-----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, KcqAi/tqU7XK+ZEvUU2jA0HIVjnLq0n2oBr8HOdNWlvhJxrXao/R8b8bPmWPfvUh tDZkjeJkp8vU235xXJshJg== 0001144204-05-021008.txt : 20050708 0001144204-05-021008.hdr.sgml : 20050708 20050708130553 ACCESSION NUMBER: 0001144204-05-021008 CONFORMED SUBMISSION TYPE: S-8 PUBLIC DOCUMENT COUNT: 6 FILED AS OF DATE: 20050708 DATE AS OF CHANGE: 20050708 EFFECTIVENESS DATE: 20050708 FILER: COMPANY DATA: COMPANY CONFORMED NAME: WINMAX TRADING GROUP INC CENTRAL INDEX KEY: 0001035517 STANDARD INDUSTRIAL CLASSIFICATION: SERVICES-COMPUTER PROCESSING & DATA PREPARATION [7374] IRS NUMBER: 650702554 STATE OF INCORPORATION: FL FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-8 SEC ACT: 1933 Act SEC FILE NUMBER: 333-126468 FILM NUMBER: 05945235 BUSINESS ADDRESS: STREET 1: 5920 MACLEOD TRAIL STREET 2: SUITE 800 CITY: CALGARY STATE: A0 ZIP: T2H OK2 BUSINESS PHONE: 8776933130 MAIL ADDRESS: STREET 1: 5920 MACLEOD TRAIL STREET 2: SUITE 800 CITY: CALGARY STATE: A0 ZIP: T2H OK2 S-8 1 v021206_s8.txt As filed with the Securities and Exchange Commission on July __, 2005 Registration No. 333-_____ UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 ------------------------ FORM S-8 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 ------------------------ WINMAX TRADING GROUP, INC. (Exact name of registrant as specified in its charter) FLORIDA 65-0702554 (State or other jurisdiction of (I.R.S. Employer Identification No.) incorporation or organization) 5920 Macleod Trail, Suite 800, Calgary, Alberta T2H 0K2 (Address of Principal Executive Offices) (Zip Code) ------------------------ ------------------------ Year 2005 Stock Award Plan 2005 Non-Qualified Stock Award and Option Plan (Full title of the plan) ------------------------ Gerald Sklar President and Chief Executive Officer Winmax Trading Group, Inc. 5920 Macleod Trail, Suite 800, Calgary, Alberta T2H 0K2 (Name and address of agent for service) (877) 693-3130 (Telephone number, including area code, of agent for service) A copy of all communications, including communications sent to the agent for service should be sent to: Elliot H. Lutzker, Esq. Robinson & Cole LLP 885 Third Avenue Suite 2800 New York, New York 10022-4834 (212) 451-2900 ================================================================================ CALCULATION OF REGISTRATION FEE
- -------------------------------------------------------------------------------------------------- Title of Proposed Proposed Securities Amount Maximum Maximum Amount to be to be Offering Price Aggregate of Registered Registered (1) per Share(5) Offering Price(5) Fee - -------------------------------------------------------------------------------------------------- Common Stock, $0.001 par value: 3,500,000 (2)(4) $.40 1,400,000 164.78 Common Stock, $0.001 par value: 3,000,000 (3)(4) $.40 1,200,000 141.24 TOTAL 6,500,000 $.40 306.02
1. Represents shares issuable pursuant to agreement(s) for services rendered or to be rendered. 2. Represents shares which may be acquired under the Year 2005 Stock Award Plan ("Stock Award Plan"). 3. Consists of shares which may be acquired by upon exercise of Non-Qualified options issuable to employees and consultants electing to participate in the 2005 Non-Qualified Stock Award and Option Plan ("2005 Stock Option Plan"). 4. This Registration Statement shall also cover any additional shares of Common Stock (the "Common Stock") which become issuable under (i) the Winmax Trading Group Inc. 2005 Stock Option Plan (Exhibit 10.1); and (ii) the Stock Award Plan (Exhibit 10.2) by reason of any stock dividend, stock split, recapitalization or other similar transaction effected without the receipt of consideration which results in an increase in the number of outstanding shares of Common Stock of the Registrant. 5. This calculation is made solely for the purposes of determining the registration fee pursuant to the provisions of Rule 457(c) under the Securities Act of 1933, as amended, and is calculated on the basis of the last sale reported as of July 1, 2005. EXPLANATORY NOTE This registration statement on Form S-8 is being filed by Winmax Trading Group, Inc. ("Winmax") to register 3,500,000 shares of common stock of Winmax under the Stock Award Plan and 3,000,000 shares of Common Stock of Winmax under the 2005 Stock Option Plan. This registration statement includes a form of prospectus, prepared in accordance with the requirements of Part I of Form S-3, which, pursuant to General Instruction C of Form S-8, may be used by certain persons, including officers and directors of Winmax who are deemed to be affiliates of Winmax, as that term is defined in Rule 405 under the Securities Act, as well as by non-affiliates, holding restricted securities, as that term is defined in Rule 144 under the Securities Act, in connection with the reoffer and resale of shares of common stock of Winmax received by such persons pursuant to the exercise of options and other stock awards granted under the 2005 Stock Option Plan and the Stock Award Plan. PART I INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS Item 1. Plan Information. We will send or give the documents containing the information specified in Part I of Form S-8 to individuals who participate in our 2005 Stock Option Plan, and who, in the case of an award of stock options, consent to and execute the required form of Stock Option Agreement. A copy of the 2005 Non-Qualified Stock Award and Option Plan is attached as exhibit 10.1 to this Form S-8; a copy of the Year 2005 Stock Award Plan is attached as exhibit 10.2 to this Form S-8, and the form of Option Agreement