Exhibit 4.1


FORBEARANCE AND CONSENT AGREEMENT


This FORBEARANCE AND CONSENT AGREEMENT (this “Agreement”), is
entered into as of April 17, 2007 by and among ARTISTdirect, Inc., a
Delaware corporation and its subsidiaries and affiliates (collectively, the “Company”),
U.S. Bank National Association, as Collateral Agent under the Note and Warrant
Purchase Agreement (as defined below) (in such capacity, “Collateral Agent”)
and the senior lenders signatories hereto (“Initial Purchasers”).


Recitals


A.            Company, Initial Purchasers and
Collateral Agent are parties to that certain Note and Warrant Purchase
Agreement, dated as of July 28, 2005 (the “Senior Financing Agreement”),
among Company, the investors party thereto, as Initial Purchasers, and
Collateral Agent.  The Senior Financing
Agreement, together with the other Transaction Documents (as defined in the
Senior Financing Agreement) as such documents have been amended from time to
time, are collectively referred to herein as the “Senior Financing Documents.”


B.            Company is in default and may trigger additional
defaults under certain provisions of the Senior Financing Documents and such
defaults are expected to continue.


C.            The Existing Senior Defaults (as defined
herein) constitute “Events of Default” for purposes hereof that entitle
Collateral Agent and Initial Purchasers to enforce their rights and remedies
under the Senior Financing Documents.


D.            Company has requested, subject to the
conditions contained herein, that Collateral Agent and Initial Purchasers
forbear from the exercise of their rights and remedies relating to the Existing
Senior Defaults and any other additional Events of Default for the purpose of
affording a period of time for Company to obtain funds to pay the obligations
under the Senior Financing Documents or to restructure its capital structure.


E.             Subject to the terms contained herein,
Collateral Agent and Initial Purchasers are willing to agree to forbear from
the exercise of their rights and remedies relating to the Existing Senior
Defaults and any other additional Events of Default.


Agreement


For good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
the parties hereby agree as follows:


1.             Definitions.  Capitalized
terms used herein but not defined herein shall have the meanings ascribed to
them in the Senior Financing Agreement. 
The following terms as used in this Agreement shall have the meanings
set forth below:


“Existing Senior Defaults” means the existing Senior Events of
Default described on Schedule I hereto.


“Forbearance Period” means the period commencing on the date
hereof and ending on the earliest to occur of the following:  (i) May 31, 2007 (as such date may be
extended pursuant to the terms of this Agreement); or (ii) any material representation
or warranty made by Company in this Agreement proves to be materially false as
of the date when made.



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“Senior Event of Default” means an Event of Default under the
Senior Financing Agreement.


2.             Agreement to Forbear.


(a)           Subject to the conditions set forth in Section 3
below, during the Forbearance Period, and subject to the terms hereof,
Collateral Agent and Initial Purchasers hereby agree to forbear from exercising
any of their rights and remedies under the Senior Financing Documents existing during
the Forbearance Period.


(b)           Nothing in this Section 2 shall be construed to
be a waiver of or acquiescence in any Existing Senior Default, and all such
Existing Senior Defaults shall continue in existence, subject only to the
written agreement of Collateral Agent and Initial Purchasers, as set forth
herein, to forbear during the Forbearance Period from exercising any of their
rights and remedies under the Senior Financing Documents.  Collateral Agent and Initial Purchasers
expressly reserve all of their rights and remedies under the Senior Financing
Documents and under applicable law with respect to such Existing Senior
Defaults, except as expressly limited in this Agreement.  Nothing in this Section 2 shall act as a
waiver of the accrual of any default interest due under section 2(b) of the Senior
Financing Agreement during the Forbearance Period.


(c)           Company shall have the option to extend the
Forbearance Period through June 30, 2007 by notifying the Initial Purchasers in
writing prior to May 31, 2007 of its exercise of such option and delivering an
additional payment of One Hundred Twenty-Five Thousand Dollars ($125,000) to
the Initial Purchasers on a pro rata basis on or before May 31, 2007 (the ”Extension
Payment”).  The Extension Payment shall
be applied in full against all Registration Delay Payments (as hereafter
defined), or any other fees and costs in favor of Initial Purchasers.  In the event that Company makes the Extension
Payment, Initial Purchasers shall immediately provide Collateral Agent with the
certificate required under Section 2(e) and provide a copy to Company.


