EXHIBIT
10.5


 


FOURTH
AMENDMENT TO FORBEARANCE AGREEMENT


 


THIS FOURTH AMENDMENT TO FORBEARANCE AGREEMENT (this “Amendment”) is
entered into this 30st day of September, 2009, by and among HERCULES TECHNOLOGY GROWTH CAPITAL, INC. a
Maryland corporation (“Lender”),
and INFOLOGIX, INC., a Delaware corporation
(“Infologix”),
INFOLOGIX SYSTEMS CORPORATION, a
Delaware corporation (“ISC”), EMBEDDED TECHNOLOGIES, LLC, a Delaware limited liability
company (“Embedded”), OPT ACQUISITION, LLC, a Pennsylvania limited liability
company (“OPT”) and Infologix — DDMS, Inc.
a limited liability company (“DDMS”, and
collectively with Infologix, ISC, Embedded and Opt, “Borrower”).  Capitalized terms used herein without
definition shall have the same meanings given them in the Forbearance Agreement
(as defined below).


 


RECITALS


 


A.            Borrower and Lender have entered into that
certain Loan and Security Agreement dated as of May 1, 2008, Amendment No. 1
to the Loan and Security Agreement dated as of November 19, 2008,
Amendment No. 2 to the Loan and Security Agreement dated as of May 31,
2009, (as may be amended, restated, or otherwise modified, the “Loan Agreement”),
pursuant to which Lender has agreed to extend and make available to Borrower
certain advances of money.


 


B.            Borrower and Lender have entered into that
certain Forbearance Agreement dated as of July 31, 2009, as amended by the
Amendment to Forbearance Agreement, dated as of August 14, 2009, the
Second Amendment to Forbearance Agreement dated as of August 20, 2009, the
Third Amendment to Forbearance Agreement dated as of September 23, 2009
(as so amended, the “Forbearance Agreement”),
pursuant to which Lender agreed to forbear from exercising its remedies under
the Loan Agreement as a result of the Specified Default, subject to the terms
and conditions, and for the period specified in the Forbearance Agreement.


 


C.            Pursuant to Section 7.23 of the Loan
Agreement, Borrower was required to pay to Lender the remaining balance of the
Restructuring Fee in the amount of $160,000 on the earliest of (i) September 30,
2009, (ii) the acceleration of the Secured Obligations, and (iii) payment
in full of the Secured Obligations. 
Borrower acknowledges that it has failed to make the required payment of
$160,000 by such date and, as a result, an Event of Default (the “Specified Payment Default”) has
occurred and is continuing under Section 9.2 of the Loan Agreement.
Lender, however, agrees to forebear from exercising its remedies under the Loan
Agreement as a result of the Specified Payment Default as well, subject to the
terms and conditions, and for the period specified in the Forbearance
Agreement.


 


D.            Each of Borrower and Lender desires to amend
the Forbearance Agreement to designate the Specified Payment Default as a
Specified Default subject to the terms and conditions of the Forbearance
Agreement.


 


AGREEMENT


 


NOW,
THEREFORE, in consideration of the foregoing Recitals, which are hereby
incorporated in this Agreement, and intending to be legally bound, the parties
hereto agree as follows:


 

















 


1.             AMENDMENTS.


 


1.1  Recitals.  Recital D of the Forbearance
Agreement is deleted in its entirety and replaced with the following:


 


“D.          Pursuant to Section 7.24 of the Loan Agreement,
the Fundamental Event Closing was to have occurred on or before July 31,
2009.  The Fundamental Event Closing has
not occurred by such date and, as a result an event of Default has occurred and
is continuing under Section 9.2 of the Loan Agreement (the “Specified Covenant Default”).
Pursuant to Section 7.23 of the Loan Agreement, Borrower was required to
pay to Lender the remaining balance of the Restructuring Fee in the amount of
$160,000 on the earliest of (i) September 30, 2009, (ii) the
acceleration of the Secured Obligations, and (iii) payment in full of the
Secured Obligations.  Borrower
acknowledges that it has failed to make the required payment of $160,000 by
such date and, as a result, an Event of Default has occurred and is continuing
under Section 9.2 of the Loan Agreement (the “Specified
Payment Default,” and collectively with the Specified Covenant
Default, the “Specified Default”).


