**Exhibit10.41**

**FORBEARANCE AGREEMENT**

**THIS FORBEARANCE AGREEMENT** (this “Agreement”), dated as ofSeptember 22, 2006, is entered into by and among the Lenders signatory hereto, **WELLS FARGO FOOTHILL, INC.**, a Californiacorporation, in its capacity as agent for the Lenders and Bank ProductProviders (in such capacity “Agent”), **MAGNETEK,INC.**, a Delaware corporation (“Parent”), and each of Parent’sSubsidiaries identified on the signature pages hereof (such Subsidiaries,together with Parent, are referred to hereinafter as a “Borrower” andindividually and collectively, jointly and severally, as the “Borrowers”).  Terms used herein without definition shallhave the meanings ascribed to them in the Credit Agreement defined below.

**RECITALS**

 

A.            The Lenders, Agent and Borrowershave previously entered into that certain Credit Agreement dated September 30,2005, as amended by that certain First Amendment to Credit Agreement andWaiver, dated November 29, 2005 and by that certain Second Amendment to CreditAgreement and Waiver, dated April 20, 2006 (as amended, modified andsupplemented from time to time, the “Credit Agreement”), pursuant towhich the Lenders have made certain loans and financial accommodationsavailable to Borrowers.

B.            Certain Events of Default have occurredand are continuing under the Credit Agreement due to Borrowers’ failure to (i)achieve the minimum amount of TTM EBITDA set forth in Section 6.16(a)(i) of theCredit Agreement for the period ending June 30, 2006, (ii) maintain the minimumFixed Charge Coverage Ration set forth in Section 6.16(a)(iii) of the CreditAgreement as of June 30, 2006 and (iii) maintain a Leverage Ratio of no morethan the amount set forth in Section 6.16(a)(iv) of the Credit Agreement as ofJune 30, 2006 (collectively, the “Known Existing Defaults”).

C.            Borrowers have requested that theAgent and Lenders forbear from exercising their rights and remedies under theCredit Agreement and the other Loan Documents in order to give Borrowers timeto negotiate a sale of the Stock of MagneTek S.p.A., a company organized underthe laws of Italy and of certain other assets of Parent associated with its “PowerElectronics Group” division.

D.            Agent and the Lenders are willing,for a limited period of time and on the terms and conditions set forth herein,to forbear from exercising their rights and remedies under the Credit Agreementand the other Loan Documents with respect to the Known Existing Defaults.

E.             Borrowers are entering into thisAgreement with the understanding and agreement that, except as specificallyprovided herein, none of the Lender Group’s rights or remedies as set forth inthe Credit Agreement or any other Loan Document is being waived or modified bythe terms of this Agreement.

**AGREEMENT**

NOW,THEREFORE, in consideration of the foregoing and the mutual covenants hereincontained, and for other good and valuable consideration, the receipt andsufficiency of which are hereby acknowledged, the parties hereby agree asfollows:

1.             Incorporation of Recitals.  Eachof the above recitals is expressly incorporated herein and is represented byeach Borrower to be true and correct.

2.             Reaffirmation of Obligations.  EachBorrower hereby acknowledges that the Loan Documents and the Obligationsconstitute the valid and binding obligations of such Borrower enforceableagainst such Borrower in accordance with their respective terms, and eachBorrower hereby reaffirms its obligations under the Loan Documents.  Agent’s and the Lenders’ entry into thisAgreement or any of the documents referenced herein, their negotiations withany party with respect to any Loan Document, their conduct of any analysis or 

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investigationof any Collateral for the Obligations or any Loan Document, their acceptance ofany payment from any Borrower or any other party of any payments made prior tothe date hereof, or any other action or failure to act on the part of anymember of the Lender Group shall not constitute (a) a modification of any LoanDocument or (b) a waiver of any Default or Event of Default under the CreditAgreement, including, without limitation, the Known Existing Defaults, or awaiver of any term or provision of any Loan Document.

