<PAGE>

                              EMPLOYMENT AGREEMENT

         THIS EMPLOYMENT AGREEMENT (this "Agreement") is made and entered into
as of the 20th day of December 2000, between eRoomSystem Technologies, Inc., a
Nevada corporation (the "Company"), and David S. Harkness, an individual (the
"Executive").

                                   WITNESSETH:

         WHEREAS, the Company and the Executive deem it to be in their
respective best interests to enter into an agreement providing for the Company's
employment of Executive pursuant to the terms herein stated.

         NOW, THEREFORE, in consideration of the mutual provisions herein
contained, the parties agree as follows:

         1. DUTIES. The Company hereby employs the Executive as the Chief
Executive Officer of the Company, with the powers and duties in that capacity to
be those powers and duties customary to such positions in similar publicly held
corporations, together with any other duties of a senior executive nature as may
be reasonably requested by the Board of Directors (the "Board") from time to
time, which may include duties for one or more subsidiaries or affiliates of the
Company. In addition, Executive is hereby appointed as Vice Chairman of the
Board of Directors for a term commencing on the date hereof and concluding on
the date of the Company's annual shareholders meeting in 2002. The Executive, in
his capacity as an employee and officer of the Company, shall be responsible to
obey the reasonable and lawful directives of the Board.

         2. TERM OF EMPLOYMENT. The term of employment pursuant to this
Agreement shall be one year (and eleven days) commencing on the date of this
Agreement and ending on December 31, 2001 (the "Term of Employment"), subject to
earlier termination in accordance with Section 7 below. The Term of Employment
and this Agreement shall be automatically extended for successive one-year
periods following the expiration of the Term of Employment, unless (i)
terminated earlier in accordance with Section 7, or (ii) either the Company or
the Executive notifies the other in writing, at least thirty days prior to such
expiration, that the Term of Employment and this Agreement shall not be so
extended.

         3. COMPENSATION. The Executive shall receive the following compensation
for his services during the Term of Employment hereunder:

                  (a) ANNUAL BASE SALARY. The Executive's annual base salary
         shall be $150,000 per calendar year. Executive's base salary shall be
         reviewed annually by the Compensation Committee. Such annual base
         salary shall be payable on a pro rata basis, in twenty-six (26) equal
         installments, in accordance with the Company's normal payroll
         procedures.

<PAGE>

                  (b) PERFORMANCE BONUS. The Executive shall be eligible to
         receive a performance bonus at the end of the Company's fiscal year.
         The amount of such performance bonus, if any, shall be determined by
         the Compensation Committee, in its sole and absolute discretion, based
         upon such factors as the Company's overall financial performance,
         anticipated working capital requirements, cash reserves, anticipated
         liabilities or threatened litigation, successful implementation of the
         Company's business plan, establishment of relationships with key hotel
         chains and customers, development of corporate projects and new
         products, and any other short- and long-term interests of the Company
         as it deems appropriate.

                  (c) STOCK OPTIONS. The Executive shall be eligible to
         participate in the Company's 2000 Stock Option Plan, as amended from
         time to time (the "Plan"). The Executive has been granted a stock
         option under the Plan to purchase 250,000 shares at an exercise price
         of $1.51 per share, subject to the terms and conditions of the option
         grant dated December 20, 2000 and attached hereto as Exhibit A, and the
         Plan; provided, however, Executive shall have an irrevocable right to
         exercise any and all options to purchase common stock of the Company
         issued to him, assuming such options are fully vested, through the
         final date on which such options are exercisable by Executive;
         provided, further, Executive is not required to be an employee of the
         Company within ninety (90) days of the exercise of such options.

                  (d) CAR ALLOWANCE. The Executive shall be entitled to a
         monthly car allowance of $500. The monthly car allowance shall cover
         Executive's car lease/purchase installments, mileage, gas, insurance,
         repair and maintenance expenses.

                  (e) OTHER BENEFITS. Executive shall be paid for ten (10)
         holidays annually as designated by the Company. Additionally, Flexible
         Time Off (FTO) will accrue at the rate of 4.31 hours upon the
         completion of each pay period in which you are employed as Chief
         Executive Officer.

