DEBT CONVERSION AGREEMENT
Exhibit 10.14
Debt
Conversion Agreement (this “Agreement”) dated as of April 1, 2006 between Xxxxxx
and Xxxxxx Xxxxxxxxxxx (the “Lenders”) and American DG Energy Inc. (the
“Borrower”).
The
Lenders are the holders of Demand Promissory Notes dated as of August 14, 2002,
March 26, 2003 and June 15, 2004 issued by the Borrower (formerly American DG
Inc.) in the aggregate principal amount of Three Hundred and Fifty Thousand
Dollars ($350,000.00)(collectively the “Notes”).
The
Lenders are willing to convert the principal amount of the Notes and a portion
of the accrued and unpaid interest on the Notes into (a) shares of the Common
Stock, par value $.001 per share of the Borrower (the “Common Stock”), and (b)
the Borrower’s 8% Senior Convertible Debentures Due 2011 (the “Debentures”), and
the Lender is willing to accept such conversion.
NOW,
THEREFORE, the undersigned, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, hereby agree as
follows:
3.
(a) As of the date hereof, the Lenders hereby agree to convert Notes
in the principal amount of Three Hundred Fifty Thousand Dollars ($350,000.00)
into shares of Common Stock at a conversion rate of Seventy Cents ($.70) per
share of Common Stock or 500,000 shares of Common Stock (the “Shares”), (b) as
of April 15, 2006, the Lenders hereby agree to accept Debentures in the
principal amount of Thirty Thousand Dollars ($30,000.00) in lieu of an equal
amount of accrued and unpaid interest due and payable on the Notes, and (c) as
of the date hereof, the Lender hereby agrees to accept from the Borrower in cash
the sum of Two Thousand and Eighty Nine Dollars and Forty One Cents ($2,089.41)
for the balance of the accrued and unpaid interest due and payable on the Notes.
Upon receipt and cancellation of the Notes, the Borrower hereby agrees to issue
such Shares and Debentures and to pay such cash to the Lender. The parties agree
to execute and deliver such further documents as may be necessary to give effect
to the conversion and cancellation of the Notes.
4. The
Borrower hereby represents and warrants to the Lenders that (a) the Borrower is
a corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware (b) the Borrower has all required corporate power
and authority to carry on its business as presently conducted, to enter into and
perform its obligations under this Agreement, (c) this Agreement constitutes the
legal, valid and binding obligation of the Borrower, enforceable against it in
accordance with its terms, except (i) as limited by applicable bankruptcy,
insolvency, reorganization, moratorium, and other laws of general application
affecting enforcement of creditors’ rights generally or by equitable principles,
and (ii) as limited by laws relating to the availability of specific
performance, injunctive relief, or other equitable remedies, (d) the execution,
delivery and performance of this Agreement has been duly authorized by all
necessary corporate action of the Borrower. Except as set forth in
the preceding sentence, the Borrower makes no representation or warranty to the
Lenders with respect to either the Shares or the Borrower.
4. The
Lenders hereby represent and warrant to the Borrower that (a) the Lenders hold
full right, title and interest to the Notes free of any liens or other
encumbrances, (b) the Lenders have the legal capacity to enter into and to
perform their obligations under this Agreement and to carry out the transactions
contemplated hereby, (c) this Agreement constitutes the legal, valid and binding
obligation of the Lenders, enforceable against the Lenders in accordance with
its terms, except (i) as limited by applicable bankruptcy, insolvency,
reorganization, moratorium, and other laws of general application affecting
enforcement of creditors’ rights generally or by equitable principles, and (ii)
as limited by laws relating to the availability of specific performance,
injunctive relief, or other equitable remedies, and (d) the Lenders are
acquiring the Shares for the Lenders’ own account and not with a view to their
distribution within the meaning of Section 2(11) of the U.S. Securities Act of
1933, as amended.
This Agreement shall be governed by and construed in accordance with the laws of
the Commonwealth of Massachusetts. Executed as of the date set forth
above.
1
|
THE
BORROWER
|
THE
LENDERS
|
||
|
Xxxxxx
X. Xxxxxxxxxxx
|
|||
|
By:
|
|
|
|
|
Xxxxxxx
X. Xxxxxxxx
|
Xxxxxx
X. Xxxxxxxxxxx
|
||
|
Chief
Financial Officer
|
|||
|
Xxxxxx
X. Xxxxxxxxxxx
|
|||
|
|
|||
|
Xxxxxx
X.
Xxxxxxxxxxx
|
|||
2
