Document:

f8k082713ex4i_ioworldmedia.htm

EXHIBIT 4.1

THIS 10% CONVERTIBLE DEBENTURE AND THE COMMON STOCK ISSUABLE UPON CONVERSION HEREOF HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), NOR UNDER ANY STATE SECURITIES LAW, AND MAY NOT BE PLEDGED, SOLD, ASSIGNED, HYPOTHECATED OR OTHERWISE TRANSFERRED UNTIL (1) A REGISTRATION STATEMENT WITH RESPECT THERETO IS EFFECTIVE UNDER THE SECURITIES ACT AND ANY APPLICABLE STATE SECURITIES LAW OR (2) THE COMPANY RECEIVES AN OPINION OF COUNSEL, EITHER FROM COUNSEL TO THE COMPANY OR COUNSEL TO THE HOLDER HEREOF WHO IS REASONABLY SATISFACTORY TO THE COMPANY, THAT SUCH 10% CONVERTIBLE DEBENTURE OR COMMON STOCK MAY BE PLEDGED, SOLD, ASSIGNED, HYPOTHECATED OR TRANSFERRED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR APPLICABLE STATE SECURITIES LAWS.

 

IOWORLDMEDIA, INCORPORATED

10% Convertible Debenture

Due           , 2014

 

$_____________

 

As of            , 2013

 

IOWORLDMEDIA, INCORPORATED, a corporation incorporated under the laws of the state of Florida (the “Company” or “Maker”), for value received, hereby promises to pay to _________________________, or its registered assigns (the “Payee” or “Holder”), at ________________________________________, upon due presentation and surrender of this 10% Convertible Debenture (this “Debenture”), on or after            , 2014 (the “Maturity Date”), the principal amount of __________________ Dollars ($_________) and accrued interest thereon as hereinafter provided.

 

This Debenture was issued by the Company as of            , 2013 (the “Issuance Date).

 

ARTICLE I

PAYMENT OF PRINCIPAL AND INTEREST; METHOD OF PAYMENT

 

1.1.           Payment of Principal and Interest.  Payment of the principal and accrued interest on this Debenture shall be made in such coin or currency of the United States of America as at the time of payment shall be legal tender for the payment of public and private debts.  Interest (computed on the basis of a 365-day year for the number of days elapsed) on the unpaid portion of said principal amount from time to time outstanding shall be paid by the Company at the rate of ten percent (10%) per annum, in like coin and currency, or at the option of the Company, in shares of the Company’s common stock, par value $0.001 per share (“Common Stock”), payable to the Payee on the Maturity Date.  Interest shall accrue from the Issuance Date.  Both principal hereof and interest thereon are payable at the Holder’s address above or such other address as the Holder shall designate from time to time by written notice to the Company.  The Company will pay or cause to be paid all sums becoming due hereon for principal and interest by check, sent to the Holder’s above address or to such other address as the Holder may designate for such purpose from time to time by written notice to the Company, without any requirement for the presentation of this Debenture or making any notation thereon, except that the Holder hereof agrees that payment of the final amount due shall be made only upon surrender of this Debenture to the Company for cancellation.

 

  

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If the Company elects to pay the interest due on the Maturity Date in shares of the Company’s Common Stock, the number of shares issued as payment of the accrued interest shall be equal to the quotient of the aggregate accrued and unpaid interest divided by the Market Price (as defined in Section 4.1 hereof) on the Maturity Date.  No fractional shares or scrip representing fractional shares will be issued upon the payment of accrued interest, but a payment in cash will be made, in respect of any fraction of a share which would otherwise be issuable in connection with the payment of accrued interest in shares of Common Stock.

 

1.2.           Extension of Payment Date.  If this Debenture or any installment hereof becomes due and payable on a Saturday, Sunday or other day on which banks in the state of New York are authorized to remain closed, the due date hereof shall be extended to the next succeeding full Business Day (as defined in Section 3.1 hereof).  All payments received by the Holder shall be applied first to the payment of all accrued interest payable hereunder.

 

ARTICLE II

CONVERSION AND OTHER RIGHTS

 

2.1.           Automatic Conversion into Common Stock.  The Holder acknowledges that, as of the date hereof, the Company does not have a sufficient number of authorized but unissued shares of Common Stock to fully convert the amounts due under this Debenture into shares of Common Stock.  Therefore, the Holder further acknowledges that this Debenture may not be converted into shares of Common Stock except in the circumstances described in this Section 2.1.  The entire principal amount of this Debenture and all accrued and unpaid interest hereunder, without any further action by the Holder, shall automatically convert into shares of Common Stock immediately upon the effectiveness of an amendment to the Company’s Articles of Incorporation that increases the number of authorized shares of Common Stock to a level sufficient to allow all amounts due under this Debenture (including principal and accrued and unpaid interest) to convert into shares of Common Stock.  Upon the automatic conversion of this Debenture, this Debenture shall be surrendered to the Company and cancelled.  The aggregate principal amount of this Debenture shall be convertible into shares of Common Stock at a price per share equal to [$0.005] [$0.0122] (“Conversion Price”), subject to the adjustments as provided for in Section 2.4.  Interest shall accrue to and include the day prior to the date of conversion and shall be paid upon conversion of this Debenture.  Accrued and unpaid interest shall be convertible into a number of shares of Common Stock equal to the quotient of the aggregate accrued and unpaid interest divided by the Market Price (as defined in Section 3.1 hereof) on the date this Debenture converts.  No fractional shares or scrip representing fractional shares will be issued upon any conversion, but a payment in cash will be made, in respect of any fraction of a share which would otherwise be issuable upon the conversion of this Debenture.  The Company shall deliver a certificate for the number of full shares of Common Stock issuable upon conversion and a check for any fractional share.

 

  

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2.2.           No Transfer of Debenture; Issuance of Common Stock Upon Conversion.  This Debenture is not divisible or transferable.

 

Subject to the terms of this Debenture, upon surrender of this Debenture, the Company shall issue and deliver with all reasonable dispatch a certificate for the number of full shares of Common Stock due to such Holder upon the conversion of this Debenture.  The Holder shall be deemed to have become the holder of record of such shares of Common Stock as of the date of the conversion of this Debenture.

