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Exhibit 10.4(u)
WAIVER AGREEMENT
THIS
WAIVER AGREEMENT (hereinafter referred to as this "Agreement") is
made
and entered into as of the 13th day of March, 2006, by and among
INNOTRAC
CORPORATION, a Georgia corporation and successor by merger to
iFULFILLMENT,
Inc., a Georgia corporation (hereinafter referred to as
"Borrower"), and
WACHOVIA BANK, NATIONAL ASSOCIATION, successor by merger to
SOUTHTRUST BANK,
(hereinafter referred to as "Bank").
BACKGROUND STATEMENT
Borrower and Bank are parties to that certain Third Amended and
Restated
Line of Credit Note dated May 10, 2004, made by Borrower (and
iFulfillment,
Inc.) to the order of Bank in the original principal amount of
Twenty Five
Million and No/100 Dollars ($25,000,000.00), as modified by the
parties from
time to time (hereinafter referred to as the "Note", and the loan
evidenced
thereby as the "Loan"). The Note is secured by that certain (a)
Second Amended
and Restated Loan and Security Agreement by and between Borrower
and Bank dated
as of April 3, 2003, as subsequently modified by the parties from
time to time
(the "Loan Agreement"), and (b) any and all other documents related
to the
aforementioned documents, as subsequently modified by the parties
from time to
time (hereinafter collectively referred to as the "Loan
Documents").
Borrower has (i) advised Bank that Borrower did not comply with
Section
6.22(1) or Section 6.22(3) for its fiscal quarter ending December
31, 2005
(collectively, the "2005 Financial Covenant Defaults"), and (ii)
requested Bank
waive the 2005 Financial Covenant Defaults.
Bank
has so agreed to waive the 2005 Financial Covenant Defaults,
subject
to the terms and conditions more specifically set forth below.
AGREEMENT
FOR
AND IN CONSIDERATION of the sum of Ten and No/100 Dollars ($10.00),
the
foregoing recitals, and other good and valuable consideration, the
receipt and
sufficiency of which are hereby acknowledged, Borrower and Bank do
hereby agree
as follows:
1.
WAIVER OF 2005 FINANCIAL COVENANT DEFAULTS. Bank hereby waives the
2005
Financial Covenant Defaults and Borrower agrees to strictly comply
with the Loan
Agreement hereafter. Borrower hereby agrees that nothing herein
shall constitute
a waiver by Bank of any default (except as expressly provided in
this paragraph
1 with respect to the 2005 Financial Covenant Defaults), whether
known or
unknown, which may exist under the Loan Agreement or any other Loan
Document.
Borrower hereby further agrees that no action, inaction or
agreement by Bank,
including, without limitation, any extension, indulgence, waiver,
consent or
agreement of modification which may have occurred or have been
granted or
entered into (or which may be occurring or be granted or entered
into hereunder
or otherwise) with respect to nonpayment of the Loans or other
Obligations or
any portion thereof, or with respect to matters involving
collateral security
for the Loans or other Obligations, or with respect to any other
matter relating
to the Loans or other Obligations, shall require or imply any
further extension,
indulgence, waiver, consent or agreement by Bank. Except as
expressly provided
in this paragraph 1, Borrower hereby acknowledges and agrees that
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