DEBT CONVERSION AGREEMENT
This Debt Conversion Agreement made as of this 1st day of December, 2003
between Dominix, Inc., a Delaware corporation (the "Company") having a principal
place of business at ▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ and ▇▇▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇ ("Lender") having a principal place of business at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇.
WHEREAS, Lender has from time to time advanced funds to the Company
totaling $158,000, including accrued but unpaid interest (the "Loan"); and
WHEREAS, Lender is willing to release the Company from its obligation to
repay the Loan upon the terms and conditions set forth herein.
NOW THEREFORE, in consideration of the terms, conditions and agreements
contained in this Agreement, the parties agree as follows:
1. Issuance of Securities.
(a) Lender agrees to accept 2,106,666 shares (the "Shares") of the
Company's Series A Convertible Preferred Stock in full satisfaction of the
Company's obligation to repay the Loan. Company agrees to issue the Shares to
Lender, or such other person that Lender has directed on Schedule A hereto,
promptly following the execution of this Agreement.
(b) The certificate, in due and proper form, representing the Shares
will bear a legend substantially in the following form:
"THE SHARES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933. THE SHARES HAVE BEEN ACQUIRED FOR
INVESTMENT AND MAY NOT BE SOLD, TRANSFERRED OR ASSIGNED IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THESE SHARES
UNDER THE SECURITIES ACT OF 1933 OR AN OPINION OF COUNSEL THAT
REGISTRATION IS NOT REQUIRED UNDER SAID ACT".
2. LENDERS REPRESENTATIONS AND WARRANTIES.
The Lender hereby acknowledges, represents and warrants to, and agrees
with, the Company as follows:
(a) The Lender is acquiring the Shares for its own account as
principal, for investment purposes only, and not with a view to, or for, resale,
distribution or fractionalization thereof, in whole or in part, and no person
other than those set forth on Schedule A has a direct or indirect beneficial
interest in such Shares.
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(b) The Lender acknowledges its understanding that the offering and
sale of the Shares is intended to be exempt from registration under the Act by
virtue of Section 4(2) of the Securities Act of 1933, as amended (the "Act") and
the provisions of Regulation D thereunder.
(c) The Lender has the financial ability to bear the economic risk
of its investment, has adequate means for providing for his current needs and
personal contingencies and has no need for liquidity with respect to his
investment in the Company.
(d) The Lender is a corporation which comes within a category of
"accredited investor" as that term is defined in Rule 501(a) of Regulation D
under the Act (17 C.F.R. 230.501(a)).
(e) The Lender has made an independent investigation of the
Company's business, been provided an opportunity to obtain additional
information concerning the Company it deems necessary to make an investment
decision and all other information to the extent the Company possesses such
information or can acquire it without unreasonable effort or expense.
(f) The Lender represents, warrants and agrees that it will not sell
or otherwise transfer the Shares unless registered under the Act or in reliance
upon an exemption therefrom, and fully understands and agrees that it must bear
the economic risk of its purchase for an indefinite period of time because,
among other reasons, the Shares or underlying securities have not been
registered under the Act or under the securities laws of certain states and,
therefore, cannot be resold, pledged, assigned or otherwise disposed of unless
they are subsequently registered under the Act and under the applicable
securities laws of such states or an exemption from such registration is
available. The Lender also understands that the Company is under no obligation
to register the Shares on its behalf or to assist the Lender in complying with
any exemption from registration under the Act. The Lender further understands
that sales or transfers of the Shares or underlying securities are restricted by
the provisions of state securities laws.
(g) The execution and performance of this Agreement has been duly
authorized by all requisite corporate action by Lender and the person signing
this Agreement on behalf of Lender has been duly authorized by such entity to do
so.
(h) The foregoing representations, warranties and agreements shall
survive the delivery of the Shares under the Agreement.
3. COMPANY REPRESENTATIONS AND WARRANTIES.
The Company hereby acknowledges, represents and warrants to, and agrees
with the Lender as follows:
(a) The Company has been duly organized, is validly existing and is
in good standing under the laws of the State of Delaware. The Company has full
corporate power and authority to enter into this Agreement and this Agreement
has been duly and validly authorized, executed and delivered by the Company and
is a valid and binding obligation of the Company, enforceable against the
Company in accordance with its terms, except as such enforcement may be limited
by the United States Bankruptcy Code and laws effecting creditors rights,
generally.