                  (f) HEALTH AND DENTAL INSURANCE. The Company shall provide
         health and dental insurance for Executive and his dependents with an
         insurance carrier of Employer's choice.

                  (g) LIFE INSURANCE. The Company shall provide term life
         insurance coverage for Executive in the amount of three times
         Executive's annual salary, or $450,000. The period of such coverage
         will coincide with Executive's term of employment.

         4. EXPENSE REIMBURSEMENT. The Company shall reimburse the Executive for
all expenses incurred by him in the performance of his duties hereunder as
required by the Board, including, but not limited to, transportation expenses,
accommodations, entertainment, and other expenses incurred in connection with
the business of the Company, in accordance with the Company's expense
reimbursement policies, but specifically excluding automobile related expenses
as outlined in Section 3(d) above.

         5. INDEMNIFICATION. The Company shall indemnify the Executive in his
capacity as an officer and a director and hold him harmless from any cost,
expense or liability arising out of


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<PAGE>

or relating to any acts or decisions made by him on behalf of or in the
course of performing services for the Company to the maximum extent provided
by the Company's bylaws and applicable law.

         6. SCOPE OF EMPLOYMENT. The Executive agrees to devote in good faith
his full time and best efforts (allowing for usual vacations and sick leave),
during reasonable business hours, to the duties that he is required to render to
the Company hereunder, and agrees to travel to the extent he deems necessary to
perform such duties. Notwithstanding the foregoing, the Executive shall be
permitted to engage in other charitable, community or business affairs that may,
from time to time, require minor portions of his time, but which shall not
interfere or be inconsistent with his duties hereunder.

         7. TERMINATION. This Agreement and the employment of the Executive
hereunder shall or may be terminated for any of the following reasons:

                  (a) The Company may terminate this Agreement and the
         employment of the Executive hereunder without cause upon not less than
         thirty (30) days advance written notice; provided, however, in such
         event the Company shall pay to Executive severance equal to three (3)
         months of his then existing salary as well as continuation of
         Executive's health and dental benefits and car allowance for such
         period. Severance payments shall be made on a bi-weekly basis. The
         severance period shall commence upon the conclusion of the notice
         period, or the first day following Executive's final day of employment.

                  (b) By the Company at any time immediately for cause by
         providing written notice to Executive. For purposes of this
         Agreement, "cause" shall include, without limitation, (i) a breach
         of any provision of this Agreement or a violation of any other duty
         or obligation to the Company; (ii) a failure to follow a written
         directive of the Board; (iii) fraud, misappropriation, dishonesty or
         embezzlement, or (iv) any willful or negligent misconduct, criminal
         conviction or similar conduct or activities.

                  (c) Immediately without notice upon the Executive's death or
         disability. For purposes of this Agreement, "disability" shall mean the
         inability of the Executive to perform his duties under this Agreement
         for a consecutive period of three (3) months or a non-consecutive
         period of six (6) months within any twelve-month period. In the event
         of the death or disability of the Executive, the Executive or the
         estate, beneficiary or legal representative of the Executive shall be
         entitled to any applicable death or disability benefits (other than
         key-man life insurance) which may be available under any benefit plans
         maintained by the Company solely for the benefit of the Executive at
         the time of the death or disability of the Executive.

Except as otherwise provided in subsection (a) above, upon the termination of
this Agreement and the employment of Executive hereunder, the Company shall have
no further obligation or liability whatsoever to Employee under this Agreement
except with respect to any stock options granted under the Plan which have
vested as of such date or salary earned by the Executive and not paid by the
Company prior to the date of termination.


                                       3

<PAGE>

         8. ASSIGNMENT. By reason of the special and unique nature of the
services hereunder, it is agreed that neither party hereto may assign any
interest, rights or duties which it or he may have in this Agreement without the
prior written consent of the other party, except that upon any merger,
liquidation, or sale of all or substantially all of the assets of the Company to
another corporation, this Agreement shall inure to the benefit of and be binding
upon the Executive and the purchasing, surviving, or resulting company or
corporation in the same manner and to the same extent as though such company or
corporation were the Company.

