Exhibit 10.13
FORBEARANCE AGREEMENT
THIS FORBEARANCE AGREEMENT ("Agreement") is entered into this 19th day
of November, 2001, by and between CYNTECH TECHNOLOGY, INC., a Utah corporation
(hereinafter referred to as "Cyntech"), and WINDSTAR RESEARCH AND ENGINEERING,
LTD., a Cayman Islands corporation (hereinafter referred to as "Windstar"), upon
the following:
Premises:
WHEREAS, Cyntech and Windstar are parties to that certain Exclusive
Option Agreement, dated February 1, 2001; and
WHEREAS, under the terms of the Exclusive Option Agreement, Cyntech is
required to commence the construction of one new facility in 2001 and two new
facilities in 2002; and
WHEREAS, under the terms of the Exclusive Option Agreement, Cyntech was
required to make the following payments to Windstar:
May 2, 2001: $100,000
August 1, 2001: $250,000
August 31, 2001: $500,000
and
WHEREAS, Cyntech signed and Windstar agreed to accept a twelve-month
note for the payment that came due on May 2, 2001 (the "Note"); and
WHEREAS, under the terms of the Exclusive Option Agreement, Windstar is
entitled to terminate the Exclusive Option Agreement upon Cyntech's default,
following 180 days notice and opportunity to cure such default; and
WHEREAS, Cyntech has provided Windstar notice that it has not been and
will not be able to perform the above-stated obligations under the Exclusive
Option Agreement; and
WHEREAS, the stockholders of Windstar are stockholders of Cyntech and
Windstar has a substantial financial interest in the success of Cyntech.
Agreement:
NOW, THEREFORE, upon these premises, which are incorporated herein by
reference, and for and in consideration of the mutual promises and covenants
hereinafter set forth and other good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, it is hereby agreed as follows:
1. Windstar Forbearance. Windstar agrees that until August 1, 2003, it
will not terminate the Exclusive Option Agreement or exercise any of its rights
or remedies thereunder or under the Note for Cyntech's default in failing to
meet the following obligations:
a. commencement of one new facility in 2001 and two new
facilities in 2002; and
b. making payments of $250,000, $500,000, and $100,000 due on
August 1, 2001, August 31, 2001, and May 2, 2002, respectively.
2. Cyntech Efforts. Cyntech agrees that it will use its best
efforts to commence the required facilities and make the required
payments before August 1, 2003.
3. Cyntech Books and Records. Cyntech agrees that it will provide
Windstar with reasonable access to Cyntech's books and records such that
Windstar will be able to determine whether Cyntech is making appropriate efforts
to comply with the terms of the Exclusive Option Agreement and this Agreement.
4. Notices. All notices, demands, requests, or other communications
required or authorized hereunder shall be in writing and shall be deemed to have
been given on the date of service if personally served or by facsimile
transmission (if receipt is confirmed by the facsimile operator of the
recipient), or on the following day if delivered by overnight courier service,
or on the fifth day after mailing if mailed by certified mail, return receipt
requested, addressed as follows:
If to Tex-Oil, to: X.X. Xxx 0000
Xxxxxxxx, XX 00000
If to Cyntech, to: 0000 Xxxxxxxxxx Xxxxx
Xxxxxxx, XX 00000
Telecopy No.: (000) 000-0000
or such other addresses and facsimile numbers as shall be furnished by any party
in the manner for giving notices hereunder.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers on the date first above written.
WINDSTAR RESEARCH AND ENGINEERING, LTD.
By /s/ X.X. Xxxxxxxx, Xx.
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X.X. Xxxxxxxx, Xx.
Managing Director - North America
CYNTECH TECHNOLOGIES, INC.
By /s/ R. Xxxxx Xxxxx
---------------------------------------
R. Xxxxx Xxxxx
President and Chief Executive Officer
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