 

2.3.           Covenants.

 

(a)           Issuance and Shares of Common Stock upon Conversion.  The Company covenants that all of the shares of Common Stock that shall be issuable upon conversion of this Debenture shall, at the time of delivery, and, subject to Section 2.4 hereof, be duly and validly issued, fully paid, nonassessable and free from all taxes, liens and charges with respect to the issue thereof (other than those which the Company shall promptly pay or discharge).

 

(b)           Restrictive Legend.  Each certificate evidencing shares of Common Stock issued to the Holder following the conversion of this Debenture shall bear the following restrictive legend or a similar legend until such time as the transfer of such security is not restricted under the federal securities laws:

 

THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “ACT”), OR UNDER ANY STATE SECURITIES LAWS, AND MAY NOT BE OFFERED, SOLD, ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF EXCEPT PURSUANT TO (I) AN EFFECTIVE REGISTRATION STATEMENT UNDER THE ACT, (II) TO THE EXTENT APPLICABLE, RULE 144 UNDER THE ACT (OR ANY SIMILAR RULE UNDER SUCH ACT RELATING TO THE DISPOSITION OF SECURITIES), OR (III) AN OPINION OF COUNSEL, IF SUCH OPINION SHALL BE REASONABLY SATISFACTORY TO COUNSEL TO THE ISSUER, THAT AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT IS AVAILABLE.

 

2.4.           Adjustment of Conversion Price and Number of Underlying Shares.  The number of shares of Common Stock issuable upon the conversion of this Debenture and the Conversion Price shall be subject to adjustment from time to time as follows:

 

(a)           Adjustment for Stock Splits and Combinations.  If the Company at any time or from time to time after the date of this Debenture effects a subdivision of the outstanding Common Stock or combines the outstanding shares of Common Stock, then, in each such case, the Conversion Price in effect immediately prior to such event shall be adjusted so that the Holder shall have the right to convert the Holder’s interests into the number of shares of Common Stock which the Holder would have owned after the event had such shares of Common Stock been converted immediately prior to the occurrence of such event.  Any adjustment under this Section 2.4(a) shall become effective as of the date and time such subdivision or combination becomes effective.

 

  

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(b)           No Impairment.  The Company will not, through any reorganization, recapitalization, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other voluntary action, avoid or seek to avoid the observance or performance of any of the terms to be observed or performed hereunder by the Company.

 

(c)           Record Date.  If the Company takes a record of the holders of Common Stock for the purpose of entitling them (i) to receive a dividend or other distribution payable in Common Stock, or in any rights, options or warrants to subscribe for or to purchase Common Stock (such rights or options or warrants being herein called “Options”) or in any stock or other securities convertible into or exchangeable for Common Stock (such convertible or exchangeable stock or securities being herein called “Convertible Securities”) or (ii) to subscribe for or purchase Common Stock, Options or Convertible Securities, then such record date shall be deemed to be the date of the issue or sale of the shares of Common Stock deemed to have been issued or sold upon the declaration of such dividend or the making of such other distribution or the date of the granting of such right of subscription or purchase, as the case may be.

 

(d)           Actions to Maintain Conversion Price Above Par Value.  Before taking any action which would cause an adjustment in the Conversion Price such that, upon conversion of this Debenture, shares of Common Stock with par value, if any, would be deemed to be issued below the then par value of the Common Stock, the Company will take any corporate action which may, in the opinion of its counsel, be reasonably necessary in order that the Company may validly and legally issue fully paid and non-assessable shares of Common Stock at the Conversion Price as so adjusted.

 

(e)           Certificate of Adjustment.  In any case of an adjustment of the number of shares of Common Stock or other securities issuable upon conversion of this Debenture, the chief financial officer or the president of the Company shall compute such adjustment in accordance with the provisions hereof and prepare and sign a certificate showing such adjustment, and shall mail such certificate, by first class mail, postage prepaid, to the Holder of this Debenture at the Holder’s address as shown in the Company’s books.  The certificate shall set forth such adjustment, showing in detail the facts upon which such adjustment is based, including a statement of the number of shares of Common Stock and the type and amount, if any, of other property which at the time would be received upon conversion of this Debenture.

 

(f)           Notices of Record Date.  In the event of (i) any taking by the Company of a record of the holders of any class of securities for the purpose of determining the holders thereof who are entitled to receive any dividend or other distribution, (ii) any reclassification or recapitalization of Common Stock, (iii) any sale of all or substantially all of the Company’s assets to another Person (as defined in Section 3.1 hereof), (iv) any consolidation, merger or other transaction which is effected in such a way that holders of more than fifty percent (50%) of the shares of Common Stock then outstanding are entitled to receive (either directly or upon subsequent liquidation) stock, securities or assets of another Person with respect to or in exchange for Common Stock (being herein called a “Restructuring”) or (v) voluntary or involuntary dissolution, liquidation or winding up of the Company, the Company shall mail to the Holder of this Debenture, not less than ten (10) days and not more than sixty (60) days prior to the date on which the books of the Company shall close, the record date specified therein or the effective date thereof as the case may be, a notice specifying (A) the material terms and conditions of the proposed action, (B) the date on which any such record is to be taken for the purpose of such dividend or distribution and a description of such dividend or distribution, (C) the date on which any such sale of all or substantially all of the Company’s assets, Restructuring, dissolution, liquidation or winding up is expected to become effective, and (D) the time, if any, that is to be fixed, as to when the holders of record of Common Stock (or other securities) shall be entitled to exchange their shares of Common Stock (or other securities) for securities or other property deliverable upon such sale of all or substantially all of the Company’s assets, Restructuring, dissolution, liquidation or winding up.

 

  

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(g)           Notices.  Any notice required by the provisions of this Section 2.4 shall be in writing and shall be deemed given upon delivery if delivered personally or by a recognized commercial courier with receipt acknowledged, or upon the expiration of seventy-two (72) hours after the same has been deposited in the United States mail, by certified or registered mail, return receipt requested, postage prepaid, and addressed to the Holder at his, her or its address appearing on the books of the Company.