for use under the 2005 Non-Qualified Stock Award and Option Plan is attached as exhibit 10.3 to this Form S-8. This Registration Statement relates to a maximum of 3,500,000 shares of Common Stock of the Registrant issuable directly under the Stock Award Plan or pursuant to the exercise of options or other awards granted under the Stock Award Plan and 3,000,000 shares of Common Stock of the Registrant under the 2005 Stock Option Plan. 2 Item 2. Registrant Information and Employee Plan Annual Information. We will provide, without charge, to each person to whom a copy of this 10(a) Prospectus is delivered, upon oral or written request, a copy of any or all documents incorporated by reference in Item 3 of Part II of this Registration Statement (which documents are incorporated by reference in the 10(a) Prospectus). Requests should be directed to the President, Gerald Sklar at 5920 Macleod Trail, Suite 800, Calgary, Alberta T2H 0K2. Our telephone number is (877) 693-3130. 3 TABLE OF CONTENTS
PAGE Availability of Information ....................................................... 5 Forward-Looking Statements ........................................................ 5 Summary Information ............................................................... 6 Risk Factors ...................................................................... 7 Use of Proceeds ................................................................... 11 Selling Security Holders .......................................................... 11 Plan of Distribution .............................................................. 11 Disclosure of Commission Position on Indemnification for Securities Act Liabilities 12 Legal Matters ..................................................................... 12 Experts ........................................................................... 12 Change in Certifying Accountants .................................................. 12
4 No person has been authorized to give any information or to make any representations, other than those contained in this Prospectus, in connection with the offering made hereby, and, if given or made, such information or representations must not be relied upon. Neither the delivery of this Prospectus nor any offer, solicitation or sale made hereunder shall, under any circumstances, create an implication that there has been no change in the affairs of the Company since the date hereof or that the information herein is correct as of any time subsequent to its date. This Prospectus does not constitute an offer to sell or a solicitation of an offer to buy any securities in any jurisdiction to any person to whom it is unlawful to make any such offer or solicitation. This Prospectus constitutes a part of a Registration Statement on Form S-8 (the "Registration Statement") filed by the Company with the Commission under the Securities Act. This Prospectus omits certain of the information contained in the Registration Statement in accordance with the rules and regulations of the Commission. Reference is hereby made to the Registration Statement and related exhibits for further information with respect to the Company and the Shares. Statements contained herein concerning the provisions of any documents are not necessarily complete and, in each instance, reference is made to the copy of such document filed as an exhibit to the Registration Statement or otherwise filed with the Commission. Each such statement is qualified in its entirety by such reference. AVAILABILITY OF INFORMATION The Registrant is subject to the informational requirements of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance therewith files reports, proxy statements and other information including annual and quarterly reports on Form 10-KSB and 10-QSB (the '1934 Act Filings') with the Securities and Exchange Commission (the 'Commission'). Reports and other information filed by the Registrant can be inspected and copied at the public reference facilities maintained at the Commission at 100 F Street, N.E., Washington, D.C. 20549. Copies of such material can be obtained upon written request addressed to the Commission, Public Reference Section, 100 F Street, N.E., Washington, D.C. 20549, at prescribed rates. The Commission maintains a web site on the Internet (http://www.sec.gov) that contains reports, proxy and information statements and other information regarding issuers that file electronically with the Commission through the Electronic Data Gathering, Analysis and Retrieval System ('EDGAR'). FORWARD-LOOKING STATEMENTS This prospectus contains forward-looking statements. In some cases, you can identify these statements by forward-looking words such as "may," "might," "will," "should," "expect," "plan," "anticipated," "believe," "estimate," "predict," "potential" or "continue," the negative or plural of these words and other comparable terminology. These forward-looking statements, which are subject to risks, uncertainties and assumptions about us, may include, among other things, projections of our future financial performance, our anticipated growth strategies and anticipated trends in our business and the markets in which we operate. These statements are only predictions, based on our current expectations and projections about future events. Although we believe the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Because these forward-looking statements involve risks and uncertainties, there are important factors that could cause our actual results, levels of activity, performance or achievements to differ materially from the results, levels of activity, performance or achievements expressed or implied by the forward-looking statements, including those factors discussed under the caption entitled "Risk Factors." You should specifically consider the numerous risks outlined under "Risk Factors." 