EXHIBIT
10.7
EMPLOYMENT
AGREEMENT
THIS EMPLOYMENT AGREEMENT (the
“Agreement”) entered into effective as of this 6th day
of October, 2008, between Options Media Group Holdings, Inc. (the
“Company”) and Dale Harrod (the
“Executive”).
WHEREAS, in its business, the Company has
acquired and developed certain trade secrets, including, but not
limited to, proprietary processes, sales methods and techniques,
and other like confidential business and technical information,
including but not limited to, technical information, design
systems, pricing methods, pricing rates or discounts, processes,
procedures, formulas, designs of computer software, or
improvements, or any portion or phase thereof, whether patented, or
not, or unpatentable, that is of any value whatsoever to the
Company, as well as information relating to the Company’s
services, information concerning proposed new services, market
feasibility studies, proposed or existing marketing techniques or
plans (whether developed or produced by the Company or by any other
person or entity for the Company), other Confidential Information,
as defined in Section 8, and information about the Company’s
executives, officers, and directors, which necessarily will be
communicated to the Executive by reason of his employment by the
Company; and
WHEREAS, the Company has strong and
legitimate business interests in preserving and protecting its
investment in the Executive, its trade secrets and Confidential
Information, and its substantial, significant, or key
relationships with vendors and Customers, as defined in Section 7,
actual and prospective; and
WHEREAS, the Company desires to preserve
and protect its legitimate business interests further by
restricting competitive activities of the Executive during the term
of this Agreement and following (for a reasonable time) termination
of this Agreement; and
WHEREAS, the Company desires to employ
the Executive and to ensure the continued availability to the
Company of the Executive’s services, and the Executive is
willing to accept such employment and render such services, all
upon and subject to the terms and conditions contained in this
Agreement.
NOW, THEREFORE, in consideration of the
premises and the mutual covenants set forth in this Agreement, and
intending to be legally bound, the Company and the Executive agree
as follows:
1.
Representations and
Warranties. The
Executive hereby represents and warrants to the Company that he (i)
is not subject to any written non-solicitation or non-competition
agreement affecting his employment with the Company (other than any
prior agreement with the Company), (ii) is not subject to any
written confidentiality or nonuse/nondisclosure agreement affecting
his employment with the Company (other than any prior
agreement with the Company), and (iii) has brought to the Company
no trade secrets, confidential business information, documents, or
other personal property of a prior employer.
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2.
Term of Employment
.
(a)
Term . The Company hereby employs the Executive, and
the Executive hereby accepts employment with the Company for a
period commencing on October 6, 2008 and ending on October 5, 2010
(such period, as it may be extended or renewed, the
“Term”), unless sooner terminated in accordance with
the provisions of Section 6. The Term shall be automatically
renewed for successive one-year terms unless written notice of
non-renewal is given by either party at least 30 days prior to the
end of the Term.
(b)
Continuing Effect
. Notwithstanding any termination
of this Agreement, at the end of the Term or otherwise, the
provisions of Sections 7 and 8 shall remain in full force and
effect and the provisions of Section 8 shall be binding upon the
legal representatives, successors and assigns of the
Executive.
3.
Duties .
(a)
General Duties . The Executive shall serve as the Chief
Information Officer of the Company, with duties and
responsibilities that are customary for such an executive.
The Executive shall also perform services for such
subsidiaries of the Company as may be necessary. The
Executive shall use his best efforts to perform his duties and
discharge his responsibilities pursuant to this Agreement
competently, carefully and faithfully. The Executive shall
report to the Chief Executive Officer of the Company.
(b)
Devotion of Time
. Subject to the last sentence of
this Section 3(b), the Executive shall devote all of his time,
attention and energies during normal business hours (exclusive of
vacation time referenced in Section 5(a) and of such normal holiday
periods as have been established by the Company) to the affairs of
the Company. The Executive shall not enter the employ of or
serve as a consultant to, or in any way perform any services with
or without compensation to, any other persons, business, or
organization, without the prior consent of the Board of Directors
of the Company. Notwithstanding the foregoing, nothing in
this Agreement shall restrict the Executive from devoting time to
educational and charitable interests, provided that none of such
activities, individually or in the aggregate, interferes with the
performance of his duties and responsibilities hereunder or
conflicts or competes with the interests of the Company.
(c)
Location of Office
. The Executive’s office
shall be located at the principal office of the Company (currently
Hallandale, Florida), which office may be moved to another location
in Miami-Dade, Broward or Palm Beach County, Florida. The
Executive’s job responsibilities shall also include all
business travel necessary to the performance of the job.