 

(h)           Closing of Books.  The Company will at no time close its transfer books against the transfer of any shares of Common Stock issued or issuable upon the conversion of this Debenture in any manner which interferes with the timely conversion of this Debenture into shares of Common Stock.

 

ARTICLE III

MISCELLANEOUS

 

3.1.           Definitions.  In addition to those terms already defined herein, the following terms as used in this Debenture shall have the meanings set forth below:

 

“Business Day” means any day that is not a Saturday, a Sunday or a day on which banks are required or permitted to be closed in the state of New York.

 

 “Market Price”  means, as to any security, the average of the closing prices of such security’s sales on all domestic securities markets on which such security may at the time be listed averaged over a period of ten (10) trading days in which the stock traded immediately preceding the day as of which “Market Price” is being determined.  If at any time such security is not listed on any domestic securities exchange or quoted on the OTC Bulletin Board or other domestic over-the-counter market, the “Market Price” shall be the fair value thereof as determined in good faith by a majority of the Company’s Board of Directors (determined without giving effect to any discount for minority interest, any restrictions on transferability or any lack of liquidity of the Common Stock or to the fact that the Company has no class of equity registered under the Securities Act), such fair value to be determined by reference to the price that would be paid between a fully informed buyer and seller under no compulsion to buy or sell.

 

  

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“Person” means an individual, partnership, corporation, trust, unincorporated organization, joint venture, government or agency, political subdivision thereof, or any other entity of any kind.

 

3.2.           Default.  If one or more of the following described events (each of which being an “Event of Default” hereunder) shall occur and shall be continuing,

 

(i)             any of the representations, covenants, or warranties made by the Company herein shall have been incorrect when made in any material respect; or

 

(ii)            the Company shall breach, fail to perform, or fail to observe in any material respect any material covenant, term, provision, condition, agreement or obligation of the Company under this Debenture, and such breach or failure to perform shall not be cured within thirty (30) days after written notice to the Company; or

 

(iii)           bankruptcy, reorganization, insolvency or liquidation proceedings or other proceedings for relief under any bankruptcy law or any law for the relief of debtors shall be instituted by or against the Company and, if instituted against the Company, Company shall by any action or answer approve of, consent to or acquiesce in any such proceedings or admit the material allegations of, or default in answering a petition filed in any such proceeding or such proceedings shall not be dismissed within sixty (60) calendar days thereafter; or

 

(iv)           a judgment or order for the payment of money in excess of $250,000 shall be rendered against the Company and such judgment or order shall continue unsatisfied and unstayed for a period of ten (10) days and the Company has not filed a formal appeal of such judgment within thirty (30) days of the rendering thereof, then, or at any time thereafter, and in each and every such case, unless such Event of Default shall have been waived in writing by the Holder (which waiver shall not be deemed to be a waiver of any subsequent default) or cured as provided herein, the Holder may consider the aggregate principal amount of this Debenture (and all interest through such date) immediately due and payable in cash, without presentment, demand protest or notice of any kind, all of which are hereby expressly waived, anything herein or in any Debenture or other instruments contained to the contrary notwithstanding, and the Holder may immediately enforce any and all of the Holder’s rights and remedies provided herein or any other rights or remedies afforded by law.

 

3.3.           Prepayment.  The principal amount of this Debenture and any accrued and unpaid interest thereon may be prepaid, in whole or in part, at any time without penalty or premium, at the discretion of the Company.

 

3.4.           Rights Cumulative.  The rights, powers and remedies given to the Holder under this Debenture shall be in addition to all rights, powers and remedies given to him, her or it by virtue of any document or instrument executed in connection therewith, or any statute or rule of law.

 

3.5.           No Waivers.  Any forbearance, failure or delay by the Payee in exercising any right, power or remedy under this Debenture, any documents or instruments executed in connection therewith or otherwise available to the Holder shall not be deemed to be a waiver of such right, power or remedy, nor shall any single or partial exercise of any right, power or remedy preclude the further exercise thereof.

 

  

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3.6.           Amendments in Writing.  No modification or waiver of any provision of this Debenture, or any documents or instruments executed in connection therewith shall be effective unless it shall be in writing and signed by the Holder, and any such modification or waiver shall apply only in the specific instance for which given.

 

3.7.           Governing Law.  This Debenture and the rights and obligations of the parties hereto, shall be governed, construed and interpreted according to the laws of the state of New York, without regard to its conflict of law principles.

 

3.8.           Successors.  The term “Payee” and “Holder” as used herein shall be deemed to include their respective successors, endorsees and assigns.

 

3.9.           Stamp or Transfer Tax.  The Company will pay any documentary stamp or transfer taxes attributable to the initial issuance of the Common Stock issuable upon the conversion of this Debenture; provided, however, that the Company shall not be required to pay any tax or taxes which may be payable in respect of any transfer involved in the issuance or delivery of any certificates for the Common Stock in a name other than that of the Holder in respect of which such Common Stock is issued, and in such case the Company shall not be required to issue or deliver any certificate for the Common Stock until the person requesting the same has paid to the Company the amount of such tax or has established to the Company’s satisfaction that such tax has been paid.

 

3.10.         Mutilated, Lost, Stolen or Destroyed Debenture.  In case this Debenture shall be mutilated, lost, stolen or destroyed, the Company shall issue and deliver in exchange and substitution for and upon cancellation of the mutilated Debenture, or in lieu of and substitution for the Debenture, mutilated, lost, stolen or destroyed, a new Debenture of like tenor and representing an equivalent right or interest, but only upon receipt of evidence reasonably satisfactory to the Company of such loss, theft or destruction and an indemnity, if requested, also reasonably satisfactory to it.

 

3.11.         No Rights as Shareholder.  Nothing contained in this Debenture shall be construed as conferring upon the Holder the right to vote or to receive dividends (except as provided in Article II of this Debenture) or to consent or to receive notice as a shareholder in respect of any meeting of shareholders for the election of directors of the Company or of any other matter, or any rights whatsoever as shareholders of the Company.