         9. CONFIDENTIALITY.

         (a) Recognizing that the knowledge and information about, or
  relationships with, the business associates, partners, customers, clients,
  suppliers, personnel and agents of the Company and its affiliated companies
  and the business, financing and marketing methods, systems, plans, policies,
  techniques and know-how of the Company and of its affiliated companies
  (collectively, "Confidential Information") which the Executive has heretofore
  and shall hereafter receive, obtain or establish as an employee of the
  Company, or otherwise, is valuable and a unique asset of the Company, the
  Executive agrees that, during the Term of Employment and for a period of five
  (5) years thereafter, he shall hold all Confidential Information in the
  strictest confidence, and shall not (otherwise than pursuant to his duties
  hereunder), directly or indirectly, disclose without the express written
  consent of the Company, any Confidential Information pertaining to any person,
  firm, corporation or other entity, for any reason or purpose whatsoever. The
  Executive acknowledges and agrees that Confidential Information shall be
  deemed to include, without limitation, all knowledge, data or information
  stored on any electronic or other media. The Executive acknowledges and agrees
  that all memoranda, notes, records and other documents made or compiled by the
  Executive or made available to the Executive concerning any Confidential
  Information shall be the Company's exclusive property and shall be delivered
  by the Executive to the Company upon expiration or termination of this
  Agreement or at any other time upon the request of the Company.

         (b) The Executive hereby acknowledges that the services to be rendered
  by him are of a special, unique and extraordinary character and, in connection
  with such services, he will have access to Confidential Information. By reason
  of this, the Executive consents and agrees that if he violates any of the
  provisions of this Agreement with respect to confidentiality, the Company
  would sustain irreparable harm and, therefore, in addition to any other
  remedies which the Company may have under this Agreement or otherwise, the
  Company will be entitled to an injunction to be issued by any court of
  competent jurisdiction restraining the Executive from committing or continuing
  any such violation of this Agreement.

         (c) The provisions of this Section 9 shall survive the expiration or
  termination (for any reason) of this Agreement or any part thereof, without
  regard to the reason therefor.

         10. COVENANT NOT TO COMPETE; NONSOLICITATION.

         (a) The parties acknowledge that the Executive's performance of all
terms of this Agreement is necessary to protect the Company's legitimate
business interests. The Executive agrees, that, during the Term of Employment
and for a period of three (3) years thereafter, he will not, on behalf of
himself, or on behalf of any person, company, corporation, partnership or


                                       4

<PAGE>

other entity or enterprise, directly or indirectly, as an employee,
proprietor, owner, stockholder, partner, member, officer, director, manager,
lender, advisor, consultant or otherwise engage in any business or activity
competitive with the business activities of the Company or any subsidiary of
the Company as it is now or hereafter undertaken by the Company or any
subsidiary. The Executive further agrees that he will not, directly or
indirectly, during the Term of Employment and for a period of two years
thereafter, solicit the trade or patronage of any customers or prospective
customers of the Company, any subsidiary of the Company or of anyone who has
heretofore traded or dealt with the Company or any subsidiary of the Company
with respect to any technologies, services, products, trade secrets or other
matters in which the Company is active.

         (b) The Executive hereby acknowledges that the services to be rendered
by him under this Agreement are of a special, unique and extraordinary character
and, in connection with such services, he will have access to Confidential
Information. By reason thereof, the Executive consents and agrees that if he
violates any of the provisions of this Agreement with respect to noncompetition
or nonsolicitation, the Company would sustain irreparable harm and, therefore,
in addition to any other remedies which the Company may have under this
Agreement or otherwise, the Company shall be entitled to an injunction to be
issued by any court of competent jurisdiction restraining the Executive from
committing or continuing any such violation of this Agreement.

         (c) The provisions of this Section 10 shall survive the expiration or
termination of this Agreement or any part thereof, without regard to the reason
therefor.

