Unassociated Document


    NOTE
      CONVERSION AGREEMENT

     

    This
      AGREEMENT (this “Agreement”),
      dated
      as of March 26, 2008, is entered into by and between Conversion Services
      International, Inc., a Delaware corporation with an address at 100 Eagle Rock
      Avenue, East Hanover, NJ 07936 (“the
      Company”),
      and
      TAG Virgin Islands, Inc., with an address at The Tunick Building, 1336 Beltjen
      Road, Suite 202, St. Thomas, USVI 00802 as agent (the “Agent”)
      for
      the “Noteholders” as defined herein.

     

    RECITALS

     

    Whereas,
      the Company has issued a note (the “Note”) in the name of Hare & Co, as
      nominee, dated as of June 7, 2004, originally in the principal amount of
      $2,000,000 and currently in the principal amount of $1,650,000, a copy of which
      is appended hereto; and

    


    Whereas,
      certain beneficial holders (hereinafter referred to collectively as the
“Noteholders”)
      in the
      aggregate amount of $600,000 of the principal of the Note have agreed to convert
      their portion of the Note (the “Noteholders’
      Portion”)
      into
      the number of shares (the “Shares”) of the Company’s common stock, par value
      $0.001 per share, (the “Common Stock”) and warrants in the form appended hereto
      as Exhibit
      A
      (the
“Warrants” collectively with the Shares the “Securities”) to purchase Common
      Stock in accordance with the provisions of Section
      2
      below
      and the Company agrees to such conversion, all on the terms and conditions
      set
      forth herein.

    


    NOW,
      THEREFORE, in consideration of the mutual promises and covenants contained
      in
      this Agreement and other good and valuable consideration, the receipt and
      sufficiency of which is hereby acknowledged, the parties hereto agree as
      follows:

     

    1. Recitals.
      The
      recitals are hereby incorporated herein and made a part hereof.

    


    2. Conversion
      of the Noteholders’ Portion
      of the Note and
      Issuance of the Securities.
      The
      Noteholders herewith convert the Noteholders’ Portion into an aggregate of
      4,615,385 Shares and warrants to purchase an aggregate of 4,615,385 shares
      of
      Common Stocks. The
      Shares are to be issued in DTC form in the name of Hare & Co.
      The
      Company will issue 12 warrants (collectively the “Warrants” and collectively
      with the Shares the “Securities”), all in the name of Hare & Co., in the
      following denominations: eight issuable for 384,615 shares, one issuable for
      576,924 shares, one issuable for 500,000 shares, one issuable for 269,232 shares
      and one issuable for 192,309 shares. The exercise price of the Warrants is
      $0.143 per share. The Noteholders will deliver the Noteholders’ Portion to the
      Company against which the Company will issue and deliver the Securities to
      the
      Noteholders in accordance with instructions from the Agent. 

     

    3. Representations
      and Warranties of the Company.
      The
      Company hereby represents and warrants to the Agent and the Noteholders
      that:


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    3.1
       Organization;
      Good Standing; Qualification and Corporate Power.

    


    (a)
       The
      Company and each of its subsidiaries is a corporation duly organized, validly
      existing and in good standing under the laws of its jurisdiction of
      incorporation and has all requisite corporate power and authority to carry
      on
      its business as now conducted and as proposed to be conducted. The Company
      and
      each of its subsidiaries is duly qualified to transact business and is in good
      standing in each jurisdiction in which the failure so to qualify would have
      a
      material adverse effect on its business or properties. True and correct copies
      of the Company Certificate of Incorporation, as amended (the "Certificate
      of Incorporation")
      and
      Bylaws have been provided to the Noteholders or made available via the SEC
      EDGAR
      website.

    


    (b)
       The
      Company has all requisite legal and corporate power and authority to execute
      and
      deliver this Agreement, to issue the Shares and the Warrants and to carry out
      and perform its obligations under the terms of this Agreement and to consummate
      the transactions contemplated hereby and thereby. All necessary corporate action
      has been taken by the Company with respect to the execution, delivery and
      performance by the Company of this Agreement and the consummation of the
      transactions contemplated hereby and thereby. The Shares, when issued
in
      accordance with the terms of the Agreement,
      will be
      legally issued, fully paid and non assessable and each Noteholder will own
      the
      Shares purchased by such Noteholder, free and clear of all liens and
      encumbrances. The Warrants, when issued in accordance with the terms of this
      Agreement, will constitute the legally binding obligation of the Company in
      accordance with their terms. 