(d)           Upon expiration of the Forbearance Period, Collateral
Agent and Initial Purchasers shall have all the rights and remedies available
to them under the Senior Financing Documents, applicable law and otherwise.


(e)           Collateral Agent may assume without inquiry that the
Forbearance Period expires on May 31, 2007, unless it receives from the Initial
Purchasers a certificate specifying another date and setting forth the
provisions of this Agreement pursuant to which alternative Forbearance Period
termination date was established.


3.             Conditions to Effectiveness. 
The Initial Purchasers’ agreement to forbear for the Forbearance Period
shall be subject to the following conditions being fully satisfied:


(a)           The execution and delivery to Collateral Agent of a
counterpart of this Agreement by Collateral Agent, each Initial Purchaser and
Company.



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(b)           All representations and warranties set forth in this
Agreement shall be true and correct as of the date hereof in all material
respects.


(c)           Company agrees to pay to the Initial Purchasers on a
pro rata basis concurrent with the full execution of this Agreement, the sum of
Two Hundred Fifty Thousand Dollars ($250,000) which shall be applied in full against
all Registration Delay Payments accruing under the Registration Rights
Agreement dated as of July 28, 2005, as amended, by and among the Company
and the Initial Purchasers, or any other fees and costs in favor of Initial
Purchasers.


(d)           Company (i) shall comply with its obligations under the
Subordination Agreement and (ii) shall not declare or pay any dividends or make
any other payments not required or allowed under the Senior Financing Documents
or the Securities Purchase Documents on account of any equity interests in the
Company.


(e)           The Company shall pay Collateral Agent’s reasonable
fees and expenses, including the fees of its counsel incurred in connection
with the negotiation, execution and delivery of this Agreement, as well as
Collateral Agent’s ongoing fees and expenses to which it is entitled under any
of the Senior Financing Documents, in accordance with the Senior Financing
Documents.


4.             Termination.  Initial
Purchasers’ agreement to so forbear shall automatically terminate, without
further act or instrument, upon the occurrence of any of the following events:


(a)           Bankruptcy.


(i)            The Company or any of its Subsidiaries
pursuant to or under or within the meaning of any Bankruptcy Code:


(1)           commences a voluntary case or proceeding;


(2)           consents to the entry of an order for relief against
it in an involuntary case or proceeding;


(3)           consents to the appointment of a Custodian of it or
for all or substantially all of its property; or


(4)           makes a general assignment for the benefit of its
creditors; or


(ii)           A court of competent jurisdiction enters an order or
decree under any Bankruptcy Code that:


(1)           is for relief against the Company or any of its
Subsidiaries in an involuntary case or proceeding;



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(2)           appoints a Custodian of the Company or any of its
Subsidiaries for all or substantially all of their properties taken as a whole;
or


(3)           orders the liquidation of the Company or any of its
Subsidiaries; and in each case the order or decree remains unstayed and in
effect for 60 days.


(b)           Company repudiates, or asserts a defense to, any
obligation or liability under the Senior Financing Documents or this Agreement
or makes or pursues a claim against the Initial Purchasers.


(c)           Company fails to timely perform any of the other material
covenants, agreements and obligations set forth in this Agreement.


5.             Representations and Warranties. 
In consideration of the agreement of Collateral Agent and Initial
Purchasers to forbear from the exercise of their rights and remedies as set
forth in this Agreement, Company hereby represents and warrants to Collateral
Agent and Initial Purchasers as of the date hereof that:


(a)           Company has full power, authority and legal right to
enter into this Agreement.


(b)           The Senior Financing Documents constitute the legal,
valid and binding obligations of Company and are enforceable against Company in
accordance with their terms, except (i) as may be limited by applicable
bankruptcy, insolvency, moratorium, reorganization or other similar laws
affecting the enforcement of creditors’ rights and subject to general equitable
principles and (ii) as may be specifically limited by the terms of this
Agreement.


(c)           This Agreement constitutes the legal, valid and
binding obligation of Company and is enforceable against Company in accordance
with its terms, except as may be limited by applicable bankruptcy, insolvency,
moratorium, reorganization or other similar laws affecting the enforcement of
creditors’ rights and subject to general equitable principles.


6.             Amendments.  This
Agreement may be amended after the date hereof only by a written amendment,
fully executed and delivered by the parties.


7.             Senior Financing Documents Still in Force. 
Notwithstanding anything to the contrary in this Agreement, the Senior
Financing Documents are in full force and effect in accordance with their
respective terms, remain valid and binding obligations of Company, and are
hereby reaffirmed and ratified by the parties. 
The Senior Financing Documents shall remain unmodified unless and until
otherwise expressly modified in accordance with the terms of the respective
Senior Financing Document.