         11. ARBITRATION. Unless otherwise indicated, any dispute arising out of
the terms and conditions of this Agreement or the Executive's employment with
the Company shall be settled by binding arbitration to be held in Las Vegas,
Nevada, in accordance with the rules for employment disputes of the American
Arbitration Association then in effect. The prevailing party in such proceeding
shall be entitled to recover the costs of arbitration from the other party,
including, without limitation, reasonable attorneys' fee.

         12. GOVERNING LAW. This Agreement shall be subject to, and governed by,
the laws of the State of Nevada without reference to any principles of conflict
of law.

         13. NOTICES. All notices and other communications required or permitted
under this Agreement shall be in writing (including a writing delivered by
facsimile transmission) and shall be deemed to have been duly given (a) when
delivered, if sent by registered or certified mail (return receipt requested),
(b) when delivered, if delivered personally or by facsimile, or (c) on the
second following business day, if sent by overnight mail or overnight courier,
in each case to the parties at the following addresses (or at such other
addresses as shall be specified by like notice):

             IF TO THE COMPANY:            eRoomSystem Technologies, Inc.
                                           390 North 3050 East
                                           St. George, Utah 84790
                                           Attention: General Counsel


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<PAGE>

             IF TO THE EXECUTIVE:          11521 North 6090 West
                                           Highland, UT 84003

         14. SEVERABILITY. If any provision hereof is unenforceable, illegal or
invalid for any reason whatsoever, such fact shall not affect the remaining
provisions hereof. If any of the provisions hereof which impose restrictions on
the Executive are, with respect to such restrictions, determined by a final
judgment of any court of competent jurisdiction to be unenforceable or invalid
because of the geographic scope or time duration of such restrictions, such
provisions hall be deemed retroactively modified to provide for the maximum
geographic scope and time duration which would make such provisions enforceable
and valid. However, no such retroactive modification shall affect any of the
Company's rights hereunder arising out of the breach of any such restrictive
provisions, including, without limitation, the Company's rights to terminate
this Agreement.

         15. WAIVER. No failure or delay on the part of the Company or the
Executive in exercising any right, power or remedy hereunder shall operate as a
waiver thereof nor shall any single or partial exercise of any such right, power
or remedy preclude any other or further exercise thereof or the exercise of any
other right, power or remedy hereunder. The remedies herein provided are
cumulative and not exclusive of any remedies provided by law.

         16. MODIFICATION. No amendment, modification, termination or waiver of
any provision of this Agreement nor consent to any departure by the Executive or
the Company therefrom shall in any event be effective unless the same shall be
in writing and signed by a duly authorized officer of the Company or by the
Executive, as the case may be. Any such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given.

         17. TAXES. The Compensation payable is stated in gross amounts and
shall be subject to such withholding taxes and other taxes as may be required by
law.

         IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed by its duly authorized officer, and the Executive has hereunto set his
signature as of the day and year first above written.

EROOMSYSTEM TECHNOLOGIES, INC.,                    EXECUTIVE
  A NEVADA CORPORATION


BY: /S/ STEPHEN M. NELSON                          /S/ DAVID S. HARKNESS
    ---------------------------                    ---------------------------
    STEPHEN M. NELSON                              DAVID S. HARKNESS
    PRESIDENT


                                       6

<PAGE>

                                    EXHIBIT A

                                  OPTION GRANT






























                                       7

<PAGE>

                         EROOMSYSTEM TECHNOLOGIES, INC.
                      2000 STOCK OPTION AND INCENTIVE PLAN
                                  OPTION GRANT


Optionee:        David S. Harkness          Date of Grant:     December 20, 2000

Grant No:        2000-12-264                Exercise Price:    $1.51

Type of Option:  Incentive Option(1)        Number of Shares:  250,000

Term of Option:  Commencing on the Date of Grant and expiring on the third
                 anniversary date of this option grant(2)

         Subject to the terms, conditions and restrictions of the 2000 Stock
Option and Incentive Plan (the "Plan") and this Option Grant, eRoomSystem
Technologies, Inc. (the "Company") hereby grants an option (the "Option") to
purchase the above-referenced number of shares of common stock, $.001 par value
("Common Stock"), of the Company exercisable at the exercise price stated above.
Capitalized terms used and not otherwise defined herein shall have the meanings
assigned to them in the Plan.

