sc13d

-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, SGLGNgUIb2mmOP7IXwqApX0BJYtBLGO3RsISIBTRAyIRcpUWM31zAKUwSVjBdgjY DNm4UKuBljStf29Dzc34GQ== 0000950124-08-002654.txt : 20080606 0000950124-08-002654.hdr.sgml : 20080606 20080606164222 ACCESSION NUMBER: 0000950124-08-002654 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 20080606 DATE AS OF CHANGE: 20080606 SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: IMEDIA INTERNATIONAL INC CENTRAL INDEX KEY: 0001208498 STANDARD INDUSTRIAL CLASSIFICATION: [9995] IRS NUMBER: 841424696 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D SEC ACT: 1934 Act SEC FILE NUMBER: 005-79148 FILM NUMBER: 08886147 BUSINESS ADDRESS: STREET 1: 1721 21ST STREET CITY: SANTA MONICA STATE: CA ZIP: 90404 BUSINESS PHONE: 310-453-4499 MAIL ADDRESS: STREET 1: 1721 21ST STREET CITY: SANTA MONICA STATE: CA ZIP: 90404 FORMER COMPANY: FORMER CONFORMED NAME: IRVINE PACIFIC CORP DATE OF NAME CHANGE: 20021203 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: Williamson Henry CENTRAL INDEX KEY: 0001423048 FILING VALUES: FORM TYPE: SC 13D BUSINESS ADDRESS: BUSINESS PHONE: 310-453-4499 MAIL ADDRESS: STREET 1: 1721 21ST STREET CITY: SANTA MONICA STATE: CA ZIP: 90404 SC 13D 1 v41387sc13d.htm SCHEDULE 13D sc13d

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934

IMEDIA INTERNATIONAL, INC.

(Name of Issuer)

Common Stock, $0.001 Par Value Per Share

(Title of Class of Securities)

452467103

(CUSIP Number)

Anthony J. Fidaleo
iMedia International, Inc.
1721 21^st Street, Santa Monica, CA 90404
(310) 453-4499

(Name, Address and Telephone Number of Person Authorized to

Receive Notices and Communications)

December 20, 2007

(Date of Event which Requires Filing of this Statement)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-1(b)(3) or (4), check the following box o.


CUSIP No.		452 467 10 3

NAME OF REPORTING PERSON

Henry Williamson

CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP

(a) o

(b) o

SEC USE ONLY

SOURCE OF FUNDS

PF, OO

CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e)

CITIZENSHIP OR PLACE OF ORGANIZATION

Citizen of United States residing in State of California

SOLE VOTING POWER

NUMBER OF

5,845,093

SHARED VOTING POWER

BENEFICIALLY

OWNED BY

N/A

EACH

SOLE DISPOSITIVE POWER

REPORTING

PERSON

5,845,093

SHARED DISPOSITIVE POWER

N/A

AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

5,845,093 shares

CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES

PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

23.55%

TYPE OF REPORTING PERSON

HC, IN

ITEM 1. SECURITY AND ISSUER

This statement on Schedule 13D relates to the common stock, $.001 par value per share (the “Common Stock”), of iMedia International, Inc. (iMedia), a Delaware corporation (“iMedia”). iMedia’s principal executive office is located at 1721 21^st Street, Santa Monica, CA 90404.

ITEM 2. IDENTITY AND BACKGROUND

The following information is provided regarding the Reporting Person:

(a) Name: Henry Williamson (“Mr. Williamson”)

(b) Business Address: 1721 21st Street, Santa Monica, CA 90404.

(d) Mr. Williamson has not, during the past five years, been convicted in any criminal proceeding (excluding traffic violations).

(e) Mr. Williamson has not, during the past five years, been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction or been subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws.

(f) Citizenship: Mr. Williamson is a citizen of United States.

ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION

On December 20, 2007, iMedia entered into a Securities Purchase Agreement with Mr. Williamson (“the Williamson Agreement”) a copy of which is filed as Exhibit 1 hereto. Pursuant to the Williamson Agreement, iMedia issued to Mr. Williamson 5,082,504 shares of Common Stock for an aggregate consideration of $770,688, comprised of $108,967 in cash and cancellation of $661,721 due under a secured demand note previously issued by iMedia to Mr. Williamson. The source of the funds was Mr. Williamson’s personal funds.

Also, on December 20, 2007, in accordance with the iMedia’s Reorganization Agreement (“the Reorganization Agreement”) iMedia granted 762,376 restricted shares of iMedia’s Common Stock to Mr. Williamson as compensation for the Company’s executive management team agreeing to cancel all their previously issued options to purchase Shares of iMedia’s Common Stock and defer a minimum of 25% of their compensation until the Reorganization was completed, of which Mr. Williamson cancelled 208,770 options to purchase iMedia Common Stock.. Executive management has agreed to voluntarily continue the deferral of a minimum of 25% their compensation on a month-to-month basis. One-third of the restricted shares of Common Stock vested on the date of grant, one-third will vest on the first anniversary of the grant date, and one-third will vest on the second anniversary of the grant date.

Prior to December 20, 2007 and prior to Mr. Williamson’s becoming the Chief Executive Officer and Chairman of the Board of iMedia, Mr. Williamson had purchased 5,500 shares of Common Stock through his personal brokerage account with his personal funds as the source. Effective with the Reorganization Agreement the shares had a 26-for-1 reverse split into 212 shares of Common Stock which Mr. Williamson still holds.

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ITEM 4. PURPOSE OF THE TRANSACTION

As previously reported in the Form 8-K report filed by iMedia with the Securities and Exchange Commission on December 24, 2007, iMedia entered into a Reorganization Agreement on December 20, 2007 for the purpose of reorganizing its outstanding debt and equity, a copy of which is filed as Exhibit 2 hereto. As a condition to the closing of the Reorganization Agreement, iMedia was required to obtain debt or equity financing of not less than $750,000 and not more than $1,500,000. The signatories to the Reorganization Agreement agreed that (i) the initial financing would result in $750,000 of gross proceeds to iMedia and that the investors in such financing would receive up to 25% of the fully diluted capital of iMedia for such funds, and (ii) one or more persons or entities affiliated with iMedia or iMedia’s executive management would be permitted to participate as investors in such financing. Accordingly, on December 20, 2007, iMedia entered into a Securities Purchase Agreement with Mr. Williamson (“the Williamson Agreement”), iMedia’s Chief Executive Officer and Chairman of iMedia’s Board of Directors, a copy of which is filed as Exhibit 1 hereto. Pursuant to the Williamson Agreement, iMedia issued to Mr. Williamson 5,082,504 Shares, equating to 25% of the fully diluted capital of iMedia, for an aggregate consideration of $770,688, comprised of $108,967 in cash and cancellation of $661,721 due under a secured demand note previously issued by iMedia to Mr. Williamson for monies drawn by iMedia against the note in anticipation of the closing of the Reorganization Agreement. The $661,721 is comprised of the $641,033 in principal drawn by iMedia under the note plus $20,688 in accrued and unpaid interest.

Also, in connection with the Reorganization Agreement, on November 15, 2007, iMedia adopted the iMedia International, Inc. 2007 Stock Incentive Plan (the “Plan”), a copy of which is filed as Exhibit 3 hereto, to become effective upon the effective date of the Reorganization Agreement. In accordance with the Reorganization Agreement, upon effectiveness of the Plan, iMedia granted 762,376 restricted Shares to Mr. Williamson. One-third of such Shares vested on the date of grant, one-third will vest on the first anniversary of the grant date, and one-third will vest on the second anniversary of the grant date.

The offers and sales of the Shares under the Reorganization Agreement and the Williamson Agreement (the “Sales”) are exempt from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”), pursuant to Rule 506 under the Securities Act based on the following: (1) the recipients of the Shares are all accredited investors within the meaning of Rule 501(a) under the Securities Act; (2) the Company has acted in accordance with Rule 502(d) under the Securities Act to restrict resales of the Shares issued in the Sales; (3) there were no more than 35 non-accredited investors in any transaction within the meaning of Rule 506(b) under the Securities Act after taking into consideration all prior investors under Section 4(2) of the Securities Act within the six months preceding the Sales; and (4) the Sales were not effected through any general solicitation or general advertising within the meaning of Rule 502(c) under the Securities Act.

Mr. Williamson intends to review on a continuing basis his investment in iMedia and may determine, depending upon the evaluation of his financial planning, upon iMedia’s business and prospects and upon future developments in general business, economic and market conditions, to increase, decrease or continue to hold or dispose of his position in iMedia.

Except as set forth in the previous paragraphs, Mr. Williamson has no plans or proposals that relate to or would result in: (a) the acquisition by any person of additional securities of iMedia, or the disposition of securities of iMedia; (b) an extraordinary corporate transaction, such as a merger, reorganization or liquidation or any of its subsidiaries; (c) any change in the present Board of Directors or management of iMedia; (d) any material change in the present capitalization or dividend policy of iMedia; (e) any other material change in iMedia, involving iMedia or any of its subsidiaries; (f) a sale or transfer of a material amount of assets of iMedia’s business or corporate structure; (g) changes in the Company’s charter, bylaws or instruments corresponding thereto or other actions which may impede the acquisition of control of iMedia by any person; (h) causing a class of securities of iMedia to be delisted from a national securities exchange or to cease to be authorized to be quoted in an inter-dealer quotation system of a registered national securities association; (i) a class of equity securities of iMedia becoming eligible for termination of

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registration pursuant to Section 12(g)(4) of the Exchange Act; or (j) any action similar to any of those enumerated in (a)-(i) above.

ITEM 5. INTEREST IN SECURITIES OF THE ISSUER

(a) The table below sets forth the aggregate number of shares and percentage of iMedia’s outstanding shares beneficially owned by Mr. Williamson.