3.             Agreement to Forbear.  Forthe Forbearance Period (as defined below), the Lender Group shall not take anyaction or commence any proceedings with respect to the enforcement of any ofits rights or remedies under the Loan Documents as a result of the KnownExisting Default.  The parties agree thatneither the foregoing agreement by the Lender Group nor the acceptance by anymember of the Lender Group of any of the payments provided for in the LoanDocuments, nor any payment prior to the date hereof shall, however, (a) excuseany party from any of its obligations under the Loan Documents, or (b) toll therunning of any time periods applicable to any such rights and remedies,including, without limitation, any grace periods with respect to Defaults underthe Loan Documents or otherwise.  EachBorrower agrees that it will not assert laches, waiver or any other defense tothe enforcement of any of the Loan Documents based upon the foregoing agreementby the Lender Group to forbear or the acceptance by any member of the LenderGroup of any of the payments provided for in the Loan Documents or any paymentprior to the date hereof.  As usedherein, “Forbearance Period” shall mean the period commencing upon theeffectiveness of this Agreement and continuing until the earliest to occurof:  (x) any Default or Event of Defaultunder any of the Financing Agreements (other than the Known Existing Default)or (y) October 31, 2006.

4.             Termination of Agreement to Forbear.  EachBorrower acknowledges and agrees that upon the termination of the Lender Group’sagreement to forbear as provided in Section 3 hereof, Agent, on behalfof the Lender Group, shall be entitled to exercise any or all of its remediesunder the Loan Documents, including, without limitation, the appointment of areceiver, the acceleration of the Obligations and the enforcement under theCode of any liens in favor of Agent, as a result of the Known ExistingDefaults, and at any time the Lender Group shall be entitled to exercise any orall of their remedies under the Loan Documents as a result of any other Defaultor Event of Default under the Loan Documents.

5.             Agreement to Defer October 1,2006 Principal Payment.  Anything in Section2.03(b) of the Financing Agreement notwithstanding, the parties herebyagree that the October 1, 2006 installment principal payment of $1,000,000shall not be due until the end of the Forbearance Period.

6.             Release; Covenant Not to Sue.

(a)           Each Borrower hereby absolutely and unconditionally releases andforever discharges the Lender Group, and any and all of their respectiveparticipants, parent corporations, subsidiary corporations, affiliated corporations,insurers, indemnitors, successors and assigns thereof, together with all of thepresent and former directors, officers, agents and employees of any of theforegoing (each a “Released Party”), from any and all claims, demands orcauses of action of any kind, nature or description, whether arising in law orequity or upon contract or tort or under any state or federal law or otherwise,which such Borrower has had, now has or has made claim to have against any suchperson for or by reason of any act, omission, matter, cause or thing whatsoeverarising from the beginning of time to and including the date of this Agreement,whether such claims, demands and causes of action are matured or unmatured orknown or unknown.  It is the intention ofeach Borrower in providing this release that the same shall be effective as abar to each and every claim, demand and cause of action specified, and infurtherance of this intention it waives and relinquishes all rights andbenefits under Section 1542 of the Civil Code of the State of California (orany comparable provision of any other applicable law), which provides:

“A general release does not extend to claims which the creditor doesnot know or suspect to exist in his favor at the time of executing the release,which if known by him might have materially affected his settlement with thedebtor.”

Each Borrower acknowledges that it may hereafter discover factsdifferent from or in addition to those now known or believed to be true withrespect to such claims, demands, or causes of action and agree that thisinstrument shall be and remain effective in all respects notwithstanding anysuch differences or additional facts. Each Borrower understands, acknowledges and agrees that the release setforth above may be pleaded as 

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a full and complete defense and may be used as a basis for aninjunction against any action, suit or other proceeding which may beinstituted, prosecuted or attempted in breach of the provisions of suchrelease.

(b)           Each Borrower, on behalf of itself and its successors, assigns, andother legal representatives, hereby absolutely, unconditionally andirrevocably, covenants and agrees with and in favor of each Released Partyabove that it will not sue (at law, in equity, in any regulatory proceeding orotherwise) any Released Party on the basis of any claim released, remised anddischarged by such Borrower pursuant to the above release.  If any Borrower or any of its successors,assigns or other legal representations violates the foregoing covenant, eachBorrower, for itself and its successors, assigns and legal representatives,agrees to pay, in addition to such other damages as any Released Party maysustain as a result of such violation, all attorneys’ fees and costs incurredby such Released Party as a result of such violation.

