Document:

opmg_ex107.htm

Exhibit 10.7

OPTIONS MEDIA GROUP HOLDINGS, INC.

SUBSCRIPTION AGREEMENT

Options Media Group Holdings, Inc.

123 NW 13th Street, Suite 300

Boca Raton, Florida 33432

Attention:  Scott Frohman, CEO

Dear Mr. Frohman:

1.           Offer to Purchase.

 

(a)           I, the undersigned investor (the “Investor”), intending to be legally bound, hereby subscribes for _______ shares of Convertible Series B Preferred Stock (the “Series B”) or _______ shares of common stock of Options Media Group Holdings, Inc., a Nevada corporation (the “Company”) on the terms set forth herein.  Each share of Series B is offered for sale at $350 and converts into 10,000 shares of common stock at an effective price of $0.035 per share of common stock or each share of common stock (the “Shares”) is offered at a purchase price of $0.035 per Share.  The Series B and the Shares shall be referred to herein collectively as the Securities.  There is a $50,000 minimum purchase requirement.  The principal terms of the offering are summarized on the Amended Term sheet dated January 7, 2009 (the “Term Sheet”) which the Investor acknowledges receipt of.

(b)           The Investor acknowledges that this subscription may be accepted or rejected in whole or in part by the Company in its sole discretion and that this subscription is and shall be irrevocable unless the Company rejects it.

2.           Subscription Payment.  As payment for this subscription, simultaneously with the execution hereof, we are converting our outstanding promissory note and delivering it to the Company with instructions to mark it paid once we receive payment of the accrued interest.

3.           Company Representations and Warranties.  The Company represents and warrants to and agrees with the Investor that:

 

(a)           Due Incorporation.  The Company is a corporation or other entity duly incorporated or organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization and has the requisite corporate power to own its properties and to carry on its business as presently conducted.  The Company is duly qualified as a foreign corporation to do business and is in good standing in each jurisdiction where the nature of the business conducted or property owned by it makes such qualification necessary, other than those jurisdictions in which the failure to so qualify would not have a Material Adverse Effect.  For purposes of this Agreement, a “Material Adverse Effect” shall mean a material adverse effect on the financial condition, results of operations, prospects, properties or business of the Company and its Subsidiaries taken as a whole.  For purposes of this Agreement, “Subsidiary” means, with respect to any entity at any date, any corporation, limited or general partnership, limited liability company, trust, estate, association, joint venture or other business entity of which more than 30% of (i) the outstanding capital stock having (in the absence of contingencies) ordinary voting power to elect a majority of the Board of Directors or other managing body of such entity, (ii) in the case of a partnership or limited liability company, the interest in the capital or profits of such partnership or limited liability company or (iii) in the case of a trust, estate, association, joint venture or other entity, the beneficial interest in such trust, estate, association or other entity business is, at the time of determination, owned or controlled directly or indirectly through one or more intermediaries, by such entity.  The Company’s Subsidiaries are 1 Touch Marketing, LLC, Options Acquisition Sub, Inc. and Icon Term Life Inc.

 

  

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(b)           Outstanding Stock.  All issued and outstanding shares of capital stock of the Company and Subsidiary have been duly authorized and validly issued and are fully paid and non-assessable.

 

(c)           Authority; Enforceability.  This Agreement, the Term Sheet, and any other agreements delivered together with this Agreement or in connection herewith (collectively “Transaction Documents”) have been duly authorized, executed and delivered by the Company and Subsidiaries (as applicable) and are valid and binding agreements of the Company enforceable in accordance with their terms, subject to bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar laws of general applicability relating to or affecting creditors' rights generally and to general principles of equity.  The Company has full corporate power and authority necessary to enter into and deliver the Transaction Documents and to perform its obligations thereunder.

 

(d)           Consents.  No consent, approval, authorization or order of any court, governmental agency or body or arbitrator having jurisdiction over the Company, or any of its Affiliates, the OTC Bulletin Board (the “Bulletin Board”) or the Company's shareholders is required for the execution by the Company of the Transaction Documents and compliance and performance by the Company of its obligations under the Transaction Documents, including, without limitation, the issuance and sale of the Securities.  The Transaction Documents and the Company’s performance of its obligations thereunder have been unanimously approved by the Company’s Board of Directors.

 

(e)           No Violation or Conflict.  Assuming the representations and warranties of the Investor in this Agreement are true and correct, neither the issuance and sale of the Securities nor the performance of the Company’s obligations under this Agreement and all other agreements entered into by the Company relating thereto by the Company will:

 

(i)           violate, conflict with, result in a breach of, or constitute a default (or an event which with the giving of notice or the lapse of time or both would be reasonably likely to constitute a default) under (A) the articles or certificate of incorporation, charter or bylaws of the Company, (B) to the Company's knowledge, any decree, judgment, order, law, treaty, rule, regulation or determination applicable to the Company of any court, governmental agency or body, or arbitrator having jurisdiction over the Company or over the properties or assets of the Company or any of its Affiliates, (C) the terms of any bond, debenture, note or any other evidence of indebtedness, or any agreement, stock option or other similar plan, indenture, lease, mortgage, deed of trust or other instrument to which the Company or any of its Affiliates is a party, by which the Company or any of its Affiliates is bound, or to which any of the properties of the Company or any of its Affiliates is subject, or (D) the terms of any "lock-up" or similar provision of any underwriting or similar agreement to which the Company, or any of its Affiliates is a party except the violation, conflict, breach, or default of which would not have a Material Adverse Effect; or

 

  

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(ii)           result in the creation or imposition of any lien, charge or encumbrance upon the Securities or any of the assets of the Company or any of its Affiliates except in favor of Investor as described herein.