Reporting Person

Number of Shares

Percentage of Total

Citizenship

Henry Williamson

5,845,093

23.55

United States

(b) Mr. Williamson holds the sole power to vote and to dispose or direct the disposition of his shares of Common Stock.

(c) Mr. Williamson has not effected any transaction in the Common Stock during the past 60 days, except as disclosed herein.

(d) Not applicable.

(e) Not applicable.


*		Based on 24,817,668 shares outstanding as of June 3, 2008.

ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER

Other than the, the Williamson Agreement, Reorganization Agreement and the Plan described in Item 4 to this Statement and attached as Exhibits 1,2 and 3 respectively, as of the date of filing of this Form there are no contracts, arrangements, understandings or relationships (legal or otherwise) between Mr. Williamson and any person with respect to any securities of iMedia.

ITEM 7. MATERIAL TO BE FILED AS EXHIBITS

	1)		Common Stock Purchase Agreement, dated as of December 20, 2007, Between iMedia International, Inc. and Henry Williamson

	2)		Reorganization Agreement, dated as of October 20, 2007 Between iMedia International, Inc. and Secured Creditors, Preferred Series A Shareholders, Preferred Series B Shareholders, and Certain Unsecured Creditors

	3)		iMedia International, Inc. 2007 Stock Incentive Plan

SIGNATURE

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information named in this statement is true, complete and correct.



Date: June 6, 2008	/s/ Henry Williamson
	HENRY WILLIAMSON

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	Exhibit Index


Exhibit No.		Description

1)		Stock Purchase Agreement, dated as of December 20, 2007, Between iMedia International, Inc. and Henry Williamson

2)		Reorganization Agreement, dated as of October 20, 2007 Between iMedia International, Inc. and Secured Creditors, Preferred Series A Shareholders, Preferred Series B Shareholders, and Certain Unsecured Creditors

3)		iMedia International, Inc. 2007 Stock Incentive Plan

EX-99.1 2 v41387exv99w1.htm EXHIBIT 1 exv99w1

EXHIBIT 99.1

SECURITIES PURCHASE AGREEMENT

This SECURITIES PURCHASE AGREEMENT (this “Agreement”), dated as of December 20, 2007, is made by and between iMEDIA INTERNATIONAL, INC., a Delaware corporation (the “Company”), and HENRY WILLIAMSON (the “Purchaser”) (each, a “Party” and, collectively, the “Parties”).

RECITALS:

A. The Purchaser desires to purchase from the Company, and the Company desires to sell to the Purchaser, subject to the terms and conditions stated in this Agreement, in one or more private placements, up to an aggregate of 10,165,008 shares (the “Shares”) of the Company’s common stock, par value $0.001 per share (the “Common Stock”).

B. The Purchaser is the payee under that certain 14% Secured Convertible Promissory Note, dated July 25, 2007 (the “Note”), made by the Company, iMedia US, LLC, iMedia Nevada, LLC, and Hollywood Previews, Inc. (collectively, the “Borrowers”), pursuant to which the Purchaser agreed to loan to the Borrowers, and the Borrowers agreed to pay to the Purchaser or his registered assigns, up to a maximum principal amount of $750,000.

C. In connection with the Note, the Purchaser is a party to that certain Intercreditor Agreement, dated as of July 25, 2007 (the “Intercreditor Agreement”), by and among the Purchaser, the Borrowers and other signatories thereto, the termination of which is a condition to the consummation of the sale of the Shares hereunder.

NOW, THEREFORE, the Parties hereby agree as follows:

1. PURCHASE AND SALE OF SHARES.

a. Commitment to Purchase. Subject to the terms and conditions hereinafter set forth, the Purchaser hereby agrees to purchase up to 10,165,008 Shares from the Company and the Company agrees to sell up to such number of Shares to the Purchaser.

b. First Closing. The first closing (the “First Closing”) of the sale of Shares by the Company to the Purchaser shall take place at the offices of Richardson & Patel LLP, Los Angeles, California, at 10:00 a.m., local time, simultaneously with the execution hereof, unless another date or place is agreed to in writing by the Parties. At the First Closing, the Purchaser shall purchase, and the Company shall sell, 5,082,504 Shares for an aggregate consideration of $750,000 (the “Purchase Price”), comprised of (i) $108,967 in cash and (ii) cancellation of the Note and all amounts due thereunder. At the First Closing:

i. The Purchaser shall deliver to the Company funds in an amount equal to $108,967;

ii. The Purchaser shall deliver the original Note to the Company for cancellation; and

iii. The Company shall deliver instructions to its transfer agent to deliver to the Purchaser a certificate or certificates representing 5,082,504 shares of Common Stock.

c. Subsequent Closings. Subsequent closings (each a “Follow-on Closing”) of sales of additional Shares shall take place on such date or dates and at such place or places as may be agreed to in writing by the Parties; provided that no such Follow-on Closing and sale of Shares shall occur later than six weeks following the Effective Date (as defined in that certain Reorganization Agreement entered into on December 20, 2007 (the “Reorganization Agreement”), among the Company and the various signatories thereto). Nothing in this Section 1.c shall create an obligation on the party of any Party to perform any Follow-on Closing. At each Follow-on Closing, (i) the Purchaser shall purchase, and the Company shall sell, that number of Shares as may be agreed to by the Parties; provided that the number of Shares purchased at any such Follow-on Closing, when added to the number of shares purchased at the First Closing and any other Follow-on Closing, shall not exceed 10,165,008. At each Follow-on Closing:

i. The Purchaser shall deliver to the Company funds in an amount equal to (i) that number of Shares to be purchased by the Purchaser at such Follow-on Closing multiplied by (ii) $0.1476 (with respect to each such Follow-on Closing, the “Follow-on Purchase Price”); and

ii. The Company shall deliver to the Purchaser a certificate or certificates representing the number of Shares to be purchased by the Purchaser at such Follow-on Closing.

d. “Closing Date” shall mean, with respect to the First Closing, the date of this Agreement, unless any other date has been agreed to in writing by the Parties, or, with respect to any Follow-on Closing, such date as may be agreed to in writing by the Parties, as applicable.

2. THE PURCHASER’S REPRESENTATIONS AND WARRANTIES.

The Purchaser represents and warrants to the Company as follows:

a. He recognizes that the purchase of the Shares involves a high degree of risk in that (i) an investment in the Company is highly speculative and only investors who can afford the loss of their entire investment should consider investing in the Company; (ii) he may not be able to liquidate his investment; and (iii) in the event of a disposition, he could sustain the loss of his entire investment.

b. He is an “accredited investor” as such term is defined in Rule 501 of Regulation D promulgated under the Securities Act of 1933, as amended (the “Securities Act”), and is able to bear the economic risk and illiquidity of an investment in the Shares.

c. He (i) has prior investment experience or has employed the services of an investment advisor, attorney and/or accountant to read all of the documents furnished or made available by the Company to him to evaluate the merits and risks of such an investment on his behalf; and (ii) is able to bear the economic risk and illiquidity that he will assume by investing in the Shares.

d. He (i) has been furnished by the Company during the course of this transaction with all information regarding the Company that he has requested or desired to know; (ii) has been afforded the opportunity to ask questions of and receive answers from duly authorized officers or other representatives of the Company concerning the Company and the Shares and has received responses satisfactory to him with regard to any such questions; and (iii) has received any additional information that he has requested.

e. To the extent necessary, he has retained, at his own expense, and relied upon the advice of appropriate professionals regarding the investment, tax and legal merits and consequences of this Agreement and his purchase of the Shares hereunder.

f. No Shares were offered or sold to him by means of any form of general solicitation or general advertising.

g. He acknowledges that no federal, state or other governmental agency has passed upon or made any recommendation or endorsement of the Shares and that this sale of Shares is intended to be exempt from the registration requirements of the Securities Act. In connection therewith, the Purchaser hereby represents that he is purchasing the Shares for his own account for investment and not with a view toward the resale or distribution thereof to others. The Purchaser shall not sell or otherwise transfer any Shares unless they are registered under the Securities Act or unless an exemption from such registration is available.

h. He understands and hereby acknowledges that the Shares he is purchasing hereunder are characterized as “restricted securities” under federal securities laws inasmuch as they are being acquired from the Company in a transaction not involving a public offering and that under such laws and applicable regulations such securities may be resold without registration under the Securities Act only in certain limited circumstances. Accordingly, the Purchaser represents that he is familiar with Rule 144 promulgated under the Securities Act, as presently in effect, and understands the resale limitations imposed thereby and by the Securities Act.

i. He understands and hereby acknowledges that, except as otherwise provided herein, the Company is under no obligation to register the Shares under the Securities Act or any state securities or “blue sky” laws. The Purchaser agrees that the Company may, in its discretion, permit the transfer of the Shares out of the Purchaser’s name only when his request for transfer is accompanied by an opinion of counsel reasonably satisfactory to the Company to the effect that neither the sale nor the proposed transfer results in a violation of the Securities Act or any applicable state “blue sky” laws.

j. He has full power and authority to execute and deliver this Agreement and to purchase the Shares subscribed for hereby and that this Agreement constitutes the legal, valid and binding obligation of the Purchaser, enforceable against him in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and other laws affecting creditors’ rights and remedies generally and to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).

k. He understands that, until such time as the Shares have been registered under the Securities Act as contemplated by the registration rights provisions hereof or otherwise may be sold by the Purchaser under Rule 144, the certificates representing any Shares shall bear a restrictive legend in substantially the following form:

THIS SECURITY HAS NOT BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE COMMISSION OR THE SECURITIES COMMISSION OF ANY STATE IN RELIANCE UPON AN EXEMPTION FROM REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT OR PURSUANT TO AN AVAILABLE EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS AS EVIDENCED BY A LEGAL OPINION OF COUNSEL TO THE TRANSFEROR TO SUCH EFFECT, THE SUBSTANCE OF WHICH SHALL BE REASONABLY ACCEPTABLE TO THE COMPANY. THIS SECURITY MAY BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN SECURED BY SUCH SECURITIES.

