EXHIBIT 99.2
                            ------------

                         COMMERCE GROUP CORP.
                        6001 NORTH 91ST STREET
                       MILWAUKEE, WI  53225-1795
                    414/462-5310 . FAX 414/462-5312
   Stock Symbols:  CGCO (OTC BB) . CMG OR CMG.BN (Boston Stock Exchange)


AND/OR COMMERCE/SANSEB JOINT VENTURE (Joint Venture)
AND/OR HOMESPAN REALTY CO., INC. (Homespan)
AND/OR PICCADILLY ADVERTISING CO., INC. (Piccadilly)
Whose name was changed as of January 27, 1999  to ECOMM GROUP INC. (Ecomm)
AND/OR SAN LUIS ESTATES, INC. (SLE)
AND/OR SAN SEBASTIAN GOLD MINES, INC. (Sanseb)
AND/OR UNIVERSAL DEVELOPERS, INC. (UDI)
ALL LOCATED AT THE SAME ADDRESS


May 10, 1999



Mr. Edward L. Machulak
903 West Green Tree Road
River Hills, Wisconsin  53217

Dear Mr. Machulak:

At today's Commerce Group Corp. (Commerce) Directors' meeting, the
Directors were informed about the confirmation and status letter you
requested from Commerce and its affiliates to establish and confirm the
amount due and the collateral pledged to Edward L. Machulak (ELM) as an
individual and not as a Director or Officer of Commerce or its
subsidiaries or as the authorized designee of the Joint Venture as of
Commerce's fiscal year ended March 31, 1999.  Today, Commerce's Directors
approved, ratified and confirmed the contents of this letter and
authorized me to authenticate and confirm the outstanding obligations due
to ELM and the collateral pledged to ELM as of Commerce's fiscal year
ended March 31, 1999, which are as follows:

1.   Promissory Notes and Other Obligations

     a.  An open-ended, secured, on-demand promissory note (Note) dated
         October 1, 1989 in which all of the prior promissory notes were
         consolidated into this single Note amounted to $490,217.19 as of
         that date.  All future advances and interest, not paid, are to
         be added to this Note.  This Note, together with cash and other
         advances and interest as of March 31, 1999, amounts to
         $2,568,600.38.  This Note bears interest, payable monthly, at
         the rate of 2% over the prime rate established from time to time
         by the First National Bank of Chicago, Chicago, Illinois, but
         not less than 16% per annum (Schedule of Principal and Interest
         as of March 31, 1999, Exhibit A).  Commerce is no longer issuing
         monthly promissory notes for the payment of interest, etc., but
         pursuant to our understanding, Commerce is adding these
         liabilities or deducting any payments to the current open-ended
         outstanding promissory note(s).

<PAGE>

     b.  In addition, Commerce owes ELM the sum of $1,674,015 which is
         due for unpaid and accrued salaries for a period of eighteen
         (18) years beginning on April 1, 1981 through March 31, 1999.
         Commerce further acknowledges that ELM's monthly salary for
         eighteen (18) years and nine months is as follows:  eleven years
         at $67,740 annually ($745,140); four years and six months at
         $114,750 annually ($516,375); thirty months at $13,750
         ($412,500).

     c.  As a result of Commerce borrowing ELM's Commerce shares and
         ELM's selling these shares as designee and for Commerce's
         benefit, and with Commerce receiving all of the proceeds,
         Commerce has agreed to pay ELM interest at the rate of prime
         plus 3%, payable monthly with Commerce's restricted common
         shares and based on the Commerce shares due to ELM.  Interest is
         also due and payable monthly with Commerce's restricted common
         shares for the shares pledged by ELM as collateral to others,
         all for the Company's interest and benefit.  An accounting of
         the Commerce common shares due and/or paid to ELM as of March
         31, 1999, pursuant to a series of open-ended, on-demand loan and
         promissory note agreements by and between Commerce and ELM dated
         April 1, 1990, May 17, 1989, October 14, 1988 and June 20, 1988,
         and for certain continuos loans and/or pledges of ELM's
         securities that have taken place and continue to occur during
         the fiscal year ended March 31, 1999 is as follows:

         1.  Share loans                                          20,200
         2.  Interest shares due on shares pledged to
             two banks for an open line of credit                 25,491
         3.  Interest shares due on shares sold for
             the benefit of Commerce                               1,032
                                                                  ------
             Total Commerce common shares paid and
             issued as of March 31, 1999 to ELM                   46,723
                                                                  ======

         Therefore, there were no shares due to ELM as of March 31, 1999.

     d.  Reference is made to four Director-approved, open-ended loan
         agreements dated June 20, 1988, October 14, 1988, May 17, 1989
         (Exhibits B, C and D of the April 12, 1993, confirmation letter)
         and April 1, 1990 (Exhibit 2 of the April 9, 1990 confirmation
         letter).

     e.  On October 23, 1993, in order to comply with the El Salvador
         Government's minimum capital requirements, the shareholders of
         Mineral San Sebastian S.A. de C.V. (Misanse) voted to increase
         Misanse's capitalization from 119,500 colones to 260,000
         colones.  This was accomplished via a shareholders' rights
         offering on the basis of purchasing one share for each share
         owned with the rights expiring on December 10, 1993.  According
         to Misanse's by-laws, the rights not exercised would be offered
         proportionately to the shareholders who did exercise their
         rights.

<PAGE>

         In addition to the rights offering, the shareholders authorized
         the sale of 210 additional common shares to the following:  ten
         shares to each of the four officers/directors (40 shares), five
         shares to each of the remaining six directors (30 shares), three
         shares to each of the ten supplemental directors (30 shares),
         (the President and the Secretary of the Company, who are
         directors of Misanse, had the right and they purchased ten and
         three shares respectively), and 110 shares were sold  to the
         Company over and above the amount of shares it was entitled to
         by the rights offering so that it would retain its 52%
         ownership.  When the Company obtained the concession in 1987, it
         agreed with the El Salvador Minister of Economy's office not to
         increase its 52% ownership of Misanse.  Therefore, after the
         rights offering, the Company owned approximately 52%.

         On the closing date of December 10, 1993 of this rights
         offering, there were 264 shares that were not subscribed and
         purchased.  The Company would have been entitled to purchase 137
         shares (264 x 52%).  However, the Company had been prohibited to
         purchase these shares as it would have exceeded its 52%
         ownership of Misanse shares.  The 137 shares were acquired by
         ELM with prior approval of Commerce's directors.  He acquired an
         additional four shares by virtue of his proportionate ownership.
         A Misanse Director-approved drawing was held to sell the
         unsubscribed shares.  In order to close the sales, 52 shares
         were purchased by ELM which he agreed in writing to hold these
         shares in escrow for a period of one year for the purpose of
         providing certain El Salvador Misanse shareholders time to
         obtain funds to purchase these shares at his cost.  None were
         purchased by the Misanse shareholders.

         During June 1995, ELM personally purchased an additional 264
         Misanse common shares from a Misanse shareholder in an
         arms-length transaction.  Therefore ELM presently owns a total
         of 467 Misanse common shares or approximately 17.96% of the
         total 2,600 Misanse common shares issued and outstanding.

2.   Collateral Pledged to ELM

     The collateral specifically pledged to ELM is as follows:

     a.  A Collateral Pledge Agreement dated October 14, 1981 granted to
         ELM by Commerce pledging the following collateral:  2,002,037
         shares of Sanseb common stock, par value $0.10 per share and
         1,346 shares of Mineral San Sebastian, S.A. de C.V. common
         stock, par value one hundred colones per share.  The shares
         pledged are as follows:  the 618 shares originally owned by
         Commerce, and the 618 shares plus 110 shares purchased from the
         October 23, 1993 Misanse rights offering.  Reference is made to
         Exhibit 4 included in the April 9, 1990 confirmation letter.