(d)
Adherence to Inside Information
Policies . The Executive
acknowledges that the Company is publicly-held and, as a result,
has implemented inside information policies designed to preclude
its executives and those of its subsidiaries from violating the
federal securities laws by trading on material, non-public
information or passing such information on to others in breach of
any duty owed to the Company, or any third party. The
Executive shall promptly execute any
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documents generally distributed by the
Company to its employees requiring such employees to abide by its
inside information policies.
4.
Compensation and Expenses
.
(a)
Salary . For the services to be rendered under this
Agreement, the Company shall pay the Executive a monthly salary of
$12,500.00 (the “Base Salary”), payable in installments
in accordance with the Company’s payroll practices.
(b)
Restricted Stock
. Subject to the execution of
the Company’s standard restricted stock agreement, the
Company shall grant the Executive 200,000 shares of restricted
stock which shall vest in three equal increments: 12, 24 and 36
months following the date of this Agreement, subject to continued
employment with the Company on each applicable vesting date and
subject to the provisions of Section 6(c) below. Any
fractional shares should be rounded up to the next whole share.
Other than continued employment on the applicable vesting dates,
the only restrictions on such stock shall be those imposed by the
Securities Act of 1933.
(c)
Discretionary Bonus
. The Board or the Compensation
Committee may award additional bonuses as it deems
appropriate.
(d)
Expenses . In addition to any compensation received
pursuant to this Section 4, the Company will reimburse or advance
funds to the Executive for all reasonable travel, entertainment and
miscellaneous expenses incurred in connection with the performance
of his duties under this Agreement, provided that the Executive
properly provides a written accounting of such expenses to the
Company in accordance with the Company’s practices.
Such reimbursement or advances will be made in accordance
with policies and procedures of the Company in effect from time to
time relating to reimbursement of, or advances to, executive
officers.
(e)
Options . Subject to the execution of the
Company’s standard stock option agreement, the Company shall
grant the Executive 100,000 five-year non-qualified stock options
exercisable at the closing price of such stock on the date of this
Agreement and vesting 12 months following the date of this
Agreement, subject to continued employment with the Company on the
vesting date.
5.
Benefits .
(a)
Vacation Time . For each 12-month period during the Term, the
Executive shall be entitled to 4 weeks of vacation time (prorated
for the partial 12-month period) without loss of compensation or
other benefits to which he is entitled under this Agreement, to be
taken at such times as the Executive may select and the affairs of
the Company may permit. Vacation time shall not include sick
leave, disability or holiday periods established by the
Company.
(b)
Employee Benefit Programs
. The Executive is entitled to
participate in any pension, 401(k), insurance or other employee
benefit plan that is maintained by the Company for its executives,
including programs of life and medical insurance and
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reimbursement of membership fees in
professional organizations. The Company shall pay the
Executive’s health insurance premiums under the
Company’s plan.
6.
Termination .
(a)
Death or Disability
. Except as otherwise provided in
this Agreement, this Agreement shall automatically terminate
without act by any party upon the death or disability of the
Executive. For purposes of this Section 6(a),
“disability” shall mean that for a period of 45
consecutive days or 90 aggregate days in any 12-month period, the
Executive is incapable of substantially fulfilling the duties set
forth in Section 3 (which means full-time employment) because of
physical, mental, or emotional incapacity, resulting from injury,
sickness, or disease, as determined by the Executive’s
physician (or his guardian). In the event that
Executive’s employment is terminated by reason of
Executive’s death or disability, the Company shall pay the
following to the Executive or his personal representative: (i) any
accrued but unpaid Base Salary for services rendered to the date of
disability or death, and (ii) an amount equal to 6 months Base
Salary plus 6 months health insurance premiums for Executive under
the Company’s plan (or an amount equal to 12 months Base
Salary plus 12 months health insurance premiums for Executive under
the Company’s plan in the event Executive has been employed
the Company for more than 1 year). Additionally, all
restricted stock and all options granted to the Executive hereunder
shall become fully vested. The Executive (or his estate)
shall receive the payments provided herein at such times he would
have received them if there was no death or disability.
Additionally, if the Executive’s employment is
terminated because of disability, any benefits to which the
Executive may be entitled pursuant to Section 5(b) shall continue
to be paid or provided by the Company, as the case may be, for one
year, subject to the terms of any applicable plan or insurance
contract and applicable law.