The legend set forth above shall be removed and the Company shall issue a certificate without such legend to the holder of any certificate upon which it is stamped, if (a) the sale of the Shares represented thereby is registered under the Securities Act or (b) in connection with the resale of such Shares, such holder provides the Company with an opinion of counsel, in form, substance and scope customary for opinions of counsel in comparable transactions, to the effect that a public sale or transfer of such Shares may be made without registration under the Securities Act or (c) such holder provides the Company with reasonable assurances that such Shares can be sold under Rule 144(k). The Purchaser agrees to sell any Shares to be sold by him, including those represented by a certificate(s) from which the legend has been removed, pursuant to an effective registration statement or under an exemption from the registration requirements of the Securities Act.

3. REPRESENTATIONS AND WARRANTIES OF THE COMPANY.

The Company represents and warrants to the Purchaser as follows:

a. Organization and Qualification. Each of the Company and each of its subsidiaries is an entity duly organized and existing under the laws of the jurisdiction in which it is incorporated or organized, and has the requisite power to own its properties and to carry on its business as now being conducted. To the Company’s knowledge, each of the Company and each of its subsidiaries is duly qualified as a foreign entity to do business, and is in good standing, in every jurisdiction in which the nature of the business conducted by it makes such qualification necessary and where the failure to so qualify would have a material adverse effect on (i) the Shares, (ii) the ability of the Company to perform its obligations hereunder, or (iii) the business, operations, properties, prospects or financial condition of the Company and its subsidiaries, taken as a whole (a “Material Adverse Effect”).

b. Authorization; Enforcement. (i) The Company has the requisite corporate power and authority to enter into and perform its obligations under this Agreement and to issue and sell the Shares in accordance with the terms hereof; (ii) the execution, delivery and performance of this Agreement by the Company and the consummation by it of the transactions contemplated hereby have been duly authorized by the Company’s Board of Directors, and no further consent or authorization of the Company, its Board of Directors or its shareholders is required; (iii) this Agreement has been duly executed and delivered by the Company; and (iv) this Agreement constitutes the legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium, fraudulent transfer and other laws affecting creditors’ rights and remedies generally and to general principles of equity (regardless of whether enforcement is sought in a proceeding at law or in equity).

c. Capitalization. The capitalization of the Company and each of its subsidiaries immediately following the First Closing is set forth on Schedule 3.c, including the authorized capital stock, the number of shares issued and outstanding, the number of shares issuable and reserved for issuance pursuant to any Company stock option plan, and the number of shares issuable and reserved for issuance pursuant to securities exercisable for, or convertible into or exchangeable for, any shares of capital stock. All of such outstanding shares of the Company’s capital stock have been, or upon issuance will be, validly issued, fully paid and nonassessable. Except as set forth on Schedule 3.c, no shares of capital stock of the Company (including the Shares) or any of its subsidiaries are subject to preemptive rights or any other similar rights of the shareholders of the Company or any liens or encumbrances. Except as disclosed in Schedule 3.c, (i) there are no outstanding options, warrants, scrip, rights to subscribe to, calls or commitments of any character whatsoever to which the Company or any of its subsidiaries is a party relating to the issuance by the Company or any of its subsidiaries of securities or rights convertible into or exercisable or exchangeable for, any shares of capital stock of the Company or any of its subsidiaries, or arrangements by which the Company or any of its subsidiaries is or may become bound to issue additional shares of capital stock of the Company or such subsidiaries, and (ii) there are no agreements or arrangements under which the Company or any of its subsidiaries is obligated to register the sale of any of its or their securities under the Securities Act. Except as set forth on Schedule 3.c, there are no securities or instruments containing anti-dilution or similar provisions that

may be triggered by the issuance of the Shares in accordance with the terms of this Agreement, and the holders of the securities and instruments listed on such Schedule 3.c have waived any rights they may have under such anti-dilution or similar provisions in connection with the issuance of the Shares in accordance with the terms of this Agreement. The Company has made available to the Purchaser true and correct copies of the Company’s Articles of Incorporation as in effect on the date hereof (the “Articles of Incorporation”), the Company’s By-laws as in effect on the date hereof (the “By-laws”) and all other instruments and agreements governing securities convertible into or exercisable or exchangeable for capital stock of the Company, except for stock options granted under any benefit plan of the Company.

d. Issuance of Shares. The Shares are duly authorized and, when issued and paid for in accordance with the terms hereof, will be validly issued, fully paid and non-assessable, and will be free from all taxes, liens, claims and encumbrances (other than those imposed through acts or omissions of the Purchaser thereof), and will not be subject to preemptive rights or other similar rights of shareholders of the Company.

e. No Conflicts. The execution, delivery and performance of this Agreement and the consummation by the Company of the transactions contemplated hereby (including, without limitation, the issuance of the Shares) will not (i) conflict with or result in a violation of the Articles of Incorporation or By-laws or (ii) conflict with, or constitute a default (or an event which, with notice or lapse of time or both, would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to which the Company or any of its subsidiaries is a party, or result in a violation of any law, rule, regulation, order, judgment or decree (including (assuming the accuracy of the representations and warranties of the Purchaser) the United States federal and state securities laws and regulations) applicable to the Company or any of its subsidiaries or by which any property or asset of the Company or any of its subsidiaries is bound or affected (except, with respect to clause (ii), for such conflicts, defaults, terminations, amendments, accelerations, cancellations and violations as would not, individually or in the aggregate, have a Material Adverse Effect). Except as specifically contemplated by this Agreement and as required under the Securities Act and any applicable state securities laws, the Company is not required to obtain any consent, approval, authorization or order of, or make any filing or registration with, any court or governmental agency or any regulatory or self regulatory agency in order for it to execute, deliver or perform any of its obligations under this Agreement (including without limitation the issuance and sale of the Shares as provided hereby) in accordance with the terms hereof.

f. Absence of Litigation. Except as disclosed in Schedule 3(f), there is no action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, to the knowledge of the Company, threatened against or affecting the Company, or any of its subsidiaries, or any of their directors or officers in their capacities as such that would have a Material Adverse Effect.

g. No Brokers. The Company has not engaged any person to which or to whom brokerage commissions, finder’s fees, financial advisory fees or similar payments are or will become due in connection with this Agreement or the transactions contemplated hereby.

h. No General Solicitation. Neither the Company nor any person participating on the Company’s behalf in the transactions contemplated hereby has conducted any “general solicitation” or “general advertising” as such terms are used in Regulation D with respect to any of the Shares being offered hereby.

i. Disclosure. All information relating to or concerning the Company and its subsidiaries set forth in this Agreement in connection with the transactions contemplated hereby is true and correct in all material respects, and the Company has not omitted to state any material fact necessary in order to make the statements made herein or therein, in light of the circumstances under which they were made, not misleading.

4. REGISTRATION RIGHTS.

If, at any time during which the Purchaser holds Shares that are not then eligible for a Rule 144(k) Sale, the Company proposes to register any of its common securities under the Securities Act (other than on a registration statement on Form S-4 or Form S-8 or any similar successor forms thereto), whether for its own account or for the account of one or more securityholders of the Company, and the registration form to be used may be used for any registration of the Shares (a “Piggyback Registration”), the Company shall give prompt written notice to the Purchaser of its intention to effect such a registration and shall include in such registration all Shares with respect to which the Company has received a written request from the Purchaser for inclusion therein within 15 days after the Purchaser’s receipt of the Company’s notice. The Company may postpone or withdraw the filing or the effectiveness of a Piggyback Registration at any time in its sole discretion. If the SEC reduces the number of securities that may be registered in such Piggyback Registration, such reduction shall be made on a pro-rata basis among the Purchaser and any other selling shareholders included therein. The underwriters in any underwritten offering by the Company shall have the right to limit, due to marketing considerations, the number of Shares to be registered in a registration pursuant to this Section 4.b.

5. CONDITIONS TO THE COMPANY’S OBLIGATION TO SELL.

a. The obligation of the Company hereunder to issue and sell Shares to the Purchaser at the First Closing is subject to the satisfaction, on or before the Closing Date, of each of the following conditions thereto; provided, however, that any of these conditions may be waived by the Company at any time in its sole discretion.

i. The Purchaser shall have executed and delivered to the Company this Agreement.

ii. The Purchaser shall have delivered the Purchase Price in accordance with Section 1.b above.

iii. The Reorganization Agreement by and among the Company and the various signatories thereto, pursuant to which the Company proposes to reorganize its debt and equity as outstanding as of September 30, 2007 (the “Reorganization Agreement”), shall have been signed by all parties thereto, and, in connection therewith, the following actions (the “Reorganization Actions”) shall have occurred:

1. The Company’s notes, preferred stock and other obligations to certain creditors shall have been converted to Common Stock as described in the Reorganization Agreement, and the holders of such notes, preferred stock and other obligations shall have executed and delivered to the Company the Ancillary Consents (as defined in the Reorganization Agreement).

2. The Company shall have adopted the stock ownership plan contemplated by the Reorganization Agreement.

3. The Purchaser, Scott Kapp and Anthony Fidaleo shall have executed employment and retention agreements with the Company as contemplated by the Reorganization Agreement.