<PAGE>


     b.  A Collateral Pledge Agreement dated February 24, 1983, by
         Commerce, SLE and UDI collectively and individually, pledging
         the following collateral:

         300 shares of no par value common shares of Homespan (formerly
         known as Trade Realty Co., Inc.), Certificate No. 7 dated
         January 21, 1974, being 100% of its issued and outstanding
         shares.  Homespan and Commerce agree that no additional shares
         of Homespan will be issued as long as there are any obligations
         due to ELM; 1,800 shares of no par value (UDI) capital stock
         Certificate No. 17 dated September 15, 1972, representing 100%
         of the shares issued and outstanding.  UDI and Commerce agree
         that no additional shares of UDI will be issued as long as there
         are any outstanding obligations due to ELM.  Reference is made
         to Exhibit 5 included in the April 9, 1990 confirmation letter.

     c.  Collateral Pledge Agreement dated July 13, 1983 granted to
         General Lumber & Supply Co., Inc. (GLSCO) and ELM by Commerce,
         SLE, and UDI, individually and collectively, pledging the
         following collateral:

         419,000 shares of fully paid and nonassessable shares of the par
         value of $.05 each of the capital stock of International
         Property Exchange, Inc., formerly known as Capital Funding &
         Development Corp., Certificate 2885 dated June 30, 1983;

         One voting membership certificate of San Luis Valley Irrigation
         Well Owners, Inc., Membership Certificate No. 871, dated
         November 27, 1979;

         Certificate No. 312, Membership No. 871, consisting of .001447
         units of Augmentation Plan Number One of San Luis Valley
         Irrigation Well Owners, Inc. dated February 8, 1980;

         100 common shares of $0.10 par value, Piccadilly (now Ecomm),
         Certificate No. 1, dated July 23, 1974.  Ecomm and Commerce
         agree that no additional shares of Ecomm will be issued as long
         as there are any outstanding obligations due to ELM. Reference
         is made to Exhibit 6 included in the April 9, 1990 confirmation
         letter.

<PAGE>

     d.  A Deed of Trust dated November 3, 1983 by and between Homespan,
         as party of the first part, and Ronald K. Carpenter, Esq.
         (Trustee), as party of the second part, for the benefit of ELM
         and GLSCO, as party of the third part.  The Deed of Trust is in
         favor of ELM and GLSCO and is open-ended to secure the
         promissory note(s) due to ELM and GLSCO and to further secure
         any future obligations that Commerce or Homespan may incur from
         them.  This Deed of Trust is issued to Ronald K. Carpenter,
         Esq., Trustee for the benefit of ELM and GLSCO and is a first
         lien on the 331-acre Standing Rock  Campground located in
         Camdenton, Missouri.  The Deed of Trust was recorded on November
         5, 1984 in Camden County, Missouri at 1:24 p.m. in Book 122,
         Page 200.  Reference is made to Exhibit 7 included in the April
         9, 1990 confirmation letter.

     e.  Two Deeds of Trust to a Colorado Public Trustee granted by SLE
         to ELM are described as follows:

         A Deed of Trust dated March 20, 1984, consisting of four lots in
         the San Luis North Estates Subdivision, Costilla, Colorado, and
         recorded at 9:01 a.m. on August 2, 1984, in Book 238, Page 600,
         Reception No. 157128;

         A Deed of Trust dated October 4, 1982, consisting of six parcels
         of land in the San Luis North Estates Subdivision, Costilla,
         Colorado, and recorded at 8:40 a.m. on October 6, 1982, in Book
         228, Pages 300-301, Reception No. 148981.  Reference is made to
         Exhibit 8 included in the April 9, 1990 confirmation letter.

     f.  GLSCO, ELM, the Edward L. Machulak Rollover Individual
         Retirement Account (ELM RIRA) and the Sylvia Machulak Rollover
         Individual Retirement Account (SM RIRA) collectively and
         individually identified as the lender(s),  have been assigned on
         October 19, 1987, all of the rights, titles, claims, remedies
         and interest in the Joint Venture, and to the mine concession
         granted by the Government of El Salvador to Misanse on July 23,
         1987, and thereafter from time to time amended, and which
         Misanse then assigned to the Joint Venture on September 22,
         1987.  Commerce and the Joint Venture have the right to assign
         this and any subsequent concession agreement.  Reference is made
         to Exhibit 9 included in the April 9, 1990 confirmation letter.
         Effective February 1996, the Government of El Salvador approved
         an updated version of the mining law.  Therefore, Commerce
         applied for a mining concession applicable to this mining law at
         the San Sebastian Gold Mine.  The concession is subject to
         compliance which has been presented to the El Salvador Director
         of Mines and Hydrocarbons.  Therefore, it is clearly understood
         that this concession is to become collateral effective
         simultaneously upon receiving the concession to all of the
         parties herein mentioned.

