XXXXX FARGO XXXXX FARGO BUSINESS CREDIT
54101-076 MAC
000 Xxxx Xxxxxxxxxx Xxxxxx, 0xx Xxxxx
Xxxxxxx, XX 00000
000-000-0000
000-000-0000 Fax
May 12, 2000
Xxxxx Xxxxxxxxxx
XxxxXxxxxXxxxxx.Xxx, Inc.
0000 Xxxx Xxxxxxxx, Xxxxx 0
Xxxxxxxxxx, XX 00000
Dear Xx. Xxxxxxxxxx:
According to Section 6.13 of the Credit and Security Agreement dated March 26,
1999 (the "Agreement") by and between XxxxXxxxxXxxxxx.Xxx, Inc. fka Auto Network
Group, Inc., an Arizona corporation (the "Borrower"), and Xxxxx Fargo Business
Credit, Inc. fka Norwest Business Credit, Inc., a Minnesota corporation (the
"Lender"), the Borrower will achieve a net loss for the quarter ended March 31,
2000 of no more than $250,000.00. The Borrower has represented and warranted to
Lender that it has violated Section 6.13 of the Agreement for the quarter ended
March 31, 2000. This result constitutes an Event of Default pursuant to Section
8.1 of the Agreement.
According to Section 6.13 of the Agreement, the Borrower will achieve net loss
for the fiscal year ended March 31, 2000 of no more than $760,000.00. The
Borrower has represented and warranted to Lender that it has violated Section
6.13 of the Agreement for the fiscal year ended March 31, 2000. This result
constitutes an Event of Default pursuant to Section 8.1 of the Agreement
According to Section 6.14 of the Agreement, the Borrower will achieve a net loss
for each month of no more than $125,000.00. For the month of March 31, 2000, the
Borrower has represented and warranted to Lender that it has violated Section
6.14 of the Agreement. This result constitutes an Event of Default pursuant to
Section 8.1 of the Agreement.
According to Section 7.10 of the Agreement, the Borrower will not expend or
contract to expend more than $1,200,000.00 in capital expenditures for fiscal
year 2000. The Borrower has represented and warranted to Lender that it has
violated Section 7.10 of the Agreement. This result constitutes an Event of
default pursuant to Section 8.1 of the Agreement.
As an accommodation to Borrower, Lender hereby agrees to waive the violations of
Sections 6.13, 6.14, and 7.10 of the Agreement for the month, quarter, and
fiscal year ended March 31, 2000 as described herein. This waiver applies only
to the violation of Sections 6.13, 6.14, and 7.10 of the Agreement for the
month, quarter and fiscal year ended March 31, 2000 as described herein and not
to any other existing or future defaults of any kind. Lender reserves all rights
and remedies allowed it under the Agreement. If you have any questions regarding
this matter, please feel free to contact me at (000) 000-0000.
If you have any questions regarding this matter, please feel free to contact me
at (000) 000-0000.
Sincerely,
/s/Xxxxx Xxxxx-Xxxxx
Xxxxx Xxxxx-Xxxxx
Vice President
