Debt Conversion Agreement


    
      

    

    Exhibit 10.16

    
 

    DEBT
      CONVERSION AGREEMENT


    


    This
      Debt
      Conversion Agreement (the “Agreement”) dated January 2, 2007, is by and between,
      Data Call Technologies, Inc., a Nevada corporation (the "Company") and Milford
      Mast, an individual (the “Creditor”).


    


    W I T N E S S E T H:


    


    WHEREAS,
      the
      Company owes $50,000 to the Creditor in consideration for $50,000 loaned to
      the
      Company in October 2006, which loan was to bear interest at the rate of 7%
      per
      annum and was due and payable on December 31, 2007 (the “Loan”);

    


    WHEREAS,
      the
      Company desires to convert the Loan into shares of newly issued restricted
      common stock of the Company, $0.001 par value per share at a rate of one (1)
      share of Common Stock for every $0.10 of the Loan (the “Common Stock” and the
“Conversion Rate;

    


    WHEREAS,
      the
      Creditor agrees to convert the Loan into Common Stock at the Conversion Rate
      and
      to forgive any accrued and unpaid interest on the Loan (“Accrued
      Interest”);

    


    WHEREAS,
      the
      Company and the Creditor desire to set forth in writing the terms and conditions
      of their agreement and understanding concerning conversion of the Loan;
      and

    


    NOW,
      THEREFORE,
      in
      consideration of the premises and the mutual covenants, agreements, and
      considerations herein contained, the parties hereto agree as
      follows:

    
 

    
      	
              1.

            	
              Consideration.
                In consideration and in satisfaction of the forgiveness of the entire
                $50,000 owed pursuant to and in connection with the Loan, which amount
                is
                owed to the Creditor, the Company agrees to issue the Creditor an
                aggregate of 500,000 shares of Common Stock (one share for every
                $0.10 of
                the Loan converted into shares of common stock)(the
                “Shares”).

            
	 	 
	 	
              In
                consideration for the issuance of the Shares, the Creditor agrees
                to
                forgive the Loan and to waive and forgive any accrued and unpaid
                interest
                payable there under.

            
	 	 
	
              2.

            	
              Restricted
                Shares.
                The Creditor agrees and understands that the Shares of the Company
                to be
                issued to the Creditor have not
                been registered under the Securities Act of 1933, as amended (the
“1933
                Act”), nor registered under any state securities law, and will be
                "restricted securities" as that term is defined in Rule 144 under
                the 1933
                Act. As such, the Shares may not be offered for sale, sold or otherwise
                transferred except pursuant to an effective registration statement
                under
                the 1933 Act, or pursuant to an exemption from registration under
                the 1933
                Act. The shares to be issued to the Creditor will bear an appropriate
                restrictive legend. 

            


    

    



    
      
         

         

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    
 

    
      	 	
              The
                Creditor understands that the Company has not registered the Shares
                under
                the 1933 Act or the applicable securities laws of any state in reliance
                on
                exemptions from registration and further understands that such exemptions
                depend upon the Creditor’s investment intent at the time he acquires the
                Shares. The Creditor therefore represents and warrants he is receiving
                the
                Shares for his own account for investment and not with a view to
                distribution, assignment, resale or other transfer of the Shares.
                Because
                the Shares are not registered, the Creditor is aware that he must
                hold
                them indefinitely unless they are registered under the 1933 Act and
                any
                applicable state securities laws or he must obtain exemptions from
                such
                registration. Creditor acknowledges that the Company is under no
                duty to
                comply with any exemption in the connection with the Creditor’s sale,
                transfer or other disposition under applicable rules and regulations.
                Creditor understands that in the event he desires to sell, assign,
                transfer, hypothecate or in any way alienate or encumber the Shares
                in the
                future, the Company can require that the Creditor provide, at Creditor’s
                own expense, an opinion of counsel satisfactory to the Company to
                the
                effect that such action will not result in a violation of applicable
                federal or state securities laws and regulations or other applicable
                federal or state laws and
                regulations.

            


    

    


    
      	
              3.

            	
              Full
                Satisfaction.
                Creditor agrees that it is accepting the Shares in full satisfaction
                of
                the Loan which is being converted into Common Stock and that as such
                Creditor will no longer have any rights of repayment against the
                Company
                as to the $50,000 previously outstanding under the Loan which is
                being
                converted into Shares pursuant to this Agreement (or any accrued
                or unpaid
                interest which is being waived by Creditor as described above), at
                such
                time as the Shares have been issued to Creditor.

            
	 	 
	
              4.

            	
              Mutual
                Representations, Covenants and Warranties.

