnify a member of its Board of
Directors or an officer, employee, agent or fiduciary, such change, to the
extent not otherwise required by such law, statute or rule to be applied to this
Agreement, shall have no effect on this Agreement or the parties' rights and
obligations hereunder except as set forth in Section 3 hereof.

     2. ADDITIONAL INDEMNITY. Subject only to the limitations set forth in
Section 3 hereof, the Company hereby further agrees to hold harmless and
indemnify Indemnitee:

          (a) against any and all expenses (including attorneys' fees), witness
fees, judgments, fines and amounts paid in settlement actually and reasonably
incurred by Indemnitee in connection with any threatened, pending or completed
action, claim, suit, arbitration, alternative dispute resolution mechanism,
investigation, or any other proceeding, whether civil, criminal, administrative
or investigative (including any appeal therefrom and including an action by or
in the right of the Company) to which Indemnitee is, was, or at any time becomes
a party, or is threatened to be made a party, by reason of the fact that
Indemnitee is, was, or at any time becomes a director, officer, employee or
agent of the Company, or is or was serving or at any time serves at the request
of the Company as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust, employee benefit plan or other enterprise
(collectively, a "PROCEEDING"); and

          (b) otherwise to the fullest extent as may be provided to Indemnitee
by the Company under the Articles of Incorporation of the Company and the Code.

     3. LIMITATIONS ON ADDITIONAL INDEMNITY.

          (a) No indemnity pursuant to Section 2 hereof shall be paid by the
Company for any of the following:

               (i) except to the extent the aggregate of losses to be
indemnified thereunder exceeds the sum of such losses for which the Indemnitee
is indemnified pursuant to Section 1 hereof or pursuant to any Directors' and
Officers' Insurance purchased and maintained by the Company;

               (ii) in respect to remuneration paid to Indemnitee if it shall be
determined by a final judgment or other final adjudication that such
remuneration was in violation of law;

                                       2
<PAGE>

               (iii) on account of any Proceeding in which judgment is rendered
against Indemnitee for an accounting of profits made from the purchase or sale
by Indemnitee of securities of the Company pursuant to the provisions of Section
16(b) of the Securities Exchange Act of 1934 and amendments thereto or similar
provisions of any federal, state or local statutory law;

               (iv) on account of any Proceeding to the extent that Indemnitee
is a plaintiff, a counter-complainant or a cross-complainant therein (other than
a Proceeding referred to in Section 8 hereof) unless such Proceeding was
authorized in the specific case by action of the Board of Directors;

               (v) on account of Indemnitee's conduct which is the subject of
any Proceeding described in Section 7(c)(ii) hereof; or

               (vi) if a final decision by a Court having jurisdiction in the
matter shall determine that such indemnification is not lawful (and, in this
respect, both the Company and Indemnitee have been advised that the Securities
and Exchange Commission believes that indemnification for liabilities arising
under the federal securities laws is against public policy and is, therefore,
unenforceable and that claims for indemnification should be submitted to
appropriate courts for adjudication).

          (b) In addition to those limitations set forth above in paragraph (a)
of this Section 3, no indemnity pursuant to Section 2 hereof in an action by or
in the right of the Company shall be paid by the Company for any of the
following:

               (i) in respect of any claim, issue or matter as to which
Indemnitee shall have been adjudged to be liable to the Company in the
performance of Indemnitee's duty to the Company and its shareholders, unless and
only to the extent that the court in which such Proceeding is or was pending
shall determine upon application that, in view of all the circumstances of the
case, Indemnitee is fairly and reasonably entitled to indemnity for expenses and
then only to the extent that the court shall determine;

               (ii) of amounts paid in settling or otherwise disposing of a
pending action without Court approval; or

               (iii) of expenses incurred in defending a pending action which is
settled or otherwise disposed of without court approval.

               (iv) on account of Indemnitee's acts or omissions that involve
intentional misconduct or a knowing and culpable violation of law;

               (v) on account of acts or omissions that Indemnitee believes to
be contrary to the best interests of the Company or its shareholders or that
involve the absence of good faith on the part of Indemnitee;

               (vi) with respect to any transaction from which Indemnitee
derived an improper personal benefit;

                                       3

<PAGE>

               (vii) on account of acts or omissions that show a reckless
disregard for Indemnitee's duty to the Company or its shareholders in
circumstances in which Indemnitee was aware, or should have been aware, in the
ordinary course of performing such Indemnitee's duties, of a risk of serious
injury to the Company or its shareholders;

               (viii) on account of acts or omissions that constitute an
unexcused pattern of inattention that amounts to an abdication of Indemnitee's
duty to the Company or its shareholders;

               (ix) to the extent prohibited by Section 310 of the California
Corporations Code, "Contracts In Which Director Has Material Financial Interest;
Validity," or;

               (x) to the extent prohibited by Section 316 of the California
Corporations Code, "Corporate Actions Subjecting Directors To Joint And Several
Liability; Actions; Damages."