 

(f)           The Securities.  The Securities upon issuance:

 

(i)           will be, free and clear of any security interests, liens, claims or other encumbrances, subject only to restrictions upon transfer under the Securities Act of 1933 (the “1933 Act”) and any applicable state securities laws;

(ii)           will be, duly and validly authorized, fully paid and non-assessable;

 

(iii)           will not have been issued or sold in violation of any preemptive or other similar rights of the holders of any securities of the Company or rights to acquire securities of the Company;

 

(iv)           will not subject the holders thereof to personal liability by reason of being such holders; and

 

(v)           assuming the representations warranties of the Investor as set forth in this Agreement hereof are true and correct, will not result in a violation of Section 5 under the 1933 Act.

 

(g)           Litigation.  There is no pending or, to the best knowledge of the Company, threatened action, suit, proceeding or investigation before any court, governmental agency or body, or arbitrator having jurisdiction over the Company, or any of its Affiliates that would affect the execution by the Company or the complete and timely performance by the Company of its obligations under the Transaction Documents.  Except as disclosed in the reports and information provided pursuant to Section 4(e) (the “Reports”), there is no pending or, to the best knowledge of the Company, basis for or threatened action, suit, proceeding or investigation before any court, governmental agency or body, or arbitrator having jurisdiction over the Company, or any of its Affiliates which litigation if adversely determined would have a Material Adverse Effect.

 

(h)           No Market Manipulation.  The Company and its Affiliates have not taken, and will not take, directly or indirectly, any action designed to, or that might reasonably be expected to, cause or result in stabilization or manipulation of the price of the Company’s common stock to facilitate the sale or resale of the Securities or affect the price at which the Securities may be issued or resold.

 

  

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(i)           Information Concerning Company.  The Reports contain all material information relating to the Company and its operations and financial condition as of their respective dates which information is required to be disclosed therein.  Since September 30, 2009 and, except as modified in the Reports, there has been no Material Adverse Event relating to the Company's business, financial condition or affairs. The Reports including the financial statements included therein do not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, taken as a whole, not misleading in light of the circumstances when made.

 

(j)           Defaults.  The Company is not in violation of its articles of incorporation or bylaws.  The Company is (i) not in default under or in violation of any other material agreement or instrument to which it is a party or by which it or any of its properties are bound or affected, which default or violation would have a Material Adverse Effect, (ii) not in default with respect to any order of any court, arbitrator or governmental body or subject to or party to any order of any court or governmental authority arising out of any action, suit or proceeding under any statute or other law respecting antitrust, monopoly, restraint of trade, unfair competition or similar matters, or (iii) not in violation of any statute, rule or regulation of any governmental authority which violation would have a Material Adverse Effect.

 

(k)           No Integrated Offering.   Neither the Company, nor any of its Affiliates, nor any person acting on its or their behalf, has directly or indirectly made any offers or sales of any security of the Company nor solicited any offers to buy any security of the Company under circumstances that would cause the offer of the Securities pursuant to this Agreement to be integrated with prior offerings by the Company for purposes of the 1933 Act or any applicable stockholder approval provisions, including, without limitation, under the rules and regulations of the Bulletin Board.  No prior offering will impair the exemptions relied upon in this offering or the Company’s ability to timely comply with its obligations hereunder.  Neither the Company nor any of its Affiliates will take any action or steps that would cause the offer or issuance of the Securities to be integrated with other offerings which would impair the exemptions relied upon in this offering or the Company’s ability to timely comply with its obligations hereunder.  The Company will not conduct any offering other than the transactions contemplated hereby that may be integrated with the offer or issuance of the Securities that would impair the exemptions relied upon in this offering or the Company’s ability to timely comply with its obligations hereunder.

 

(l)           No General Solicitation.  Neither the Company, nor any of its Affiliates, nor to its knowledge, any person acting on its or their behalf, has engaged in any form of general solicitation or general advertising (within the meaning of Regulation D under the 1933 Act) in connection with the offer or sale of the Securities.

 

(m)           No Undisclosed Liabilities.  The Company has no liabilities or obligations which are material, individually or in the aggregate, other than those incurred in the ordinary course of the Company businesses since September 30, 2009 and which, individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect, except as disclosed in the Reports.

 

  

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(n)           No Undisclosed Events or Circumstances.  Since September 30, 2009, except as disclosed in the Reports or in any press releases, no event or circumstance has occurred or exists with respect to the Company or its businesses, properties, operations or financial condition, that, under applicable law, rule or regulation, requires public disclosure or announcement prior to the date hereof by the Company but which has not been so publicly announced or disclosed in the Reports.

 

(o)           Capitalization.  The Company’s capitalization is set forth in the Term Sheet.

