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EMPLOYMENT
AGREEMENT
THIS
EMPLOYMENT AGREEMENT is made and entered into as of this 23rd day of June, 2008,
by and between OPTIONS MEDIA GROUP HOLDINGS, INC., a Nevada corporation with
offices at 240 Old Federal Highway, Suite 100 Hallandale, Florida 33009 (the
“Corporation”),
and Scott Frohman, an individual residing at 347 N. New River Drive East, Apt.
3001, Fort Lauderdale, FL 33301 (the “Executive”), under
the following circumstances:
RECITALS:
A. The
Corporation desires to secure the services of the Executive upon the terms and
conditions hereinafter set forth; and
B. The
Executive desires to render services to the Corporation upon the terms and
conditions hereinafter set forth.
NOW,
THEREFORE, the parties mutually agree as follows:
1. Employment. The
Corporation hereby employs the Executive and the Executive hereby accepts
employment as an executive of the Corporation, subject to the terms and
conditions set forth in this Agreement.
2. Duties. The Executive
shall serve as the Chief Executive Officer of the Corporation with such duties,
responsibilities and authority as are commensurate and consistent with his
position, as may be, from time to time, assigned to him by the Board of
Directors of the Corporation. The Executive shall report directly to the Board
of Directors of the Corporation. During the term of this Agreement, the
Executive shall devote his full business time and efforts to the performance of
his duties hereunder unless otherwise authorized by the Board of Directors.
Notwithstanding the foregoing, the expenditure of reasonable amounts of time by
the Executive for the making of passive personal investments, the conduct of
private business affairs and charitable and professional activities shall be
allowed, provided such activities do not materially interfere with the services
required to be rendered to the Corporation hereunder and do not violate the
restrictive covenants set forth in Section 9
below.
3. Term of Employment.
The term of the Executive’s employment hereunder, unless sooner terminated as
provided herein (the “Initial Term”), shall
be for a period of two (2) years commencing on the date hereof (the “Commencement Date”).
The term of this Agreement shall automatically be extended for additional terms
of one year each (each a “Renewal Term”) unless
either party gives prior written notice of non-renewal to the other party no
later than sixty (60) days prior to the expiration of the Initial Term (“Non-Renewal Notice”),
or the then current Renewal Term, as the case may be. For purposes of this
Agreement, the Initial Term and any Renewal Term are hereinafter collectively
referred to as the “Term.”
4. Compensation of
Executive.
(a) The
Corporation shall pay the Executive as compensation for his services hereunder,
in equal semi-monthly or bi-weekly installments during the Term, the sum of (i)
Fifteen Thousand Dollars ($15,000) per month for each of the first six months of
the Term, (ii) Twenty Thousand Dollars ($20,000) per month for each of the
second six months of the Term, and (iii) Twenty Five Thousand Dollars ($25,000)
per month for each month of the Term thereafter (the “Base Salary”), less
such deductions as shall be required to be withheld by applicable law and
regulations. The Corporation shall review the Base Salary on an annual basis and
has the right but not the obligation to increase it, but has no right to
decrease the Base Salary.
(b) In
addition to the Base Salary set forth in Section 4(a) above, the Executive shall
be entitled to such bonus compensation (in cash, capital stock or other
property) as a majority of the members of the Board of Directors of the
Corporation may determine from time to time in their sole
discretion.
(c) The
Corporation shall pay or reimburse the Executive for all reasonable
out-of-pocket expenses actually incurred or paid by the Executive in the course
of his employment, consistent with the Corporation’s policy for reimbursement of
expenses from time to time.
(d) The
Executive shall be entitled to participate in such pension, profit sharing,
group insurance, hospitalization, and group health and benefit plans and all
other benefits and plans as the Corporation provides to its senior executives
(the “Benefit
Plans”).
(e) Upon the
execution hereof, the Corporation shall grant the Executive (i) 2,500,000 shares
of restricted stock under the Corporation’s 2008 Stock Incentive Plan (the
“2008 Plan”)
that shall not be subject to any vesting period and (ii) options to purchase an
aggregate of 2,250,000 shares of the Corporation’s common stock (“Options”) under the
Plan. The per share exercise price of the Options shall be $0.30,
which represents the fair market value per share of the Corporation’s common
stock on the date of grant. The term of the Option shall be ten years from the
date of grant. One twenty-fourth (4.167%) of the Options shall become
exercisable on each monthly anniversary of the date of grant.
5. Termination.
(a) This
Agreement and the Executive’s employment hereunder shall terminate upon the
happening of any of the following events:
(i) upon the
Executive’s death;
(ii) upon the
Executive’s “Total Disability” (as herein defined);
(iii) upon the
expiration of the Initial Term of this Agreement or any Renewal Term thereof, if
either party has provided a timely notice of non-renewal in accordance with
Section 3, above;
2
(iv) at the
Corporation’s option, upon sixty (60) days prior written notice to the Executive
if without cause;
(v) at the
Executive’s option, upon thirty (30) days prior written notice to the
Corporation;
(vi) at the
Executive’s option, in the event of an act by the Corporation, defined in
Section 5(c), below, as constituting “Good Reason” for termination by the
Executive; and
(vii) at the
Corporation’s option, in the event of an act by the Executive, defined in
Section 5(d), below, as constituting “Cause” for termination by the
Corporation.
(b) For
purposes of this Agreement, the Executive shall be deemed to be suffering from a
“Total
Disability” if the Executive has failed to perform his regular and
customary duties to the Corporation for a period of 180 days out of any 360-day
period and if before the Executive has become “Rehabilitated” (as herein
defined) a majority of the members of the Board of Directors of the Corporation,
exclusive of the Executive, vote to determine that the Executive is mentally or
physically incapable or unable to continue to perform such regular and customary
duties of employment. As used herein, the term “Rehabilitated” shall
mean such time as the Executive is willing, able and commences to devote his
time and energies to the affairs of the Corporation to the extent and in the
manner that he did so prior to his Disability.
(c) For
purposes of this Agreement, the term “Good Reason” shall
mean that the Executive has resigned due to the failure of the Corporation to
meet any of its obligations to the Executive under this or any other agreement
between the Corporation and the Executive, and failure to cure the same within
thirty (30) days following Executive’s delivery of notice specifying the
breach(es) by the Corporation.
