Exhibit 10.2
FORBEARANCE
AGREEMENT
THIS FORBEARANCE AGREEMENT (this
“Agreement”) is entered into as of this 3rd day of
August, 2011 (the “Effective Date”), by and among
Quatech, Inc., an Ohio corporation (“Borrower”), and
the Director of Development of the State of Ohio
(“Lender”). Capitalized terms not otherwise defined
herein shall have the meanings given to such terms in the Loan
Agreement (as defined below).
RECITALS AND
STIPULATIONS
A. Borrower and Lender are parties
to a certain Loan Agreement, dated as of January 27, 2006 (as
amended, modified, supplemented, restated or replaced from time to
time, the “Loan Agreement”);
B. In connection with the Loan
Agreement, the Borrower executed that certain Cognivit Promissory
Note in favor of Lender, dated as of January 27, 2006 (the
“Note” and together with the Loan Agreement and any
other documents, instruments and agreements delivered in connection
with the Loan Agreement, the “Loan
Documents”);
C. Borrower has requested that
Lender forbear from exercising any of its rights and remedies under
the Loan Documents and applicable law in respect of certain Events
of Default under the Loan Documents, and Lender has agreed to so
forbear upon the terms and subject to the conditions set forth in
this Agreement;
D. Borrower have informed Lender
that Borrower intends to enter into an Asset Purchase Agreement
(the “Purchase Agreement”) with Q-Tech Acquisition, LLC
(“QT”), which requires, inter alia, payment in
full of all outstanding principal and interest under the Note in
connection with the closing thereunder; and
E. Borrower and Lender acknowledge
and agree that this Agreement has been negotiated in good
faith.
NOW, THEREFORE,
in consideration of the recitals and
stipulations set forth above and the mutual promises and covenants
contained herein, and for other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged,
Borrower and Lender hereby agree as follows:
AGREEMENT
1. General
Acknowledgment .
Borrower acknowledges and agrees to the following:
(a) Borrower hereby acknowledges the
accuracy of the representations set forth in the Recitals and
Stipulations of this Agreement;
(b) Neither this Agreement nor any
other agreement entered in connection herewith or pursuant to the
terms hereof shall be deemed or construed to be a compromise,
satisfaction, reinstatement, accord and satisfaction, novation or
release of any of the Loan Documents, or any rights or obligations
thereunder, or a waiver by Lender of any of its rights under the
Loan Documents or at law or in equity;
(c) Neither this Agreement nor any
other agreement executed in connection herewith pursuant to the
terms hereof, nor any actions taken pursuant to this Agreement or
such other agreement shall be deemed to cure any Event of Default
which may exist under the Loan Documents, or to be a waiver by
Lender of any Event of Default under the Loan Documents, or of any
rights or remedies in connection therewith or with respect hereto,
evidencing the parties’ intention that Borrower’s
obligations under the Loan Documents shall remain in full force and
effect;
(d) All liens, security interests,
rights and remedies granted to Lender for its benefit under the
Loan Documents are hereby renewed, confirmed and continued, subject
to all senior liens, security interests, rights and remedies held
by Fifth Third Bank (“Fifth Third”) and Canal Mezzanine
Partners, L.P. (“Canal”; and
(e) Borrowers reaffirm the validity,
binding effect and enforceability of each of the Loan Documents, as
modified by provisions of this Agreement, and acknowledge that
Borrower is liable to Lender for the full amount of the principal
and interest evidenced by the Loan Documents (as modified hereby),
without offset, deduction, claim, counterclaim, defense or
recoupment of any kind.
2. Confirmation of
Indebtedness .
Borrower confirms and acknowledges that as of July 28, 2011,
it is indebted and obligated to Lender under the Note in the
following amounts:
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(a)
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Principal:
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$
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1,833,351.05; and
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(b)
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Accrued and Unpaid Interest:
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$
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11,000.07
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(c)
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Loan Participation Fee:
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$
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223,183.70
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