6.             Effectiveness of this Agreement. Agent must have received the following items, in form and contentacceptable to Agent, before this Agreement is effective and the Lenders arerequired to resume making extensions of credit to Borrowers under the CreditAgreement.

(a)           Agreement; Acknowledgement and Release.  ThisAgreement and the attached Acknowledgement and Release by Guarantors, eachfully executed in a sufficient number of counterparts for distribution to allparties.

(b)           Forbearance as to Second Lien Loan Agreement,etc.  Evidence that the Borrowers, Second LienAgent and the Second Lien Lenders have entered into a forbearance agreementwith respect to the Second Lien Loan Agreement reflecting substantially thesame terms set forth in this Agreement (the “Second Lien Forbearance”)or otherwise satisfactory to Agent.

(c)           Representations and Warranties. Except for the existence of the Known Existing Defaults, therepresentations and warranties set forth herein and in the Credit Agreementmust be true and correct in all material respects (except where any suchrepresentation and warranty is already subject to a materiality standard, inwhich case such representation and warranty must be true and correct in allrespects) on and as of the date hereof as though made on and as of the datehereof (other than any such representations and warranties that, by theirterms, are specifically made as of a date other than the date hereof).

(d)           Other Required Documentation.  Allother documents and legal matters in connection with the transactionscontemplated by this Agreement shall have been delivered or executed orrecorded, as required by Agent.

7.             Representations and Warranties.  EachBorrower represents and warrants as follows:

(a)           Authority.  Each Borrower has therequisite corporate power and authority to execute and deliver this Agreement,and to perform its obligations hereunder and under the Loan Documents to whichit is a party.  The execution, deliveryand performance by each Borrower of this Agreement have been duly approved byall necessary corporate action and no other corporate proceedings are necessaryto consummate such transactions.

(b)           Enforceability.  ThisAgreement has been duly executed and delivered by each Borrower.  This Agreement and each Loan Document is thelegal, valid and binding obligation of each Borrower, enforceable against suchBorrower in accordance with its terms, and is in full force and effect.

(c)           Representations and Warranties.  Therepresentations and warranties contained in each Loan Document (other than anysuch representations or warranties that, by their terms, are specifically madeas of a date other than the date hereof) are true and correct in all materialrespects (except where any such representation and warranty is already subjectto a materiality standard, in which case such representation 

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andwarranty is true and correct in all respects) on and as of the date hereof asthough made on and as of the date hereof.

(d)           Due Execution.  Theexecution, delivery and performance of this Agreement are within the power ofeach Borrower, have been duly authorized by all necessary corporate action,have received all necessary governmental approval, if any, and do notcontravene any law or any contractual restrictions binding on such Borrower.

(e)           No Default.  Other than the Known ExistingDefaults, no event has occurred and is continuing that constitutes a Default oran Event of Default.

(f)            No Duress.  This Agreement has beenentered into without force or duress, of the free will of each Borrower.  Each Borrower’s decision to enter into thisAgreement is a fully informed decision and such Borrower is aware of all legaland other ramifications of such decision.

(g)           Counsel.  Each Borrower has read and understandsthis Agreement, has consulted with and been represented by legal counsel inconnection herewith, and has been advised by its counsel of its rights andobligations hereunder and thereunder.

8.             Choice of Law.  Thevalidity of this Agreement, its construction, interpretation and enforcement,the rights of the parties hereunder, shall be determined under, governed by,and construed in accordance with the internal laws of the State of New Yorkgoverning contracts only to be performed in that State.

9.             Counterparts.  ThisAgreement may be executed in any number of counterparts and by differentparties and separate counterparts, each of which when so executed anddelivered, shall be deemed an original, and all of which, when taken together,shall constitute one and the same instrument. Delivery of an executed counterpart of a signature page to thisAgreement by telefacsimile or other similar method of electronic transmissionshall be effective as delivery of a manually executed counterpart of thisAgreement.