    


    3.2
       Capitalization
      and Voting Rights. The Company’s authorized capital consists of:

    


    (a)
      Common Stock. 200,000,000 shares of Common Stock, of which 110,171,558 shares
      were issued and outstanding as of the date hereof. The Common Stock is currently
      accepted for trading on the American Stock Exchange. 

     

    (b)
      Preferred Stock. 20,000,000 shares of preferred stock (the "Preferred
      Stock"),
      of
      which, as of the date hereof, an aggregate of 39,000 shares are issued and
      outstanding, 19,000
      as
      Series A Convertible Preferred Stock
      and
      20,000 as Series B Convertible Preferred Stock. 

    


    3.3
       Subsidiaries;
      Interests of the Company. Except as set forth in the SEC Documents, as defined
      in Section
      3.5
      below,
      the Company does not currently own or control, directly or indirectly, any
      interest in any other partnership, limited liability company, corporation,
      joint
      stock company, trust, estate, joint venture, association or unincorporated
      organization, or any other form of business or professional entity.

    


    3.4
       Authorization.
      This Agreement and all other agreements executed and delivered by the Company
      in
      connection therewith, have been duly authorized, executed and delivered by
      the
      Company and constitute the legal, valid and binding obligations of the Company,
      enforceable in accordance with their respective terms, subject to (i) applicable
      bankruptcy, insolvency, reorganization and moratorium laws, (ii) other laws
      of
      general application affecting the enforcement of creditors' rights generally
      and
      general principles of equity, (iii) the discretion of the court before which
      any
      proceeding therefor may be brought, and (iv) as rights to indemnity may be
      limited by federal or state securities laws or by public
      policy.


    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    


    


    3.5 SEC
      Documents. The Company has filed all reports, schedules, forms, statements
      and
      other documents required to be filed by it with the Securities and Exchange
      Commission (the “Commission”)
      pursuant to the Securities Act of 1933 (the “Securities
      Act”)
      and
      the Securities Exchange Act of 1934 (the “Exchange
      Act”)
      (the
“SEC
      Documents”),
      and
      during the 12 calendar months prior to the date hereof all such SEC Documents
      have been filed in a timely manner. The Company is currently eligible to use
      Form S-3 for stockholder registration statements under the Securities Act.
      The
      SEC Documents have complied in all material respects with the requirements
      of
      the Securities Act or the Exchange Act, as the case may be, and the rules and
      regulations of the Commission promulgated thereunder applicable to the SEC
      Documents, and none of the SEC Documents, at the time they were filed with
      the
      Commission, contained any untrue statement of a material fact or omitted to
      state a material fact required to be stated therein or necessary in order to
      make the statements therein, in light of the circumstances under which they
      were
      made, not misleading. As of their respective dates, to the best of the Company’s
      knowledge during those respective dates, the financial statements of the Company
      included in the SEC Documents complied as to form in all material respects
      with
      applicable accounting requirements and the published rules and regulations
      of
      the Commission with respect thereto. Such financial statements have been
      prepared in accordance with accounting principles generally accepted in the
      United States as in effect from time to time (“GAAP”),
      consistently applied, during the periods involved (except (a) as may be
      otherwise indicated in such financial statements or the notes thereto, or (b)
      in
      the case of unaudited interim statements, to the extent they may exclude
      footnotes or may be condensed or summary statements) and fairly present in
      all
      material respects the financial condition of the Company as of the respective
      dates thereof and the results of its operations and cash flows for the
      respective periods then ended (subject, in the case of unaudited statements,
      to
      normal year-end audit adjustments). Except as set forth in the SEC Documents,
      the Company has not received notification from the Commission, the American
      Stock Exchange and/or any federal or state securities bureaus that any
      investigation (informal or formal), inquiry or claim is pending, threatened
      or
      in process against the Company and/or relating to any of the Company’s
      securities. 

