FORBEARANCE AGREEMENT
THIS FORBEARANCE AGREEMENT ("Agreement"), made and entered into as of the
29th day of November, 2005, by and among Laser Energetics, Inc., an Oklahoma
corporation ("Company") and XXXXXX XXXXX ("Xxxxx") and CINCINNATI SUB-ZERO
PRODUCTS, INC. ("CSZ") (Xxxxx and CSZ are hereinafter collectively referred to
as the "Creditors").
RECITALS
WHEREAS, the Creditors have made or may in the future make, certain loans
to the Company, including loans made by Xxxxx to Laser Energetics, Inc., a
Florida corporation (LEI(Fl)) in the aggregate outstanding principal amount as
of October 31, 2005 of $335,313.00 and loans made by CSZ to LEI (Fl) in the
aggregate outstanding principal amount as of October 31, 2005 of $26,750.00,
which obligations have or will be assumed to the Company (the "Creditor
Obligations"); and
WHEREAS, Cornell Capital Partners, LP (the "Investor") and the Company are
about to enter into a certain Amended and Restated Securities Purchase Agreement
to be dated on or about November 30, 2005 (the "Purchase Agreement"), pursuant
to which the Company will issue to the Investor a Secured Convertible Debenture
in the original principal amount of approximately $1,200,000.00 (the
"Debenture") (the "Investor Obligations"); and
WHEREAS, the Creditors have agreed to subordinate the Creditor Obligations
to the Investor Obligations as set forth below.
A. NOW, THEREFORE, in consideration of the mutual promises and benefits
hereinafter set forth, and of other good and valuable consideration, the
Creditors covenant and agree that (i) no payments due or to become due on the
Creditor Obligations shall be paid, and no payment on account thereof, and (ii)
Creditors will not exercise any rights or remedies which they may have in
connection with the Creditor Obligations unless and until the Company has paid
and satisfied in full the Investor Obligations.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the day and year first above written.
LASER ENERGETICS, INC., an Oklahoma
corporation
By: /s/ Xxxxxx X. Xxxxxx
-----------------------------------------
Xxxxxx X. Xxxxxx, Chief Executive Officer
CINCINNATTI SUB-ZERO
By: /s/ Xxxxxx X. Xxxxx
-----------------------------------------
Name: Xxxxxx X. Xxxxx
Title: President + CEO
/s/ Xxxxxx Xxxxx
---------------------------------------------
XXXXXX XXXXX