 

IN WITNESS WHEREOF, ioWorldMedia, Incorporated has caused this Debenture to be duly executed and delivered as of the date first above written.

 

	  	
IOWORLDMEDIA, INCORPORATED

	 	 
	  	
By:

	  
	  	
Name:

	
Zachary McAdoo

	  	
Title:

	
Chairman, President and Chief Executive  Officer

 

7f8k082713ex10i_ioworldmedia.htm

EXHIBIT 10.1

 

EXECUTIVE EMPLOYMENT AGREEMENT

 

This EXECUTIVE EMPLOYMENT AGREEMENT (this “Agreement”), is entered into as of this 28th day of August, 2013 (the “Effective Date”), by and between ioWorldMedia, Incorporated, a Florida corporation (the “Company”), and Zachary McAdoo (the “Executive”).  The Company and the Executive are sometimes collectively referred to herein as the “Parties” and individually as a “Party”.

 

RECITALS

 

WHEREAS, the Company wishes to employ the Executive on the terms and conditions set forth herein; and

 

WHEREAS, the Executive wishes to be employed by the Company on the terms and conditions set forth herein;

 

NOW, THEREFORE, in consideration of the foregoing recitals and other respective covenants, representations and agreements of the Parties contained in this Agreement, and for such other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the Executive hereby agree, intending to be legally bound, as follows:

 

ARTICLE I

EMPLOYMENT

 

Section 1.01   At-Will Employment.

 

The Executive’s employment with the Company shall at all times be “at-will” and is to continue until the death of the Executive or either the Company or the Executive has notified the other Party in writing of the termination of the Executive’s employment with the Company, which termination may be for any lawful reason or for no reason at all.  This Agreement is not intended to create nor is it to be construed as an express or implied contract of continued employment for any period of time.

 

Section 1.02   Employment Duties and Offices.

 

(a)   Duties.  The Executive shall serve as the President, Chief Executive Officer and Chief Financial Officer of the Company in accordance with this Agreement and the Company’s Bylaws.  The Executive shall have such authority and be responsible for such reasonable duties and responsibilities as are set forth in the Company’s Bylaws or assigned to him by the Company’s Board of Directors (the “Board”); provided, that such duties and responsibilities are consistent with and ordinarily expected of individuals in similar positions with publicly traded companies in the markets in which the Company operates. Certain employees of the Company and its subsidiaries will report to the Executive, and the Executive may be responsible for reviewing the performance of such employees of the Company and its subsidiaries.

 

  

  

  

 

The Executive shall faithfully perform and discharge his duties and responsibilities to the Company and its subsidiaries and shall devote the necessary time, energy, skills and attention to the business and affairs of the Company and its subsidiaries in order to fully and adequately perform such duties and responsibilities.  The Executive shall perform his duties and responsibilities to the best of his abilities in a diligent, trustworthy, businesslike and efficient manner.  The Executive understands that, in his capacity as an executive of the Company, he may be considered a Company insider and thereby subject to any insider trading policy in effect for the Company.

 

(b)   Offices.  The Executive agrees to serve without additional compensation, if elected or appointed thereto, as a member of the Board or the board of directors of any direct or indirect parent company (if applicable) or any of its subsidiaries, or in one or more executive offices of any of the Company, any direct or indirect parent company (if applicable) or any of its subsidiaries.

 

Section 1.03   Place of Performance.

 

The Executive’s principal places of business shall be at 635 Madison Avenue, New York, New York  10022 and 475 Park Avenue, New York, New York  10016, or such other locations as may be mutually agreed to by the Company and the Executive.  The Executive shall be required from time to time to reasonably travel as part of his duties hereunder.

 

ARTICLE II

COMPENSATION AND BENEFITS

 

Section 2.01   Compensation and Benefits.

 

(a)   Cash Compensation.  The Company will pay $100 to the Executive on the Effective Date.  However, the Company will not initially pay the Executive any base salary.  In the event the Board, in its sole discretion, determines that the Company has sufficient revenue and/or investment capital to pay cash compensation, the Board and the Executive will discuss and establish base salary payments for the Executive.  In addition, the Board, in its sole discretion, may award bonus compensation to the Executive which shall be based on such performance criteria as developed by the Board and the Executive.  Any base salary and bonus will be paid in accordance with the Company’s ordinary payroll practices and policies.

 

(b)   Vacation.  The Executive shall be entitled to twenty (20) days of vacation each calendar year, subject to adjustment based on time of service to the Company as may be provided for in the Company’s vacation policy for full-time employees.  Subject to applicable law, any vacation days will be unpaid until such time as the Company has sufficient revenue and/or investment capital to pay the Executive for his vacation days.  All other terms and conditions related to vacation shall be as may be set forth in the Company’s vacation policy for full-time employees.

 

  

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Section 2.02   Other Executive Benefits.

 

The Executive (and his dependents and beneficiaries, if applicable) shall be eligible to participate in all employee benefit plans which the Company makes generally available to full-time employees and participation in any such employee benefit plan shall be in accordance with the Company’s policies with respect to, and the terms and conditions of, such employee benefit plan.  Such employee benefit plans and programs may be amended from time to time or terminated in the sole discretion of the Company.

 

Section 2.03   Business Expenses.

 

The Executive shall be entitled to prompt reimbursement for all reasonable, ordinary and necessary business expenses, including travel expenses, incurred by the Executive during his  employment with the Company (in accordance with the policies and procedures established for employees of the Company) in the performance of his duties and responsibilities for the Company under this Agreement; provided, however, that Executive shall properly account for such expenses in accordance with the Company’s policies and procedures.

 

Section 2.04   Withholding Taxes

 

Payments made to the Executive pursuant to this Agreement shall be subject to withholding and social security taxes and other ordinary and customary payroll deductions.

 

ARTICLE III

NON-COMPETITION, NON-DISCLOSURE AND NON-SOLICITATION

 

Section 3.01   Covenant Not to Compete.