 

(p)           Dilution.   The Company's executive officers and directors understand the nature of the Securities being sold hereby and recognize that the issuance of the securities will have a potential dilutive effect on the equity holdings of other holders of the Company’s equity or rights to receive equity of the Company.  The Board of Directors of the Company has concluded, in its good faith business judgment that the issuance of the Securities is in the best interests of the Company.  The Company specifically acknowledges that its obligation to issue shares of common stock upon conversion of the Series B, pursuant to a certificate of designation filed in accordance with the Term Sheet, is binding upon the Company and enforceable regardless of the dilution such issuance may have on the ownership interests of other shareholders of the Company or parties entitled to receive equity of the Company.

 

(q)           No Disagreements with Accountants and Lawyers.  There are no material disagreements of any kind presently existing, or reasonably anticipated by the Company to arise between the Company and the accountants and lawyers previously and presently employed by the Company, including but not limited to disputes or conflicts over payment owed to such accountants and lawyers, nor have there been any such disagreements during the two years prior to this Agreement.

(r)           Investment Company.   Neither the Company nor any Affiliate of the Company is an “investment company” within the meaning of the Investment Company Act of 1940, as amended.

(s)           Foreign Corrupt Practices.  Neither the Company, nor to the knowledge of the Company, any agent or other person acting on behalf of the Company, has (i) directly or indirectly, used any funds for unlawful contributions, gifts, entertainment or other unlawful expenses related to foreign or domestic political activity, (ii) made any unlawful payment to foreign or domestic government officials or employees or to any foreign or domestic political parties or campaigns from corporate funds, (iii) failed to disclose fully any contribution made by the Company (or made by any person acting on its behalf of which the Company is aware) which is  in violation of law, or (iv) violated in any material respect any provision of the Foreign Corrupt Practices Act of 1977, as amended.

  

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(t)           Reporting Company/Shell Company.  The Company is a publicly-held company subject to reporting obligations pursuant to Section 15 of the Securities Exchange Act of 1934, as amended (the "1934 Act").  Pursuant to the provisions of the 1934 Act, the Company has timely filed all reports and other materials required to be filed thereunder with the Securities and Exchange Commission during the preceding twelve months.  The Company is not a “shell company” as that term is employed in Rule 144 under the 1933 Act.

(u)           Listing.  The Company's common stock is quoted on the Bulletin Board under the symbol OPMG.  The Company has not received any oral or written notice that its common stock is not eligible nor will become ineligible for quotation on the Bulletin Board nor that its common stock does not meet all requirements for the continuation of such quotation.  The Company satisfies all the requirements for the continued quotation of its common stock on the Bulletin Board.

(v)           DTC Status.   The Company’s transfer agent is a participant in, and the Company’s common stock is eligible for transfer pursuant to, the Depository Trust Company Automated Securities Transfer Program. The name, address, telephone number, fax number, contact person and email address of the Company transfer agent is Island Stock Transfer, 100 2nd Avenue South, Ste 705S, St. Petersburg, Florida 33701, St. Petersburg, Florida 33701, (727) 289-0010, Fax: (727) 289-0069, Jillian O’Malley, email: Jillian@IslandStockTransfer.com.

(w)           Survival. The foregoing representations and warranties shall survive for one year following payment for the Securities.

  

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4.              Representations and Warranties of the Investor.

The Investor hereby severally represents and warrants to the Company as follows:

(a)           The Investor has all requisite power and authority to enter into this Agreement and to purchase the Securities set forth herein or on the signature page.  This Agreement, when executed and delivered by the Investor, will constitute a valid and legally binding obligation of the Investor, enforceable against him, her or it in accordance with its terms.

(b)           The Investor is acquiring the Securities to be purchased by such Investor for his own account for investment and not with a view to, or for sale in connection with, any distribution thereof, nor with any present intention of distribution or selling the same, and, except as contemplated by this Agreement, such Investor has no present or contemplated agreement, undertaking, arrangement, obligation, indebtedness or commitment providing for the disposition thereof.  The Investor understands that the Securities may not be sold, transferred or otherwise disposed of without registration under the Securities Act or an exemption therefrom, and that in the absence of an effective registration statement covering the Securities or an available exemption from registration under the Securities Act, the Securities must be held indefinitely.

(c)           The Investor understands that the Securities are not registered under the Securities Act in reliance on an exemption from registration under the Securities Act pursuant to Section 4(2) thereof and Rule 506 thereunder and the Securities will bear a restrictive legend.

(d)           The Investor acknowledges that the purchase of the Securities, entails a high degree of risk, including the risk factors contained in filings by the Company with the Securities and Exchange Commission including its annual report on Form 10-K for the year ended December 31, 2008, in other publicly available information.

(e)           The Investor represents that he has had an opportunity to ask questions and receive answers from the Company regarding the terms and conditions of this Agreement and the reasons for this offering of the Securities, the business prospects of the Company, the risks attendant to the Company’s business, and the risks relating to an investment in the Company. The Investor further acknowledges that pursuant to Section 517.061(11)(a)(3), Florida Statutes and Rule 3E-5090.05(a) thereunder, he has had an opportunity to obtain additional information (to the extent the Company possesses such information and could acquire it without unreasonable effort or expense) necessary to verify the accuracy of any information furnished to such Investor or to which such Investor had access. The Company will put such information in writing if requested by the Investor. The Investor acknowledges the receipt (without exhibits) of the Reports which include the Company’s annual report on Form 10-K with respect to the year ended December 31, 2008 and quarterly reports on Form 10-Q for the quarters ended March 31, 2009, June 30, 2009 and September 30, 2009 (as well as any other reports) filed prior to the time the Investor submits his subscription.  The Reports will be made available to the Investor upon written request to the Company.  The Investor is relying solely upon these Reports, other public information distributed by the Company and other written information prepared by the Company.  The Investor also represents that he has read this Subscription Agreement.