10.           Reference to and Effect on the Loan Documents.

(a)           Upon and after the effectiveness of this Agreement, each reference inthe Credit Agreement to “this Agreement”, “hereunder”, “hereof” or words oflike import referring to the Credit Agreement, and each reference in the otherLoan Documents to “the Credit Agreement”, “thereof” or words of like importreferring to the Credit Agreement, shall mean and be a reference to the CreditAgreement as supplemented hereby.

(b)           The Credit Agreement and all other Loan Documents, are and shallcontinue to be in full force and effect and are hereby in all respects ratifiedand confirmed and shall constitute the legal, valid, binding and enforceableobligations of each Borrower to the Lender Group and Bank Product Providers.

(c)           The execution, delivery and effectiveness of this Agreement shall notoperate as a waiver of any right, power or remedy of the Lender Group under anyof the Loan Documents, nor constitute a waiver of any provision of any of theLoan Documents.

11.           Ratification.  EachBorrower hereby restates, ratifies and reaffirms each and every term andcondition set forth in the Credit Agreement and the Loan Documents effective asof the date hereof.

12.           Integration.  This Agreement, together withthe other Loan Documents, incorporates all negotiations of the parties heretowith respect to the subject matter hereof and is the final expression andagreement of the parties hereto with respect to the subject matter hereof.

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13.           Severability.  Incase any provision in this Agreement shall be invalid, illegal orunenforceable, such provision shall be severable from the remainder of thisAgreement and the validity, legality and enforceability of the remainingprovisions shall not in any way be affected or impaired thereby.

14.           Submission of Amendment.  Thesubmission of this Agreement to the parties or their agents or attorneys forreview or signature does not constitute a commitment by Agent or the Lenders toforbear from exercising any of the Lender Group’s rights and remedies under theLoan Documents, and this Agreement shall have no binding force or effect untilall of the conditions to the effectiveness of this Agreement have beensatisfied as set forth herein.

15.           Modification.  ThisAgreement may not be amended, waived or modified in any manner without thewritten consent of the party against whom the amendment, waiver or modificationis sought to be enforced.

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IN WITNESSWHEREOF, the parties have entered into this Agreement as of the date firstabove written.
| ** ** | **MAGNETEK, INC.,**                 |
|------------|-------------------------------------|
|       | a Delaware  corporation             |
|       |                                |
|       |                                |
|       | By:                                 | /s/ David P.  Reiland |   |
|       | Name:                               | David P. Reiland |   |
|       | Title:                              | Executive Vice  President |   |
|       |                                |   |   |
|       |                                |   |   |
| ** ** | **MAGNETEK  ADS POWER, INC.,**      |
|       | a Delaware  corporation             |
|       |                                |
|       |                                |
|       | By:                                 | /s/ David P.  Reiland |   |
|       | Name:                               | David P. Reiland |   |
|       | Title:                              | Executive Vice  President |   |
|       |                                |   |   |
|       |                                |   |   |
| ** ** | **MAGNETEK  MONDEL HOLDING, INC.,** |
|       | a Delaware  corporation             |
|       |                                |
|       |                                |
|       | By:                                 | /s/ David P.  Reiland |   |
|       | Name:                               | David P. Reiland |   |
|       | Title:                              | Executive Vice  President |   |
|       |                                |   |   |
|       |                                |   |   |
| ** ** | **WELLS  FARGO FOOTHILL, INC.,**    |
|       | a California  corporation,          |
|       | as Agent and as  sole Lender        |
|       |                                |
|       |                                |
|       | By:                                 | /s/ Jeffrey P.  Royston |   |
|       | Name:                               | Jeffrey P.  Royston |   |
|       | Title:                              | Vice President |   |
|            |                                     |  |  |  |  |  |  |

 