            


    

    


    
      	
              (a)

            	
              The
                parties have all requisite power and authority, corporate or otherwise,
                to
                execute and deliver this Agreement and to consummate the transactions
                contemplated hereby and thereby. The parties have duly and validly
                executed and 
                delivered
                  this Agreement and will, on or prior to the consummation of the
                  transactions contemplated herein, execute, such other documents
                  as may be
                  required hereunder and, assuming the due authorization, execution
                  and
                  delivery of this Agreement by the parties hereto and thereto, this
                  Agreement constitutes, the legal, valid and binding obligation
                  of the
                  parties enforceable against each party in accordance with its terms,
                  except as such enforcement may be limited by applicable bankruptcy,
                  insolvency, reorganization, moratorium or similar laws affecting
                  creditors’ rights generally and general equitable
                  principles.

              

            
	 	 
	
              (b)

            	
              The
                execution and delivery by the parties of this Agreement and the
                consummation of the transactions contemplated hereby and thereby
                do not
                and shall not, by the lapse of time, the giving of notice or otherwise:
                (a) constitute a violation of any law; or (b) constitute a breach
                or
                violation of any provision contained in the Articles of Incorporation
                or
                Bylaws, or such other document(s) regarding organization and/or management
                of the parties, if applicable; or (c) constitute a breach of any
                provision
                contained in, or a default under, any governmental approval, any
                writ,
                injunction, order, judgment or decree of any governmental authority
                or any
                contract to which either the Company or the Creditor is a party or
                by
                which either the Company or the Creditor is bound or
                affected.

            


    

    


    
      	
              5.

            	
              Creditor
                Representations and Warranties.
                The Creditor represents and warrants to the Company that the Creditor
                has
                such knowledge and experience in financial and business matters that
                the
                Creditor is capable of evaluating the merits and risks of an investment
                in
                the Shares and that the Creditor is an “accredited investor” as such term
                is defined under the 1933 Act. The Creditor represents that it is
                familiar
                with the Company’s business objectives and the financial arrangements in
                connection therewith and he believes that the Shares are the kind
                of
                securities that he wishes to hold for investment and that the nature
                and
                amount of the Shares are consistent with his investment program.
                The
                Creditor has been advised and is fully aware that investing in securities
                such as the Shares is a speculative and uncertain undertaking whose
                advantages and benefits are generally limited to a certain class
                of
                investors who understand the nature of the proposed operations of
                the
                Company and for whom the investment is suitable. The Creditor recognizes
                that an investment in the Shares involves certain risks and he has
                taken
                full cognizance of and understands all of the risk factors related
                to the
                business objectives of the Company and the
                Shares.

            


    

    


    6. Miscellaneous.

    


    
      	
              (a)

            	
              Assignment.
                All of the terms, provisions and conditions of this Agreement shall
                be
                binding upon and shall inure to the benefit of and be enforceable
                by the
                parties hereto and their respective successors and permitted
                assigns.

            
	 	 
	
              (b)

            	
              Applicable
                Law.
                This Agreement shall be construed in accordance with and governed
                by the
                laws of the State of Texas, excluding any provision which would require
                the use of the laws of any other jurisdiction.

               

            


    


    
      
         

        
        

      

      
        
        

        
          

        

      

      
        
        

      

    


    


    
      	
              (c)

            	
              Entire
                Agreement, Amendments and Waivers.
                This Agreement constitutes the entire agreement of the parties regarding
                the subject matter of the Agreement and expressly supersedes all
                prior and
                contemporaneous understandings and commitments, whether written or
                oral,
                with respect to the subject matter hereof. No variations, modifications,
                changes or extensions of this Agreement or any other terms hereof
                shall be
                binding upon any party hereto unless set forth in a document duly
                executed
                by such party or an authorized agent or such party. 

            
	 	 
	
              (d)

            	
              Section
                Headings.
                Section headings are for convenience only and shall not define or
                limit
                the provisions of this Agreement.

            
	 	 
	
              (e)

            	
              Effect
                of Facsimile and Photocopied Signatures. This
                Agreement may be executed in several counterparts, each of which
                is an
                original. It shall not be necessary in making proof of this Agreement
                or
                any counterpart hereof to produce or account for any of the other
                counterparts. A copy of this Agreement signed by one party and faxed
                to
                another party shall be deemed to have been executed and delivered
                by the
                signing party as though an original. A photocopy of this Agreement
                shall
                be effective as an original for all
                purposes.

            


    

    


    IN
      WITNESS WHEREOF,
      the
      parties hereto have executed this Agreement as of the day and year first written
      above.

     

    


    Data
      Call Technologies, Inc.

    


                                                                                                                           
      /s/ James Ammons   

    James
      Ammons,

    Chief
      Executive Officer

     

    
      “Creditor”

                                            
        /s/ Milford Mast


                                                       
        Milford Mast