 

  

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(f)           The Investor represents that he is an “accredited investor” within the meaning of the applicable rules and regulations promulgated under the Securities Act,  is experienced in evaluating and investing in private placement transactions of securities in similar circumstances and acknowledges that he:

•           is able to fend for himself;

•           can bear the economic risk of such Investor’s investment;

•           has such knowledge and experience in financial and businessmatters that such Investor is capable of evaluating the merits andrisks of the investment in the Securities.

Further, the Investor:

•           has adequate means of providing for his financialneeds and contingencies,

•           is able to bear the substantial economic risks of an investment inthe Securities for an indefinite period of time,

•           has no need for liquidity in such investment,

 

•           has made commitments to investments that are not readily marketable which are reasonable in relation to the Investor’s net worth, and

•           can afford a complete loss of such investment.

 

(g)           The Investor acknowledges that he is purchasing the Securities for an indefinite period of time, has no need for liquidity in such investment, has made commitments to investments that are not readily marketable which are reasonable in relation to the undersigned’s net worth and can afford a complete loss of such investment.

(h)           The Investor has such knowledge and experience in financial, tax and business matters so as to enable it to utilize the information made available to it in connection with the offering of the Securities to evaluate the merits and risks of an investment in the Securities and to make an informed investment decision with respect thereto.

(i)             The Investor is not relying on the Company with respect to the tax and other economic considerations of an investment in the Securities, and the Investor has relied on the advice of, or has consulted with, only the Investor’s own advisors.

  

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(j)           The Investor is not subscribing for the Securities as a result of or subsequent to any advertisement, articles, notice or other communication published in any newspaper, television or radio or presented at any seminar or meeting, or any solicitation of a subscription by a person not previously known to the undersigned in connection with investments in securities generally.

(k)           The information contained in this Subscription Agreement is true and correct including any information which the Investor has furnished and will furnish to the Company with respect to such Investor’s financial position, business experience and residence, is correct and complete as of the date of this Subscription Agreement and if there should be any material change in such information prior to the Company’s acceptance of this Subscription Agreement and the depositing of the payments described above, the Investor will furnish such revised or corrected information to the Company.  The representations, warranties and agreements of the Investor contained herein shall survive the execution and delivery of this Agreement and the purchase of the Securities.

(l)           The Investor acknowledges that he has received notice of his possible right under applicable Florida law to rescind the purchase of the Securities within three business days following the payment of the purchase price as set forth in Section 9 hereof.

5.              Investor Representations and Warranties Concerning Suitability, Accredited Investor and Eligible Client Status.  I represent and warrant the following information:

(a)   The following information should be provided by the person making the investment decision whether on his own behalf or on behalf of an entity:

 

	 	 (1)	 Name of Investor:	 	 Age:	 
	 	 	 	 	 
	 	 (2)	Name of person making investment decision	 	 
	 	 	 	 	 	 
	 	 	 	

Age:

	 
	 	 	

(Print)

	 	 	 
	 	 	 	 	 	 
	 	(3)	Principal residence address and telephone number:	 	 
	 	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	 	(4)	Secondary residence address and telephone number:	 	 
	 	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 

 

  

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I have no present intention of becoming a resident of any other state or jurisdiction.

	 	 
	 	 	 	 	 	 
	 	(5)	Name, address, telephone number and facsimile number of employer or business:	 	 
	 	 	 	 	 	 
	 	 	(i)    Nature of business	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	 	 	(ii)   Position and nature of responsibilities	 	 	 
	 	 	 	 	 	 
	 	 	 	 	 	 
	 	(6)	Length of employment or in current position	 	 	 
	 	 	 	 	 	 
	 	 (7)	

Prior employment, positions or occupations during the past five years (and the inclusive dates of each) are as follows:

	 	 

 

	 	

Nature of Employment,

or Occupation

	 	

Position/ Duties

	 	

From/To

	 	 	 	 	 	 
	 	 
	 	 
	 	 
	 	 
	 	 

 

	 	 	  

Attach additional pages to answer any questions in greater detail, if necessary.  Each prospective investor should answer the following questions which pertain to income, tax rate, net worth, liquid assets, and non-liquid assets by including spousal contribution even though the investment will be held in single name.

	 	 	 	 
	 	

(8)

	

Business or professional education and the degree(s) received are as follows:

 

	 	 	
School

	
Degree

	
Year Received

	 	 	  
	 	 	  
	 	 	  
	 	 	  
	 	 	  
	 	 	  

 

  

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(b)

	
Accredited Investor Representations. Initial all appropriate spaces on the following pages indicating the basis upon which the undersigned qualifies as an accredited investor (must initial one).

For Individual Investors Only:

	 	
(1)

	
I certify that I am an accredited investor because I have an individual net worth, or my spouse and I have combined net worth, in excess of $1,000,000.  For purposes of this question, “net worth” means the excess of total assets at fair market value, including home, home furnishings and automobiles, over total liabilities.