     4. CONTRIBUTION. If the indemnification provided in Sections 1 and 2 hereof
is unavailable by reason of a Court decision described in Section 3(a)(vi)
hereof based on grounds other than any of those set forth in Sections 3(a)(ii)
through (v) hereof or in Sections 3(b)(i) through (x) hereof, then in respect of
any threatened, pending or completed action, suit or proceeding in which the
Company is jointly liable with Indemnitee (or would be if joined in such action,
suit or proceeding), the Company shall contribute to the amount of expenses
(including attorneys' fees), judgments, fines and amounts paid in settlement
actually and reasonably incurred and paid or payable by Indemnitee in such
proportion as is appropriate to reflect (i) the relative benefits received by
the Company on the one hand and Indemnitee on the other hand from the
transaction from which such action, suit or proceeding arose, and (ii) the
relative fault of the Company on the one hand and of Indemnitee on the other in
connection with the events which resulted in such expenses, judgments, fines or
settlement amounts, as well as any other relevant equitable considerations. The
relative fault of the Company on the one hand and of Indemnitee on the other
shall be determined by reference to, among other things, the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
the circumstances resulting in such expenses, judgments, fines or settlement
amounts. The Company agrees that it would not be just and equitable if
contribution pursuant to this Section 4 were determined by pro rata allocation
or any other method of allocation which does not take account of the foregoing
equitable considerations.

     5. CONTINUATION OF OBLIGATIONS. All agreements and obligations of the
Company contained herein shall continue during the period Indemnitee is a
director, officer, employee or agent of the Company (or is or was serving at the
request of the Company as a director, officer employee or agent of another
corporation, partnership, joint venture, trust, employee benefit plan or other
enterprise) and shall continue thereafter so long as Indemnitee shall be subject
to any possible claim or threatened, pending or completed action, suit or
proceeding, whether civil, criminal or investigative, by reason of the fact that
Indemnitee was an officer or director of the Company or serving in any other
capacity referred to herein.

     6. NOTIFICATION AND DEFENSE OF CLAIM. Not later than 30 days after receipt
by Indemnitee of notice of the commencement of any action, suit or proceeding,
Indemnitee will, if

                                       4
<PAGE>

a claim in respect thereof is to be made against the Company under this
Agreement, notify the Company of the commencement thereof; but the omission so
to notify the Company will not relieve it from any liability which it may have
to Indemnitee otherwise than under this Agreement. With respect to any such
action, suit or proceeding as to which Indemnitee notifies the Company of the
commencement thereof:

          (a) the Company will be entitled to participate therein at its own
expense;

          (b) except as otherwise provided below, to the extent that it may
wish, the Company jointly with any other indemnifying party similarly notified
will be entitled to assume the defense thereof, with counsel reasonably
satisfactory to Indemnitee. After notice from the Company to Indemnitee of its
election to assume the defense thereof, the Company will not be liable to
Indemnitee under this Agreement for any legal or other expenses subsequently
incurred by Indemnitee in connection with the defense thereof other than
reasonable costs of investigation or as otherwise provided below. Indemnitee
shall have the right to employ its counsel in such action, suit or proceeding
but the fees and expenses of such counsel incurred after notice from the Company
of its assumption of the defense thereof shall be at the expense of Indemnitee
unless (i) the employment of counsel by Indemnitee has been authorized by the
Company, (ii) Indemnitee shall have reasonably concluded that there may be a
conflict of interest between the Company and Indemnitee in the conduct of the
defense of such action or (iii) the Company shall not in fact have employed
counsel to assume the defense of such action, in each of which cases the fees
and expenses of Indemnitee's separate counsel shall be at the expense of the
Company. The Company shall not be entitled to assume the defense of any action,
suit or proceeding brought by or on behalf of the Company or as to which
Indemnitee shall have made the conclusion provided for in (ii) above; and

          (c) the Company shall not be liable to indemnify Indemnitee under this
Agreement for any amounts paid in settlement of any action or claim effected
without its written consent. The Company shall be permitted to settle any action
except that it shall not settle any action or claim in any manner which would
impose any penalty or limitation on Indemnitee without Indemnitee's written
consent. Neither the Company nor Indemnitee will unreasonably withhold its
consent to any proposed settlement.

     7. ADVANCEMENT AND REPAYMENT OF EXPENSES.

          (a) In the event that Indemnitee employs his own counsel pursuant to
Section 6(b)(i) through (iii) above, the Company shall advance to Indemnitee,
prior to any final disposition of any threatened or pending action, suit or
proceeding, whether civil, criminal, administrative or investigative, any and
all reasonable expenses (including legal fees and expenses) incurred in
investigating or defending any such action, suit or proceeding within ten
business days after receiving copies of invoices presented to Indemnitee for
such expenses; and

          (b) Indemnitee agrees that Indemnitee will reimburse the Company for
all reasonable expenses paid by the Company in defending any Proceeding in the
event and only to the extent it shall be ultimately determined by a final
judicial decision (from which there is no right of appeal) that Indemnitee is
not entitled, under applicable law, the Company's Bylaws, this Agreement or
otherwise, to be indemnified by the Company for such expenses.