<PAGE>

     g.  An interest with GLSCO in filing financing statements under the
         Uniform Commercial Code by an assignment and pledge of all
         corporate assets, such as but not limited to the property of
         Commerce, Joint Venture, SLE, and Homespan, wherever located,
         now owned or hereafter acquired is as follows:  all accounts,
         all land contract receivables, contract rights, instruments and
         chattel paper; all inventory, all jewelry and precious stones,
         and all documents relating to inventory, including all goods
         held for sale, lease or demonstration, to be furnished under
         contracts of service, and raw materials, work in process and
         materials and supplies used or consumed in the business of
         Commerce, Commerce/Sanseb Joint Venture, SLE, and Homespan; all
         office furniture, fixtures and all other equipment; all general
         intangibles, all stock and securities of any kind, and all
         rights, titles and interest in the Commerce Group Corp./San
         Sebastian Gold Mines, Inc. Joint Venture, and all additions and
         accessions to, all spare and repair parts, special tools,
         equipment and replacements for all returned or repossessed goods
         the sale or lease of which gave rise to, and all proceeds and
         products of the foregoing.  Reference is made to the Uniform
         Commercial Code filing, Exhibit 10, included in the April 9,
         1990 confirmation letter and the renewed UCC-1 filing on
         December 17, 1996, Exhibit B, included in the April 14, 1997
         confirmation letter.

     h.  Commerce and Sanseb agree that ELM has as collateral, the
         assignment and pledge of all of their rights, titles, claims,
         remedies, and interest whatsoever in the Joint Venture which was
         formed on September 22, 1987.  In the event of default, whatever
         interest Commerce and Sanseb have in the Joint Venture will be
         transferred to ELM and it will include whatever assets are owned
         by the Joint Venture. Reference is made to Exhibit C included in
         the April 8, 1991 confirmation letter.

3.   Cross Pledge Collateral Agreement

     GLSCO, ELM, the ELM RIRA and the SM RIRA individually are entitled
     to specific collateral that has been pledged to them by Commerce,
     its subsidiaries, affiliates and the Joint Venture.  Upon default by
     Commerce, or its subsidiaries or affiliates or the Joint Venture,
     GLSCO, ELM, the ELM RIRA and the SM RIRA have the first right to the
     proceeds from the specific collateral pledged to each of them.
     Commerce, its subsidiaries, affiliates, and the Joint Venture also
     have cross-pledged the collateral without diminishing the rights of
     the specific collateral pledged to each of the following:  GLSCO,
     ELM, the ELM RIRA and the SM RIRA.  The purpose and the intent of
     the cross pledge of collateral is to assure GLSCO, ELM, the ELM RIRA
     and the SM RIRA, that each of them would be paid in full; thus, any
     excess collateral that would be available is for the purpose of
     satisfying any debts and obligations due to each of the named
     parties.  The formula to be used (after deducting the payments made
     from the specific collateral) is to total all of the debts due to
     GLSCO, ELM, the ELM RIRA and the SM RIRA, and then to divide this
     total debt into each individual debt to establish each individual's
     percentage of the outstanding debt due.  This percentage then will
     be multiplied by the total of the excess collateral to determine the
     amount of proceeds derived from the excess collateral and then the
     amount due to each of them would be distributed.

<PAGE>

4.   Bonus

     On February 16, 1987, by a Consent Resolution of all of the
     Directors, ELM was awarded as a bonus compensation, the following:
     for a period of 20 years, commencing the first day of the month
     following the month in which Commerce begins to produce gold from
     its El Salvadoran gold mining operations, Commerce will pay annually
     to ELM, 2% of the pre-tax profits earned from these operations.
     Reference is made to Exhibit 11 included in the April 9, 1990
     confirmation letter.