 

(a)    The Executive hereby agrees that during the Executive’s employment with the Company and thereafter for a period of six (6) months (hereinafter referred to as the “Covenant Period”), the Executive will not directly or indirectly engage in, become affiliated with, or become interested in any business in the Restricted Territory (as defined below), which is engaged in a Competing Business (as defined below), alone or with any individual, group, partnership, limited partnership, corporation, limited liability company, firm, association or any other person or entity in any capacity.  For these purposes, “to engage in,” “become affiliated with” or “become interested in” shall mean: (i) becoming an officer, director, agent, representative, consultant, independent contractor or employee of any entity, enterprise or person which is engaged in a Competing Business; (ii) becoming an owner, partner, limited partner, member, joint venturer, creditor, or shareholder or stockholder in a Competing Business (except as a shareholder or stockholder owning not greater than a five percent (5%) interest in a corporation, entity or other person whose shares are actively traded on a national securities exchange or in the over-the-counter market); and (iii) communicating to any person, which is engaged in a Competing Business, the names or addresses or any other information concerning any past, present, or prospective client, customer, joint venture partner, supplier or acquisition or investment target of the Company.  For purposes of this Section 3.01, a “Competing Business” means any business which performs the same or substantially similar services as the Company, including, without limitation, any internet radio service provider and business offering customized background music, and the “Restricted Territory” shall mean the United States of America.

 

  

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(b)    If the covenant not to compete provided for herein is found by any court having jurisdiction to be too broad or too restrictive, then the covenant not to compete shall nevertheless remain effective, but shall be considered amended to a point considered by said court as reasonable and, as so amended, shall be fully enforceable.

 

Section 3.02   Non-Solicitation and Non-Interference.

 

The Executive hereby agrees that during the Executive’s employment with the Company and thereafter for a period of twelve (12) months (the “Non-Solicitation Period”), the Executive will not in any way, directly or indirectly, for herself or on behalf of or in conjunction with any other individual, person, partnership, limited partnership, limited liability company, firm, association, corporation or entity:

 

(a)    Solicit or divert away or attempt to solicit or divert any client or customer served or solicited by the Company while the Executive was employed by the Company or any potential customer of the Company if such potential customer’s business had been actively solicited by the Company while the Executive was employed by the Company;

 

(b)    Interfere with or attempt to interfere with negotiations between the Company and any acquisition or investment target of the Company;

 

(c)    Solicit or attempt to solicit any acquisition or investment target which the Company has been in negotiations with during the six (6) month period prior to the Executive’s termination of employment with the Company;

 

(d)    Cause, induce, or encourage any employee of the Company to leave the employ of the Company, or any independent contractor to terminate any independent contractor relationship with the Company;

 

(e)    Cause, induce, or encourage any former employee of the Company to become employed by a business which is engaged in a Competing Business; or

 

(f)     Employ or seek to employ any person who is at that time employed with the Company.

 

Section 3.03   Remedies.

 

The Executive acknowledges that any breach or violation of this Article III by the Executive will cause irreparable harm to the Company and that damages are not an adequate remedy.  The Executive therefore agrees that the Company shall be entitled to specific performance and injunctive relief in addition to any other remedy that may be available at law or in equity.

 

  

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Section 3.04   Independent.

 

The covenants set forth in the foregoing Sections of this Article III are and shall be deemed and construed as separate and independent covenants.  Should any part or provision of such covenants be held invalid, void or unenforceable in any court of competent jurisdiction, such invalidity, voidness or unenforceability shall not render invalid, void or unenforceable any other part or provision thereof.  Specifically, and without limiting the generality of the foregoing, if any portion of Sections 3.01, 3.02 or 3.03 is found to be invalid by a court of competent jurisdiction because its duration, the territory and/or the restricted business are invalid or unreasonable in scope, such duration, territory and/or restricted business, as the case may be, shall be redefined by consideration of the reasonable concerns and needs of the Company such that the intent of the Company and the Executive, in agreeing to Sections 3.01, 3.02, 3.03 and 3.04, will not be impaired and shall be enforceable to the fullest extent of the applicable laws.

 

ARTICLE IV

MISCELLANEOUS

 

Section 4.01   Notices.

 

All notices required or permitted hereunder shall be in writing and shall be delivered by hand delivery, overnight courier or certified or registered mail, return receipt requested, postage prepaid, as follows:

 

	 	If to the Company:	 	ioWorldMedia, Incorporated
	 	 	 	475 Park Avenue
	 	 	 	New York, New York  10016
	 	 	 	Attention:  Chief Operating Officer
	 	 	 	 
	 	 	 	
with a copy to:

	 	 	 	 
	 	 	 	
Paul T. Colella, Esq.

	 	 	 	
Giordano, Halleran & Ciesla, P.C.

	 	 	 	
125 Half Mile Road, Suite 300

	 	 	 	
Red Bank, New Jersey 07701

	 	 	 	 
	 	If to the Executive: 	 	Zachary McAdoo
	 	 	 	299 Pavonia Avenue, Apt. 2-9
	 	 	 	Jersey City, New Jersey 07302

                                                                                                                                                                                                                                                                

Notices may be sent to such other address as either Party may designate in a written notice served upon the other Party in the manner provided herein.  All notices required or permitted hereunder shall be deemed duly given and received on the day delivered, if delivery is by hand delivery, the next business day, if delivery is by overnight courier, or the second day next succeeding the date of mailing, if delivery is by registered mail.

 

  

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Section 4.02   Governing Law and Consent to Jurisdiction.

 

This Agreement will be governed by and construed in accordance with the laws of the State of New York, without giving effect to its conflicts of laws principles.  All disputes, claims or controversies arising out of or in connection with this Agreement shall be subject to the jurisdiction of the federal and state courts in New York City, New York.

 

Notwithstanding the previous paragraph and provided both Parties consent, the Parties may, at any time after the inception of a dispute, claim or controversy arising out of or in connection with this Agreement, submit such dispute, claim or controversy to binding arbitration under the rules of the American Arbitration Association in effect at the inception of such dispute, claim or controversy.  The Parties shall cooperate fully with each other so that any such dispute, claim or controversy submitted to binding arbitration pursuant to this Section 4.02 may be resolved as expeditiously as possible.