(b)
Termination by Company for Cause or by
Executive Without Good Reason . The Company may terminate the
Executive’s employment pursuant to the terms of this
Agreement at any time for Cause (as defined below) by giving the
Executive written notice of termination. Such termination
shall become effective upon the giving of such notice. Upon
any such termination for Cause, or in the event the Executive
terminates his employment with the Company without “Good
Reason,” as defined below, then the Executive shall have no
right to compensation, or reimbursement under Section 4, or to
participate in any Executive benefit programs under Section 5,
except as may otherwise be provided for herein or by law, for any
period subsequent to the effective date of termination. For
purposes of this Agreement, “Cause” shall mean: (i) the
Executive is convicted of a felony or misdemeanor or commits a
criminal act; (ii) the Executive, in carrying out his duties
hereunder, has acted with gross negligence or intentional
misconduct resulting, in any case, in harm to the Company; (iii)
the Executive misappropriates Company funds or otherwise defrauds
the Company; (iv) the Executive breaches his fiduciary duty to the
Company resulting in profit to him, directly or indirectly; (v) the
Executive breaches any written agreement with the Company; (vi) the
Executive breaches any provision of Sections 7 or 8 of this
Agreement; (vii) the Executive materially fails to competently
perform his duties under Section 3 and after the giving of notice
specifying with reasonable particularity any alleged
deficiency(ies) fails to cure the alleged deficiency(ies) within 30
days; (viii) the Executive suffers from alcoholism or drug
addiction or otherwise uses alcohol to excess or uses drugs in any
form except strictly in accordance with the recommendation of a
physician or dentist; (ix) the Executive has been found to have
committed any act or have failed to take any action which results
in the Company’s common stock being delisted
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or not listed for trading on the
Over-the-Counter Bulletin Board or a national securities exchange,
as applicable; (x) the Executive is chronically absent or tardy
after being warned by the Company; (xi) the Executive willfully
fails on more than one occasion to comply with the reasonable
directive’s of the Company’s Board of Directors; or
(xii) the Executive fails or refuses to cooperate in any official
investigation or inquiry conducted by or on behalf of the Company
or by any government body or agency asserting jurisdiction over the
Company or any of its securities.
(c)
Termination by Company Without Cause
or Termination by Executive for Good Reason.
The Executive may terminate, by
written notice to the Company, the Executive’s employment at
any time for “Good Reason,” as defined below, and in
the event the Company terminates the Executive without Cause, then
in either such case, the Company shall pay the Executive at the
time of termination:(i) an amount equal to 6 months’ Base
Salary plus payment of 6 months health insurance premiums for the
Executive with respect to the policy provided by the Company (or an
amount equal to 9 months Base Salary plus payment of 9 months
health insurance premiums for the Executive with respect to the
health insurance policy provided by the Company in the event the
Executive has been employed for more than 2 years) and (ii) all of
the Executive’s remaining unvested restricted stock issued
hereunder, if any, along with all unexercised stock options shall
vest immediately upon such termination. The term Good Reason
shall mean (x) the Executive, with or without change in title or
formal corporate action, no longer exercises substantially all of
the duties and responsibilities and no longer possess substantially
all of the authority set forth in Section 3 (unless the Executive
has agreed to the change in title and/or duties); (y) the Company
materially breaches this Agreement, and such breach is not cured
within 30 days following receipt of notice by the Company; or (z)
any “Change in Control” (as defined below) of the
Company. The Executive shall have a period of 30 days
following the occurrence of an event constituting Good Reason under
clauses (x) and (y) above and a period of 90 days following an
event constituting Good Reason under clause (z) above in which to
exercise his right to terminate for Good Reason, or the Executive
shall be deemed to have waived that particular Good Reason.
Any failure by the Company to make any required
payments (including, but not limited to Base Salary) will be deemed
Good Reason under this Agreement. A “Change in Control”
shall mean any of the following: (A) the consummation of a merger
or consolidation of the Company with or into another entity or any
other corporate reorganization, if more than 50% of the combined
voting power of the continuing or surviving entity’s
securities outstanding immediately after such merger, consolidation
or other corporate reorganization are owned by persons who were not
stockholders of the Company immediately prior to such merger,
consolidation or other corporate reorganization; (B) any entity or
person not now an executive officer or director of the Company
becomes either individually or as part of a group required to file
a Schedule 13D or 13G with the Securities and Exchange Commission
(“SEC”) the beneficial owner of 30% or more of the
Company’s common stock; for this purpose, the terms
“person” and “beneficial ownership” shall
have the meanings provided in Section 13(d) of the Securities
Exchange Act of 1934 (the “Exchange Act”) or
related rules promulgated by the SEC; (C) a sale of all or
substantially all of the assets of the Company in a transaction
requiring stockholder approval; (D) individuals who, as of the date
of this Agreement, constitute the Board (the “Incumbent
Board”) cease for any reason to constitute at least a
majority of the Board, provided, however, that any individual
becoming a director subsequent to the date of this Agreement
appointed by a majority of the directors then comprising the
Incumbent Board or whose election or nomination for election by the
Company’s stockholders was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board shall
be considered as though such individual were a member of the
Incumbent Board, but excluding, for this purpose, any
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such individual whose initial assumption
of offi