8.             No Waiver of Rights Under Senior Financing Documents. 
Neither the failure nor delay by the Initial Purchasers to exercise its rights
and remedies nor the acceptance of any partial performance (whether any of the
foregoing is before or after the date of this Agreement) nor any provision of
this Agreement shall amend, modify, supplement, extend, delay, renew, terminate,
waive, release or otherwise limit or prejudice Initial Purchasers’ rights and
remedies or Company’s obligations under the Senior Financing Documents
(including, but not limited to, the Initial Purchasers’ right to receive full
payment of principal and interest as well as late charges, delinquent interest,
attorneys’ fees and expenses, and other charges to the extent provided in the
Senior Financing Documents) except as specifically provided in a written
agreement between the parties that is fully executed and delivered in
accordance with the terms of the respective Senior Financing Document (and
except that, without modifying or amending the Senior Financing Documents, the
Initial Purchasers agree to forbear to the extent specifically provided in Section 2
hereof), nor shall it affect the relative priority of the Initial Purchasers’
security interest in the Collateral.



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In particular, Company understands that nothing
referred to above shall operate to prohibit, restrict or otherwise inhibit the
Initial Purchasers from exercising any right or remedy it may have under the
Senior Financing Documents (except that the Initial Purchasers agree to forbear
to the extent specifically provided in Section 2 hereof) or constitute a
cure of any existing default and, without limitation, shall not extend any
applicable reinstatement or redemption period.


9.             Voluntary Agreement.  Each party to
this Agreement represents and warrants to each other party that it is
represented by legal counsel of its choice, that it has consulted with counsel
regarding this Agreement, that it is fully aware of the terms contained herein
and that it has voluntarily and without coercion or duress of any kind entered
into this Agreement.


10.           Effect on and Ratification of the Senior Financing
Documents.  Company acknowledges, confirms and agrees
(without limiting or modifying the provisions of the Senior Financing Documents
or the rights and remedies otherwise available to Collateral Agent and Initial
Purchasers) that Collateral Agent and Initial Purchasers (x) have not made
any representations, promises or agreements, and shall have no obligation, to
extend the Forbearance Period (except as provided for in this Agreement), or
otherwise to grant Company any extension, delay, deferral or other indulgence
(other than those contemplated by this Agreement), and (y) after
expiration of the Forbearance Period, may proceed immediately to enforce all
rights and remedies available to them under the Senior Financing Documents for
collection, foreclosure or otherwise.


11.           Miscellaneous.


(a)           Counterparts.  This
Agreement may be signed in multiple counterparts, each of which shall
constitute an original and all of which, taken together, shall constitute one
and the same instrument.  One or more
counterparts of this Agreement may be delivered by facsimile, with the
intention that they shall have the same effect as an original counterpart
thereof and shall be binding on the person delivering the same.


(b)           Governing Law; Jurisdiction; Jury Trial. 
All questions concerning the construction, validity, enforcement and
interpretation of this Agreement shall be governed by the internal laws of the
State of New York, without giving effect to any choice of law or conflict of
law provision or rule (whether of the State of New York or any other
jurisdictions) that would cause the application of the laws of any
jurisdictions other than the State of New York. 
Each party hereby irrevocably submits to the exclusive jurisdiction of
the state and federal courts sitting in The City of New York, Borough of
Manhattan, for the adjudication of any dispute hereunder or in connection
herewith or with any transaction contemplated hereby or discussed herein, and
hereby irrevocably waives, and agrees not to assert in any suit, action or
proceeding, any claim that it is not personally subject to the jurisdiction of
any such court, that such suit, action or proceeding is brought in an
inconvenient forum or that the venue of such suit, action or proceeding is
improper.



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Each party hereby irrevocably waives personal service
of process and consents to process being served in any such suit, action or
proceeding by mailing a copy thereof by registered or certified mail, return
receipt requested to such party at the address for such notices to it under the
Senior Financing Agreement and agrees that such service shall constitute good
and sufficient service of process and notice thereof.  Nothing contained herein shall be deemed to
limit in any way any right to serve process in any manner permitted by law.  EACH PARTY
HEREBY IRREVOCABLY WAIVES ANY RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A
JURY TRIAL FOR THE ADJUDICATION OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH
OR ARISING OUT OF THIS AGREEMENT OR ANY TRANSACTION CONTEMPLATED HEREBY.