	 	
(2a)

	
I certify that I am an accredited investor because I had individual income (exclusive of any income attributable to my spouse) of more than $200,000 in each of the last two completed years and I reasonably expect to have an individual income in excess of $200,000 in the current year.

	 	
(2b)

	
Alternatively, my spouse and I have joint income in excess of $300,000 in each applicable year.

	 	
(3)

	
I am a director or executive officer of the Company.

Other Investors:

 

(1)    ____The undersigned certifies that it is one of the following:  any bank as defined in Section 3(a)(2) of the Securities Act whether acting in its individual or fiduciary capacity; any broker or dealer registered pursuant to Section 15 of the Securities Exchange Act of 1934; insurance company as defined in Section 2(13) of the Securities Act; investment company registered under the Investment Company Act of 1940 or a business development company as defined in Section 2(a)(48) of that Act; Small Business Investment Company licensed by the U.S. Small Business Administration under Section 301(c) or (d) of the Small Business Invest­ment Act of 1958; any plan established and maintained by a state, its political subdivisions, or any agency or instrumentality of a state or its political subdivisions, for the benefit of its employees, if such plan has total assets in excess of $5,000,000; employee benefit plan within the meaning of Title I of the Employee Retirement Income Security Act of 1974, if the investment decision is made by a plan fiduciary, as defined in Section 3(21) of such Act, which is either a bank, savings and loan association, insurance company, or registered investment advisor, or if the employee benefit plan has total assets in excess of $5,000,000, or if a self-directed plan, with investment decisions made solely by persons that are accredited investors.

 

  

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(2)    ____The undersigned certifies that it is a private business development company as defined in Section 202(a)(22) of the Investment Advisors Act of 1940.

 

(3)    ____The undersigned certifies that it is a organization described in Section 501(c)(3) of the Internal Revenue Code, corporation, Massachusetts or similar business trust or partnership, not formed for the specific purpose of acquiring the securities offered, with total assets in excess of $5,000,000.

 

(4)  _____The undersigned certifies that it is a trust, with total assets in excess of $5,000,­000, not formed for the specific purpose of acquiring the securities offered, whose purchase is directed by a sophisticated person as descri­bed in Rule 506(b)(2)(ii) of the Securities Act.

 

(5)  _____The undersigned certifies that it is an entity in which all of the equity owners are accredited investors.

 

6.           Indemnification by Investor.  The Investor agrees to indemnify and hold the Company and its agents, representatives and employees harmless from and against all liability, damage, loss, cost and expense (including reasonable attorneys’ fees) which they may incur by reason of the failure of the Investor to fulfill any of the terms or conditions of this Agreement, or by reason of any inaccuracy or omission in the information furnished by the Investor herein or any breach of the representations and warranties made by the Investor herein or in any document provided by the Investor to the Company.

7.           Miscellaneous.

(a)           This Agreement has been duly and validly authorized, executed and delivered by the Investor and constitutes the valid, binding and enforceable agreement of the Investor.  If this Agreement is being completed on behalf of an entity it has been completed and executed by an authorized party.

(b)           This Agreement and any documents referred to herein constitute the entire agreement between the parties hereto with respect to the subject matter hereof and together supersede all prior discussions or agreements in respect hereof.

(c)           The Company shall be notified immediately of any change in any of the information contained above occurring prior to the Investor’s purchase of the Securities or at any time thereafter for so long as the undersigned is a holder of the Securities.

(d)           Governing Law.  This Agreement shall be governed by and construed under the laws of the State of Florida, without regard to any jurisdiction’s conflicts of law provisions.

  

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8.           Florida Blue Sky Legend.

 FLORIDA LAW PROVIDES THAT WHEN SALES ARE MADE TO FIVE OR MORE PERSONS IN FLORIDA, ANY SALE MADE IN FLORIDA IS VOIDABLE BY THE PURCHASER WITHIN THREE DAYS AFTER THE FIRST TENDER OF CONSIDERATION IS MADE BY SUCH PURCHASER TO THE COMPANY, AN AGENT OF THE COMPANY OR AN ESCROW AGENT OR WITHIN THREE DAYS AFTER THE AVAILABILITY OF THAT PRIVILEGE IS COMMUNICATED TO SUCH PURCHASER, WHICHEVER OCCURS LATER.  ALL SALES IN THIS OFFERING ARE SALES IN FLORIDA.  PAYMENTS FOR TERMINATED SUBSCRIPTIONS VOIDED BY PURCHASERS AS PROVIDED FOR IN THIS PARAGRAPH WILL BE PROMPTLY REFUNDED WITHOUT INTEREST.  NOTICE SHOULD BE GIVEN TO THE COMPANY TO THE ATTENTION OF SCOTT FROHMAN AT THE ADDRESS SET FORTH ON THE COVER PAGE OF THIS SUBSCRIPTION AGREEMENT.

 

IN WITNESS WHEREOF, the undersigned has executed this Subscription Agreement this ___ day of _______, 2010.