4. The 26-for-1 reverse split of the Company’s Common Stock shall have become effective under Delaware law.

iv. The Intercreditor Agreement shall have been terminated by a writing signed by all of the parties thereto, and all liens on assets of the Borrowers (as defined in the Intercreditor Agreement) securing indebtedness of the Borrowers to the Existing Secured Parties (as defined in the Intercreditor Agreement) shall have been released.

v. The representations and warranties of the Purchaser shall be true and correct as of the date when made and as of the Closing Date as though made at that time (except for representations and warranties that speak as of a specific date, which representations and warranties shall be true and correct as of such date), and the Purchaser shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by him on or prior to the Closing Date.

vi. No statute, rule, regulation, executive order, decree, ruling, injunction, action, proceeding or interpretation shall have been enacted, entered, promulgated, endorsed or adopted by any court or governmental authority of competent jurisdiction or any self-regulatory organization, or the staff of any thereof, having authority over the matters contemplated hereby that questions the validity of, or challenges or prohibits the consummation of, any of the transactions contemplated by this Agreement.

b. The obligation of the Company hereunder to issue and sell Shares to the Purchaser at any Follow-on Closing is subject to the satisfaction, on or before the applicable Closing Date, of each of the following conditions thereto; provided, however, that any of these conditions may be waived by the Company at any time in its sole discretion.

i. The Purchaser shall have executed and delivered to the Company this Agreement, and the First Closing shall have occurred.

ii. The Purchaser shall have delivered the applicable Follow-on Purchase Price in accordance with Section 1.c above.

iii. The Reorganization Agreement shall have been signed by all parties thereto, and, in connection therewith, the Reorganization Actions shall have occurred.

iv. The Intercreditor Agreement shall have been terminated by a writing signed by all of the parties thereto, and all liens on assets of the Borrowers securing indebtedness of the Borrowers to the Existing Secured Parties shall have been released.

v. The representations and warranties of the Purchaser shall be true and correct as of the date when made and as of the applicable Closing Date as though made at that time (except for representations and warranties that speak as of a specific date, which representations and warranties shall be true and correct as of such date), and the Purchaser shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by him on or prior to the applicable Closing Date.

6. CONDITIONS TO THE PURCHASER’S OBLIGATION TO PURCHASE THE SHARES.

a. The obligation of the Purchaser hereunder to purchase Shares at the First Closing is subject to the satisfaction, on or before the Closing Date, of each of the following conditions, provided, however, that any of these conditions may be waived by the Purchaser at any time in his sole discretion:

i. The Company shall have executed and delivered to the Purchaser this Agreement.

ii. The Company shall have delivered instructions to its transfer agent to deliver to the Purchaser duly executed certificates representing the number of Shares as provided in Section 1.b above.

iii. The Reorganization Agreement shall have been signed by all parties thereto, and, in connection therewith, the Reorganization Actions shall have occurred.

v. The representations and warranties of the Company shall be true and correct as of the date when made and as of the Closing Date as though made at that time (except for representations and warranties that speak as of a specific date, which representations and warranties shall be true and correct as of such date), and the Company shall have performed, satisfied and

complied in all material respects with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Company on or prior to the Closing Date. The Purchaser shall have received a certificate, executed on behalf of the Company by its Chief Financial Officer, dated as of the Closing Date, to the foregoing effect and attaching true and correct copies of the resolutions adopted by the Company’s Board of Directors authorizing the execution, delivery and performance by the Company of its obligations under this Agreement.

vii. From the date of this Agreement through the Closing Date, there shall not have occurred any Material Adverse Effect.

b. The obligation of the Purchaser hereunder to purchase Shares at any Follow-on Closing is subject to the satisfaction, on or before the applicable Closing Date, of each of the following conditions, provided, however, that any of these conditions may be waived by the Purchaser at any time in his sole discretion:

i. The Company shall have executed and delivered to the Purchaser this Agreement, and the First Closing shall have occurred.

ii. The Company shall have delivered instructions to its transfer agent to deliver to the Purchaser duly executed certificates representing the number of Shares as provided in Section 1.c above.

iii. The Reorganization Agreement shall have been signed by all parties thereto, and, in connection therewith, the Reorganization Actions shall have occurred.

v. The representations and warranties of the Company shall be true and correct as of the date when made and as of the applicable Closing Date as though made at that time (except for representations and warranties that speak as of a specific date, which representations and warranties shall be true and correct as of such date), and the Company shall have performed, satisfied and complied in all material respects with the covenants, agreements and conditions required by this Agreement to be performed, satisfied or complied with by the Company on or prior to the applicable Closing Date. The Purchaser shall have received a certificate, executed on behalf of the Company by its Chief Financial Officer, dated as of the applicable Closing Date, to the foregoing effect and attaching true and correct copies of the resolutions adopted by the Company’s Board of Directors authorizing the execution, delivery and performance by the Company of its obligations under this Agreement.

vii. From the date of this Agreement through the applicable Closing Date, there shall not have occurred any Material Adverse Effect.

7. GOVERNING LAW MISCELLANEOUS.

a. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, without regard to the conflicts of law principles thereof.

b. Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be an original instrument and all of which, when taken together, shall constitute one and the same agreement. Signatures delivered by facsimile or other electronic means shall have the same force and effect as original signatures hereto.

c. Headings. The headings of this Agreement are for convenience of reference and shall not form part of, or affect the interpretation of, this Agreement.

d. Severability. If any provision of this Agreement shall be invalid or unenforceable in any jurisdiction, such invalidity or unenforceability shall not affect the validity or enforceability of the remainder of this Agreement or the validity or enforceability of this Agreement in any other jurisdiction.

e. Entire Agreement; Amendments; Waiver. This Agreement and the instruments referenced herein contain the entire understanding of the Parties with respect to the matters covered herein and therein and, except as specifically set forth herein or therein, neither the Company nor the Purchaser makes any representation, warranty, covenant or undertaking with respect to such matters. No provision of this Agreement may be waived or amended other than by an instrument in writing signed by the Parties. Any waiver by a Party of a breach of any provision of this Agreement shall not operate as or be construed to be a waiver of any other breach of such provision of or any breach of any other provision of this Agreement. The failure of a Party to insist upon strict adherence to any term of this Agreement on one or more occasions shall not be considered a waiver or deprive that Party of the right thereafter to insist upon strict adherence to that term or any other term of this Agreement.

f. Notices. Any notices or other correspondence required or permitted to be given hereunder shall be given in writing and shall be deemed effectively given upon (a) personal delivery, (b) delivery by fax (with answer back confirmed), or (c)two business days after mailing by recognized overnight courier (such as Federal Express), addressed to the Party at its address or sent to the fax number provided below or at such other address or fax number as such Party may

designate by three days’ advance notice to the other Party. All correspondence shall be addressed as follows:

If to the Company, to:

iMedia International, Inc.
1721 21^st Street
Santa Monica, CA 90404
Facsimile No.: (310) 453-6120
Attention: Anthony J. Fidaleo

With a copy to:

Richardson & Patel LLP
10900 Wilshire Blvd., Suite 500
Los Angeles, CA 90024
Facsimile No.: (310) 208-1154
Attention: Jennifer A. Post, Esq.

If to the Purchaser, to:

Henry Williamson
1721 21^st Street
Santa Monica, CA 90404
Facsimile No.: (310) 453-6120

g. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the Parties and their successors and assigns. The Company shall not assign this Agreement or any rights or obligations hereunder without the prior written consent of the Purchaser.

h. Third Party Beneficiaries. This Agreement is intended for the benefit of the Parties and their respective permitted successors and assigns and is not for the benefit of, nor may any provision hereof be enforced by, any other person.

i. Survival. The representations and warranties shall survive the each of the First Closing and each Follow-on Closing for the applicable statute of limitations.

j. Termination. In the event that the First Closing shall not have occurred on or before December 21, 2007, unless the Parties agree otherwise, this Agreement shall terminate at the close of business on such date. Notwithstanding any termination of this Agreement, any Party not in breach of this Agreement shall preserve all rights and remedies it may have against the other Party for a breach of this Agreement prior to or relating to the termination hereof.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

IN WITNESS WHEREOF, the Company and the Purchaser have caused this Agreement to be duly executed as of the date first above written.


		The Company:

		iMEDIA INTERNATIONAL, INC.

		By:

		Name: Scott Kapp

		Title: President


		The Purchaser:



		HENRY WILLIAMSON

[WILLIAMSON SECURITIES PURCHASE AGREEMENT]

EX-99.2 3 v41387exv99w2.htm EXHIBIT 2 exv99w2

EXHIBIT 99.2

REORGANIZATION AGREEMENT

This Reorganization Agreement (this “Agreement”) is entered into on this 8th day of October, 2007 by and among iMedia International, Inc., a Delaware corporation, with an address of 1721 21^st Street, Santa Monica, CA 90404 (the “Company”) and each of the persons identified on Exhibit A hereto (the “Signatories”).

WITNESSETH:

WHEREAS, the Company is proposing a reorganization of its outstanding debt and equity (the “Reorganization”) pursuant to which up to approximately $14,409,000 of the Company’s unaudited outstanding trade payables, promissory notes, accrued expenses, other liabilities, Series A preferred stock as well as its outstanding preferred stock, as of September 30, 2007 would be exchanged for a number of shares of the Company’s common stock, $.001 par value per share (“Common Stock”) representing approximately 80% of the outstanding shares of the Common Stock following the Reorganization (exclusive of any further dilution resulting from the additional financing the Company intends to seek in conjunction with this Reorganization);

WHEREAS, upon the consummation of the Reorganization and without giving effect to any additional financing in conjunction with the Reorganization, the Company estimates that its outstanding indebtedness and other liabilities, other than trade payables and accrued expenses incurred in the ordinary course of business, and deferred compensation, will not exceed $100,000;

WHEREAS, the proposed capitalization of the Company following the completion of the Reorganization is set forth on Exhibit B hereto;

WHEREAS, the consummation of the Reorganization is subject to a number of conditions precedent described below, including but not limited to: (a) the Company obtaining new financing of no less than $750,000 and no greater than $1,500,000 and the consent by Midsummer Investment, Ltd. (“Midsummer”) and Crestview Capital Master LLC (“Crestview”) of the terms and conditions thereof, (b) shareholder approval of a 26 for 1 reverse split of the Common Stock (the “Reverse Stock Split”), (c), the adoption of an Employee Stock Ownership Plan, and (d) obtaining the prerequisite number of stakeholders and other select creditors to agree to the terms set forth herein; and

WHEREAS, the Company and the Signatories desire to set forth the terms and conditions of the Reorganization.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and in consideration of the mutual covenants set forth herein, pursuant to the terms of this Agreement, each of the Signatories hereto hereby agrees to the

terms of the Reorganization in general and the specific exchanges of their rights for post-Reorganization Common Stock, all as set forth herein, and intends to be legally bound hereby

Except as otherwise noted, all references to Common Stock contained herein are as adjusted to account for the proposed 26 to 1 Reverse Stock Split.