    


    3.6
       Governmental
      Consents. No consent, approval, order, or authorization of, or registration,
      qualification, designation, declaration or filing with, any federal, state,
      local or provincial governmental authority on the part of the Company is
      required in connection with the consummation of the transactions contemplated
      by
      this Agreement. The Company and each of its subsidiaries has obtained all
      federal, state, local and foreign governmental licenses and permits material
      to
      and necessary in the conduct of its business, such licenses and permits are
      in
      full force and effect, no material violations are or have been recorded in
      respect of any such licenses or permits, and no proceeding is pending or
      threatened to revoke or limit any thereof. There are no consents or waivers
      necessary for the consummation of the transactions contemplated by this
      Agreement.


    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

    


    3.7
       Litigation.
      Except as set forth in the SEC Documents, (i) there is no action, suit,
      proceeding, or investigation pending or currently threatened against the
      Company, and (ii) in the Company’s reasonable judgment, none of such disclosures
      are likely to question the validity of this Agreement, or the right of the
      Company to enter into such agreements, or to consummate the transactions
      contemplated hereby or thereby, or which might result, either individually
      or in
      the aggregate, in any material adverse change in the assets, condition, affairs,
      or property of the Company, financially or otherwise, or any change in the
      current equity ownership of the Company, including, without limitation, actions
      pending or to the Company’s knowledge threatened involving the prior employment
      of any of the Company’s employees, their use in connection with the Company’s
      business of any information or techniques allegedly proprietary to any of their
      former employers, or their obligations under any agreements with prior
      employers.

    


    3.8
       Compliance
      with Other Instruments. The Company is not in violation or default of any
      provisions of its Certificate of Incorporation or Bylaws or of any instrument,
      judgment, order, writ, decree, or contract to which it is a party or by which
      it
      is bound or, to its knowledge, of any provision of federal or state statute,
      rule or regulation, license, or permit applicable to the Company, the violation
      or default of which would have a material adverse effect on the Company. The
      execution, delivery, and performance of this Agreement and the consummation
      of
      the transactions contemplated hereby and thereby will not result in any such
      violation or be in conflict with or constitute, with or without the passage
      of
      time and giving of notice, either a default under any such provision,
      instrument, judgment, order, writ, decree, or material contract or an event
      which results in the creation of any lien, charge, or encumbrance upon any
      assets of the Company.

    


    4. Representations
      and Warranties of the Noteholders.
      Each
      Noteholder represents and warrants to the Company as follows:

     

    4.1 Review
      and Inspection. The Noteholder is relying on his own analysis regarding the
      Company’s operations, financial condition, assets, liabilities and other
      relevant matters as the Noteholder deemed necessary or desirable in order to
      evaluate the merits and risks of the prospective investment contemplated herein.
      The Noteholder
      acknowledges
      that he has not relied upon any information given to the Noteholder, or any
      statements made, by the Company or any officers or directors of the Company,
      except for the representations and warranties of the Company expressly made
      herein.

     

    4.2 Noteholder
      Due Diligence. The Noteholder and his representatives are solely responsible
      for
      the Noteholder’s own “due diligence” investigation of the Company and its
      management and business and for the Noteholder’s analysis of the financial
      future and viability of the Company and desirability of the terms of this
      investment. The Noteholder acknowledges that neither the Company nor any officer
      or director of the Company is making any representation or warranty regarding
      any financial projections previously given to the Noteholder or the assumptions
      underlying such financial projections, as such financial projections are subject
      to significant business, economic and other uncertainties and contingencies.
      The
      Noteholder acknowledges that if the Company is not able to operate profitably
      or
      generate positive cash flows, the Company may have difficulty meeting its
      obligations and may not be able to continue to operate its business, and the
      Noteholder could lose all of his investment. The Noteholder has such knowledge
      and experience in financial and business matters that he is capable of
      evaluating the merits and risks of the acquisition of the Shares pursuant to
      the
      terms of this Agreement and of protecting his interest in connection
      therewith.


    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    


    4.3 Accredited
      Investor Status.
      The
      Noteholder is an “Accredited Investor” as that term is defined in Rule 501 of
      Regulation D promulgated under the Securities Act and the Noteholder is able
      to
      bear the economic risk of the acquisition of the Shares pursuant to the terms
      of
      this Agreement, including a complete loss of his investment in the
      Shares.