 

Section 4.03   Waiver of Jury Trial.

 

Each of the Company and the Executive hereby waives the right to trial by jury in all proceedings commenced with respect to any disputes, claims or controversies arising out of or in connection with this Agreement.

 

THE EXECUTIVE HAS READ AND UNDERSTANDS THIS SECTION 4.03 WHICH DISCUSSES THE WAIVER OF THE EXECUTIVE’S RIGHT TO A JURY TRIAL.  THE EXECUTIVE UNDERSTANDS THAT BY SIGNING THIS AGREEMENT, THE EXECUTIVE IS WAIVING his  RIGHT TO A JURY TRIAL IN ALL DISPUTES, CLAIMS OR CONTROVERSIES RELATING TO ANY ASPECT OF THE EMPLOYER/EMPLOYEE RELATIONSHIP GOVERNED BY THIS AGREEMENT, INCLUDING, BUT NOT LIMITED TO, THE FOLLOWING CLAIMS:

 

(a)           ANY AND ALL CLAIMS FOR WRONGFUL DISCHARGE OF EMPLOYMENT; BREACH OF CONTRACT, BOTH EXPRESS AND IMPLIED; BREACH OF THE COVENANT OF GOOD FAITH AND FAIR DEALING, BOTH EXPRESS AND IMPLIED; NEGLIGENT OR INTENTIONAL INFLICTION OF EMOTIONAL DISTRESS; NEGLIGENT OR INTENTIONAL MISREPRESENTATION; NEGLIGENT OR INTENTIONAL INTERFERENCE WITH CONTRACT OR PROSPECTIVE ECONOMIC ADVANTAGE; AND DEFAMATION;

 

(b)           ANY AND ALL CLAIMS FOR VIOLATION OF ANY FEDERAL, STATE OR MUNICIPAL STATUTE, INCLUDING, BUT NOT LIMITED TO, THE CONSCIENTIOUS EMPLOYEE PROTECTION ACT, TITLE VII OF THE CIVIL RIGHTS ACT OF 1964, THE CIVIL RIGHTS ACT OF 1991, THE AGE DISCRIMINATION IN EMPLOYMENT ACT OF 1967, THE AMERICANS WITH DISABILITIES ACT OF 1990, AND THE FAIR LABOR STANDARDS ACT; AND

 

(c)           ANY AND ALL CLAIMS ARISING OUT OF ANY OTHER LAWS AND REGULATIONS RELATING TO EMPLOYMENT OR EMPLOYMENT DISCRIMINATION.

 

  

6

  

 

Section 4.04   Entire Agreement; Amendments.

 

This Agreement contains the entire agreement between the Parties hereto with respect to the subject matter hereof and supersedes all prior and contemporaneous agreements and understandings, oral or written, with respect to the subject matter hereof, but excluding the Confidential Information and Intellectual Property Assignment Agreement attached hereto as Exhibit A.  This Agreement may not be changed, amended or modified orally, but may be changed only by an agreement in writing signed by the Party against whom any waiver, change, amendment, modification or discharge may be sought.

 

Section 4.05   Agreement Relating to Intellectual Property and Confidential Information.

 

The Parties hereby acknowledge that contemporaneously herewith, the Executive executed and delivered to the Company the Confidential Information and Intellectual Property Assignment Agreement, a copy of which is attached hereto as Exhibit A, and said agreement shall remain in full force and effect pursuant to its terms from and after the Effective Date.

 

Section 4.06   Successors and Assigns.

 

This Agreement shall be enforceable by, inure to the benefit of and be binding upon (a) the Executive and the Executive’s heirs, beneficiaries, executors, administrators and legal representatives, and (b) the Company and its successors and assigns.  The Company may assign this Agreement, including, without limitation, in connection with any merger or consolidation of the Company with any other person or entity or a sale of all or substantially all of the assets of the Company to any other person or entity.  The assignment of this Agreement by the Company shall not be deemed a termination of the Executive’s employment.  The obligations of the Executive under this Agreement are personal to the Executive and may not be assigned, delegated or transferred to any other person by the Executive.

 

Section 4.07   Severability.

 

If any one or more of the provisions of this Agreement shall be determined to be invalid, illegal, or unenforceable in any respect and for any reason, the validity, legality, and enforceability of any such provision in every other respect and the remaining provisions of this Agreement shall not in any way be impaired.

 

Section 4.08   Headings.

 

The headings of the Articles and Sections contained in this Agreement are for reference purposes only and shall not in any way affect the meaning or interpretation of any provision of this Agreement.

 

Section 4.09   Counterparts.

 

This Agreement may be executed in one or more counterparts, none of which need contain the signature of more than one Party hereto, each of which shall be deemed to be an original, and all of which together shall constitute a single agreement.

 

  

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Section 4.10   Acknowledgement.

 

The Executive represents that he has read and fully understands the terms of this Agreement and that he has signed it voluntarily.  The Executive has been given an adequate opportunity to review this Agreement and the Confidential Information and Intellectual Property Assignment Agreement attached hereto as Exhibit A with his  attorney and other advisors.

 

  

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IN WITNESS WHEREOF, the Parties have executed this Executive Employment Agreement on the day and year first set forth above.