1. Senior Creditors. The Company is indebted to the persons identified on Exhibit A hereto as the Senior Creditors (the “Senior Creditors”) in the aggregate principal amount of $4,380,000 pursuant to promissory notes issued by the Company that are currently payable on demand (the “Notes”). By execution hereof, the Senior Creditors hereby agree to convert the principal amount, any accrued but unpaid interest and any and all other obligations owed to them pursuant to the Notes into an aggregate of 6,403,464 shares of Common Stock (“Note Exchange Shares”), to be distributed pro rata amongst the Senior Creditors in accordance with Exhibit C hereto. The Senior Creditors agree to execute and deliver the Conversion and Waiver Agreement in the form of that attached hereto as Exhibit G. The term “Person” or “person” means an individual or corporation, partnership, trust, incorporated or unincorporated association, joint venture, limited liability company, joint stock company, government (or an agency or subdivision thereof) or other entity of any kind.

2. Preferred Stockholders. (a) As of the date hereof, an aggregate of 3,040 shares of Series A Convertible Preferred Stock (the “Series A Preferred”) and 4,920 shares of Series B Convertible Preferred Stock (the “Series B Preferred” and, collectively with the Series A Preferred, the “Preferred Stock”) are currently outstanding. By execution hereof, the persons identified on Exhibit A hereto as the holders of the Preferred Stock (the “Preferred Stockholders”) hereby agree to cancel their shares of Preferred Stock, including any and all dividends, liquidated damages or any other amounts payable in connection with the Preferred Stock as well as any and all warrants to purchase shares of Common Stock owned by them or the investment banker involved in such financings (whether such warrants were acquired in connection with the acquisition of the Preferred Stock or otherwise, the “Warrants”) in exchange for an aggregate of 2,882,494 shares of Common Stock, to be distributed amongst the preferred shareholders on a pro rata basis in accordance with Exhibit D hereto (the “Preferred Stock Shares”).

3. Other Creditors. The Company is indebted to the persons identified on Exhibit A hereto as the Other Creditors (the “Other Creditors”) in the aggregate principal amount of $899,113. By execution hereof, the Other Creditors hereby agree to convert any and all obligations owed to them by the Company into an aggregate of 759,812 shares of Common Stock, to be distributed amongst the Other Creditors on a pro rata basis in accordance with Exhibit E hereto (the “Other Creditor Shares”).

4. Stock Ownership Plan. The Company shall adopt a Stock Ownership Plan (the “Plan”) pursuant to which the Board of Directors of the Company shall be eligible to issue awards of stock options, restricted stock and other equity awards to employees, officers, directors and consultants to the Company. An aggregate of 7,500,000 shares of Common Stock shall be eligible for award grants under the Plan and it is anticipated that an aggregate of 2,222,539 shares of Common Stock will be allocated and reserved for issuance as restricted stock or stock options to Executive Officers and employees of the Company in connection with the

Reorganization (the “Plan Shares”), with an additional 1,762,261 shares of Common Stock (the “Milestone Shares”) to be issued upon the earlier of achieving annualized revenue run rate milestones of $5 million no later than September 30, 2008 or $10 million by June 30, 2009 in accordance with Exhibit F hereto (the “Target Revenues”).

5. Executive Officers.

(a) By execution hereof, Henry Williamson, Scott Kapp and Anthony J. Fidaleo (collectively, the “Executive Officers”) agree to execute three-year Employment and Retention Agreements with the Company (the “Employment Agreements”) pursuant to which each of the Executive Officers will agree to remain with the Company following the Reorganization and shall serve in the following offices:


		Henry Williamson		Chairman of the Board and Chief Executive Officer

		Scott Kapp		President and Director

		Anthony J.		Fidaleo Executive Vice President, Chief Financial Officer, Chief Operating Officer and Director

(b) The Executive Officers agree to defer 25% of the base salary payable to them until the completion of a Qualified Financing (as defined in Paragraph 7 below). Any compensation deferred by the Executive Officers shall be due and payable in full following the closing of a Qualified Financing.

(c) In addition, upon the effectiveness of the Plan the Executive Officers shall receive 1,865,396 Plan Shares and an additional 1,524,751 Milestone Shares (collectively, the “Executive Shares”). The Executive Shares shall vest as to 1/3 of the shares on the date of grant, with an additional 1/3 of the shares vesting on the first anniversary of the date of grant and all remaining shares vesting on the second anniversary of the date of grant; provided, however, the Milestone Shares shall only be eligible for issuance in the event the Company’s average annualized revenues for any trailing three calendar month period prior to September 30, 2008 or June 30, 2009 equal or exceed $5 million or $10 million, respectively.

(d) In the event an Executive Officer’s employment is terminated by the Company for Cause, or the Executive Officer terminates his employment without Good Reason, all unvested shares shall be forfeited. In the event the Company terminates an Executive Officer’s employment without Cause or an Executive Officer terminates his employment for Good Reason, all unvested shares shall automatically accelerate and be fully vested.

(e) The Company shall have “Cause” to terminate an Executive Officer if (i) the Executive Officer is convicted of a felony involving moral turpitude, (ii) the Executive Officer engages in gross negligence or willful misconduct in the performance of his duties, which conduct results in material injury to the Company, or (iii) the

Executive engages in material and continued failure to perform his duties to the Company, provided that the Executive Officer has received written notice from the Board of Directors of the Company of his failure to perform his duties and the Executive Officer has not cured such failure in the 30-day period following the receipt of notice.

(f) An Executive Officer shall have “Good Reason” to terminate his employment if the Company breaches its duties and obligations to the Executive Officer under such Executive Officer’s Employment Agreement, including the Company’s obligation to pay the salary of the Executive Officer when due.

6. Current Employees. The Company shall allocate an aggregate of 357,143 Plan Shares and 237,510 Milestone Shares for issuance as stock options to certain employees of the Company (other than the Executive Officers and Directors described above) upon the effectiveness of the Reorganization. The Milestone Shares and Plan Shares granted to the employees will be subject to the same vesting and other terms and restrictions as the Milestone Shares and Plan Shares granted to the Executive Officers.

7. Conditions to the Consummation of the Reorganization. The consummation of the Reorganization by the Company (the “Closing”) and the obligations of the persons executing this Agreement to perform their respective obligations hereunder are subject to the satisfaction of the following conditions on or before the Effective Date (as defined below) of the Reorganization:

(a) Shareholder Approval; Reverse Stock Split. The Signatories of the Common Stock prior to the Reorganization shall have approved an amendment to the Company’s Articles of Incorporation providing for the 26 for 1 Reverse Stock Split of the outstanding Common Stock and the Reverse Stock Split shall have become effective under Delaware law.

(b) Signatories to this Agreement. All of the Senior Creditors and Executive Officers shall have executed this Agreement. In addition, the Preferred Stockholders holding no less than 100% of the outstanding Preferred Shares as well as 100% of the Other Creditors of the Company shall have executed this Agreement. In addition, the Signatories of the Warrants set forth on the Exhibits hereto shall have executed this Agreement.

(c) Qualified Financing. The Company shall have obtained debt or equity financing on terms acceptable to the Company in its discretion with aggregate gross proceeds to the Company of not less $750,000 and not greater than $1,500,000 (the “Qualified Financing”). In the event the Company initially closes a Qualified Financing with less than the maximum funds, it may in its discretion keep the offering open for an additional six weeks after the Effective Date to seek to obtain the maximum financing on terms and conditions acceptable to the Board of Directors without further approvals of the Signatories. The Signatories to this Agreement acknowledge and agree that the Qualified Financing amounts in excess of $750,000 will result in additional dilution to the Signatories of the Company’s Common Stock following the Reorganization.

(d) Written Consents and Agreements. The Company shall have received from each of the Signatories hereto, a written consent, waiver or exchange agreement in the forms of Exhibit G, H and I hereto (as applicable) with respect to each Signatory, further evidencing the conversion and/or exchange of the Preferred Stock, the Notes, the Warrants, and the debt held by the Other Creditors and such other matters as are set forth on the applicable Exhibit (the “Ancillary Consents”).

(e) Regulation D Questionnaire. Each of the Signatories of the Preferred Stock and the Notes, and each of the Other Creditors shall have completed, executed and delivered a Regulation D Questionnaire in favor of the Company in the form of that attached hereto as Exhibit J.

(f) Employment and Retention Agreements. Each of Mr. Henry Williamson, Mr. Scott Kapp and Mr. Anthony J. Fidaleo shall have executed and delivered in favor of the Company an Employment or Retention Agreement on terms approved by the Board of Directors of the Company including the terms set forth in Paragraph 5 hereof.