     

    4.4 Authority
      for Agreement.
      The
      Noteholder has the full right, power and authority to enter into and perform
      his
      obligations under the Agreement, and the Agreement constitutes the valid and
      binding obligations of the Noteholder enforceable in accordance with its terms,
      subject to (i) applicable bankruptcy, insolvency, reorganization and moratorium
      laws, (ii) other laws of general application affecting the enforcement of
      creditors' rights generally and general principles of equity, (iii) the
      discretion of the court before which any proceeding therefor may be brought,
      and
      (iv) as rights to indemnity may be limited by federal or state securities laws
      or by public policy..

     

    4.5 Governmental
      Consents.
      To the
      Noteholder’s knowledge, no consent, approval or authorization of or designation,
      declaration or filing with any governmental authority on the part of the
      Noteholder is required in connection with the valid execution, delivery and
      performance of the Agreement.

     

    4.6 Taxes.
      The
      Noteholder has not relied on any statements or representations of the Company
      or
      any of its agents (other than the representations and warranties set forth
      herein) with respect to the federal, state, local and foreign tax consequences
      of this investment and the federal, state, local and foreign tax consequences
      of
      transactions contemplated by this Agreement. With respect to such matters,
      the
      Noteholder understands that he (and not the Company) shall be responsible for
      his own tax liability that may arise as a result of this investment or the
      transactions contemplated by this Agreement.

     

    4.7
       Unregistered
      Securities.
      The
      Noteholder understands that the Securities and the Common Stock issuable upon
      exercise of the Warrants (the “the Warrant Shares”) have not been registered
      under the Securities Act or the laws of any state and may not be sold or
      transferred, or otherwise disposed of, without registration under the Securities
      Act and applicable state securities laws, or pursuant to an exemption therefrom.
      In the absence of an effective registration statement or an exemption therefrom
      covering the Securities and the Warrant Shares, the Noteholder will sell or
      transfer, or otherwise dispose of, the Securities and any the Warrant Shares
      he
      may acquire only in a manner consistent with his representations and agreements
      set forth herein and any applicable federal and state securities laws. Anything
      to the contrary notwithstanding, the Company agrees with and acknowledges to
      each Noteholder that the Shares and Warrants are being issued pursuant to the
      exemption from registration provided by Section 3(a)(9) of the Securities Act
      and, in accordance with the provisions of that Section and Rule 144 promulgated
      under the Securities Act, neither the certificates representing the Shares
      nor
      the Warrants shall bear the legend referred to in Section
      4.8
      below.


    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

    


    4.8
       Legends.
      It is
      understood that the certificates evidencing the Warrant Shares may bear the
      following legend:

    


    (a)
      THE
      SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE
      SECURITIES ACT OF 1933 OR APPLICABLE STATE SECURITIES LAWS AND MAY NOT BE
      TRANSFERRED, SOLD OR OTHERWISE DISPOSED OF IN THE ABSENCE OF AN EFFECTIVE
      REGISTRATION STATEMENT WITH RESPECT TO THE SECURITIES EVIDENCED BY THIS
      CERTIFICATE, FILED AND MADE EFFECTIVE UNDER THE SECURITIES ACT OF 1933 AND
      SUCH
      APPLICABLE STATE SECURITIES LAWS OR, UNLESS REASONABLY REQUESTED BY THE COMPANY,
      THE COMPANY RECEIVES AN OPINION OF COUNSEL REASONABLY SATISFACTORY TO THE
      COMPANY TO THE EFFECT THAT REGISTRATION UNDER SUCH ACT AND SUCH APPLICABLE
      STATE
      SECURITIES LAWS IS NOT REQUIRED.

    


    (b)
       Any
      legend required by the securities (“Blue Sky”) laws of any state.

    


    The
      legend referred to in clause (a) above shall be removed by the Company from
      any
      certificate at such time as the holder of the securities represented by the
      certificate delivers an opinion of counsel reasonably satisfactory to the
      Company to the effect that such legend is not required in order to establish
      compliance with any provisions of the Securities Act, or at such time as the
      holder of such shares satisfies the requirements of Rule 144 or such other
      substantially similar rule promulgated under the Securities Act then in effect
      under the Securities Act; provided, that the Company has received from the
      holder a written representation that (i) such holder is not an affiliate of
      the
      Company and has not been an affiliate during the preceding three months, (ii)
      such holder has beneficially owned and paid for the shares represented by the
      certificate for a period of at least one year (or the period of time then
      required by Rule 144 or such other substantially similar rule promulgated under
      the Securities Act then in effect), and (iii) such holder otherwise satisfies
      the requirements of Rule 144 as then in effect with respect to such
      shares.