 

	 	
IOWORLDMEDIA, INCORPORATED

	 	 
	 	
By:

	
/s/ Julia Miller

	 	
Name:

	
Julia Miller

	 	
Title:

	
Chief Operating Officer and Secretary

 

	 	
EXECUTIVE

	 	 
	 	
/s/ Zachary McAdoo

	 	
Zachary McAdoo

  

9

  

 

EXHIBIT A

CONFIDENTIAL INFORMATION AND INTELLECTUAL PROPERTY  ASSIGNMENT AGREEMENT

IOWORLDMEDIA, INCORPORATED

 

Confidential Information and Intellectual Property Assignment Agreement

(this “Agreement”)

 

As a condition of my employment relationship with ioWorldMedia, Incorporated, its subsidiaries, affiliates, successors or assigns (together the "Company"), and in consideration of my employment relationship with the Company and my receipt of the compensation now and hereafter paid to me by Company, I agree to the following:

 

1.      Confidential Information.

(a)           Company Information.  I agree at all times during the term of my employment relationship with the Company (my "Relationship with the Company") and thereafter to hold in strictest confidence, and not to use except for the benefit of the Company or to disclose to any person, firm or corporation without written authorization of the Board of Directors of the Company, any Confidential Information (as hereinafter defined) of the Company.  I understand that "Confidential Information" means any Company proprietary information, technical data, trade secrets or know-how, including, but not limited to, research, product plans, products, services, customer lists and customers (including, but not limited to, customers of the Company on whom I called or with whom I became acquainted during the term of my Relationship with the Company), markets, works of original authorship, photographs, negatives, digital images, software, developments, inventions, processes, formulas, technology, designs, drawings, engineering, hardware configuration information, marketing, finances or other business information disclosed to me by the Company either directly or indirectly in writing, orally or by drawings or observation of parts or equipment.  I further understand that Confidential Information does not include any of the foregoing items which has become publicly known and made generally available through no wrongful act of mine or of others who were under confidentiality obligations as to the item or items involved.

(b)           Other Employer Information.  I agree that I will not, during my Relationship with the Company, improperly use or disclose any proprietary information or trade secrets of any former or concurrent employer or other person or entity and that I will not bring onto the premises of the Company any unpublished document or proprietary information belonging to any such employer, person or entity unless consented to in writing by such employer, person or entity.

 

  

  

  

(c)           Third Party Information.  I recognize that the Company has received and in the future will receive from third parties their confidential or proprietary information subject to a duty on the Company's part to maintain the confidentiality of such information and to use it only for certain limited purposes.  I agree to hold all such confidential or proprietary information in the strictest confidence and not to disclose it to any person, firm or corporation or to use it except as necessary in carrying out my work for the Company consistent with the Company's agreement with such third party.

 

2.      Intellectual Property.

(a)           Assignment of Intellectual Property.  I agree that I will promptly make full written disclosure to the Company, will hold in trust for the sole right and benefit of the Company, and hereby assign to the Company, or its designee, all my right, title, and interest in and to any original works of authorship, inventions, concepts, improvements or trade secrets, whether or not patentable or registrable under copyright or similar laws, which I may solely or jointly conceive or develop or reduce to practice, or cause to be conceived or developed or reduced to practice, during the period of time I am employed by the Company (collectively referred to as "Intellectual Property") and which (i) are developed using the equipment, supplies, facilities or Confidential Information of the Company, (ii) result from or are suggested by work performed by me for the Company, or (iii) relate to the business, or to the actual or demonstrably anticipated research or development, of the Company. The Intellectual Property will be the sole and exclusive property of the Company.  I further acknowledge that all original works of authorship which are made by me (solely or jointly with others) within the scope of and during the period of my Relationship with the Company and which are protectable by copyright are "works made for hire," as that term is defined in the United States Copyright Act.  To the extent that any Intellectual Property is not deemed to be work for hire, then I will and hereby do assign all my right, title and interest in such Intellectual Property to the Company, except as provided in Section 2(e).

(b)           Patent and Copyright Registrations.  I agree to assist the Company, or its designee, at the Company's expense, in every proper way to secure the Company's rights in the Intellectual Property and any copyrights, patents or other intellectual property rights relating thereto in any and all countries, including the disclosure to the Company of all pertinent information and data with respect thereto, the execution of all applications, specifications, oaths, assignments and all other instruments which the Company shall deem necessary in order to apply for and obtain such rights and in order to assign and convey to the Company, its successors, assigns, and nominees the sole and exclusive rights, title and interest in and to such Intellectual Property, and any copyrights, patents or other intellectual property rights relating thereto.  I further agree that my obligation to execute or cause to be executed, when it is in my power to do so, any such instrument or papers shall continue after the termination of this Agreement.  If the Company is unable because of my mental or physical incapacity or for any other reason to secure my assistance in perfecting the rights transferred in this Agreement, then I hereby irrevocably designate and appoint the Company and its duly authorized officers and agents as my agent and attorney in fact, to act for and in my behalf and stead to execute and file any such applications and to do all other lawfully permitted acts to further the prosecution and issuance of letters patent or copyright registrations thereon with the same legal force and effect as if executed by me.  The designation and appointment of the Company and its duly authorized officers and agents as my agent and attorney in fact shall be deemed to be coupled with an interest and therefore irrevocable.

 

  

2

  

(c)           Maintenance of Records.  I agree to keep and maintain adequate and current written records of all Intellectual Property made by me (solely or jointly with others) during the term of my Relationship with the Company.  The records will be in the form of notes, sketches, drawings, and works of original authorship, photographs, negatives, digital images or any other format that may be specified by the Company.  The records will be available to and remain the sole property of the Company at all times.

(d)           Intellectual Property Retained and Licensed.  I provide below a list of all original works of authorship, inventions, developments, improvements, and trade secrets which were made by me prior to my Relationship with the Company (collectively referred to as "Prior Intellectual Property"), which belong to me, which relate to the Company's current or anticipated business, products or research and development, and which are not assigned to the Company hereunder; or, if no such list is attached, I represent that there is no such Prior Intellectual Property.  If in the course of my Relationship with the Company, I incorporate into Company property any Prior Intellectual Property owned by me or in which I have an interest, the Company is hereby granted and shall have a nonexclusive, royalty-free, irrevocable, perpetual, worldwide license to make, have made, modify, use and sell such Prior Intellectual Property as part of or in connection with such Company property.