         The Option granted hereunder shall be exercisable only to the extent it
has vested. Each installment of the Option shall vest on the vesting date(s) set
forth below so long as Optionee continues to have an uninterrupted Relationship
with the Company or a Subsidiary up to, and including, each such respective
scheduled vesting date. Optionee will only have the right to exercise any vested
portion(s) of the Option. If Optionee ceases to have a Relationship with the
Company or a Subsidiary up to, and including, the date upon which all or any
installment of the option vest(s), the Optionee shall have no right, nor be
entitled, to exercise the unvested portion of the Option. The vesting schedule
for the Option under this Option Grant is as follows:

              December 20, 2000    --    100% of the Option vests

         The Option shall not be assigned, pledged, sold, encumbered,
transferred or otherwise disposed of by Optionee, either voluntarily or by
operation of law, other than by will or the laws of descent and distribution,
and during the lifetime of Optionee the Option shall be exercisable only by such
Optionee. Any attempted assignment, pledge, sale, encumbrance, transfer or other
disposition of the Option, other than in accordance with the terms set forth
herein, shall be null and void, and of no effect.

----------------

(1) In order to qualify as an Incentive Option, numerous conditions must be met,
    including the approval of the Plan by the stockholders of the Company within
    twelve months after the date of adoption of the Plan by the Board. Neither
    the Committee, the Board nor the Company shall have any liability if the
    Option does not qualify as an Incentive Option. Any portion of the Option
    that does not qualify as an Incentive Option shall be deemed to be a
    Nonstatutory Option.

(2) The Option shall terminate in accordance with the Plan.


                                       8

<PAGE>

         In addition to the foregoing, the shares of Common Stock issuable upon
exercise of the Option shall not be assigned, pledged, sold, encumbered or
otherwise transferred by Optionee, either voluntarily or by operation of law,
other than by will or the laws of descent and distribution, for a period of one
year after the close of an underwritten initial public offering for shares of
the Company's Common Stock, or for an additional period if required by the
Nasdaq National Market or similar agency. Any attempted assignment, pledge,
sale, encumbrance, transfer or other disposition of the shares of Common Stock
issuable upon exercise of the Option, other than in accordance with the terms
set forth herein, shall be null and void, and of no effect.

NOTE: A COPY OF THE PLAN IS ATTACHED. THE PLAN DETAILS THE TERMS, CONDITIONS AND
RESTRICTIONS OF THE OPTION AND THE UNDERLYING SHARES OF COMMON STOCK, AND SHOULD
BE CAREFULLY READ IN ITS ENTIRETY. IN ADDITION, THIS OPTION GRANT MAY CONTAIN
ADDITIONAL TERMS, CONDITIONS AND RESTRICTIONS OF THE OPTION AND THE UNDERLYING
SHARES OF COMMON STOCK. IF THERE IS ANY QUESTION, AMBIGUITY OR CONTRADICTION IN
THIS OPTION GRANT, THE LANGUAGE OF THE PLAN SHALL GOVERN.

         IN WITNESS WHEREOF, the undersigned executes this Option Grant as of
the Date of Grant first set forth above:


                                                EROOMSYSTEM TECHNOLOGIES, INC.,
                                                A NEVADA CORPORATION

                                                By:
                                                    ----------------------------
                                                    STEPHEN M. NELSON
                                                    PRESIDENT


ACCEPTED AND AGREE TO AS OF THE DATE OF GRANT:

Signature:                                 Social Security Number:  ###-##-####
           ------------------------------                           -----------

Residence Address: 11521 North 6090 West                Highland, UT 84003
                   ------------------------------------------------------------
                     (street address)                 (city, state, zip code)


                                       9