Exhibit 10.21
PROPOSAL/MEMORANDUM OF UNDERSTANDING
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February 20, 2006
Pediatric Prosthetics Inc
12926 Willow Case Drive
Houston, Texas 77070
RE: MEDIA CAMPAIGN FOR PEDIATRICS PROSTHETICS INC.
Global Media Fund, Inc. (GMF) is pleased to present this offer to produce and
distribute a total of One Million Five Hundred Thousand Dollars ($1,500,000)
worth of nationally syndicated newspaper features and/or nationally syndicated
radio features on behalf of Pediatric Prosthetics Corp. (Pediatric Prosthetics),
using the industry standard advertising rates currently utilized by GMF over a
twelve (12) month time frame. Pediatric Prosthetics will have the option to
choose at its discretion the balance of print and radio media features. GMF has
summarized some expected exposure values in the paragraphs below assuming that
Pediatric Prosthetics chooses to utilize only print features. These exposure
values are not guaranteed numbers, but are based upon current average results
displayed over the selected time frame for illustrative purposes. They do not
factor in media campaign ramp up times, or the fact that the features will
continue to run or play for up to two years after the last feature is
distributed.
NEWSPAPER FEATURES
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The newspaper features will be specifically about your company and distributed
to 10,250 daily and weekly newspapers, news, and wire services. Our services
will include: story consultation and development, writing and editing, printing,
delivery, clippings and readership reports including comparable advertising
space value reports. You will have final approval on all copy.
Your features will be distributed on computer disks, by direct electronic feed
and in a hard copy camera-ready format. GMF will deliver clipping reports
beginning ten (10) weeks after media pick up; these reports will continue to be
sent on a monthly basis for one (1) calendar year from delivery (date feature
was distributed).
NEWSPAPER DISTRIBUTION GUARANTEE. Although public relations placement is subject
to individual editorial discretion, GMF offers the following guarantee: each
print feature must receive placements in at least one hundred (100) newspapers
(we currently average 648 placements per feature). If the placements do not
total 100 within a six (6) month period of your sign-off on the feature, GMF
will re-write and/or re-distribute that feature at no cost to you until the
guaranteed itninimum of 100 is obtained.
EXPECTED PRINT EXPOSURE. Assuming that Pediatric Prosthetics chooses to run all
print features in a twelve (12) month time frame, the print features would reach
an estimated audience of Fifty One Million Three Hundred Twenty One Thousand and
Six Hundred (51,321,600) readers per month for twelve (12) months.
RADIO FEATURES
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The radio features will be nationally syndicated radio features specifically
about your-' company. Your features will be written by media and radio
professionals, read! by radio professionals, produced on a CD-ROM and sent to
over 6,000 radio stations around the country. In addition to the CD, a script of
your public service message is distributed as well, so that announcers can
"localize" the material.
Radio Features consist of two 30-second scripts under one heading written to
your approval. You will have final approval on all radio features. GMF will
deliver radio exposure reports on a monthly basis for the duration of the media
campaign that details each radio station that played the feature. These releases
are guaranteed (see "Radio Distribution Guarantee" below) to be played on at
least Four Hundred (400) radio stations. RADIO DISTRIBUTION GUARANTEE. Although
public relations placement is subject to individual editorial discretion, GMF
offers the following guarantee: each radio feature must receive placements in
at, least Four Hundred (400) radio stations. If the placements do not total Four
Hundred (400) within a Six (6) month period of your sign-off on the feature, GMF
will re-write and/or re-distribute that feature at no cost to you until the
guaranteed minimum of Four Hundred (400) is obtained.
IN CONSIDERATION OF MEDIA CAMPAIGN
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GMF acknowledges that the restricted securities received in consideration for
services provided by this agreement may or may not have any future or current
market value, but for computational ease GMF agrees to accept the "Restricted
Stock Valuation (Market Price)" as defined in this MOU.
The total all-inclusive cost for this media campaign is One Hundred and Fifty
Thousand Dollars ($150,000). This shall be paid as follows: (i) In consideration
for this media campaign, Pediatric Prosthetics shall remit to GMF Two Hundred
Fifty Thousand (250,000) shares of restricted common stock of Pediatric
Prosthetics (the "Restricted Shares") valued at Thirty Seven Thousand Five
Hundred Dollars ($37,500) within Ten (10) days of the execution of this MOU.,
(ii) The number of shares of restricted stock to be issued as payment for the
remaining balance of $112,500 shall also be calculated using the "Restricted;
Stock Valuation (Market Price)" defined below and paid as follows: Twenty Eight
Thousand One Hundred Twenty Five Dollars ($28,125) worth of restricted stock to
be issued no later than May I, 2006, August 1, 2006, November 1, 2006 and
February 1, 2007 respectively. The number of shares of restricted common stock
required to pay these payments shall be calculated using the "Restricted Stock
Valuation (Market Price) clause below.
