EXHIBIT 10.6
ASD GROUP, INC.
XXX XXXXXXXX XXXXXX
XXXXXXXXXXXX, XXX XXXX 00000
Dated as of December 20, 1996
Mr. Xxxxxxx Xxxxxx
X.X. Xxx 000
Xxxxxxx Xxxxxxx, Xxx Xxxxxx 00000
Dear Xx. Xxxxxx:
Reference is made to that certain Purchase Agreement dated as of
December 29, 1995 (the "Agreement"), by and among ASD Group, Inc. and certain of
its subsidiaries (collectively, "ASD") and an investor group, including Xxxxxxx
Xxxxxx ("Investor Group"). Xxxxxx, on behalf of the Investor Group, hereby
agrees to amend the Agreement as follows:
1. Upon the date of closing (the "Closing Date") by ASD of an IPO
for which X.X. Xxxxxx and Co., Inc. shall serve as one of the managing
underwriters, ASD will repay to the Investor Group $900,000 in principal amount
of the Notes in proportion to the principal amount of Notes purchased by each
member of the Investor Group, together with any accrued interest on the Notes
through the Closing Date. The remaining $1.1 million in principal amount of
Notes shall be due and payable on the 13th month anniversary of the Closing Date
(the "Extended Maturity Date") and interest at the rate of 10% per annum on said
principal amount of Notes shall accrue and be payable on the Extended Maturity
Date. In addition, the security interest in ASD's inventory granted by ASD to
the Investor Group in order to secure repayment of the Notes shall be released
in full on the Closing Date.
2. Section 1(b)(i) of the Agreement is amended to provide that in
lieu of the Shares, Convertible Securities and Warrants which the Investor Group
would be entitled to receive upon consummation of an IPO by ASD pursuant to the
terms of said Section 1(b)(i), ASD shall, contemporaneously with the execution
of this letter, issue to the Investor Group, in proportion to the principal
amount of Notes purchased by them pursuant to the Agreement, Warrants to
purchase 500,000 Shares. The Warrants will be exercisable at a price per Share
equal to 47.5% of the price per Share of Shares sold in the IPO for a ten year
period from the closing; provided, however, that the Warrants shall not be
exercisable for a period of two years from the Closing Date without the prior
written consent of ASD and the managing underwriters of the IPO. The Warrants
shall be in the form of Exhibit "E" to the Agreement.
All terms not otherwise defined herein shall have the meanings as set
forth in the Agreement. This letter supersedes all prior agreements and
understandings between the parties with respect to the subject matter hereof.
Mr. Xxxxxxx Xxxxxx
December 20, 1996
Page 2
If the foregoing correctly sets forth our understanding, kindly so
indicate by signing and returning this letter.
Very truly yours,
ASD GROUP, INC.
By: /S/ XXXXXX XXXXXXXX
-----------------------------------------
Xxxxxx Xxxxxxxx, Chief Financial Officer
Accepted and Agreed to as of Decem-
ber 20, 1996
/S/ XXXXXXX XXXXXX
---------------------------------
Xxxxxxx Xxxxxx, on behalf of the
Investor Group