 

	 	 
	 	(Signature of subscriber)

 

  

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	 	PRINT NAME:	 
	 	 	 
	 	ENTITY NAME (IF APPLICABLE):	 
	 	 	 
	 	TITLE OF SIGNER (IF APPLICABLE):	 
	 	 	 
	 	TAXPAYER IDENTIFICATION OR SOCIAL SECURITY NO.:	 
	 	 	 
	 	RESIDENCE OR BUSINESS ADDRESS:	 
	 	 	 
	 	_________________________________________________	 
	 	Street	 
	 	_________________________________________________	 
	 	City                                State                            Zip	 
	 	 	 
	 	 	 
	 	MAILING ADDRESS (If different from business address):	 
	 	 	 
	 	_________________________________________________	 
	 	Street	 
	 	_________________________________________________	 
	 	City                                State                            Zip	 
	 	 	 
	 	 	 
	 	 	 
	ACCEPTED AND AGREED TO:	 	 
	 	 	 
	OPTIONS MEDIA GROUP HOLDINGS, INC.	 	 
	 	 	 
	By:      _____________________________________________	 	 
	Scott Frohman 

Chief Executive Officer

	 	 
	 	 	 
	Date:  ______ ____, 2010	 	 
	 	 	 

 

 

  

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EXHIBIT A

 

INSTRUCTIONS

In connection with your subscription for the purchase of the Securities of Options Media Group Holdings, Inc., enclosed herewith is the following document and related instructions:

1.  SUBSCRIPTION AGREEMENT - Complete each blank as indicated and sign the applicable signature block.

Upon completion, please send the above document to:

 

	 	Options Media Group Holdings, Inc.
	 	123 NW 13th Street
	 	Suite 300
	 	Boca Raton, Florida 33432
	 	Attention: Scott Frohman

 

2.  PAYMENT - Wire transfer the subscription price to the Company at:

 

	 	Bank Name:	Regions Bank
	 	 	595 Okeechobee Blvd. Suite 700
	 	 	West Palm Beach, FL  33401
	 	 	 
	 	 	 
	 	Attention: 	Estrella Cullen
	 	Telephone: 	(561) 837-8246
	 	Facsimile:	(561) 837-8272
	 	 	 
	 	Reference: 	Options Media Group Holdings, Inc.
	 	 	 
	 	Account Number: 	0079258360
	 	 	 
	 	ABA Routing #:	062005690

 

 

  

15Unassociated Document

 

EXHIBIT 10.8

 

 

 

OPTIONS MEDIA GROUP HOLDINGS, INC.

NON-QUALIFIED STOCK OPTION AGREEMENT

NON-PLAN

THIS STOCK OPTION AGREEMENT (the “Agreement”) entered into as of December 11, 2009 between Options Media Group Holdings, Inc. (the “Company”) and Scott Frohman (the “Optionee”).

WHEREAS, pursuant to the authority of the Board of Directors (the “Board”), the Company has granted the Optionee the right to purchase common stock of the Company.

NOW THEREFORE, in consideration of the mutual covenants and promises hereafter set forth and for other good and valuable consideration, receipt of which is acknowledged, the parties hereto agree as follows:

1.           Grant of Non-Qualified Options.  The Company irrevocably granted to the Optionee, as a matter of separate agreement and not in lieu of salary or other compensation for services, the right and option to purchase all or any part of an aggregate of 5,000,000 shares of authorized but unissued or treasury common stock of the Company (the “Options”) on the terms and conditions herein set forth.  The common stock shall be unregistered unless the Company voluntarily files a registration statement covering such shares with the Securities and Exchange Commission.  The Options are not intended to be Incentive Stock Options as defined by Section 422 of the Internal Revenue Code of 1986 (the “Code”) and are not issued under any of the Company’s equity incentive plans.  This Agreement replaces any stock option agreement or offer letter previously provided to the Optionee, if any, with respect to the Options.

2.           Price.  The exercise price of the shares of common stock subject to the Options shall be $0.035 per share.

3.           Vesting - When Exercisable.

(a)           The Options are fully vested.

(b)           Subject to Sections 3(c) and 4 of this Agreement, Options are exercisable until 6:00 p.m. New York time on December 11, 2014.

(c)           However, notwithstanding any other provision of this Agreement (including Section 4), all Options shall be immediately forfeited in the event of:

(1)           Termination for any reason whatsoever including, but not limited to, fraud, theft, employee dishonesty and violation of Company policy;

(2)           Purchasing or selling securities of the Company without written authorization in accordance with the Company’s inside information guidelines then in effect;

 

  

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(3)           Breaching any duty of confidentiality including that required by the Company’s inside information guidelines then in effect;

(4)           Competing with the Company;

(5)           Being unavailable for consultation after leaving the Company’s employ if such availability is a condition of any agreement between the Company and the Employee;

(6)           Recruitment of Company personnel after termination of employment, whether such termination is voluntary or for cause;

(7)           Failure to assign any invention or technology to the Company if such assignment is a condition of employment or any other agreements between the Company and the Employee; or

(8)           A finding by the Company’s Board that the Employee has acted against the interests of the Company.

4.           Termination of Relationship.

(a)           If for any reason, except death or disability as provided below, the Optionee ceases to perform the services for which the Options were granted, all rights granted hereunder shall terminate effective two years from the date the Optionee ceases to perform such services, except as otherwise provided for herein.

(b)           If the Optionee shall die while performing services for the Company, his estate or any Transferee, as defined herein, shall have the right within two years from the date of death to exercise the Optionee’s vested Options. For the purpose of this Agreement, “Transferee” shall mean a person to whom such shares are transferred by will or by the laws of descent and distribution.