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**ACKNOWLEDGEMENTAND RELEASE BY GUARANTORS**

Inconnection with the foregoing Forbearance Agreement (the “Agreement”),each of the undersigned, being a Guarantor (as defined in the Credit Agreementreferenced in the Agreement) under their respective Guaranties (as defined inthe Credit Agreement referenced in the Agreement), hereby acknowledges andagrees to the Agreement and confirms and agrees that its Guaranty is and shallcontinue to be, in full force and effect and is hereby ratified and confirmedin all respects.  Although Agent and theLenders have informed Guarantors of the matters set forth above, and Guarantorshave acknowledged the same, each Guarantor understands and agrees that neitherthe Lender Group nor the Bank Product Providers have any duty under the CreditAgreement, any Guaranty or any other agreement with any Guarantor to so notify anyGuarantor or to seek such an acknowledgement, and nothing contained herein isintended to or shall create such a duty as to any transaction hereafter.

Each Guarantor hereby absolutely and unconditionallyreleases and forever discharges each Released Party (as defined in theAgreement), from any and all claims, demands or causes of action of any kind,nature or description, whether arising in law or equity or upon contract ortort or under any state or federal law or otherwise, which such Guarantor has had,now has or has made claim to have against any such person for or by reason ofany act, omission, matter, cause or thing whatsoever arising from the beginningof time to and including the date hereof, whether such claims, demands andcauses of action are matured or unmatured or known or unknown.  It is the intention of each Guarantor inproviding this release that the same shall be effective as a bar to each andevery claim, demand and cause of action specified, and in furtherance of thisintention it waives and relinquishes all rights and benefits under Section 1542of the Civil Code of the State of California (or any comparable provision ofany other applicable law), which provides:

“A general release does not extend to claimswhich the creditor does not know or suspect to exist in his favor at the timeof executing the release, which if known by him might have materially affectedhis settlement with the debtor.”

EachGuarantor acknowledges that it may hereafter discover facts different from orin addition to those now known or believed to be true with respect to suchclaims, demands, or causes of action and agree that this instrument shall beand remain effective in all respects notwithstanding any such differences oradditional facts.  Each Guarantor understands,acknowledges and agrees that the release set forth above may be pleaded as afull and complete defense and may be used as a basis for an injunction againstany action, suit or other proceeding which may be instituted, prosecuted orattempted in breach of the provisions of such release.  Each Guarantor, on behalf of itself and itssuccessors, assigns, and other legal representatives, hereby absolutely,unconditionally and irrevocably, covenants and agrees with and in favor of eachReleased Party above that it will not sue (at law, in equity, in any regulatoryproceeding or otherwise) any Released Party on the basis of any claim released,remised and discharged by such Guarantor pursuant to the above release.  If any Guarantor or any of its successors,assigns or other legal representations violates the foregoing covenant, suchGuarantor, for itself and its successors, assigns and legal representatives,agrees to pay, in addition to such other damages as any Released Party maysustain as a result of such violation, all attorneys’ fees and costs incurredby such Released Party as a result of such violation.

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| ** ** | **MAGNETEK NATIONAL ELECTRIC COIL, INC.,** |
|------------|--------------------------------------------|
|       | a Delaware  corporation                    |
|       |                                       |
|       |                                       |
|       | By:                                        | /s/ David P.  Reiland |   |
|       | Name:                                      | David P. Reiland |   |
|       | Title:                                     | Executive Vice  President |   |
|       |                                       |   |   |
|       |                                       |   |   |
| ** ** | **MAGNETEK  ALTERNATIVE ENERGY, INC.,**    |
|       | a Delaware  corporation                    |
|       |                                       |
|       |                                       |
|       | By:                                        | /s/ David P.  Reiland |   |
|       | Name:                                      | David P. Reiland |   |
|       | Title:                                     | Executive Vice  President |   |
|       |                                       |   |   |
|       |                                       |   |   |
| ** ** | **MONDEL  ULC,**                           |
|       | a Nova Scotia  unlimited liability company |
|       |                                       |
|       |                                       |
|       | By:                                        | /s/ David P.  Reiland |   |
|       | Name:                                      | David P. Reiland |   |
|       | Title:                                     | Executive Vice  President |   |
|            |                                            |  |  |  |  |  |

 

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