12.           Initial Purchasers’ Direction to Collateral Agent. 
Initial Purchasers represent and warrant to Collateral Agent that,
together with Collateral Agent, they are the sole holders and beneficial owners
of Company’s obligations under the Senior Financing Documents.  Having the power under the Senior Financing
Documents to do so, Initial Purchasers (i) direct Collateral Agent to
enter into and perform its obligations under this Agreement and
(ii) confirm their indemnity obligations to Collateral Agent as and to the
extent set forth in the Senior Financing Documents.


[Signatures on following page]



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IN WITNESS WHEREOF, each of the parties hereto has caused this
Forbearance and Consent Agreement to be duly executed and delivered by its duly
authorized officer as of the date first above written.


	
  

  	
   

  	
  JMB CAPITAL PARTNERS, L.P.,

  
	
   

  	
   

  	
  as an Initial
  Purchaser

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Cyrus Hadidi

  	
   

  
	
   

  	
   

  	
   

  	
  Name:   Cyrus Hadidi

  
	
   

  	
   

  	
   

  	
  Title:   Partner

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  JMG CAPITAL
  PARTNERS, L.P.,

  
	
   

  	
   

  	
  as an Initial
  Purchaser

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Jonathan Glaser

  	
   

  
	
   

  	
   

  	
   

  	
  Name:   Jonathan Glaser

  
	
   

  	
   

  	
   

  	
  Title:     Member Manager
  of the L.P.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  JMG TRITON
  OFFSHORE FUND, LTD.,

  
	
   

  	
   

  	
  as an Initial
  Purchaser

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Jonathan Glaser

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Jonathan Glaser

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Member Manager of the Investment

  
	
   

  	
   

  	
   

  	
   

  	
  Manager

  
								



 



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  CCM MASTER
  QUALIFIED FUND, LTD,

  
	
   

  	
   

  	
  as an Initial
  Purchaser

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Clint Coghill

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Clint Coghill

  
	
   

  	
   

  	
   

  	
  Title:

  	
  President of Investment Manager, 

  
	
   

  	
   

  	
   

  	
   

  	
  Director of CCM Master Qualified

  
	
   

  	
   

  	
   

  	
   

  	
  Fund, LTD

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  U.S. BANK
  NATIONAL ASSOCIATION,

  
	
   

  	
   

  	
  as Collateral
  Agent for Initial Purchasers

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Brad E. Scarbrough

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Brad E. Scarbrough

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Vice President

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ARTISTDIRECT,
  INC.,

  
	
   

  	
   

  	
  a Delaware
  corporation

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Robert Weingarten

  	
   

  
	
   

  	
   

  	
   

  	
  Name:

  	
  Robert Weingarten

  
	
   

  	
   

  	
   

  	
  Title:

  	
  Chief Financial Oficer

  
								



 



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Schedule I


List of Existing Senior Defaults


Listed below are the current Events of Default with respect to each of
the Sections of the Senior Financing Agreement indicated below which have
occurred and are continuing and known to the Company.  The Parties hereto acknowledge that
additional Events of Default may occur during the Forbearance Period.


·                                          Section 6(c):  Company
has not timely filed all reports required to be filed with the SEC pursuant to
the 1934 Act.


·                                          Section 6(p):  Company
has not maintained its eligibility to use the registration statement filed with
the SEC for the resale of the Registrable Securities.


·                                          Section 8(g):  Company
has defaulted under it obligations under the Convertible Subordinated Notes,
the Registration Rights Agreement associated with the Convertible Subordinated
Notes and the Securities Purchase Agreement.


·                                          Amended Senior Financing Documents: 
All Events of Default described in the Amended Senior Financing
Documents or otherwise disclosed in the Company’s filings with the SEC.


Listed below are the current Events of Default with respect to each of
the Sections of the Registration Rights Agreement indicated below which have
occurred and are continuing and known to the Company.  The Parties hereto acknowledge that
additional Events of Default may occur during the Forbearance Period.


·                                          Section 2(f). 
Company has not paid the Registration Delay Payments.


·                                          Section 3(m). 
Company has not made generally available to its security holders an
earnings statement for the year ended December 31, 2006, within ninety (90)
days of the close of the year-end period.


·                                          Section 8(b). 
Company has not timely filed all reports required to be filed with the
SEC pursuant to the 1934 Act.



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