 


2.             BORROWER’S
REPRESENTATIONS AND WARRANTIES.  Borrower represents and warrants that:


 


(a)           Borrower has the power and authority to
execute and deliver this Amendment and to perform its obligations under the
Loan Agreement, as amended by this Amendment;


 


(b)           the execution and delivery by Borrower of
this Amendment and the performance by Borrower of its obligations under the
Loan Agreement, as amended, have been duly authorized by all necessary action
on the part of Borrower; and


 


(c)           this Amendment has been duly executed and
delivered by Borrower and is the binding obligation of Borrower, enforceable
against it in accordance with its terms, except as such enforceability may be
limited by bankruptcy, insolvency, reorganization, liquidation, moratorium or
other similar laws of general application and equitable principles relating to
or affecting creditors’ rights.


 


Borrower understands and
acknowledges that Lender is entering into this Amendment in reliance upon, and
in partial consideration for, the above representations and warranties, and
agrees that such reliance is reasonable and appropriate.


 


3.             LIMITATION.  The amendments set forth in this Amendment
shall be limited precisely as written and shall not be deemed (a) to be a
waiver or modification of any other term or condition of the Loan Agreement or
of any other instrument or agreement referred to therein or to prejudice any
right or remedy which Lender may now have or may have in the future under or in
connection with the Loan Agreement or any instrument or agreement referred to
therein; or (b) to be a consent to any future amendment or modification or
waiver to any instrument or agreement the execution and delivery of which is
consented to hereby, or to any waiver of any of the provisions 


 


2

















 


thereof.  Except as expressly amended hereby, the Loan
Agreement shall continue in full force and effect.


 


4.             EFFECTIVENESS.  This Amendment shall become effective upon
the satisfaction of all the following conditions precedent:


 


4.1          Amendment.  Borrower and Lender shall have duly executed
and delivered this Amendment to Lender.


 


5.             COUNTERPARTS.  This Amendment may be signed in any number of
counterparts, and by different parties hereto in separate counterparts, with
the same effect as if the signatures to each such counterpart were upon a
single instrument.  All counterparts
shall be deemed an original of this Amendment.


 


6.             INTEGRATION.  This Amendment and any documents executed in
connection herewith or pursuant hereto contain the entire agreement between the
parties with respect to the subject matter hereof and supersede all prior
agreements, understandings, offers and negotiations, oral or written, with
respect thereto and no extrinsic evidence whatsoever may be introduced in any
judicial or arbitration proceeding, if any, involving this Amendment; except
that any financing statements or other agreements or instruments filed by
Lender with respect to Borrower shall remain in full force and effect.


 


7.             GOVERNING
LAW; VENUE.  THIS
AMENDMENT SHALL BE GOVERNED BY AND SHALL BE CONSTRUED AND ENFORCED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA.  Borrower and Lender each submit to the
exclusive jurisdiction of the State and Federal courts in Santa Clara County,
California.


 


[signature
page follows]


 


3

















 


IN WITNESS WHEREOF, the parties have duly
authorized and caused this Amendment to be executed as of the date first
written above.


 


BORROWER:


 


	
  INFOLOGIX, INC.

  	
   

  
	
   

  	
   

  
	
  By: 

  	
  /s/ John A. Roberts

  	
   

  
	
   

  	
   

  
	
  Name: Jay Roberts

  	
   

  
	
   

  	
   

  
	
  Title: Chief Financial Officer

  	
   

  
			



 


INFOLOGIX SYSTEMS CORPORATION


 


	
  By: 

  	
  /s/ John A. Roberts

  	
   

  
	
   

  
	
  Name: Jay Roberts

  
	
   

  
	
  Title: Chief Financial Officer

  



 


OPT ACQUISITION, LLC


 


	
  By: 

  	
  /s/ John A. Roberts

  	
   

  
	
   

  
	
  Name: Jay Roberts

  
	
   

  
	
  Title: Chief Financial Officer

  



 


EMBEDDED TECHNOLOGIES, LLC


	
  By: INFOLOGIX, INC. its
  sole member

  	
   

  
	
   

  
	
  By: 

  	
  /s/ John A. Roberts

  	
   

  
	
   

  
	
  Name: Jay Roberts

  
	
   

  
	
  Title: Chief Financial
  Officer

  
			



 


INFOLOGIX — DDMS, INC.


 


	
  By: 

  	
  /s/ John A. Roberts

  	
   

  
	
   

  
	
  Name: Jay Roberts

  
	
   

  
	
  Title: Chief Financial Officer

  



 

















 


LENDER:


 


	
  HERCULES TECHNOLOGY GROWTH CAPITAL, INC.

  
	
   

  
	
  By:  

  	
  /s/ K. Nicholas Matitsch

  	
   

  
	
   

  
	
  Name: K. Nicholas Matitsch

  
	
   

  
	
  Title: Associate General
  Counsel