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[XXXXX FARGO LETTERHEAD]
November 2, 2000
Xxxx Xxxx Xxxx
Xxxxx America Corporation
000 Xxxxx Xxxx
Xxxxx Xxxxxxx, XX 00000
RE: Waiver of Default
Dear Xxxx Xxxx:
Xxxxx Fargo Bank, National Association, assignee of Norwest Bank Minnesota,
National Association, (the "Bank") and Young America Corporation (the
"Borrower") are parties to a certain Credit Agreement dated as of April 7, 1998
(the "Agreement") as amended.
Section 5.10 of the Agreement states that the Borrower will maintain a Current
Ratio at not less than 1.00 to 1.00 for the Covenant Computation Date as of
September 30, 2000. For the Covenant Computation Date as of September 30, 2000,
the Borrower's Current Ratio was 0.95 to 1.00, thereby creating an Event of
Default under the Agreement.
Section 5.11 of the Agreement states that the Borrower will maintain a minimum
cumulative EBITDA of not less than $7,500,000 for the Covenant Computation Date
as of September 30, 2000. For the Covenant Computation Date as of September 30,
2000, the Borrower's cumulative EBITDA was $6,252,197, thereby creating an Event
of Default under the Agreement.
Pursuant to your request and subject to receipt of a nonrefundable $5,000.00 fee
for waiving the Events of Default and for other valuable consideration, the Bank
hereby waives the violations of Section 5.10 and 5.11 for the period ending
September 30, 2000 as noted in the paragraphs above. This waiver is unique and
specific. The Bank does not waive any other portions of the Agreement, nor do
they give up any of the rights and remedies granted to them thereunder.
Very truly yours,
/s/ Xxxxxxx X. Xxxxxxx
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Xxxxxxx X. Xxxxxxx
Assistant Vice President