                                       5
<PAGE>

          (c) Notwithstanding the foregoing, the Company shall not be required
to advance such expenses to Indemnitee if Indemnitee (i) commences or is a party
to any action, suit or proceeding as a plaintiff unless such advance is
specifically approved by a majority of the Board of Directors, or (ii) is a
party to an action, suit or proceeding brought by the Company and approved by a
majority of the Board of Directors which alleges willful misappropriation of
corporate assets by Indemnitee, disclosure of confidential information in
violation of Indemnitee's fiduciary or contractual obligations to the Company,
or any other willful and deliberate breach in bad faith of Indemnitee's duty to
the Company or its shareholders.

     8. ENFORCEMENT. In the event Indemnitee brings any action to enforce rights
or to collect moneys due under this Agreement and is successful in such action,
the Company shall reimburse Indemnitee for all of Indemnitee's reasonable fees
and expenses in bringing and pursuing such action.

     9. SUBROGATION. In the event of payment under this Agreement, the Company
shall be subrogated to the extent of such payment to all of the rights of
recovery of Indemnitee who shall execute all documents required and shall do all
acts that may be necessary to secure such rights and to enable the Company
effectively to bring suit to enforce such rights.

     10. NON-EXCLUSIVITY OF RIGHTS. The rights conferred on Indemnitee by this
Agreement shall not be exclusive of any other right which Indemnitee may have or
hereafter acquire under any statute, provision of the Company's Articles of
Incorporation or Bylaws, agreement, vote of shareholders or directors, or
otherwise, both as to action in his official capacity and as to action in
another capacity while holding office.

     11. SURVIVAL OF RIGHTS. The rights conferred on Indemnitee by this
Agreement shall continue after Indemnitee has ceased to be a director, officer,
employee or other agent of the Company and shall inure to the benefit of
Indemnitee's heirs, executors and administrators.

     12. NOTICE. All notices and other communications required or permitted
hereunder shall be in writing, shall be effective when given, and shall in any
event be deemed to be given (a) five calendar days after deposit with the U.S.
Postal Service or other applicable postal service, if delivered by first class
mail, postage prepaid, (b) upon delivery, if delivered by hand, (c) one business
day after the business day of deposit with Federal Express or similar overnight
courier, freight prepaid, or (d) one day after the business day of delivery by
facsimile transmission, if deliverable by facsimile transmission, with copy by
first class mail, postage prepaid, and shall be addressed if to Indemnitee, at
Indemnitee's address as set forth beneath Indemnitee's signature to this
Agreement and if to the Company at the address of its principal corporate
offices (attention: Chief Executive Officer) or at such other address as such
party may designate by ten calendar days' advance written notice to the other
party hereto.

     13. SEVERABILITY. The provisions of this Agreement shall be severable in
the event that any of the provisions hereof (including any provision within a
single section, paragraph or sentence) are held by a court of competent
jurisdiction to be invalid, void or otherwise unenforceable, and the remaining
provisions shall remain enforceable to the fullest extent permitted by law.
Furthermore, to the fullest extent possible, the provisions of this Agreement
(including, without limitations, each portion of this Agreement containing any
provision held to

                                       6
<PAGE>

be invalid, void or otherwise unenforceable, that is not itself invalid, void or
unenforceable) shall be construed so as to give effect to the intent manifested
by the provision held invalid, illegal or unenforceable.

     14. GOVERNING LAW. This Agreement shall be interpreted and enforced in
accordance with the laws of the State of California.

     15. BINDING EFFECT. This Agreement shall be binding upon Indemnitee and
upon the Company, its successors and assigns, and shall inure to the benefit of
Indemnitee, his heirs, personal representatives and assigns and to the benefit
of the Company, its successors and assigns.

     16. AMENDMENT AND TERMINATION. No amendment, modification, termination or
cancellation of this Agreement shall be effective unless it is in writing signed
by all parties hereto. No waiver of any of the provisions of this Agreement
shall be deemed or shall constitute a waiver of any other provisions hereof
(whether or not similar) nor shall such waiver constitute a continuing waiver.

     17. INTEGRATION AND ENTIRE AGREEMENT. This Agreement sets forth the entire
understanding between the parties hereto and supersedes and merges all previous
written and oral negotiations, commitments, understandings and agreements
relating to the subject matter hereof between the parties hereto.

     18. NO CONSTRUCTION AS EMPLOYMENT AGREEMENT. Nothing contained in this
Agreement shall be construed as giving the Indemnitee any right to be retained
in the employ of the Company or any of its subsidiaries.

     19. CORPORATE AUTHORITY. The Board of Directors and shareholders of the
Company have approved the terms of this Agreement.

                                       7
<PAGE>

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement on and
as of the day and year first above written.

                                    COMPANY:

                                    SIMPLE TECHNOLOGY, INC.

                                    By   ____________________________
                                         Manouch Moshayedi,
                                         President

                                    Address:__________________________
                                           ___________________________

                                    INDEMNITEE

                                    __________________________________
                                    [_______]

                                    Address:__________________________
                                           ___________________________

                                       8

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