5 SUMMARY INFORMATION The following summary is qualified in its entirety by reference to the more detailed information appearing elsewhere in this prospectus or incorporated herein by reference. Each prospective investor is urged to read this prospectus and the documents incorporated herein by reference in their entirety. Investment in the securities offered hereby involves a high degree of risk. See "Risk Factors." The Company was incorporated in the State of Florida on September 26, 1996, to engage in Commodities futures trading. From approximately November 1996 until October 2000, Winmax managed a commodities futures investment fund, the Winmax Alpha Fund Limited Partnership, of which the Company was the general partner. From October 2000 to May 2001, the Company had no significant operations or business plan. In June of 2001, the sole officer and director, Ralph Pistor, sold 100,000 shares of the Company's common stock held by him, which represented a majority of the then outstanding common stock, to Gerald Sklar, the Company's current President, Chief Executive Officer and Director. In connection with the purchase of the 100,000 shares of the common stock by Gerald Sklar, the following occurred: a) Ralph Pistor resigned as sole Officer and Director; b) Gerald Sklar became President, Chief Executive Officer and Director; c) Current management was appointed to fill vacancies on the Board of Directors; and d) Winmax adopted a new corporate strategy, which is described below. Corporate Strategy In June 2001, the Company's corporate strategy was to: (a) establish a web development, design, web casting, Internet solutions and e-commerce business; (b) acquire raw gemstone materials and/or minerals and to arrange for the finishing and marketing of the gemstone and/or mineral material and then retail the finished product through its Internet website www.thegemstore.com, and (c) advance money to prospect and possibly produce gemstone material. In 2001, the Company acquired an inventory of gemstones and pieces of finished jewelry. In 2003, management elected to abandon any interests in or financing of prospecting possible gemstone or mineral material. In 2003 and 2004, management recognized the need to grow sales in the gemstone marketing division and added the opening of Retail Merchandising Units ("RMU's") to it's corporate strategy and RMU's were opened in key locations to test markets. During 2003 and 2004, management recognized the need to grow sales in the gemstone marketing division and opened certain RMU's in key locations as test markets. In 2004, management assessed the viability of the RMU locations and subsequently closed all "kiosk" style RMU's. 6 In 2005, Management's proposed strategy was to open a number of stores specializing in predominantly jewelry sales and Kiosk style RMU's specializing in mineral sales. In addition, Management is proposing to commence negotiations respecting the purchase of a European jewelry chain in order to provide the Company's "gemstore brand" with a wider audience as well as to return monies on investment. In this prospectus we refer to Winmax Trading Group, Inc. as "Winmax", "we", "us" or "our". RISK FACTORS An investment in the securities offered hereby is highly speculative and involves a high degree of risk and should be made only by investors who can afford to lose their entire investment. Prospective purchasers, prior to making any investment decision shall carefully consider along with other matters referred to herein the following risk factors. Risks Relating to Our Financial Condition Need for additional proceeds. We require additional funds to fully implement our general business plan. Management can give no assurance the funds so obtained will be sufficient to fully implement the business plan, or that a full implementation of such business plan will result in Winmax's profitability. If we are unable to obtain financing, we may have to curtail or suspend our operations, and you could lose your entire investment in the company. If Winmax continues to incur negative cash flow from its operations, it may exhaust its capital resources. No net positive cash flow has been generated from Winmax's operations since its inception. Winmax has been primarily a development stage company to date and has invested the majority of its resources in the establishment of its multi-media component of business and the carrying out of test markets in its retail business with minimal investment for the commercialization of its product. Winmax had a net loss of $3,608,391 on net sales of $355,820 for the year ended December 31, 2004; a net loss of $895,520 on net sales of $582,377 for the year ended December 31, 2003; a net loss of $6,992,661 on net sales of $224,838 for the year ended December 31, 2002, and a cumulative loss from inception through December 31, 2004, of $16,005,933. Winmax has funded its activities primarily through the contribution of its President, Gerald E. Sklar, of approximately $4,067,873 as of December 31, 2004. Winmax anticipates negative cash flow from operations to continue for some time. We do not anticipate that this form of shareholder and executive officer funding will continue for an indefinite period. Accordingly, we can give no assurance that we will be able to operate profitably or be able to produce positive cash flow from operations in the future. Our efforts to