(c)           If the Optionee becomes disabled while performing services for the Company within the meaning of Section 22(e)(3) of the Code, the Optionee shall have the right within two years from date the Optionee becomes disabled to exercise the Optionee’s vested Options.

5.           Profits on the Sale of Certain Shares; Redemption.  If any of the events specified in Section 3(c) of this Agreement occur within one year from the last date the Optionee performed services for the Company (the “Termination Date”), all profits earned from the sale of the Company’s securities, including the sale of shares of common stock underlying Options, during the two-year period commencing one year prior to the Termination Date shall be forfeited and forthwith paid by the Optionee to the Company.  Further, in such event, the Company may at its option redeem shares of common stock acquired upon exercise of Options by payment of the exercise price to the Optionee.  The Company’s rights under this Section 5 do not lapse one year from the Termination Date but are a contract right subject to any appropriate statutory limitation period.

 

  

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6.           Transfer. No transfer of the Options by the Optionee by will or by the laws of descent and distribution shall be effective to bind the Company unless the Company shall have been furnished with written notice thereof and a copy of the letters testamentary or such other evidence as the Board may deem necessary to establish the authority of the state and the acceptance by the Transferee or Transferees of the terms and conditions of the Options.

7.           Method of Exercise. The Options shall be exercisable by a written notice which shall:

(a)           state the election to exercise the Options, the number of shares to be exercised, the person in whose name the stock certificate or certificates for such shares of common stock is to be registered, his address and social security number (or if more than one, the names, addresses and social security numbers of such persons);

(b)           contain such representations and agreements as to the holder’s investment intent with respect to such shares of common stock as set forth in Section 11 hereof;

(c)           be signed by the person or persons entitled to exercise the Options and, if the Options are being exercised by any person or persons other than the Optionee, be accompanied by proof, satisfactory to counsel for the Company, of the right of such person or persons to exercise the Options; and

(d)           be accompanied by full payment of the purchase or exercise price in United States dollars by wire transfer or by check.

The certificate or certificates for shares of common stock as to which the Options shall be exercised shall be registered in the name of the person or persons exercising the Options.

8.           Sale of Shares Acquired Upon Exercise of Options.  If the Optionee is an officer (as defined by Section 16(b) of the Securities Exchange Act of 1934 (“Section 16(b)”)) or director of the Company, any shares of the Company’s common stock acquired pursuant to Options granted hereunder cannot be sold by the Optionee until at least six months elapse from the date of grant of the Options except in case of death or disability or if the grant was exempt from the short-swing profit provisions of Section 16(b).

9.           Adjustments.  Upon the occurrence of any of the following events, the Optionee’s rights with respect to Options granted to him hereunder shall be adjusted as hereinafter provided unless otherwise specifically provided in a written agreement between the Optionee and the Company relating to such Options:

(a)           If the shares of common stock shall be subdivided or combined into a greater or smaller number of shares or if the Company shall issue any shares of its common stock as a stock dividend on its outstanding common stock, the number of shares of common stock deliverable upon the exercise of Options shall be appropriately increased or decreased proportionately, and appropriate adjustments shall be made in the exercise price per share to reflect such subdivision, combination or stock dividend.

 

  

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(b)           If the Company is to be consolidated with or acquired by another entity pursuant to an acquisition, the Board of any entity assuming the obligations of the Company hereunder (the “Successor Board”) shall either (i) make appropriate provision for the continuation of such Options by substituting on an equitable basis for the shares then subject to such Options the consideration payable with respect to the outstanding shares of common stock in connection with the Acquisition; or (ii) terminate all Options in exchange for a cash payment equal to the excess of the fair market value of the shares subject to such Options over the exercise price thereof.

(c)           In the event of a recapitalization or reorganization of the Company (other than a transaction described in Section 9(b) above) pursuant to which securities of the Company or of another corporation are issued with respect to the outstanding shares of common stock, the Optionee upon exercising Options shall be entitled to receive for the purchase price paid upon such exercise, the securities he would have received if he had exercised his Options prior to such recapitalization or reorganization.

(d)           Except as expressly provided herein, no issuance by the Company of shares of common stock of any class or securities convertible into shares of common stock of any class shall affect, and no adjustment by reason thereof shall be made with respect to, the number or price of shares subject to Options.  No adjustments shall be made for dividends or other distributions paid in cash or in property other than securities of the Company.

(e)           No fractional shares shall be issued and the Optionee shall receive from the Company cash in lieu of such fractional shares.

(f)           The Board or the Successor Board shall determine the specific adjustments to be made under this Section 9, and its determination shall be conclusive.  If the Optionee receives securities or cash in connection with a corporate transaction described in Section 9(a), (b) or (c) above as a result of owning such restricted common stock, such securities or cash shall be subject to all of the conditions and restrictions applicable to the restricted common stock with respect to which such securities or cash were issued, unless otherwise determined by the Board or the Successor Board.

10.           Necessity to Become Holder of Record.  Neither the Optionee, the Optionee’s estate, nor the Transferee have any rights as a shareholder with respect to any shares covered by the Options until such person shall have become the holder of record of such shares.  No adjustment shall be made for cash dividends or cash distributions, ordinary or extraordinary, in respect of such shares for which the record date is prior to the date on which such holder shall become the holder of record thereof.