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(b) Subject to the performance by the Lenders of its obligations
under this Agreement and the accuracy of the representations and warranties of
the Lender, the offering and sale of the Shares will be exempt from the
registration requirements of the Act.
(c) The execution and delivery by the Company of, and the
performance by the Company of its obligations under this Agreement in accordance
with the terms of this Agreement will not contravene any provision of applicable
law or the charter documents of the Company or any agreement or other instrument
binding upon the Company, or any judgment, order or decree of any governmental
body, agency or court having jurisdiction over the Company, and no consent,
approval, authorization or order of, or qualification with, any governmental
body or agency is required for the performance by the Company of its obligations
under this Agreement in accordance with the terms of this Agreement.
(d) The foregoing representations, warranties and agreements shall
survive the Closing.
4. RELEASE.
Upon the delivery of the consideration to Lender set forth in Section 1 of
this Agreement, the Lender releases and forever discharges the Company of and
from all and all manner of actions, suits, debts, sums of money, contracts,
agreements, claims and demands at law or in equity, that Lender had, or may have
arising from the Loan.
5. MISCELLANEOUS.
(a) Modification. Neither this Agreement nor any provisions hereof
shall be modified, discharged or terminated except by an instrument in writing
signed by the party against whom any waiver, change, discharge or termination is
sought.
(b) Notices. Any notice, demand or other communication which any
party hereto may be required, or may elect, to give to anyone interested
hereunder shall be sufficiently given if (a) deposited, postage prepaid, in a
United States mail letter box, registered or certified mail, return receipt
requested, addressed to such address as may be given herein, or (b) delivered
personally at such address.
(c) Counterparts. This Agreement may be executed through the use of
separate signature pages or in any number of counterparts, and each of such
counterparts shall, for all purposes, constitute one agreement binding on all
the parties, notwithstanding that all parties are not signatories to the same
counterpart.
(d) Binding Effect. Except as otherwise provided herein, this
Agreement shall be binding upon and inure to the benefit of the parties and
their heirs, executors, administrators, successors, legal representatives and
assigns. If the undersigned is more than one person, the obligation of the
Investor shall be joint and several, and the agreements, representations,
warranties and acknowledgments herein contained shall be deemed to be made by
and be binding upon each such person and his heirs, executors, administrators
and successors.
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(e) Entire Agreement. This instrument contains the entire agreement
of the parties, and there are no representations, covenants or other agreements
except as stated or referred to herein.
(f) Applicable Law. This Agreement shall be governed and construed
under the laws of the State of New York.
IN WITNESS WHEREOF, the Company and Lender have caused this Agreement to
be executed and delivered by their respective officers, thereunto duly
authorized.
DOMINIX, INC.
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, President
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
-----------------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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SCHEDULE A
▇▇▇▇▇ ▇▇▇▇▇ 10,333
Snapper Partners, LLC 545,000
▇▇▇▇▇▇.▇▇▇, Inc. 50,000
▇▇▇▇▇▇ ▇. ▇▇▇▇▇ 115,000
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ 140,000
Dakota Group, Ltd. 75,000
▇▇▇▇▇▇ ▇▇▇▇▇▇ 141,000
▇▇▇▇ ▇▇▇-▇▇▇▇ 66,000
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ 75,000
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ 75,000
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ 100,000
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ 50,000
▇▇▇▇ ▇. ▇'▇▇▇▇▇▇ 70,000
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ 50,000
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ 50,000
▇▇▇▇▇ ▇▇▇▇▇▇▇ 115,000
▇▇▇▇▇▇▇ ▇▇▇▇▇ 25,000
▇▇▇▇ ▇▇▇▇▇ 141,000
▇▇ ▇▇▇▇▇▇ 50,000
▇▇▇▇▇▇ ▇▇▇▇ 50,000
▇▇▇▇▇ ▇▇▇▇▇▇ 25,000
▇▇▇▇▇▇ ▇▇▇▇▇▇ 25,000
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ 25,000
▇▇▇▇ ▇▇▇▇▇▇▇▇ 25,000
▇▇▇▇▇▇ ▇▇▇▇▇▇ 13,333
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TOTAL 2,106,666
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