This investment is in the form of a convertible note that is secured by certain assets of RedMoon and is convertible into equity of RedMoon. Zoom has also entered into an option agreement with RedMoon which provides Zoom with the option to purchase 100% of RedMoon under the terms and conditions there under.
In addition, Zoom has agreed to purchase an additional $50,000 per month of convertible notes beginning on May 1, 2008 and continuing until the earlier of Zoom’s election to exercise its option to buy RedMoon or Zoom’s election to terminate such option agreement, up to a maximum total investment of $500,000. Finally, Zoom is entitled to designate and have elected a representative to the board of directors of RedMoon.
Frank Manning, president and CEO of Zoom, said: RedMoon has a proven track record of installing high-performance wireless networks, and has strong links to Texas communities, powerful business partners, and suppliers. We are particularly excited about RedMoon’s prospects in the wireless meter reading and public safety areas. We believe that Zoom’s investment and experience will help accelerate RedMoon’s growth, potentially making RedMoon an attractive acquisition for Zoom.
