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EXHIBIT C
ELXSI
0000 Xxxxxxxx Xxxx
Xxxxx X-0
Xxxxxxx, Xxxxxxx 00000
June ___, 1997
Azimuth Corporation
Delaware Electro Industries, Inc.
Contempo Design, Inc.
Contempo Design West, Inc.
c/o Azimuth Corporation
0000 Xxxxxxxx Xxxx
Xxxxx X-0
Xxxxxxx, Xxxxxxx 00000
Satisfaction and Termination of Loan Agreements
Dear Sirs:
Reference is hereby made to: (i) that certain Recapitalization Agreement,
dated as of December 30, 1996 (the "Recapitalization Agreement"), by and among
Azimuth Corporation, a Delaware corporation ("Azimuth"), Delaware Electro
Industries, Inc., a Delaware corporation ("DEI"), Contempo Design, Inc., an
Illinois corporation ("CDI"), Contempo Design West, Inc., a Delaware corporation
("CDW"; and, collectively with Azimuth, DEI and CDI, the "Group Members"),
ELXSI, a California corporation ("ELXSI"), and Bank of America Illinois; (ii)
the Group Loan Documentation (as defined in the Recapitalization Agreement); and
(iii) the three $9,650,000 maximum principal amount New Revolving Notes, each
dated December 30, 1996 (the "New Subsidiary Notes") made by (respectively) DEI,
CDI and CDW (the "Subsidiaries") payable to the order of ELXSI. Capitalized
terms used and not defined herein have the respective meanings ascribed to such
terms under the Recapitalization Agreement.
1. Acknowledgement of Payment. ELXSI hereby acknowledges receipt this day
of $5,550,000, constituting payment in full of the outstanding principal amount
of the Subsidiary Loans plus the accrued but unpaid interest thereon. Promptly
after the date hereof, the Subsidiaries will pay or cause to be paid to ELXSI
the full amount of the accrued but unpaid interest on such Subsidiary Loans.
2. Termination of Group Loan Documentation. Effective as of the date
hereof: (i) each of the Credit (as defined in each Subsidiary Loan Agreement),
each of the Group Loan Documentation and each New Subsidiary Note are hereby
terminated by mutual consent, and (ii) the Group Loan Documentation and New
Subsidiary Notes shall no longer be of any force or effect; provided, however,
that the foregoing shall not effect a termination of: (a) any provision of any
of the Group Loan Documentation that, by the terms thereof, is intended to
survive a termination of such Group Loan Documentation,
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or (b) the obligations of the Subsidiaries under the second sentence of the
foregoing paragraph 1.
3. Security Interests. In connection with the foregoing terminations, ELXSI
hereby: (i) releases the Group Security, and (ii) assigns, transfers and
delivers to the appropriate Group Member, without recourse, representation or
warranty, all of ELXSI's right, title and interest in and to the Collateral and
Pledged Property.
4. Further Assurances. From time to time after the date hereof, as and when
requested by any party hereto, each other party hereto shall execute and
deliver, or cause to be executed and delivered, such documents and instruments
and shall take, or cause to be taken, such further or other actions as such
requesting party may reasonably deem necessary or desirable in order to further
effect or evidence the transactions contemplated hereby and to otherwise carry
out the intent and purposes of this agreement.
5. Governing Law. This agreement shall be governed by and construed in
accordance with the laws of the State of Illinois (without regard to the choice
of law principles thereof).
Kindly indicate your acceptance of and agreement with the foregoing by
executing a counterpart of this letter in the space provided below, whereupon it
shall become a binding agreement among us.
Very truly yours,
ELXSI
By:
--------------------------------
Title:
Accepted and Agreed to, as of the date first above written:
AZIMUTH CORPORATION DELAWARE ELECTRO INDUSTRIES, INC.
By: By:
------------------------------- --------------------------------
Title: Title:
CONTEMPO DESIGN, INC. CONTEMPO DESIGN WEST, INC.
By: By:
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Title: Title:
