Option Agreement



 Exhibit 10.42 
  
 THIS OPTION AND THE SHARES OF COMMON STOCK ISSUABLE UPON THE EXERCISE HEREOF, HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS
AMENDED (THE “ACT”), OR FILED OR REGISTERED WITH THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR WITH THE SECURITIES REGULATORY AUTHORITY OF ANY STATE, BUT ARE BEING ISSUED PURSUANT TO CERTAIN EXEMPTIONS THEREUNDER. THIS OPTION,
AND SUCH SHARES OF COMMON STOCK, HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE UNITED STATES SECURITIES AND EXCHANGE COMMISSION OR BY THE SECURITIES REGULATORY AUTHORITY OF ANY STATE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. THIS
OPTION, AND SUCH SHARES OF COMMON STOCK, ARE SUBJECT TO RESTRICTIONS ON TRANSFERABILITY AND RESALE, AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND THE APPLICABLE STATE SECURITIES LAWS,
PURSUANT TO REGISTRATION THEREUNDER OR EXEMPTION THEREFROM. 
  
 PUBLIC MEDIA WORKS, INC. 
 STOCK OPTION AGREEMENT 
  
 This Stock Option Agreement (this “Agreement”) is made as of December 21, 2005 (the “Grant
Date”) between Public Media Works, Inc., a Delaware corporation (the “Company”), and Stephen Brown (the “Optionee”). 
  

1. Option Grant; Exercise of Option. In connection with the Employment Agreement dated as of December 21, 2005 between the
Company and Optionee (the “Employment Agreement”), the Company hereby grants to Optionee an option (the “Option”) to purchase up to 20,000,000 shares of the Company’s common stock, $.0001 par value (the
“Shares”), at an exercise price per share, and with vesting and expiration conditions as follows: 
  

													
	 Month

	  	May 21, 2006

	  	December 21, 2006

	  	May 21, 2007

	  	December 21, 2007


	 Amount Vested
	  	 	5,000,000	  	 	5,000,000	  	 	5,000,000	  	 	5,000,000
	 Exercise Price
	  	$	.15	  	$	.30	  	$	.60	  	$	1.20
	 Trading Price Condition Precedent For Exercise(1)
	  	$	.30	  	$	.60	  	$	1.20	  	$	2.40
	 Expiration of Options(2)
	  	 	June 21, 2006	  	 	January 21, 2007	  	 	June 21, 2007	  	 	January 21, 2008

  

	(1)	Optionee may not exercise the options unless the average closing price of the Company Common Stock on the OTC Bulletin Board or a national securities exchange meets or exceeds the
stated trading price for the thirty (30) trading days preceding Optionee’s election to exercise the options. 











	(2)	The options may expire earlier in the event Optionee’s employment is terminated as provided in Section 2 below. 

  
 The number of shares of Common Stock to be received upon the exercise of this
Option and the price to be paid for a share of Common Stock may be adjusted from time to time as hereinafter set forth. The shares of the Common Stock deliverable upon such exercise, and as adjusted from time to time, are hereinafter sometimes
referred to as “Option Stock,” and the exercise price of a share of Common Stock in effect at any time and as adjusted from time to time is hereinafter sometimes referred to as the “Exercise Price.” If the date on
which the Optionee’s right to purchase Common Stock expires is a day on which national banks in Van Nuys, California, are authorized by law to close, then that right shall expire on the next succeeding day that is not such a day. The Optionee
shall exercise all rights to purchase Common Stock by presenting and surrendering this Option to the Company or at the office of its stock transfer agent, if any, with the Purchase Form attached hereto duly executed and accompanied by payment of the
Exercise Price for the number of shares specified in such form. 
  
 2. Termination of Options. The Options granted hereunder will expire, unless previously exercised in full, on or before the first to occur of (i) sixty (60) days after the termination of Optionee’s
employment under the Employment Agreement, or (ii) as provided in Section 1 above. 
  
 3. Reservation of Shares; Fractional Shares. The Company hereby agrees that at all times there shall be reserved for issuance and delivery upon exercise of this Option such number of shares of
Common Stock as shall be required for issuance or delivery upon exercise of this Option. No fractional shares or script representing fractional shares shall be issued upon the exercise of this Option. If the Common Stock is listed or admitted to
unlisted trading privileges, then the current value shall mean the closing price of the Common Stock on the last business day prior to the exercise if this Warrant. If the Common Stock is not listed or admitted to unlisted trading privileges, then
the current value shall be an amount determined in such reasonable manner as may be prescribed by the Company’s board of directors. 
  
 4. Transfer, Assignment or Loss of Option. 
  

(a) This Option and the Option Stock have not been filed or registered with the United States Securities and Exchange Commission or
with the securities regulatory authority of any state. This Option and the Option Stock are subject to restrictions imposed by federal and state securities laws and regulations on transferability and resale, and may not be transferred assigned or
resold except as permitted under the Securities Act of 1933, as amended (the “Act”), and the applicable state securities laws, pursuant to registration thereunder or exemption therefrom. This Option may not be transferred or
assigned by Optionee. 
  
 (b) Upon receipt by the
Company of evidence satisfactory to it of the loss, theft, destruction or mutilation of this Option, and in the case of loss, theft or destruction 

  

 2 








 
of reasonably satisfactory indemnification, and upon surrender and cancellation of this Option in the case of mutilation, the Company will execute and
deliver a new Option of like tenor and date. Any such new Option executed and delivered shall constitute an additional contractual obligation on the part of the Company, whether or not this Option so lost, stolen, destroyed or mutilated shall be at
any time enforceable by anyone. 
  
 (c) The
Company may cause any legend required under the Act and applicable state securities laws, or advisable in the opinion of its legal counsel, to be set forth on each Option, on each certificate representing Option Stock, and on any other security
issued or issuable upon exercise of this Option. 
  
 5.
Rights of the Optionee. The Optionee shall not, by virtue hereof, be entitled to any rights of a stockholder in the Company, either at law or equity, and the rights of the Optionee as the holder of this Option are limited to those
expressed in this Option. 
  
 6. Anti-Dilution
Provisions. If the Company shall at any time subdivide the outstanding shares of Common Stock, or shall issue a stock dividend on the outstanding Common Stock, then the Exercise Price in effect immediately prior to that subdivision or
the issuance of that dividend shall be proportionately decreased, and if the Company shall at any time combine the outstanding shares of Common Stock, then the Exercise Price in effect immediately prior to that combination shall be proportionately
increased, effective at the close of business on the date of the subdivision, dividend or combination, as the case may be. 
  
 7. Representations of Optionee. The Company is issuing this Option to Optionee, and any and all Option Stock to Optionee, in reliance
upon the following representations made by Optionee, as of the date of this Option, and the date of each exercise of this Option: 
  
 (a) Optionee is an “accredited investor” within the meanings set forth in Regulation D of the Securities Act of 1933, as amended. 
  
 (b) Optionee (i) has had, and continues to have, access to detailed
information with respect to the business, financial condition, results of operations and prospects of the Company; (ii) has received or has been provided access to all material information concerning the Company; and (iii) has been given
the opportunity to obtain any additional information or documents from, and to ask questions and receive answers of, the officers, directors and representatives of the Company to the extent necessary to evaluate the merits and risks related to
equity in the Company represented by the Option and Option Stock. 
  
 (c) As a result of Optionee’s study of the aforementioned information and his prior overall experience in financial matters, and his familiarity with the nature of businesses such as the Company, Optionee is properly able to
evaluate the capital structure of the Company, the business of the Company, and the risks inherent therein. 
  

 3 








 (d) Optionee’s investment in the Company pursuant to this Option and Option Stock is
consistent, in both nature and amount, with his overall investment program and financial condition. 
  
 (e) Optionee’s financial condition is such that he can afford to bear the economic risk of holding the Option and Option tock and to suffer a
complete loss of his investment in the Company represented by the Option Stock. 
  
 (f) Optionee’s principal residence is as set forth on the signature page hereto. 
  
 8. Reclassification, Reorganization or Merger. In case of any reclassification, capital reorganization or other change of outstanding
shares of Common Stock of the Company (other than a change in par value, or from par value to no par value, or from no par value to par value, or as a result of an issuance of Common Stock by way of dividend or other distribution or of a subdivision
or combination), or in case of any consolidation or merger of the Company with or into another corporation (other than a merger with a subsidiary in which merger the Company is the continuing corporation and which does not result in any
reclassification, capital reorganization or other change of outstanding shares of Common Stock of the class issuable upon exercise of this Option) or in case of any sale or conveyance to another corporation of the property of the Company as an
entirety or substantially as an entirety, the Company shall cause effective provision to be made so that the Optionee shall have the right thereafter, by exercising this Option, to purchase the kind and amount of shares of stock and other securities
and property receivable upon such classification, capital reorganization or other change, consolidation, merger, sale or conveyance. Any such provision shall include provision for adjustments which shall be as nearly equivalent as may be practicable
to the adjustments provided for in this Option. The foregoing provisions of this Section 8 similarly apply to successive reclassifications, capital reorganizations and changes of shares of Common Stock and to successive consolidations, mergers,
sales or conveyances. In the event that in any such capital reorganization or reclassification, consolidation, merger, sale or conveyance, additional shares of Common Stock shall be issued in exchange, conversion, substitution or payment, in whole
or in part, for or of a security of the Company other than Common Stock, any such issue shall be treated as an issue of Common Stock covered by the provisions of Section 8 hereof with the amount of the consideration received upon the issue
thereof being determined by the Company’s board of directors, such determination to be final and binding on the Optionee. 
  
 9. Miscellaneous. 
  
 (a) All notices given under this Option shall be in writing, addressed to the Company at 14759 Oxnard Blvd., Van Nuys, California 91411,
and to the Optionee at the Optionee’s address set forth is the Company’s records, or at such other address as a party may specify by notice given in accordance with this paragraph, and shall be effective on the earliest of (i) the
date received, or (ii) if given by facsimile transmittal with receipt electronically confirmed on the date given if transmitted before 5:00 p.m., the recipient’s time, otherwise it is effective the next day, or (iii) on the second
business day after 

  

 4 








 
delivery to a major international air delivery or air courier service (such as Federal Express or Network Couriers). 
  
 (b) This Option is binding on and, except for the
limitations on transfer and assignment contained in Section 4, shall inure to the benefit of the successors in interest of the Company and the Optionee, respectively. 
  
 (c) This Agreement constitutes and contains the entire agreement and understanding concerning the grant of
options to Optionee, and supersedes and replaces all prior negotiations and all agreements proposed or otherwise, whether written or oral, concerning the granting or issuance of any options or equity to Optionee in connection with Optionee’s
employment with the Company. This Agreement may only be modified or amended by a mutually executed written agreement between Optionee and the Company. 
  
 (d) This Option shall be construed and enforced in accordance with the laws of California. 
  
 (e) Any controversy or claim arising out of or relating to
this Agreement (whether in contract or tort, or both) shall be determined by binding arbitration at Van Nuys, California, in accordance with the commercial arbitration rules of the American Arbitration Association, by a panel of three arbitrators,
one chosen by each of the parties and the third by the two so chosen. If the two arbitrators cannot agree on a third, then the third shall be appointed in accordance with such rules. The prevailing party in any arbitration proceeding shall be
awarded reasonable attorneys fees and costs of the proceeding. The arbitration award shall be final, and may be entered in and enforced by any court having jurisdiction. 
  
 This Option is dated and effective as of December 21, 2005. 
  

									
	COMPANY:	 	 	 	OPTIONEE:
			
	 Public Media Works, Inc.
	 	 	 	 
				
	By:	 	/s/    CORBIN BERNSEN        	 	 	 	/s/    STEPHEN
BROWN        
	 	 	Corbin Bernsen, President	 	 	 	Stephen Brown
				
	 	 	 	 	 	 	 Principal Residence:

				
	 	 	 	 	 	 	 1529 Villa Rica Drive
 Henderson, Nevada 89052


  

 5 








 PURCHASE FORM 
  
 Date: ____________________ 
  
 TO: PUBLIC MEDIA WORKS, INC.: 
  
 The undersigned hereby irrevocably elects to exercise the within Option to the extent of purchasing
                                        
     (                    ) shares of Common Stock, and hereby makes payment of _______________ Dollars and
_________________ Cents ($__________) in payment of the Exercise Price thereof. 
  
 INSTRUCTIONS FOR ISSUANCE OF STOCK 
  

			
	 Name: 
	  	 


			
		
	 Address: 
	  	 


			
		
	 City, State, Zip Code: 
	  	 

  
 Signature ____________________________

  
 Name _______________________________ 
  
 Date signed __________________________