5.   Cancellation of Inter-Company Debts Upon Default

     Since part of the collateral pledged to GLSCO, ELM, the ELM RIRA and
     the SM RIRA is the common stock of Homespan, Ecomm, Sanseb, SLE,
     Misanse, UDI and the interest in the ownership of the Joint Venture,
     Commerce agreed, upon default of the payment of principal or
     interest to any of the individual lender(s) mentioned herein, that
     it will automatically cancel any inter-company debts owed to
     Commerce by any of its wholly-owned subsidiaries or affiliates or
     the Joint Venture at such time as any of the stock or Joint Venture
     ownership is transferred to the collateral holders as a result of
     default of any promissory note.

6.   Guarantors

     This agreement further confirms that Commerce and all of the
     following are guarantors to the loans made by ELM to Commerce:
     Joint Venture, Homespan, Ecomm, SLE, Sanseb and UDI.  They jointly
     and severally guarantee payment of the note(s) that were issued to
     ELM and also agree that these note(s) may be accelerated in
     accordance with the provisions contained in the agreement and/or any
     collateral or mortgages securing these notes.  Also, Commerce, all
     of its subsidiaries and the Joint Venture agree to the cross pledge
     of collateral for the benefit of GLSCO, ELM, the ELM RIRA and the SM
     RIRA.  Reference is made to Exhibit 12 included in the April 9, 1990
     confirmation letter.

7.   Omissions

     Commerce believes that it has included all of its obligations,
     monies due and has listed all of the collateral due to ELM, however,
     since these transactions have taken place over  a long period of
     time in which changes could have taken place, it is possible that
     inadvertently some item(s), particularly collateral, could have been
     omitted.  If that should prove to be a fact, then Commerce, the
     Joint Venture, Homespan, Ecomm, SLE, Sanseb, and UDI agree that
     those omissions of collateral, if any, are meant to be included as
     collateral with this confirmation and agreement.

<PAGE>

8.   Real Estate Ownership Adjacent to San Sebastian Gold Mine, Inc.
     (SSGM)

     Commerce acknowledges that ELM personally owns the real estate
     adjacent to and bordering the north boundary line of the SSGM
     located in the Republic of El Salvador, Central America, and that
     Comseb is performing certain exploration and exploitation on this
     property.  These costs are to be payable by an offset to the amounts
     due to ELM.  (Reference is made to Exhibit B, "Concesion de
     Exploracio El Paraiso" - plat map that identifies the ELM (Macay)
     "92.13 Hectareas," in the April 13, 1998 confirmation letter).

If you are in agreement with the contents of this letter, please sign
below and return one copy to Commerce.

Very truly yours,

COMMERCE GROUP CORP.

/s/ Edward A. Machulak
-------------------------
Edward A. Machulak
Secretary

<PAGE>


The contents of this letter are agreed by the following:

COMMERCE/SANSEB JOINT VENTURE           HOMESPAN REALTY COMPANY, INC.
as Guarantor (Joint Venture)            as Guarantor (Homespan)

/s/ Edward L. Machulak                  /s/ Edward L. Machulak
_______________________________________ __________________________________
By:  Edward L. Machulak, Auth. Designee By:  Edward L. Machulak, President


ECOMM GROUP INC.                        SAN LUIS ESTATES, INC.
as Guarantor (Ecomm)                    as Guarantor (SLE)

/s/ Edward A. Machulak                  /s/ Edward L. Machulak
____________________________________    __________________________________
By:  Edward A. Machulak, Secretary      By:  Edward L. Machulak, President


SAN SEBASTIAN GOLD MINES, INC.          UNIVERSAL DEVELOPERS, INC.
as Guarantor (Sanseb)                   as Guarantor (UDI)


/s/ Edward L. Machulak                  /s/ Edward L. Machulak
____________________________________    __________________________________
By:  Edward L. Machulak, President      By:  Edward L. Machulak, President


Accepted by:

/s/ Edward L. Machulak
____________________________________
Edward L. Machulak, as an Individual and
not as a Director or Officer of any of the
Corporations mentioned in this letter.
Date:  May 10, 1999

<PAGE>

                       Exhibit A to Exhibit 99.2
        (Schedule of Principal and Interest as of March 31, 1999
             has been purposely omitted as it only reflects
            the calculations of the principal and interest.)