REMOTEMDX,
INC.
EXCHANGE
AGREEMENT
This
Exchange Agreement (the “ Agreement ”) is
entered into as of November __, 2009 by and between RemoteMDx,
Inc., a Utah corporation (the “ Company ”), and
Tennenhaus (“ Debt Holder ”).
R E C
I T A L S
A. The
Company, through its Board of Directors, has decided to authorize
and issue a new series of stock to be designated Series D
Convertible Preferred Stock of the Company (“ Series D
Convertible Preferred Stock ”).
B. The
Company, through its Board of Directors, has decided to offer the
Debt Holder the right to exchange and convert each $1,000 of the
outstanding debt of the Company held by Debt Holder (hereinafter,
the “ Obligations ”) for one (1) whole
share of Series D Convertible Preferred Stock.
C. The
rights of the Series D Convertible Preferred Stock shall be as set
forth in the Certificate of Designation of the Relative Rights and
Preferences of the Series D Convertible Preferred Stock of the
Company (the “ Designation ”).
NOW
THEREFORE, in consideration of the foregoing and the mutual
promises herein contained, the parties agree as follows:
A G R
E E M E N T
1.
Exchange of Obligations for Series D Convertible Preferred
Stock . Subject to the terms and conditions hereof, Debt Holder
and the Company hereby exchange all Obligations held by the Debt
Holder as follows: (i) for each $1,000 owed under such
Obligations, including accrued and unpaid interest through the date
of conversion and exchange, one (1) whole share of Series D
Convertible Preferred Stock and (ii) cash for the balance of
such Obligations remaining after conversion under (i). Fractional
shares of the Series D Convertible Preferred Stock shall not be
issued. This Agreement shall only become effective and
accepted by the Company at such time as the Company has sold shares
of the Series D Convertible Preferred Stock for aggregate proceeds
of a minimum of $2,600,000.
2.
Closing . Upon (a) acceptance and execution of
this Agreement by the Company, and (b) surrender of all instruments
evidencing the Obligations marked “Paid in Full” or
otherwise evidencing the cancellation and satisfaction thereof, the
Company shall issue to the Debt Holder that number of shares of
Series D Convertible Preferred Stock indicated opposite the Debt
Holder’s name on the attached Exhibit A .
3.
Representations and Warranties of the Company . The Company
represents and warrants to the Debt Holder that (a) the shares
of Series D Convertible Preferred Stock have been duly authorized
and validly issued and are fully paid and non-assessable, and
(b) this Agreement has been duly authorized, executed and
delivered by the Company, and this Agreement constitutes the valid
and legally binding obligation of the Company.
4.
Investment Representations .
4.1 This
Agreement is made in reliance upon the Debt Holder’s
representation to the Company, which by acceptance hereof the Debt
Holder hereby confirms, that the shares of Series D Convertible
Preferred Stock to be received by the Debt Holder will be acquired
for investment for the own account of the Debt Holder, not as a
nominee or agent, and not with a view to the sale or distribution
of any part thereof, and that the Debt Holder has no present
intention of selling, granting participation in, or otherwise
distributing the same, but subject nevertheless to any requirement
of law that the disposition of the property of the Debt Holder
shall at all times be within the control of the Debt
Holder.
4.2 The
Debt Holder understands that the Series D Convertible Preferred
Stock is not registered under the Securities Act of 1933, as
amended (the “ Securities Act ”), on the basis
that the sale provided for in this Agreement and the issuance of
securities hereunder is exempt from registration under the
Securities Act pursuant to Section 4(2) and 3(a)(9) thereof,
and that the Company’s reliance on such exemption is
predicated on the Debt Holder’s representations set forth
herein. The Debt Holder realizes that the basis for the exemption
may not be present if, notwithstanding such representations, the
Debt Holder has in mind merely acquiring shares of the Series D
Convertible Preferred Stock for a fixed or determinable period in
the future, or for a market rise, or for sale if the market does
not rise. The Debt Holder does not have any such
intention.
4.3 The
Debt Holder understands that the Series D Convertible Preferred
Stock may not be sold, transferred, or otherwise disposed of
without registration under the Securities Act or an exemption
therefrom, and that in the absence of an effective registration
statement covering the Series D Convertible Preferred Stock or an
available exemption from registrat