(g) Company Approvals; Good Standing. The Company shall have taken all steps necessary or desirable to obtain the requisite approvals of its Board of Directors to the execution, delivery and performance of this Agreement and each of the other agreements, documents or instruments which the Company may be party to, including the approval of the Reverse Stock Split and the filing of Articles of Amendment in the State of Delaware. The Company shall be in good standing as of the date of the execution of this Agreement and the effectiveness of the Reorganization.

(h) Other Items. The Company shall have received such other items from the Signatories as it may reasonably request in order to evidence or effectuate the terms and intents of this Agreement.

The Reorganization shall be deemed effective on the date upon which (i) the Reverse Stock Split has become effective under Delaware law and (ii) all of the above conditions have been satisfied (the “Effective Date”); provided that the conditions of Paragraphs 7 (d), (e) and (h) may be waived in writing by the Company and the Signatories of a majority of the Notes and a majority of the Preferred Stock, including Crestview and Midsummer. The failure of any Signatory to deliver any of the Ancillary Consents shall not render the obligations and terms of this Agreement non-binding on such party.

8. Failure to Satisfy Conditions. In the event any of the conditions to the consummation of the Reorganization set forth in Paragraph 7, above, are not satisfied (or waived) on or prior to November 19, 2007, each signatory to this Agreement hereby agrees to provide their support and consent to the filing of a petition under Chapter 11 of the federal Bankruptcy Code seeking to approve a plan of reorganization on substantially the same terms as set forth in this Agreement.

9. Representations and Warranties of the Company. The Company hereby makes the following representations and warranties to each Signatory:

(a) Organization and Qualification. The Company and, to the knowledge of the Company, each of the subsidiaries (each, a “Subsidiary” and collectively, the “Subsidiaries”), is an entity duly incorporated or otherwise organized, validly existing and in good standing under the laws of the jurisdiction of its incorporation or organization (as applicable), with the requisite power and authority to own and use its properties and assets and to carry on its business as currently conducted. To the knowledge of the Company, neither the Company nor any Subsidiary is in violation or default of any of the provisions of its respective certificate or articles of incorporation, bylaws or other organizational or charter documents.

(b) Authorization; Enforcement. The Company has the requisite corporate power and authority to enter into and to consummate the transactions contemplated by this Agreement and otherwise to carry out its obligations hereunder. The execution and delivery of each of this Agreement by the Company and the consummation by it of the transactions contemplated hereby and thereby have been duly authorized by all necessary action on the part of the Company and no further action is required by the Company, its board of directors or its Stockholders in connection therewith. This Agreement has been duly executed by the Company and, when delivered in accordance with the terms hereof and thereof, will constitute the valid and binding obligation of the Company enforceable against the Company in accordance with its terms except (i) as limited by general equitable principles and applicable bankruptcy, insolvency, reorganization, moratorium and other laws of general application affecting enforcement of creditors’ rights generally, (ii) as limited by laws relating to the availability of specific performance, injunctive relief or other equitable remedies and (iii) insofar as indemnification and contribution provisions may be limited by applicable law.

(c) No Conflicts. To the knowledge of the Company, the execution, delivery and performance of this Agreement by the Company and the consummation by the Company of the transactions contemplated hereby do not and will not: (i) conflict with or violate any provision of the Company’s or any Subsidiary’s certificate or articles of incorporation, bylaws or other organizational or charter documents, or (ii) conflict with, or constitute a default (or an event that with notice or lapse of time or both would become a default) under, result in the creation of any Lien upon any of the properties or assets of the Company or any Subsidiary, or give to others any rights of termination, amendment, acceleration or cancellation (with or without notice, lapse of time or both) of, any agreement, credit facility, debt or other instrument (evidencing a Company or Subsidiary debt or otherwise) or other understanding to which the Company or any Subsidiary is a

party or by which any property or asset of the Company or any Subsidiary is bound or affected, or (iii) conflict with or result in a violation of any law, rule, regulation, order, judgment, injunction, decree or other restriction of any court or governmental authority to which the Company or a Subsidiary is subject (including federal and state securities laws and regulations), or by which any property or asset of the Company or a Subsidiary is bound or affected.

(d) Filings, Consents and Approvals. To the knowledge of the Company, the Company is not required to obtain any consent, waiver, authorization or order of, give any notice to, or make any filing or registration with, any court or other federal, state, local or other governmental authority or other person in connection with the execution, delivery and performance by the Company of this Agreement except for such filings or consents that have been made or obtained, or will be timely made or obtained hereafter.

(e) Issuance of the Shares. As of the Closing Date, the shares of Common Stock issued hereunder will be duly authorized and, when issued in accordance with this Agreement, will be duly and validly issued, fully paid and nonassessable, free and clear of all liens imposed by the Company or any other person.

(f) Capitalization. The capitalization of the Company as of the date hereof, immediately prior to the Closing, is as set forth on Exhibit G attached hereto, and the capitalization of the Company immediately following the Closing, assuming consummation of the transactions contemplated by this Agreement and the Purchase Agreement, will be as set forth on Exhibit G attached hereto, each of which schedule shall include the number of shares of Common Stock and all other equity securities or convertible debt securities owned or to be owned beneficially, and of record, by each security Signatory of the Company (other than security Signatories who hold less than 1% of the Common Stock as of the date hereof and are not Affiliates of any party to this Agreement, which security Signatories are denominated as a group as Other Common Stockholders), together with the outstanding options, warrants, scrip rights to subscribe to, calls or commitments of any character whatsoever relating to, or securities, rights or obligations convertible into or exercisable or exchangeable for, or giving any person any right to subscribe for or acquire, any shares of Common Stock, or contracts, commitments, understandings or arrangements by which the Company or any Subsidiary is or may become bound to issue additional shares of Common Stock or Common Stock Equivalents. There are no Stockholders agreements, voting agreements or other similar agreements with respect to the Company’s capital stock to which the Company is a party or, to the knowledge of the Company, between or among any of the Company’s Stockholders or any control share acquisition, business combination, poison pill (including any distribution under a rights agreement) or similar anti-takeover plans.

(g) Transactions with Affiliates and Employees. None of the officers or directors of the Company and, to the knowledge of the Company, none of the employees of the Company is presently a party to any transaction with the Company or any Subsidiary, including any contract, agreement or other arrangement providing for the furnishing of services to or by, providing for rental of real or personal property to or from, or otherwise requiring payments to or from any officer, director or such employee

or, to the knowledge of the Company, any entity in which any officer, director, or any such employee has a substantial interest or is an officer, director, trustee or partner, in each case in excess of $25,000 other than for (i) payment of salary, consulting fees and directors’ fees for services rendered in the ordinary course of business consistent with past practices, (ii) reimbursement for expenses incurred on behalf of the Company, (iii) other employee benefits granted in the ordinary course of business, including stock option agreements under any stock option plan of the Company disclosed in filings with the Securities and Exchange Commission (the “Commission”), (iv) the Qualified Financing Transaction, and (v) a note payable in the amount of $52,500 owing to iPublishing Inc. (iPublishing), payable in semi-monthly installments of $2,500, for the purchase of iPublishing’s intellectual property. iPublishing is wholly owned by the three founders of iMedia International, Inc. and was formerly required to be combined into the consolidated financial statements of iMedia International, Inc. until the purchase transaction was consummated, effective January 1, 2007.

(h) Certain Fees. (i) No brokerage or finder’s fees or commissions are or will be payable by the Company to any broker, financial advisor or consultant, finder, placement agent, investment banker, bank or other person with respect to the transactions contemplated by this Agreement; and (ii) the Signatories shall have no obligation with respect to any fees or with respect to any claims made by or on behalf of other persons for fees of a type contemplated in this Section that may be due in connection with the transactions contemplated by this Agreement.

(i) Disclosure. All written disclosure furnished by or on behalf of the Company by an authorized representative to the Signatories regarding the Company, its business and the transactions contemplated hereby, including the exhibits attached hereto, is true and correct and does not contain any untrue statement of a material fact or omit to state any material fact necessary in order to make the statements made therein, in light of the circumstances under which they were made, not misleading.

(j) No General Solicitation. Neither the Company nor any person acting on behalf of the Company has offered or sold (i) any of the shares issuable hereunder by any form of general solicitation or general advertising, or (ii) any other securities of the Company with comparable rights and preferences by any form of general solicitation or general advertising within two months of the date hereof.

(k) Acknowledgement Regarding Signatories’ Trading Activity. Anything in this Agreement or elsewhere herein to the contrary notwithstanding, it is understood and acknowledged by the Company (i) that none of the Signatories have been asked to agree, nor has any Signatory agreed, to desist from purchasing or selling, long and/or short, securities of the Company, or “derivative” securities based on securities issued by the Company or to hold the Shares for any specified term; (ii) that past or future open market or other transactions by any Signatory, including Short Sales, and specifically including, without limitation, Short Sales or “derivative” transactions, before or after the closing of this or future private placement transactions, may negatively impact the market price of the Company’s publicly-traded securities; (iii) that any Signatory, and counter-parties in “derivative” transactions to which any such Signatory is a party, directly or indirectly,

presently may have a “short” position in the Common Stock; and (iv) that each Signatory shall not be deemed to have any affiliation with or control over any arm’s length counter-party in any “derivative” transaction. The Company further understands and acknowledges that (a) one or more Signatories may engage in hedging activities at various times during the period that the Shares are outstanding, including, without limitation, during the periods that the value of the Shares deliverable with respect to Shares are being determined and (b) such hedging activities (if any) could reduce the value of the existing Stockholders’ equity interests in the Company at and after the time that the hedging activities are being conducted. The Company acknowledges that such aforementioned hedging activities do not constitute a breach of any of this Agreement.