    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

    


    4.9 No
      Short
      Sales. The Noteholders and their affiliates have not engaged in short sales
      of
      the Common Stock (as defined in applicable SEC and FINRA rules) prior to the
      date hereof and will not engage in short sales of the Common Stock prior to
      the
      registration of the Shares.

    


    5. Representations
      and warranties of the Agent.
      The
      Agent represents and warrants to the Company that it is authorized to act on
      behalf of the Noteholders with respect to the transactions referred to in this
      Agreement including providing the Noteholders” representations and warranties
      set forth in Section
      4
      above.

     

    6. Conditions
      to the Obligations of the Noteholders.
      The
      obligation of the Noteholders to convert the Notes into the Securities (the
      “Conversion”)
      is
      subject to the fulfillment, or the written waiver, of each of the following
      conditions on or before the date of the Conversion (the “Conversion
      Date”):

     

    6.1 Accuracy
      of Representations and Warranties. Each representation and warranty of the
      Company contained in Section
      3
      hereof
      shall be true on and as of the Conversion Date with the same effect as though
      such representation and warranty had been made on and as of that
      date.

     

    6.2 Performance.
      the Company shall have performed and complied with all covenants, agreements
      and
      conditions contained in this Agreement and required to be performed or complied
      with by the Company prior to or at the Conversion Date.

     

    6.3 Proceedings
      and Documents. All documents and instruments incident to the transactions
      contemplated at the Conversion shall be reasonably satisfactory in substance
      and
      form to each Noteholder and his counsel.

     

    6.4
       Share
      Certificates and Warrants. Each Noteholder shall have received a certificate
      or
      certificates representing such number of Shares of his investment and the
      Warrants registered in his name as set forth on the Schedule of
      Noteholders.

     

    6.6 Execution
      of Registration Rights Agreement. The Company shall have executed and delivered
      to the Registration Rights Agreement in the form appended hereto as Exhibit
      B.

     

    7. Condition
      to the Obligations of the Company.
      The
      obligation of the Company to sell the Shares and deliver the Warrants at the
      Conversion is subject to fulfillment, or the written waiver, of each of the
      following conditions on or before the Conversion Date:

     

    7.1 Accuracy
      of Representations and Warranties. Each representation and warranty of the
      Noteholders contained in Section
      4
      hereof
      shall be true on and as of the Conversion Date with the same effect as though
      such representation and warranty had been made on and as of that
      date.


    
      
        
        

      

      
        -7-

        
          

        

      

      
        
        

      

    


    7.2 Performance.
      All covenants, agreements and conditions contained in this Agreement and
      required to be performed by the Noteholders on or prior to the Conversion Date
      shall have been performed or complied with in all material
      respects.

     

    8.
       Covenants
      of the Company.
      In
      addition to any covenants set forth in the Company's Certificate of
      Incorporation, the Company agrees that, so long as any Noteholder and/or an
      affiliate thereof beneficially owns any Shares and/or a Warrant remains
      outstanding:

    


    8.1
       Maintenance
      of Existence. the Company shall at all times (a) preserve, renew and keep in
      full force and effect its legal existence and rights and franchises with respect
      thereto; and (b) maintain in full force and effect all patents, copyrights,
      permits, licenses, trademarks, trade names, approvals, authorizations, leases
      and contracts necessary to carry on the business as currently or proposed to
      be
      conducted.

    


    8.2 Payment
      of Obligations. The Company shall pay and discharge at or before maturity,
      all
      of its material obligations and liabilities, including, without limitation,
      tax
      liabilities, except where the same may be contested in good faith by appropriate
      proceedings or as waived, forgiven or modified by the creditor, and will
      maintain, in accordance with generally accepted accounting principles as they
      then exist, appropriate reserves for the accrual of any of the
      same.

    


    8.3 Reservation
      of Shares. The Company shall at all times duly reserve the
      Warrant Shares for
      issuance upon exercise of the Warrants. 

