FORBEARANCE AGREEMENT
This Forbearance Agreement (this "Agreement") is entered into as of
the 14 day of July, 2005, by and among On The Go Healthcare, Inc. a Delaware
corporation (the "Company"), and Laurus Master Fund, Ltd. (the "Laurus").
Unless otherwise defined herein, capitalized terms used herein shall have the
meaning provided such terms in the Security and Purchase Agreement referred
to below.
BACKGROUND
WHEREAS, it is a condition to Laurus' making an investment in the
Company pursuant to, and in accordance with, (i) that certain Security
and Purchase Agreement dated as of the date hereof by and between
the Company and Laurus (as amended, modified or supplemented from time
to time, the "Purchase Agreement") and (ii) the Ancillary Agreements
referred to in the Purchase Agreement. Capitalized terms used but not
defined herein shall have the meanings given them in the Purchase
Agreement.
WHEREAS, the Company has entered into an equity line of credit with
Dutchess Private Equities Fund, L.P., a Delaware limited partnership
("Dutchess") pursuant to the an Equity Line of Credit Investment
Agreement dated February 17, 2004 by and between the Company and
Dutchess (the "Investment Agreement").
NOW, THEREFORE, each Company and Laurus agree as follows:
TERMS
1. In order to induce Laurus to enter into the financing arrangement
with the Company contemplated by the Purchase Agreement, the Company
hereby agrees that, until (i) each of the Notes has been
indefeasibly repaid in full, or (ii) the Company shall receive
the prior written consent of Laurus, the Company shall not be
permitted to, and the Company shall not, submit a Put Notice (as
defined in the Investment Agreement") to Dutchess. Notwithstanding
the immediately foregoing, if on any day during the Term, the
outstanding Loans made to the Company exceed the Formula Amount,
then, if Laurus shall decline (in the exercise of its sole
discretion under the Purchase Agreement) to make an Overadvance
available to the Company, the Company may, upon five (5) days
prior written notice to Laurus, submit a Put Notice (as defined
in the Investment Agreement") to Dutchess.
2. This Agreement shall be deemed to be an Ancillary Agreement as
defined in the Purchase Agreement. Each Company further expressly
acknowledges and agrees that any breach by it of its agreements
hereunder shall, in each event, constitute an "Event of Default"
under, and as defined in, the Purchase Agreement.
3. This Agreement shall be binding upon each Company and upon the
heirs, legal representatives, successors and assigns of each Company
and the successors and assigns of any Company. No waiver,
modification or amendment of any provision of this Agreement shall
be effective unless specifically made in writing and duly signed
by the party to be bound thereby.
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4. This Agreement shall be construed in accordance with and governed
by the laws of New York without regard to conflict of laws
provisions. Wherever possible each provision of this Agreement
shall be interpreted in such manner as to be effective and valid
under applicable law, but if any provision of this Agreement shall
be prohibited by or invalid under such law, such provision shall
be ineffective to the extent of such prohibition or invalidity,
without invalidating the remainder of such provision or the
remaining provisions of this Agreement.
[signature page follows]
IN WITNESS WHEREOF, this Agreement has been made and delivered this 14 day of
July, 2005.
ON THE GO HEALTHCARE, INC.
By:/s/Xxxxxx Xxxx
-------------------------
Name: Xxxxxx Xxxx
Title:CEO
LAURUS MASTER FUND, LTD.
By:/s/Xxxxx Grin
-------------------------
Name:Xxxxx Grin
Title: Director
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