Exhibit 10.15
CONVERSION AGREEMENT
December 30, 1999
RoomSystems, Inc.
000 Xxxxx 0000 Xxxx
Xx. Xxxxxx, Xxxx 00000
Ladies and Gentlemen:
1. Conversion. Subject to the terms and conditions set forth herein, the
undersigned hereby irrevocably converts $219,153 of (i) accrued salary, (ii)
accrued consulting fees and (iii) outstanding principal and accrued interest
relating to transferred intellectual property, evidenced by a promissory note
issued by RoomSystems, Inc ("Company") in favor of the undersigned, into 73,051
shares of Series B Convertible Preferred Stock (the "Shares") of the Company.
The Shares are sometimes referred to herein as the "Securities."
The undersigned is aware of the Company's business affairs and financial
condition, and has acquired sufficient information about the Company to reach an
informed and knowledgeable decision to acquire the Securities. The undersigned
understands that the Securities will not be registered or qualified under any
federal or state securities laws in reliance upon exemptions therefrom. The
undersigned acknowledges and agrees that in order to ensure that the offer and
sale of the Securities are exempt from registration or qualification, the
Company will rely on the covenants, representations and warranties which the
undersigned has made in this Conversion Agreement (the "Agreement").
Accordingly, the undersigned makes the following covenants, representations and
warranties for the purpose of inducing the Company to permit the undersigned to
acquire the Securities for which the undersigned hereby subscribes.
The undersigned acknowledges that the Company reserves the right to accept
or reject any subscription in its sole discretion, in whole or in part.
2. Knowledge. By executing this Agreement, the undersigned acknowledges
having read, understood and agreed to each and every provision contained herein.
3. Representations Warranties and Covenants. The undersigned hereby makes
the following representations and warranties to the Company:
3.1. The undersigned is acquiring the Securities solely for the
undersigned's own account, or for one or more fiduciary accounts for which the
undersigned has sole investment discretion. The undersigned is acquiring such
Securities without a view to, and not for resale in connection with, a
distribution of the Securities within the meaning of the Securities Act of 1933,
as amended (the "Act"). The undersigned hereby covenants and agrees that the
undersigned shall not sell any of the Securities in violation of the Act.
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3.2. The undersigned understands that the Securities have not been
registered under the Act or qualified under the securities laws of any states
and therefore cannot be transferred, resold, pledged, hypothecated, assigned or
otherwise disposed of unless such Securities are subsequently registered or
qualified under the Act and under applicable state securities laws, or an
exemption from registration and/or qualification is available. The undersigned
will not sell or otherwise transfer the Securities without registration under
the Act or pursuant to an exemption therefrom, and the undersigned understands
and agrees that the Company is not obligated to register or qualify any shares
of its Common Stock on its behalf or to assist the undersigned in complying with
any exemption from such registration or qualification.
3.3. If the undersigned is a corporation, partnership, trust or
other entity, the undersigned represents and warrants that the signatory hereto
is authorized and qualified to become a stockholder in the Company; and such
entity and the undersigned signatory hereto for such stockholder further
represents and warrants that such signatory has been duly authorized by the
prospective stockholder to execute this Agreement.
3.4. The undersigned further certifies and acknowledges as follows:
(a) The undersigned has adequate means of providing for the
undersigned's current needs and possible personal or other contingencies, and
the undersigned has no need for liquidity of the undersigned's investment in the
Securities;
(b) The undersigned has a net worth sufficient to bear the
economic risk of losing the undersigned's entire investment in the Securities;
(c) The undersigned does not have an overall commitment to
non-readily marketable investments which is disproportionate to the
undersigned's net worth and the investment subscribed for herein will not cause
such overall commitment to become excessive.
3.5. The address set forth below is the undersigned's true and
correct residence and/or principal place of business, and the undersigned has no
present intention of becoming a resident of any other state or jurisdiction.
3.6. The undersigned acknowledges and is aware that the Securities
are speculative investments which involve a high degree of risk of loss by the
undersigned of his, her or its entire investment in the Company.