11.           Conditions to Exercise of Options.  In order to enable the Company to comply with the Securities Act of 1933 (the “Securities Act”) and relevant state law, the Company may require the Optionee, the Optionee’s estate, or any Transferee as a condition of the exercising of the Options granted hereunder, to give written assurance satisfactory to the Company that the shares subject to the Options are being acquired for his own account, for investment only, with no view to the distribution of same, and that any subsequent resale of any such shares either shall be made pursuant to a registration statement under the Securities Act and applicable state law which has become effective and is current with regard to the shares being sold, or shall be pursuant to an exemption from registration under the Securities Act and applicable state law.

 

  

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The Options are subject to the requirement that, if at any time the Board shall determine, in its discretion, that the listing, registration, or qualification of the shares of common stock subject to the Options upon any securities exchange or under any state or federal law, or the consent or approval of any governmental regulatory body, is necessary as a condition of, or in connection with the issue or purchase of shares under the Options, the Options may not be exercised in whole or in part unless such listing, registration, qualification, consent or approval shall have been effected.

12.           Duties of Company.  The Company will at all times during the term of the Options:

(a)           Reserve and keep available for issue such number of shares of its authorized and unissued common stock as will be sufficient to satisfy the requirements of this Agreement;

(b)           Pay all original issue taxes with respect to the issue of shares pursuant hereto and all other fees and expenses necessarily incurred by the Company in connection therewith; and

(c)           Use its best efforts to comply with all laws and regulations which, in the opinion of counsel for the Company, shall be applicable thereto.

13.           Severability.  In the event any parts of this Agreement are found to be void, the remaining provisions of this Agreement shall nevertheless be binding with the same effect as though the void parts were deleted.

14.           Arbitration.  Any controversy, dispute or claim arising out of or relating to this Agreement, or its interpretation, application, implementation, breach or enforcement which the parties are unable to resolve by mutual agreement, shall be settled by submission by either party of the controversy, claim or dispute to binding arbitration in Broward County, Florida (unless the parties agree in writing to a different location), before a single arbitrator in accordance with the rules of the American Arbitration Association then in effect. The decision and award made by the arbitrator shall be final, binding and conclusive on all parties hereto for all purposes, and judgment may be entered thereon in any court having jurisdiction thereof.

15.           Benefit.  This Agreement shall be binding upon and inure to the benefit of the parties hereto and their legal representatives, successors and assigns.

	
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16.           Notices and Addresses.  All notices, offers, acceptance and any other acts under this Agreement (except payment) shall be in writing, and shall be sufficiently given if delivered to the addressees in person, by Federal Express or similar receipted delivery, as follows:

 

	 	The Optionee: 	Scott Frohman
	 	 	 
123 NW 13th Street, Suite 300

	 	 	 
Boca Raton, FL 33432

	 	 	 
	 	 
The Company:

	 
Options Media Group holdings, Inc.

	 	 	 
123 NW 13th Street, Suite 300

	 	 	 
Boca Raton, FL 33432

	 	 	 
	 	 
with a copy to:

	 
Michael D. Harris, Esq.

	 	 	Harris Cramer LLP
	 	 	1555 Palm Beach Lakes Blvd., Suite 310
	 	 	West Palm Beach, FL 33401

 

or to such other address as either of them, by notice to the other may designate from time to time.  Time shall be counted to, or from, as the case may be, the delivery in person or by mailing.

17.           Attorney’s Fees.  In the event that there is any controversy or claim arising out of or relating to this Agreement, or to the interpretation, breach or enforcement thereof, and any action or proceeding is commenced to enforce the provisions of this Agreement, the prevailing party shall be entitled to a reasonable attorney’s fee, costs and expenses.

18.           Governing Law.  This Agreement and any dispute, disagreement, or issue of construction or interpretation arising hereunder whether relating to its execution, its validity, the obligations provided herein or performance shall be governed or interpreted according to the laws of the State of Florida without regard to choice of law considerations.

19.           Oral Evidence.  This Agreement constitutes the entire Agreement between the parties and supersedes all prior oral and written agreements between the parties hereto with respect to the subject matter hereof. Neither this Agreement nor any provision hereof may be changed, waived, discharged or terminated orally, except by a statement in writing signed by the party or parties against which enforcement or the change, waiver discharge or termination is sought.

20.           Counterparts.  This Agreement may be executed in one or more counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.  The execution of this Agreement may be by actual or facsimile signature.

21.           Section or Paragraph Headings.  Section headings herein have been inserted for reference only and shall not be deemed to limit or otherwise affect, in any matter, or be deemed to interpret in whole or in part any of the terms or provisions of this Agreement.

  

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IN WITNESS WHEREOF the parties hereto have set their hand and seals the day and year first above written.

 

 

	 	 	 	 
THE COMPANY

	 	 	 	 
	 	 	 	 
	_________________________________________________________	 	By:	___________________________________________
	 	 	 	Steve Stowell
	 	 	 	Chief Financial Officer
	 	 	 	 
	 	 	 	OPTIONEE:
	 	 	 	 
	 	 	 	___________________________________________
	_________________________________________________________	 	 	Scott Frohman
	 	 	 	 

 

  

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