    


    9.
       Indemnity.
      The
      Company shall, with respect to the representations, warranties, covenants and
      agreements made by it herein indemnify, defend and hold each Noteholder and
      his
      employees, partners, agents, counsel and affiliates (each, an “Indemnified
      Party”)
      harmless from and against all liability, loss or damage, together with all
      reasonable costs and expenses related thereto (including legal and accounting
      fees and expenses), arising from the untruth, inaccuracy or breach of any such
      representations, warranties, covenants or agreements of the Company contained
      in
      this Agreement or the assertion of any claims relating to the foregoing. Without
      limiting the generality of the foregoing, each Indemnified Party shall be deemed
      to have suffered liability, loss or damage as a result of the untruth,
      inaccuracy or breach of any such representations, warranties, covenants or
      agreements if such liability, loss or damage shall be suffered by the
      Indemnified Party as a result of, or in connection with, such untruth,
      inaccuracy or breach or any facts or circumstances constituting such untruth,
      inaccuracy or breach. the Company shall indemnify and hold harmless each
      Indemnified Party against any losses, claims, damages or liabilities, joint
      or
      several, to which any of the foregoing persons may become subject, insofar
      as
      such losses, claims, damages or liabilities (or actions in respect thereof)
      arise out of or are based upon any violations by the Company of the Securities
      Act or state Blue Sky laws applicable to the Company relating to action or
      inaction required of the Company in connection with the Securities Act or
      registration or qualification under such state Blue Sky laws; and shall
      reimburse each such Indemnified Party for any legal or any other expenses
      reasonably incurred by any of them in connection with investigating or defending
      any such loss, claim, damage, liability or action; provided,
      however,
      that no
      indemnification shall be required hereunder for the gross negligence or willful
      misconduct of any Indemnified Party or material breach by a Noteholder of any
      of
      the representations and warrants set forth in Section
      4
      hereof.
      In case any such action is brought against an Indemnified Party, the Company
      will be entitled to participate in and assume the defense thereof with counsel
      reasonably satisfactory to such Indemnified Party, and after notice from the
      Company to such Indemnified Party of its election to assume the defense thereof,
      the Company shall be responsible for any legal or other expenses subsequently
      incurred by the latter in connection with the defense thereof, provided that
      if
      any Indemnified Party shall have reasonably concluded that there may be one
      or
      more legal defenses available to such Indemnified Party that conflict in any
      material respect with those available to the Company, or that such claims or
      litigation involves or could have an effect upon matters beyond the scope of
      the
      indemnity provided by this Section
      9,
      the
      Company shall reimburse such Indemnified Party and shall not have the right
      to
      assume the defense of such action on behalf of such Indemnified party and the
      Company shall reimburse each such Indemnified Party and any individual,
      partnership, limited liability company, corporation, joint stock company, trust,
      estate, joint venture, association or unincorporated organization, or any other
      form of business or professional entity (“Person”) controlling such Indemnified
      Party for that portion of the reasonable fees and expenses of any counsel
      retained by the Indemnified Party. the Company shall not make any settlement
      of
      any claims indemnified against hereunder without the written consent of the
      Indemnified Party or Parties, which consent shall not be unreasonably withheld.
      Any claim for indemnification under this Section
      9
      with
      respect to representations and warranties must be made not later than the end
      of
      the 12-month survival period set forth in Section
      10.2.


    
      
        
        

      

      
        -8-

        
          

        

      

      
        
        

      

    

     

    10. Miscellaneous.

     

    10.1 Assignment.
      This Agreement and all of the provisions hereof will be binding upon and inure
      to the benefit of the parties hereto and their respective successors and
      permitted assigns. Neither this Agreement nor any of the rights, interests
      or
      obligations hereunder may be assigned by any party without prior written consent
      of the other party.

     

    10.2 Survival
      of Representations and Warranties. The warranties, representations and covenants
      of the Company and the Noteholders contained in or made pursuant to this
      Agreement shall survive the execution and delivery of this Agreement for a
      period of 12 months after the date hereof and shall in no way be affected by
      any
      investigation of the subject matter thereof made by or on behalf of the
      Noteholders or the Company.

     

    10.3 Notices.
      Unless otherwise provided, any notice required or permitted under this Agreement
      shall be given in writing and shall be deemed effectively given (i) upon
      personal delivery to the party to be notified, (ii) four days after deposit
      with
      the United States Post Office, by registered or certified mail, postage prepaid,
      or (iii) one day after deposit with a reputable overnight courier service and
      addressed to the party to be notified:

     


    
      
        
        

      

      
        -9-

        
          

        

      

      
        
        

      

    


    If
      to the
      Company:

    


    Conversion
      Services International, Inc.