3.7. It has never been guaranteed or warranted to the undersigned by
the Company or by any other person, expressly or by implication, that:
(a) The undersigned will be required to remain an owner of
Securities any approximate or exact length of time;
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(b) The undersigned will receive any approximate or exact
amount of return or other type of consideration, profit or loss as a result of
an investment in the Securities, or
(c) The past performance or experience on the part of the
Company, any director, officer or any affiliate thereof, will in any way
indicate or predict future operating results of the Company or the overall
success of the Company.
3.8 If the undersigned is more than one person, the obligations of
the undersigned shall be joint and several, and the representations and
warranties herein contained shall be deemed to be made by and be binding upon
such person, and ownership of the Securities subscribed for by the undersigned
shall be as set forth on the signature page hereto.
3.9 If there should be any adverse change in the representations and
information set forth herein prior to the Company's acceptance or rejection of
this subscription, the undersigned will immediately
3.10 The undersigned hereby agrees that the representations and
warranties set forth in this Agreement shall be binding upon the heirs,
executors, administrators, successors and assigns of the undersigned, but this
subscription is not voluntarily transferable or assignable by the undersigned.
This Agreement shall be governed by and construed in accordance with the
internal laws of the State of Nevada.
3.11 The undersigned acknowledges and agrees that all
representations, warranties and covenants made by the undersigned to the Company
in this Agreement shall survive the issuance of his, her or its Securities. The
undersigned agrees to protect, defend, indemnify and hold harmless the Company
from all losses, costs, expenses (including, without limitation, reasonable
attorney's fees and expenses) or liabilities for any breach of the undersigned's
representations, warranties or covenants.
3.12 The undersigned acknowledges and agrees that instruments
representing the Shares issued upon exercise of the Option will bear a legend
restricting transferability, in substantially the form as follows, and agrees to
comply in all respects with the terms of such legend:
THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF
1933, AS AMENDED. THEY MAY NOT BE SOLD, OFFERED FOR SALE, PLEDGED OR
HYPOTHECATED IN THE ABSENCE OF A REGISTRATION STATEMENT IN EFFECT WITH
RESPECT TO THE SECURITIES UNDER SUCH ACT OR AN OPINION OF COUNSEL
SATISFACTORY TO THE COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED OR
UNLESS SOLD PURSUANT TO RULE 144 OF SUCH ACT.
4. Acceptance. This subscription is subject to final acceptance by the
Company, to be evidenced by the signature of the individual investor or the
signatory on behalf an entity converting
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hereunder as set forth on Signature Pages No. 1 and No. 2 to this Agreement,
respectively.
5. Registered Name for the Shares. The certificate(s) representing the
Shares should be registered in the following name(s) and denomination(s):
Name Number of Shares
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6. Address of Record. The certificate(s) representing the Shares should
be sent to the following address:
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(Rest of Page Intentionally Left Blank)
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SIGNATURE FOR INDIVIDUAL INVESTOR:
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IN WITNESS WHEREOF, the undersigned has executed this Subscription Agreement as
of __________________________.
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(Signature)
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(Print Name)
Address: ______________________________________________
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(Social Security Number)
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(Signature of Spouse, If Applicable)
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(Print Name of Spouse)
If Joint Ownership. Check One:
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____ Husband and Wife, as Community Property
____ Joint Tenants with Right of Survivorship
____ Tenants-in-Common
ACCEPTANCE:
The subscription of the above-named investor is hereby accepted by the Company
as of December 30, 1999.
"COMPANY"
By:_____________________________________
Xxxxxxx X. Xxxxxx, Secretary
[Signature Page No. 1 to Subscription Agreement]
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SIGNATURE FOR PARTNERSHIP, TRUST, LLC, CORPORATION OR OTHER ENTITY:
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IN WITNESS WHEREOF, the undersigned has executed this Subscription Agreement as
of this ____ day of _____________________.
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(Print Name of Stockholder)
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(Signature)
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(Print Name of Person Signing)
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(Title)
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(Print Type of Entity and Jurisdiction)
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(U.S. Taxpayer Identification Number)
ACCEPTANCE:
The subscription of the above-named investor is hereby accepted as of December
30, 1999.
"COMPANY"
By:__________________________________
Xxxxxxx X. Xxxxxx
Secretary
[Signature Page No. 2 to Subscription Agreement]
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