The restricted stock shall be governed by the "Restricted Stock Terms" as
outlined herein. Fulfillment of this MOU by GMF is conditional on the receipt:
of all payments owed in the specified time frame. Failure to pay as agreed may
trigger a default as per the included "Default Provisions".
RESTRICTED STOCK TERMS
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The, initial shares of Restricted Shares of Common Stock specified as payment
are to be issued within ten days from the execution of this MOU. All the
Restricted Shares of Common Stock shall be issued as of the Effective Date.
Restricted Stock Valuation (Market Price) For the purposes of this
MOU, the Market Price of the restricted stock shall be calculated as ninety
percent (90%) of the arithmetic average of the closing price of Pediatric
Prosthetics's Common Stock for the five (5) trading days immediately
preceding the stock issuance date, as reported daily by the principal
national or regional stock exchange on which the common stock is listed.
The total number of restricted shares to be issued to GMF for each payment
due shall be calculated by dividing the amount due by the Market Price.
Registration Provisions. The Restricted Shares issued to GMF under
this MOU shall be subject to the following registration provisions:
Pediatric Prosthetics grants to GMF piggyback registration rights
with respect to all Restricted Shares mentioned in this MOU. Pediatric
Prosthetics shall give prompt written notice to GMF of any intended
registration and will automatically include GMF's Restricted Shares in
such registration unless notified to the contrary by GMF. In the event
that Pediatric Prosthetics does not register the Restricted Sruires as
required in this MOU, or if the Restricted Shares are eligible for
sale pursuant to Rule 144 and Pediatric Prosthetics does not provide
all required documents such as counsel opinion letter to remove stock
restrictions within one week of written request from GMF, Pediatric
Prosthetics shall pay GMF, as liquidated damages, an amount equal to
five percent (5%) of the total value of this MOU, such payment shall
be made no later than the first business day of the following calendar
month and Pediatric Prosthetics furthermore agrees to accept and
represent to Pediatric Prosthetics's transfer agent as valid, an
opinion letter from GMF's counsel regarding restricted stock status.
DEFAULT PROVISIONS
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Any default by Pediatric Prosthetics in the payment of any amount when due under
this MOU, or any failure to timely review and approve media supplied by GMF for
review, shall entitle GMF to place a hold on all work specified in this MOU, at
its sole option, to terminate this MOU upon Thirty (30) days written notice and
declare this MOU null and void. No media advertising will be distributed unless
all payments outlined in this MOU have been received by GMF irt the time frame
specified.
Pediatric Prosthetics has the right to cancel this MOU with Thirty (30) days
written notice, and if such right is utilized will not be responsible for any
additional payments owed under this MOU. Upon the event of such cancellation by
Pediatric Prosthetics all payments paid to date of cancellation shall not be
subject to refund. GMF shall not be in default as a result of any delays in
services that are directly or indirectly the result of actions of Pediatric
Prosthetics, or failure to act on the parts of Pediatric Prosthetics, such as
failure to approve copy submitted by GMF for distribution in a reasonable yet
timely manner, or failure to submit materials periodically (at least monthly) to
GMF to develop features.
This Agreement will be governed, construed and enforced in accordance with and
governed by the laws of the state of Virginia county of Fairfax applicable to
agreements made and to be performed in such jurisdiction without reference to
conflicts of law principles. The Parties irrevocably consent that any legal
action or proceeding against them under, arising out of or in any manner
relating to this Agreement or any other agreement, document or instrument
arising out of or executed in connection with this Agreement may be brought only
in a court with jurisdiction located in, or the federal district court the
district of which includes Fairfax County, Virginia and the Parties each
irrevocably consent to that venue and to the personal jurisdiction thereof.
The offer contained in this MOU supersedes any previous written or verbal offers
submitted to Pediatric Prosthetics and is valid for a period of 14 days from the
date; in the footnote at the bottom of the page. Please indicate your acceptance
of this MOU by signing below, and then please fax the original, followed by
mailing of two executed copies, at your earliest convenience to: Don L Rose,
President, Global Media Fund Inc., P. O. Box 78, Mt. Sinai, NY 11766; Ph:
631/791-5126, Fax: 631/389-2367.
SIGNATURE PAGE
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AGREED AND ACCEPTED:
/s/ Kenneth W. Bean
Pediatric Prosthetics Inc. ------------------------------
Signature
Date 2/20/2006
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AGREED AND ACCEPTED:
/s/ Don Rose
Global Media Fund, Inc. ------------------------------
Signature
Date 2/20/2006
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