Prior Intellectual Property:

	

Title

	 	

Date

	 	

Identifying Number

or Brief Description

	  	 	  	 	  
	  	 	  	 	  
	  	 	  	 	  
	  	 	  	 	  
	  	 	  	 	  
	  	 	  	 	  

 

(e)           Exception to Assignments.  I understand that the provisions of this Agreement requiring assignment of Intellectual Property to the Company do not apply to any intellectual property that (i) I develop entirely on my own time; and (ii) I develop without using Company equipment, supplies, facilities, or Confidential Information; and (iii) do not result from any work performed by me for the Company; and (iv) do not relate at the time of conception or reduction to practice to the Company's current or anticipated business, or to its actual or demonstrably anticipated research or development.  Any such intellectual property will be owned entirely by me, even if developed by me during the time period in which I am in the service of the Company.  I will advise the Company promptly in writing of any intellectual property that I believe meet the criteria for exclusion set forth herein and are not otherwise disclosed pursuant to Section 2(d) above.

 

  

3

  

(f)           Return of Company Documents.  I agree that, at the time of leaving the service of the Company, I will deliver to the Company (and will not keep in my possession, recreate or deliver to anyone else) any and all works of original authorship, photographs, negatives, digital images, devices, records, data, notes, reports, proposals, lists, correspondence, specifications, drawings blueprints, sketches, materials, equipment, other documents or property, any Confidential Information or reproductions of any aforementioned items developed by me pursuant to my employment with the Company or otherwise belonging to the Company, its successors or assigns.  In the event of the termination of my Relationship with the Company, I agree to sign and deliver the "Termination Certificate" attached hereto as Appendix A.

 

3.      Notification of New Employer.  In the event that I leave the service of the Company, I hereby grant consent to notification by the Company to my new employer or consulting client about my rights and obligations under this Agreement.

 

4.      Representations.  I represent that my performance of all the terms of this Agreement will not breach any agreement to keep in confidence proprietary information acquired by me in confidence or in trust prior to my Relationship with the Company.  I have not entered into, and I agree I will not enter into, any oral or written agreement in conflict herewith.  I agree to execute any proper oath or verify any proper document required to carry out the terms of this Agreement.

 

5.      Equitable Relief.  I acknowledge that any breach or violation of this Agreement by me will cause irreparable harm to the Company and that damages are not an adequate remedy.  I therefore agree that the Company shall be entitled to specific performance and injunctive relief in addition to any other remedy that may be available at law or in equity.

 

6.      General Provisions.

(a)           Governing Law; Consent to Personal Jurisdiction.  This Agreement will be governed by and construed in accordance with the laws of the State of New York, without giving effect to its conflicts of law principles.  I hereby expressly consent to the nonexclusive personal jurisdiction and venue of the state and federal courts located in New York City, New York for any lawsuit filed there by either party arising from or relating to this Agreement.

 

  

4

  

(b)           Waiver of Jury Trial.  I hereby waive the right to trial by jury in all proceedings commenced with respect to any disputes, claims or controversies arising out of or in connection with this Agreement.

I HAVE READ AND UNDERSTAND THIS SECTION 6(b) WHICH DISCUSSES THE WAIVER OF MY RIGHTS TO A JURY TRIAL.  I UNDERSTAND THAT BY SIGNING THIS AGREEMENT, I AM WAIVING MY RIGHT TO A JURY TRIAL IN ALL DISPUTES, CLAIMS OR CONTROVERSIES RELATING TO ANY ASPECT OF THIS AGREEMENT.

(c)           Entire Agreement.  This Agreement sets forth the entire agreement and understanding between the Company and me relating to the subject matter herein and merges all prior discussions between us.  No modification of or amendment to this Agreement, nor any waiver of any rights under this Agreement, will be effective unless in writing signed by the party to be charged.  Any subsequent change or changes in my duties, salary or compensation will not affect the validity or scope of this Agreement.

(d)           Severability.  If one or more of the provisions in this Agreement are deemed void by law, then the remaining provisions will continue in full force and effect.

(e)           Successors and Assigns.  This Agreement will be binding upon my heirs, executors, administrators and other legal representatives and will be for the benefit of the Company, its successors, and its assigns.

(f)           Counterparts. This Agreement may be executed in one or more counterparts, none of which need contain the signature of more than one party hereto, each of which shall be deemed to be an original, and all of which together shall constitute a single agreement.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

  

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IN WITNESS WHEREOF, the undersigned has executed this Confidential Information and Intellectual Property Assignment Agreement as of August 28, 2013.

	 	 	EXECUTIVE
	 	  	  
	 	  	  
	 	  	
(Signature)

	 	  	  
	 	  	
Zachary McAdoo

	 	  	
(Print Name)

	 	  	  
	 	  	
299 Pavonia Avenue, Apt. 2-9

	 	  	
Jersey City, New Jersey 07302

	 	  	
(Print Address)

	 	  	  
	 	  	
Agreed to and Accepted by

	 	  	
IOWORLDMEDIA, INCORPORATED

	 	  	  
	 	
By:

	  
	 	
Name:

	
Julia Miller

	 	
Title:

	
Chief Operating Officer and Secretary

 

  

  

  

 

APPENDIX A

 

IOWORLDMEDIA, INC. 

 

Termination Certificate

 

This is to certify that I do not have in my possession, nor have I failed to return, any devices, records, data, notes, reports, proposals, lists, correspondence, specifications, drawings, blueprints, sketches, materials, equipment, other documents or property, any Confidential Information (as such term is defined in the Intellectual Property Agreement defined below) or reproductions of any aforementioned items belonging to ioWorldMedia, Incorporated its subsidiaries, affiliates, successors or assigns (together, the "Company").

I further certify that I have complied with all the terms of the Company's Confidential Information and Intellectual Property Assignment Agreement signed by me (the "Intellectual Property Agreement"), including the reporting of any Intellectual Property (as defined therein), conceived or made by me (solely or jointly with others) covered by the Intellectual Property Agreement.

I further agree that, in compliance with the Intellectual Property Agreement, I will preserve as confidential all Confidential Information, including all trade secrets, confidential knowledge, data or other proprietary information relating to products, processes, know-how, designs, formulas, developmental or experimental work, computer programs, data bases, other original works of authorship, customer lists, business plans, financial information or other subject matter pertaining to any business of the Company or any of its employees, clients, consultants or licensees.

 

	
 

	 	 
	(Date)	 	(Signature)

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