Exhibit
4.14
FORBEARANCE AGREEMENT
THIS
FORBEARANCE AGREEMENT (this
“Forbearance Agreement”
)
is made and entered into as of April 2, 2008 by and between
Brendan Technologies, Inc., a Nevada corporation (the
“Company” ),
Brendan Technologies, Inc., a Michigan corporation (the
“
Guarantor ”),
and Little Bear Investments, LLC (the
“Agent” ).
RECITALS
WHEREAS,
pursuant to that certain (a) Loan and Security Agreement
(the
“Loan Agreement” ),
dated as of July 10, 2007, by and among certain lenders of the
Company (each, a
“Lender” ,
and
collectively,
the
“Lenders” ),
the Agent and the Company, the Company issued to the Lenders (i)
secured promissory notes, each dated July 10, 2007, in the
aggregate principal amount of $600,000 (the
“Notes” ),
and (ii) warrants to purchase an aggregate of 600,000 shares
(the
“Shares” )
of common stock of the Company (the
“Common Stock” ),
each dated July 10, 2007.
WHEREAS,
pursuant to that certain Subsidiary Guarantee dated July 10,
2007, delivered by the Guarantor,
in favor of each Lender, the Guarantor has guaranteed the
Company’s obligations to the Lenders under the Notes
(the
“Guarantee” ).
WHEREAS,
pursuant to Section 4(a)(i) of the Notes, if the company fails
to pay to the Lenders any principal or interest when due an
Event of Default (as defined in the Notes) shall have
occurred.
WHEREAS,
the Company has failed to pay interest to the Lenders and such
failure has remained ongoing as of February 1, 2008 (the
“
Default Date ”)
and therefore Event of Default has occurred.
WHEREAS,
as of the Default Date, interest on the Notes have been
accruing at 22% per annum (the “
Default Rate ”)
in accordance with the terms of the Note.
WEREAS,
pursuant to Section 4(b) of the Notes, upon the occurrence of
an Event of Default the full principal amount of the Notes
together with all accrued interest thereon shall become
immediately due and payable (the
“Right of Acceleration”
).
WHEREAS,
the stated maturity date of the Notes is April 10, 2008 (the
“
Maturity Date ”).
WHEREAS,
the Company requests that the Agent waive the Right of
Acceleration and extend the Maturity Date until June 9,
2008.
WHEREAS,
the Agent, as to and on behalf of all Lenders agrees to (i)
waive the Right of Acceleration until June 9, 2008 only in
connection with the failure by the Company to pay any interest
when due and (ii) extend the Maturity Date of the Notes until
June 9, 2008 in consideration for the offer by the Company to
each Lender to (i) issue to the Lenders shares of the
Company’s Common Stock in accordance with
Schedule I attached
hereto.
WHEREAS,
pursuant to the Loan Agreement and the Notes, the Agent may
waive an Event of Default on behalf of all the
Lenders.
NOW,
THEREFORE, in consideration of the foregoing and the mutual
promises and covenants set forth herein, the parties hereby
agree as follows:
AGREEMENT
A.
The
Company agrees
that ,
as of the close of business on April 1, 2008, the Company was
indebted to the Lenders in respect of the loans and advances
under the Notes in the aggregate principal amount of $600,000.
All such loans, together with interest accrued and accruing
thereon, and costs, expenses, fees (including attorneys’
fees and legal expenses) and all other charges or amounts now
or hereafter payable by the Company to the Lenders
(collectively, the
“Obligations” )
are unconditionally owing by the Company to the Lenders without
offset, defense, reduction or counterclaim of any kind or nature.
The Guarantor hereby acknowledges, confirms and agrees that its
obligations, liabilities and indebtedness to the Lenders for the
payment and performance of the Obligations are unconditionally
owing to the Lenders without offset, defense reduction or
counterclaim of any kind or nature, that the terms of the Guarantee
shall remain in full force and effect and that nothing herein shall
constitute a waiver of any of Lenders’ rights or remedies
contained in the Guarantee.
B.
The
Company and the Guarantor hereby acknowledge, confirm and
agree that the Lenders have and shall continue to have valid,
enforceable and perfected liens upon and security interests in
the assets and properties of the Company and the Guarantor
pursuant to the Loan Agreement and the Guarantee.
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