    100
      Eagle
      Rock Avenue

    East
      Hanover, NJ 07936

    Attn: Scott
      Newman, President and Chief Executive Officer

    


    With
      a
      Copy to:

    


    Ellenoff
      Grossman & Schole LLP

    370
      Lexington Avenue

    New
      York,
      NY 10019

    Attn:
      David Selengut, Esq.

    


    If
      to the
      Noteholders:

    


    TAG
      Virgin Islands, Inc.

    The
      Tunick Building

    1336
      Beltjen Road, Suite 202

    St.
      Thomas, VI 00802

    Attn: James
      Tagliaferri, President 

    


    With
      a
      copy to:

    


    Barry
      Feiner, Esq.

    170
      Harrison Avenue

    Harrison,
      New York 10528

     

    10.4 Brokers.
      Each Noteholder, on the one hand, and the Company, on the other hand
      (a) represents and warrants to the other party that he/it has not retained
      any finders or brokers in connection with the transactions contemplated by
      this
      Agreement, and (b) will indemnify and save the other party harmless from
      and against any and all claims, liabilities or obligations with respect to
      brokerage or finders’ fees or commissions, or consulting fees in connection with
      the transactions contemplated by this Agreement asserted by any Person on the
      basis of any statement or representation alleged to have been made by
      him/it.

     

    10.5 Expenses.
      The Company and the Noteholders
      shall
      bear their own expenses incurred with respect to this Agreement and the
      transactions contemplated hereby except that the Company shall pay the
      reasonable fees and expenses incurred by the Noteholders for the legal services
      rendered to them with respect to this Agreement and the transactions
      contemplated hereby. 


    
      
        
        

      

      
        -10-

        
          

        

      

      
        
        

      

    


    10.6 Entire
      Agreement. This Agreement, the other documents delivered herewith pursuant
      to
      this Agreement and the Purchase Agreement embody the entire agreement and
      understanding between the parties hereto with respect to the subject matter
      hereof and supersede all prior agreements and understandings relating to such
      subject matter.

     

    10.7 Amendments
      and Waivers. Any term of this Agreement may be amended and the observance of
      any
      term of this Agreement may be waived (either generally or in a particular
      instance and either retroactively or prospectively) only with the written
      consent of the Company and the Noteholders. No waivers of or exceptions to
      any
      term, condition or provision of this Agreement, in any one or more instances,
      shall be deemed to be, or construed as, a further or continuing waiver of any
      such term, condition or provision.

     

    10.8 Counterparts.
      This Agreement may be executed in one or more counterparts, each of which shall
      be deemed to be an original, but all of which shall be one and the same
      document.

     

    10.9 Section
      Headings. The Section headings are for the convenience of the parties and in
      no
      way alter, modify, amend, limit, or restrict the contractual obligations of
      the
      parties.

     

    10.10 Severability.
      Any part, provision, representation or warranty of this Agreement that is
      prohibited or that is held to be void or unenforceable shall be ineffective
      solely to the extent of such prohibition or unenforceability without
      invalidating the remaining provisions hereof.

     

    10.11 Governing
      Law. This Agreement shall be governed by and construed in accordance with the
      laws of the State of Delaware (without regard to its conflict of laws
      principles). The parties hereto irrevocably consent to the exclusive personal
      jurisdiction of the federal and state courts located in the New York County,
      New
      York, as applicable, for any matter arising out of or relating to this
      Agreement. 

     

    10.12 Gender.
      The use herein of the masculine pronouns or similar terms shall be deemed to
      include the feminine and neuter genders as well and the use of the singular
      pronouns shall be deemed to include the plural as well.

     

    (signature
      page to follow)


    
      
        
        

      

      
        -11-

        
          

        

      

      
        
        

      

    


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

    


    
      	
              CONVERSION
                SERVICES INTERNATIONAL, INC.

            
	 	 
	
              By:

            	  

	 	
              Name:   
                Scott Newman

            
	 	
              Title:     
                President and Chief Executive Officer

            
	 	 
	
              TAG
                VIRGIN ISLANDS, INC.,

            
	
              as
                agent for the Noteholders

            
	 	 
	
              By:
                

            	   

	 	
              Name:   
                James Tagliaferri

            
	 	
              Title:     
                President

            


    


    
      
        
        

      

      
        -12-