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EXHIBIT 1
[SOLO ENERGY CORPORATION LETTERHEAD]
August 7, 2001
Xx. Xxxxxxx Xxxxxxxxx
Elektryon
0000 Xxxxxxx Xxxxxx
Xxx Xxxxx, Xxxxxx 00000
RE: ASSET ACQUISITION AGREEMENT DATED AS OF APRIL 16, 2001 (THE
"ACQUISITION AGREEMENT") BY AND BETWEEN ELEKTRYON AND SOLO
ENERGY CORPORATION (THE "COMPANY")
Dear Xxxxxxx:
Reference is made to (i) the above referenced Acquisition Agreement by and
between Elektryon and the Company, dated as of April 16, 2001 and (ii) the
letter agreement by and between Elektryon and the Company dated June 14, 2001
(the "June Letter Agreement"). Capitalized terms used herein, but not defined
herein, shall have the meanings set forth in the Acquisition Agreement and the
June Letter Agreement, except as modified below.
1. Termination Date. Pursuant to the June Letter Agreement, the Termination
Date set forth in Section 13.1(e) of the above referenced Acquisition
Agreement, was extended by mutual agreement from June 30, 2001 to July 30,
2001. By this letter agreement, the Company and Elektryon hereby agree to
extend the Termination Date from July 30, 2001 to August 31, 2001. As a
result of such extension, the Company shall not be obligated to consummate
the transactions contemplated by the Acquisition Agreement until August 31,
2001.
2. Sale of Inventory. Notwithstanding anything in the Acquisition Agreement to
the contrary, by this letter agreement, the Company hereby agrees that (i)
on or after August 6, 2001, Elektryon shall be permitted to sell or dispose
of a portion of its Inventories with a book value not to exceed $500,000
("Permitted Inventory Sales"), (ii) Elektryon shall be permitted to retain
the proceeds from such Permitted Inventory Sales, and (iii) for purposes of
calculating the distribution of the Cash Escrow under Section 2.5(i) of the
Acquisition Agreement, any reduction in Inventories resulting from any
Permitted Inventory Sale shall not be reflected in the Closing Balance
Sheet. Elektryon shall provide the Company with evidence of the date and
purchase
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[SOLO ENERGY CORPORATION LETTERHEAD]
price of each Permitted Inventory Sale within two business days following
the Permitted Inventory Sale.
3. Information Regarding Series D Financing. The Company hereby agrees to
conduct a telephone conference call with Elektryon and the Company's
investment bankers on a weekly basis, beginning the week of August 6, 2001,
to inform Elektryon as to the current status of the Company's Series D
financing and to allow Elektryon the opportunity to ask questions regarding
the same.
All other terms set forth in the Acquisition Agreement, other than any
modifications set forth above and in the June Letter Agreement, shall remain in
full force and effect.
If the foregoing correctly represents your understanding and agreement, please
so indicate by signing a copy of this letter agreement in the place indicated,
whereupon all of the parties hereto shall be legally bound on the foregoing
terms and conditions.
Very truly yours,
SOLO ENERGY CORPORATION
/S/ XXXXXX XXXXXX
__________________________________
By: Xxxxxx Xxxxxx, Chief Financial Officer
AGREED AND ACCEPTED
ELEKTRYON
By: /S/ XXXXXXX XXXXXXXXX
______________________________
Date: 8/7/01
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