AMENDED FORBEARANCE AGREEMENT

 

                          AMENDED FORBEARANCE AGREEMENT

 

            This Agreement (the "AGREEMENT") is entered into and made this 18th

day of May, 2005, by and among VITROTECH CORPORATION, a Nevada corporation

("VitroTech"), VITROCO INCORPORATED, a Nevada corporation

("VitroCo")(collectively, VitroTech and VitroCo are referred to as the

"Borrowers"), and 1568931 ONTARIO LTD., an Ontario company partnership

("Lender"), and amends and supercedes a Forbearance Agreement, dated May 10,

2005, by and between the parties hereto.

 

            WHEREAS, Lender and Borrowers entered into that certain agreement,

dated September 29, 2004 (the "September 2004 Agreement"), by which Lender

agreed to loan to VitroTech up to $3,000,000 and pursuant to which Borrowers

agreed to grant to Lender a security interest in substantially all of their

assets and funds have been loaned to date and Borrowers and Lender have agreed

to execute various documents further defining the rights of Lender and Borrowers

under the September 2004 Agreement (such documents being referred to,

collectively with the September 2004 Agreement, as the "Loan Documents"); this

Agreement does not, in any way, diminish or reduce any of the rights of Lender

under the September 2004 Agreement and, except as otherwise provided for herein,

the September 2004 Agreement shall remain in full force and affect and Lender

shall retain, unabated, all rights conferred by law as well as those rights

contained in (1) the September 2004 Agreement, and (2) all Loan Documents

contemplated to be executed pursuant to the September 2004 Agreement;

 

            WHEREAS, pursuant to the terms of the September 2004 Agreement,

Enviro Investment Group LLC, Red Rock Canyon Mineral LLC and Valley Springs

Mineral LLC (the "Mines") pledged to Lender, as additional collateral to secure

Borrowers' obligations under the September 2004 Agreement, certain assets,

including but not limited to all then mined, processed and/or warehoused mineral

owned by the Mines (the "Inventory"), including Inventory in possession of

Borrowers and subject to Borrowers' rights to purchase such Inventory;

 

            WHEREAS, Lender has entered in an Inter-Creditor Agreement, dated

April 18, 2005 (the "Inter-Creditor Agreement"), with Vitrobirth LLC pursuant to

which Lender and Vitrobirth agreed to share collateral pledged by Borrowers;

 

            WHEREAS, Borrowers are presently out of compliance with various

provisions of the Loan Documents, such non-compliance being grounds for Lender

to declare Borrowers in default under the Loan Documents;

 

            WHEREAS, Borrowers and Lender have negotiated and agreed in

principal that Lender will forbear from exercising any remedy available to

Lender upon the occurrence of an event of default, as defined under the Loan

Documents, until the earlier of (1) a Triggering Event, as defined herein, or

(2) May 23, 2005 (subject to the sole and absolute right of Lender to extend

said date); and Borrowers will facilitate the sale and transfer to Lender of all

of Borrowers' interest in the Inventories and receivables held by Borrowers, all

subject to the terms of the Inter-Creditor Agreement and/or any amendment

thereto or subsequent agreement entered into between Lender and Vitrobirth LLC

and the obligation to pay to the Mines and Hi-Tech Environmental Products LLC

("Hi-Tech") an aggregate of fifteen percent (15%) of the ultimate sales price of

Inventory; and

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            WHEREAS, Borrowers and Lender wish to evidence their agreement with

respect to the matters set forth above.

 

            NOW, THEREFORE, for and in consideration of the mutual promises

herein contained, and other good and valuable consideration, the receipt and

sufficiency of which are hereby acknowledged, Lender and Borrowers hereby agree

as follows:

 

            1. At the specific request of Borrowers, Lender hereby agrees to

forbear from exercising any remedy available to Lender upon the occurrence of an

Event of Default or Default (as such terms are defined in the Loan Documents)

under the Loan Documents until the earlier of (a) a Triggering Event

(hereinafter defined) or (b) May 23, 2005 (subject to the sole and absolute

right of Lender to extend said date)(the earlier of such dates being referred to

herein as the "Termination Date").

 

            2. In consideration of the forbearance agreed to in Paragraph 1

hereof, Borrowers hereby sell, assign, transfer, convey and deliver to Lender,

as an outright conveyance and not as a security interest, and subject to the

rights and obligations of Lender and Vitrobirth under the Inter-Creditor

Agreement and/or any amendment thereto, or subsequent agreement entered into

between Lender and Vitrobirth LLC, all right, title and interest of Borrowers

in:

 

                       a. the Inventory, as set forth on Schedule A attached

         hereto; and with respect to the Inventory: (i) Borrowers represent and

         warrant that (A) the Mines own all of the Inventory set forth on

         Schedule A, subject only to the rights of Borrowers to purchase the

         Inventory, (B) Borrowers own certain rights in the Inventory, free and

         clear of liens, subject only to the rights of (1) Lender under the Loan

         Documents, (2) Vitrobirth under an existing loan to the Borrowers, (3)

         warehousemen in possession of the Inventory and owed money with respect

         to the warehousing of Inventory, which amounts are, as of the date

         hereof, not more than $15,000 in the aggregate, and (4) the Mines and

         Hi-Tech to be paid an aggregate of fifteen percent (15%) of the

         ultimate sales price of the inventory; and (C) the Inventory listed on

         Schedule A constitutes all of the Inventory of mined and/or processed

         material that the Borrowers own or have control over or an interest in,

         whether directly or indirectly; (ii) Borrowers agree that Lender shall

         have all of the rights Borrowers would otherwise have to deal with the

         Inventory and control the same as fully as Borrowers; (iii) Borrowers

         shall grant no rights in the inventory to any parties other than Lender

         without the prior written consent of Lender; (iv) Borrowers shall

         notify all persons in possession of the Inventory, including

         warehousemen, of the rights granted to Lender hereunder; and (v)

         Borrowers have included herewith as Schedule C, and will update as

         appropriate Schedule C, listing all warehouse receipts, if any,

         relating to the Inventory; and

 

                       b. all receivables and other forms of rights to payment

         now existing, as reflected on Schedule B attached hereto, or arising in

         the future, excluding those receivables specifically noted as excluded

         on Schedule B; and with respect to the receivables: (i) Borrowers

         represent and warrant that in the event invoices are attached to

         Schedule B, such invoices represent true and correct copies of invoices

         for the receivables; (ii) in the event Schedule B is not attached to

         this Agreement at the time of its original execution, the parties agree

         that actual purchases of receivables will be evidenced by the

         completion and execution by both parties of Schedule B in the future,

         which schedule must be delivered by Borrowers not later than 48 hours

         after each such purchase; (iii) whether or not an initial Schedule B is

         attached to this Agreement, it is anticipated that additional