Exhibit
10.5


 


CLASS B UNITS CONVERSION AGREEMENT


 


This
Class B Units Conversion Agreement (this “Agreement”), effective as of January 31,
2005, is entered into by and among InnSuites Hospitality Trust, an Ohio real
estate investment trust (the “Company”), and the parties named on the
signature pages hereof (the “Unit Holders”).


 


WHEREAS,
James F. Wirth (“Wirth”) and his affiliates own all 4,467,938 outstanding Class
B limited partnership units in RRF Limited Partnership, a Delaware limited
partnership (the “Partnership”); and


 


WHEREAS,
as a result of the prior approval of the shareholders and Board of Trustees of
the Company, up to 1,000,000 of the outstanding Class B limited partnership
units in the Partnership owned by Wirth and his affiliates (the “Units”)
are convertible into a like number of newly-issued Shares of Beneficial
Interest in the Company (the “Shares”); and


 


WHEREAS,
the Company and the Unit Holders have agreed to provide for the conversion of
1,000,000 of the Units as provided herein.


 


NOW, THEREFORE,
in consideration of the foregoing premises and the mutual covenants hereinafter
set forth, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto agree as
follows:


 


SECTION 1.                            ELECTION
TO CONVERT.  In accordance with the
terms hereof, and as a result of the prior approval of the shareholders and
Board of Trustees of the Company, the Unit Holders hereby elect, and the
Company hereby acknowledges that election, to convert 1,000,000 of the Units
into 1,000,000 Shares (the “New Shares”) as set forth on Exhibit A.


 


SECTION 2.                            ISSUANCE
OF SHARES.  As soon as practicable
after the date hereof, the Company shall cause to be issued one or more share
certificates representing the New Shares as set forth on Exhibit A.


 


SECTION 3.                            INVESTMENT
REPRESENTATIONS.


 


3.1                                 No Distribution.  The Unit Holders are acquiring the New Shares
for their own account, for investment, and not with an intention of selling the
New Shares in connection with a distribution (as the term “distribution” is
understood under the Securities Act of 1933, as amended (the “Securities Act”)).


 


3.2                                 No Registration.  The Unit Holders acknowledge that the New
Shares have not been, and likely will not be, registered under the Securities
Act, by reason of their issuance in a transaction exempt from the registration
requirements of the Securities Act, or under any applicable blue sky or state
securities law, and that they must be held indefinitely unless a subsequent
disposition thereof is registered under the Securities Act or is exempt from
registration.


 


3.3                                 Rule 144.  The Unit Holders understand that the
exemption from registration afforded by Rule 144 promulgated under the
Securities Act (the provisions of which are known to the Unit Holders) depends
on the satisfaction of various conditions and that, if applicable, such Rule
144 may only afford the basis for sales under certain circumstances and only in
limited amounts.


 


3.4                                 Additional
Information.  The Unit Holders have
had the opportunity to ask questions and receive answers concerning the terms
and conditions of the New Shares obtained hereby, and to obtain any additional
information that the Company possesses or could acquire, and have


 





















 


knowledge and experience in business and financial matters and with
respect to investments in securities of companies as to enable the Unit
Holders  to understand and evaluate the
risks of an investment in the New Shares and to form an independent investment
decision with respect thereto.


 


3.5                                 Accredited Investor.  The Unit Holders are “accredited investors,”
as such term is defined in Rule 501 (the provisions of which are known to the
Unit Holders) promulgated under the Securities Act.


 


SECTION 4.                            MISCELLANEOUS.


 


4.1                                 Further Assurances.
Each party hereto agrees to furnish or cause to be furnished, to the other
party such documents or further assurances, and to perform, or cause to be
performed, such undertakings as the other party may reasonably request at any
time in connection with this Agreement.


 


4.2                                 Severability.  If any provision of this Agreement shall be
declared void or unenforceable by a judicial or administrative authority, the
validity of any other provision and of the entire Agreement shall not be
affected thereby.


 


4.3                                 Governing Law.  This Agreement shall be governed by, and
construed in accordance with, the substantive laws of the State of Ohio,
without reference to its conflict of laws rules.


 


4.4                                 Expenses.  Each of the parties will pay the fees and
expenses incurred by it in connection with the preparation, execution, and
delivery of this Agreement and the consummation of the transactions
contemplated hereby.


 


4.5                                 Counterparts.  This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument and shall become a
binding agreement when one or more of the counterparts have been signed by each
party.


 


4.6                                 Entire Agreement.  This Agreement constitutes the entire
agreement among the parties and supersedes all prior understandings,
agreements, arrangements, or representations by or among the parties, written
or oral, that may have related in any manner to the subject matter hereof.


 


Signature page follows


 


2





















 


IN WITNESS WHEREOF, the parties have executed
this Agreement as of the date first above written.


 


 


	
   

  	
  INNSUITES HOSPITALITY TRUST

  an Ohio real estate investment trust

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  James F. Wirth

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  Gail J. Wirth

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  INNTERNATIONAL SUITES CORP.

  an Arizona corporation

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
									



 


3





















 


Exhibit A


 


	
  Name

  	
   

  	
  No. of Units to be Converted

  	
   

  
	
  James F. Wirth and Gail J. Wirth

  	
   

  	
  469,032

  	
   

  
	
  Innternational Suites Corp.

  	
   

  	
  530,968

  	
   

  



 


4