10. Additional Covenants of the Signatories.

(a) Each of the Signatories hereto acknowledges and agrees that (i) the initial Qualified Financing shall result in $750,000 of gross proceeds to the Company, and that the investors in such Qualified Financing shall receive up to 25% of the fully diluted capital of the Company for such funds, and (ii) one or more persons or entities affiliated with the Company or the Company’s Executive Management may participate as an investor in such Qualified Financing.

(b) Pending the Effective Date of the Reorganization and thereafter, each of the Signatories agrees that it will not threaten or commence litigation or arbitration against the Company on account of any claims it may have or which may develop prior to the Effective Date, and that it shall forebear from the exercise of its rights and remedies against the Company with respect to the Preferred Stock, the Warrants, the Notes or any unsecured claims of the Other Creditors each may have or hereafter develop.

(c) Each Signatory agrees and acknowledges that the waivers set forth in the Ancillary Consents to which it is a party are valid and binding on such Signatory.

(d) Each Signatory will use its best efforts to validly and duly execute and deliver the Ancillary Consent it is requested to execute and deliver to further evidence and memorialize the terms and conditions of the conversion and/or exchange of the Preferred Stock, Warrants, Notes, or unsecured creditor claims, as the case may be.

(e) Each of the Signatories represents and warrants that it has full authority to execute and deliver, and perform its obligations under, this Agreement and the Ancillary Consent to which it is a party, and that the person executing and delivering this Agreement and the Ancillary Consent on its behalf is duly authorized to do so.

11. Additional Covenants of the Company.

(a) Transfer Restrictions.

(i) The shares of Common Stock issuable hereunder (the “Shares”) may only be disposed of in compliance with state and federal securities laws. In connection with any transfer of Shares other than pursuant to an effective registration statement or Rule 144, to the Company or to an affiliate of a

Signatory or in connection with a pledge, the Company may require the transferor thereof to provide to the Company an opinion of counsel selected by the transferor and reasonably acceptable to the Company, the form and substance of which opinion shall be reasonably satisfactory to the Company, to the effect that such transfer does not require registration of such transferred Shares under the Securities Act of 1933, as amended (the “Securities Act”).

(ii) The Signatories agree to the imprinting, so long as is required by this Section 11(a), of a legend on any of the Shares in the following form:

(iii) Certificates evidencing the Shares shall not contain any legend (including the legend set forth in Section 4.1(b) hereof): (i) while a registration statement covering the resale of such security is effective under the Securities Act, or (ii) following any sale of such Shares pursuant to Rule 144, or (iii) if such Shares are eligible for sale under Rule 144(k), or (iv) if such legend is not required under applicable requirements of the Securities Act (including judicial interpretations and pronouncements issued by the staff of the Commission). The Company agrees that following the Effective Date or at such time as such legend is no longer required under this Section 11(a)(iii), it will, no later than five trading days following the delivery by a Signatory to the Company or the Company’s transfer agent of a certificate representing Shares, as applicable, issued with a restrictive legend, deliver or cause to be delivered to such Signatory a certificate representing such shares that is free from all restrictive and other legends. The Company may not make any notation on its records or give instructions to any transfer agent of the Company that enlarge the restrictions on transfer set forth in this Section. Certificates for Shares subject to legend removal hereunder shall be transmitted by the transfer agent of the Company to the Signatories by crediting the account of the Signatory’s prime broker with the Depository Trust Company System.

(iv) A Signatory shall have the right to pursue all remedies available to it at law or in equity including, without limitation, a decree of specific performance and/or injunctive relief to cause the removal of the legend.

(b) Furnishing of Information/ 144 Tacking. As long as any Signatory owns Shares, the Company covenants to use commercially reasonable efforts to timely file (or obtain extensions in respect thereof and file within the applicable grace period) all reports required to be filed by the Company after the date hereof pursuant to the Securities and Exchange Act of 1934, as amended (the “Exchange Act”). As long as any Signatory owns Shares, if the Company is not required to file reports pursuant to the Exchange Act, it shall use commercially reasonable efforts to prepare and furnish to the Signatories and make publicly available in accordance with Rule 144(c) such information as is required for the Signatories to sell the Securities under Rule 144. Notwithstanding the foregoing, the Signatories each acknowledge and agree that there is not currently sufficient public information within the meaning of Rule 144(c) to permit sales of Shares under Rule 144 and that the Company is not current on reports required to be filed by it under the Exchange Act, and that such public information and reports may not be current or in compliance with the Exchange Act for a minimum of six months following the Effective Date. The Company further covenants that it will take such further action as any Signatory of Shares may reasonably request, to the extent required from time to time to enable such Person to sell such Shares without registration under the Securities Act within the requirements of the exemption provided by Rule 144, including providing a legal opinion of counsel if required by the transfer agent to effect such transfer. The Company shall accept, and not object to, any opinion of counsel of a Signatory that the holding period of Shares held by such Signatory “tack” back to the original issue date of the securities surrendered hereunder which opinion may be delivered to the Company’s transfer agent with respect to the removal of a legend on any certificate.

(b) Securities Laws Disclosure; Publicity. The Company shall, by the fourth Business Day following the date hereof, issue a Current Report on Form 8-K, disclosing the material terms of the transactions contemplated hereby and including this Agreement as exhibits thereto. The Company, Midsummer and Crestview shall consult with each other in issuing any other press releases with respect to the transactions contemplated hereby, and neither the Company nor any Signatory shall issue any such press release or otherwise make any such public statement without the prior consent of the Company, with respect to any press release of any Signatory, or without the prior consent of Midsummer and Crestview, with respect to any press release of the Company, which consent shall not unreasonably be withheld or delayed, except if such disclosure is required by law, in which case the disclosing party shall promptly provide the other party with prior notice of such public statement or communication.

(c) Non-Public Information. Except with respect to the material terms and conditions of the transactions contemplated by this Agreement, the Company covenants and agrees that neither it nor any other person acting on its behalf will provide any Signatory or its agents or counsel with any information that the Company believes constitutes material non-public information, unless prior thereto such Signatory shall have executed a written agreement regarding the confidentiality and use of such

information. The Company understands and confirms that each Signatory shall be relying on the foregoing representations in effecting transactions in securities of the Company.

(d) Indemnification of Signatories. The Company will indemnify and hold each Signatory and its directors, officers, shareholders, members, partners, employees and agents, each Person who controls such Signatory (within the meaning of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the directors, officers, shareholders, agents, members, partners or employees of such controlling person (each, a “Signatory Party”) harmless from any and all losses, liabilities, obligations, claims, contingencies, damages, costs and expenses, including all judgments, amounts paid in settlements, court costs and reasonable attorneys’ fees and costs of investigation that any such Signatory Party may suffer or incur as a result of or relating to (a) any material breach of any of the material representations, warranties, covenants or agreements made by the Company in this Agreement or (b) any action instituted against a Signatoryby any stockholders of the Company who is not an Affiliate of such Signatory, with respect to any of the transactions contemplated by this Agreement (unless such action is based upon (i) a breach of such Signatory’s representations, warranties or covenants under this Agreement or (ii) any agreements or understandings such Signatory may have with any such stockholders or (iii) any violations by the Signatory of state or federal securities laws or (iv) any conduct by such Signatory which constitutes fraud, gross negligence, willful misconduct or malfeasance). If any action shall be brought against any Signatory Party in respect of which indemnity may be sought pursuant to this Agreement, such Signatory Party shall promptly notify the Company in writing, and the Company shall have the right to assume the defense thereof with counsel of its own choosing reasonably acceptable to the Signatory Party. Any Signatory Party shall have the right to employ separate counsel in any such action and participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of such Signatory Party except to the extent that (i) the employment thereof has been specifically authorized by the Company in writing and (ii) the Company has failed after a reasonable period of time to assume such defense and to employ counsel. The Company will not be liable to any Signatory Party under this Agreement (i) for any settlement by a Signatory Party effected without the Company’s prior written consent, which shall not be unreasonably withheld or delayed; or (ii) to the extent, but only to the extent that a loss, claim, damage or liability is attributable to (i) any Signatory Party’s breach of any of the representations, warranties, covenants or agreements made by such Signatory Party in this Agreement, (ii) any agreements or understandings such Signatory may have with the suing stockholder(s) or (iii) any violations by the Signatory of state or federal securities laws or (iv) any conduct by such Signatory which constitutes fraud, gross negligence, willful misconduct or malfeasance. For the purposes of this Section 11(d), “Affiliate” shall have the definition in Section 501 of Regulation D of the Securities Act of 1933.

(e) Reservation and Listing of Shares. The Company shall, if applicable: (i) in the time and manner required by the principal Trading Market, prepare and file with such Trading Market an additional shares listing application covering a number of shares of Common Stock at least equal to the Required Minimum on the date of such

application, (ii) take all steps necessary to cause such shares of Common Stock to be approved for listing on such Trading Market as soon as possible thereafter, (iii) provide to the Signatories evidence of such listing, and (iv) maintain the listing of such Common Stock on any date at least equal to the Required Minimum on such date on such Trading Market or another Trading Market.

(f) Equal Treatment of Signatories. Except as set forth in this Agreement, no consideration shall be offered or paid to any person to amend or consent to a waiver or modification of any provision of any of this Agreement unless the same consideration is also offered to all of the parties to this Agreement. For clarification purposes, this provision constitutes a separate right granted to each Signatory by the Company and negotiated separately by each Signatory, and is intended for the Company to treat the Signatories as a class and shall not in any way be construed as the Signatories acting in concert or as a group with respect to the purchase, disposition or voting of Shares or otherwise.

(g) Form D; Blue Sky Filings. The Company agrees to timely file, if necessary, a Form D with respect to the Shares as required under Regulation D and to provide a copy thereof, promptly upon request of any Signatory. The Company shall take such action as the Company shall reasonably determine is necessary in order to obtain an exemption for, or to qualify the Shares for, sale to the Signatories at the Closing under applicable securities or “Blue Sky” laws of the states of the United States, and shall provide evidence of such actions promptly upon request of any Signatory.

(H) RELEASE. IN CONSIDERATION OF THE EXECUTION OF THIS AGREEMENT, THE SATISFACTION OF THE TERMS AND CONDITIONS OF THIS AGREEMENT, AND OTHER GOOD AND VALUABLE CONSIDERATION, THE RECEIPT AND VALUE OF WHICH IS HEREBY CONFIRMED, EFFECTIVE AS OF THE CLOSING, THE COMPANY AND EACH SIGNATORY HEREBY FULLY, FINALLY, AND FOREVER SETTLE AND RELEASE EACH OTHER FROM ANY AND ALL CLAIMS, LOSSES, FINES, PENALTIES, DAMAGES, DEMANDS, JUDGMENTS, DEBTS, OBLIGATIONS, INTERESTS, LIABILITIES, CAUSES OF ACTION, BREACHES OF DUTY, COSTS, EXPENSES, JUDGMENTS AND INJUNCTIONS OF ANY NATURE WHATSOEVER, WHETHER KNOWN OR UNKNOWN, FROM ALL RELATIONSHIPS BETWEEN THEM AS OF THE EFFECTIVE DATE (CUMULATIVELY REFERRED TO AS THE “RELEASED CLAIMS”). THE RELEASED CLAIMS SHALL EXPRESSLY NOT INCLUDE ANY MATTERS ARISING OUT OF FACTS AND CIRCUMSTANCES ARISING OR ACCRUING AFTER THE EFFECTIVE DATE, AND SHALL NOT INCLUDE ANY MATTERS ARISING OUT OF THIS AGREEMENT.

(i) Officer and Director Compensation. Any compensation paid to officers and members of the Board of Directors shall be reasonable and commensurate with what is customary in the industry for a company in a similar financial position.

(j) Registration Rights. If, at any time prior to the date that a Signatory holds Shares issued hereunder that are not then eligible for resale pursuant to Rule 144(k) under the Securities Act (or any successor rule thereof that allows for the resale of the shares without volume, manner or any other restriction on resale), there is not an effective registration statement covering all of such Signatory’s Shares and the Company shall determine to prepare and file with the Commission a registration statement relating to an offering for its own account or the account of others under the Securities Act of any of its equity securities, other than on Form S-4 or Form S-8 (each as promulgated under the Securities Act) or their then equivalents relating to equity securities to be issued solely in connection with any acquisition of any entity or business or equity securities issuable in connection with the Company’s stock option or other employee benefit plans, then the Company shall deliver to such Signatory a written notice of such determination and, if within fifteen days after the date of the delivery of such notice, any such Signatory shall so request in writing, the Company shall include in such registration statement all or any part of such Shares as such Signatory requests to be registered. If the Commission reduces the number of securities that may be registered on a registration statement, such reduction shall be done on a pro-rata basis among all Signatory’s.

12. Representation by Counsel. In connection herewith, each of the Signatories hereto hereby acknowledges and agrees that they have carefully read and understood the terms and provisions of this Agreement, that such Signatories have been advised by the Company that material legal rights they hold are affected by this Agreement and that the Company has advised and given all other Signatories the opportunity to seek the advice of separate legal counsel in connection with the negotiation of the terms of the Agreement and their rights with respect to the Agreement. All such Signatories each acknowledge that the Company has advised them to seek the advice of counsel in connection with their rights with respect to this Agreement. In connection with the foregoing, each of the Signatories to this Agreement and the Company acknowledge that the Company has been represented by the law firms of Jeffer, Mangels, Butler & Marmaro LLP and Richardson & Patel LLP who have represented solely the interests of the Company in connection with the negotiation, documentation and execution of this Agreement and have not represented any other Signatory or party to this Agreement.

13. Fees and Expenses. Except as expressly set forth in this Agreement to the contrary, each party shall pay the fees and expenses of its advisers, counsel, accountants and other experts, if any, and all other expenses incurred by such party incident to the negotiation, preparation, execution, delivery and performance of this Agreement. The Company shall pay all transfer agent fees, stamp taxes and other taxes and duties levied in connection with the delivery of any Shares to the Signatories.

14. Governing Law. All questions concerning the construction, validity, enforcement and interpretation of this Agreement shall be governed by and construed and enforced in accordance with the internal laws of the State of New York, without regard to the principles of conflicts of law thereof. Each party agrees that all legal proceedings concerning the interpretations, enforcement and defense of the transactions contemplated by this Agreement and (whether brought against a party hereto or its respective affiliates, directors, officers, shareholders, employees or agents) shall be commenced exclusively in the state and federal courts sitting in the City of New York. Each party hereby irrevocably submits to the exclusive

jurisdiction of the state and federal courts sitting in the City of New York, borough of Manhattan for the adjudication of any dispute hereunder or in connection herewith or with any transaction contemplated hereby or discussed herein (including with respect to the enforcement of any of this Agreement), and hereby irrevocably waives, and agrees not to assert in any suit, action or proceeding, any claim that it is not personally subject to the jurisdiction of any such court, that such suit, action or proceeding is improper or is an inconvenient venue for such proceeding. Each party hereby irrevocably waives personal service of process and consents to process being served in any such suit, action or proceeding by mailing a copy thereof via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for notices to it under this Agreement and agrees that such service shall constitute good and sufficient service of process and notice thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted by law. The parties hereby waive all rights to a trial by jury. If either party shall commence an action or proceeding to enforce any provisions of this Agreement, then the prevailing party in such action or proceeding shall be reimbursed by the other party for its reasonable attorneys’ fees and other costs and expenses incurred with the investigation, preparation and prosecution of such action or proceeding.

15. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be an original instrument and all of which, when taken together, shall constitute one and the same Agreement. Signatures delivered by facsimile or other electronic means shall have the same force and effect as original signatures hereto.

16. Notices. Any notices or other correspondence (hereinafter collectively referred to as “correspondence”) required or permitted to be given hereunder shall be given in writing and shall be deemed effectively given upon (a) personal delivery, (b) delivery by fax (with answer back confirmed), or (c) two business days after mailing by recognized overnight courier (such as Federal Express), addressed to a party at its address or sent to the fax number provided below or at such other address or fax number as such party may designate by three days’ advance notice to the other party. All correspondence to the Company shall be addressed as follows:

iMedia International, Inc.
1721 21^st Street
Santa Monica, CA 90404
Fax Number: 310-453-6120
Attention: Anthony J. Fidaleo

with a copy to:

Richardson & Patel LLP
10900 Wilshire Blvd., Suite 500
Los Angeles, CA. 90024
Fax: 310-208-1154
Attention: Jennifer A. Post, Esq.

All correspondence to any Signatory shall be sent to the most recent address furnished by such person to the Company.

Any Signatory may change the address to which correspondence to it is to be addressed by notification as provided for herein.

17. Successors and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, personal representatives, successors or assigns. This Agreement shall also be binding upon and inure to the benefit of any transferee of any of the Notes, Preferred Stock or indebtedness with respect to the Other Creditors.

18. Entire Agreement. The Agreement, together with the exhibits and schedules thereto and the other agreements referenced herein, contain the entire understanding of the parties with respect to the subject matter hereof and supersede all prior agreements and understandings, oral or written, with respect to such matters, which the parties acknowledge have been merged into such documents, exhibits and schedules. The Company has made no additional side agreements with any Signatory not disclosed hereunder.

19. Amendments; Waivers. No provision of this Agreement may be waived, modified, supplemented or amended except in a written instrument signed by the Company, Midsummer, Crestview and the Signatories holding at least 51% of the Shares then outstanding (which may include Midsummer and Crestview), or, in the case of a waiver, by the party against whom enforcement of any such waived provision is sought. No waiver of any default with respect to any provision, condition or requirement of this Agreement shall be deemed to be a continuing waiver in the future or a waiver of any subsequent default or a waiver of any other provision, condition or requirement hereof, nor shall any delay or omission of any party to exercise any right hereunder in any manner impair the exercise of any such right.

20. Survival. The representations and warranties shall survive the Closing and the delivery of Shares for the applicable statue of limitations.

21. Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their commercially reasonable efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such term, provision, covenant or restriction.

22. Independent Nature of Signatories’ Obligations and Rights. The obligations of each Signatory under this Agreement are several and not joint with the obligations of any other Signatory, and no Signatory shall be responsible in any way for the performance or non-performance of the obligations of any other Signatory under this Agreement. Nothing contained herein, and no action taken by any Signatory pursuant thereto, shall be deemed to constitute the Signatories as a partnership, an association, a joint venture or any other kind of entity, or create a presumption that the Signatories are in any way acting in concert or as a group with respect to such obligations or the transactions contemplated by this Agreement. Each Signatory shall be

entitled to independently protect and enforce its rights, including without limitation, the rights arising out of this Agreement, and it shall not be necessary for any other Signatory to be joined as an additional party in any proceeding for such purpose. Each Signatory has been represented by its own separate legal counsel in their review and negotiation of this Agreement. For reasons of administrative convenience only, Signatories and their respective counsel have chosen to communicate with the Company through FWS. FWS does not represent all of the Signatories but only Midsummer. The Company has elected to provide all Signatories with the same terms for the convenience of the Company and not because it was required or requested to do so by the Signatories.

23. Construction. The parties agree that each of them and/or their respective counsel has reviewed and had an opportunity to revise this Agreement and, therefore, the normal rule of construction to the effect that any ambiguities are to be resolved against the drafting party shall not be employed in the interpretation of this Agreement or any amendments hereto.

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IN WITNESS WHEREOF, THE PARTIES HERETO HAVE EXECUTED THIS AGREEMENT AS OF THE DATE ABOVE FIRST WRITTEN.