operate profitably and obtain positive cash flow from operations will depend on, among other things: a) Developing the Winmax brand, marketing and other promotional activities, for the retail and internet sale of jewelry and minerals; 7 b) Expanding general and administrative functions to support growth that may occur; and c) Acquire new diverse clients to support our multi-media divisions. If we fail to establish the Winmax or the gemstore brand or to attract new and repeat customers, Winmax may not be able to increase its revenues sufficiently to fund its operations. We must develop, establish and strengthen the Winmax and/or the gemstore brand for the sale of gemstones, jewelry and minerals. If we fail to establish the brand, we will be at a competitive disadvantage and may lose the opportunity to obtain, and thereafter maintain, a sufficient number of customers. The development of the brand will depend largely on the success of our marketing efforts and our ability to acquire and maintain sufficient retail units in North America and through our ability to expand our operations to Europe and Asia. We cannot be certain that our brand promotion activities will be successful, or will result in increased revenues or that our proposed European and Asian expansion will occur. If increased revenues are achieved, there can be no assurance that these revenues will be sufficient to offset the expenditures incurred in establishing the brand. Winmax is obligated to comply with government regulation and its failure to do so could result in significant liability and curtailment or suspension of operations. The Company's business is governed by the laws of the jurisdictions in which it operates which includes The United States, Canada and Thailand. If the Company's expansion efforts are successful it will also be subject to the laws of Europe and China. Failure to comply with all laws in any jurisdiction will accrue significant liability and/or curtailment or suspension of operations. We lack business diversification. As a result of our limited resources, the prospects for our initial success will be entirely dependent upon the future performance of our core business, the retail sale of jewelry, gemstones and minerals. Although our multi media revenues are hoped to increase our long term viability as a company is closely related to how well we will perform in the highly competitive business of jewelry, gemstone and mineral retail sales. We do not have the resources to diversify our operations or benefit from the possible spreading of risks or offsetting of losses through various business segments. We have a limited operating history upon which you can base an investment decision. We were organized on September 26, 1996 and re-organized our operations with a complete change of focus in June, 2001. We have only a limited operating history upon which you can make an investment decision, or upon which we can accurately forecast future sales. You should, therefore, consider us subject to all of the business risks associated with a new business. The likelihood of our success must be considered in light of the expenses, difficulties and delays frequently encountered in connection with the formation and initial operations of a new and unproven business. 8 Discretion in use of funds. Winmax anticipates applying the net proceeds of this Offering, from the exercise of options which may be granted, to the items described under the heading "Use of Proceeds". However, as of the date hereof, other than to fund retail sales, general, corporate and administrative expenses we have no material restrictions on our use of the proceeds. As such, management of Winmax shall have broad discretion, subject to their fiduciary duties, in the application of the proceeds, if any, from the exercise of options. See "Use of Proceeds." SECURITIES RISKS Winmax's CEO, President and Directors may have the ability to control almost all matters of the Company. The officers and directors of Winmax and their affiliates, beneficially own approximately 62.23% of the issued and outstanding shares of common stock of Winmax prior to this Offering. Therefore, Management will have significant influence over the election of Winmax`s directors and to control the outcome of other issues submitted to stockholders of Winmax. This includes their ability to amend the Certificate of Incorporation, approve a merger or consolidation of Winmax with another company or approve the sale of all or substantially all of the assets of Winmax without the agreement of the shareholders who purchase Units offered hereby. If we do not keep this registration statement current, you may not be able to sell your stock. We must keep a registration statement effective with the SEC. We may not be able to maintain a registration statement in effect. Maintaining an effective registration statement requires substantial continuing expenses for legal and accounting fees and we cannot guarantee our ability to keep the registration statement effective. Difficulty of Trading and Obtaining Quotations for Common Stock. Winmax's Common Stock is currently quoted on the Pink Sheets LLC under the symbol WMTG. Our Common Stock is traded but the bid and ask prices for our Common stock have fluctuated significantly. As a result, an investor may find it difficult to dispose of, or to obtain accurate quotations of the price of, Winmax securities. This severely limits the liquidity of the Common Stock, and would likely have a material adverse effect on the market price of the Common Stock and on our ability to raise additional capital. Penny Stock Regulation. Winmax's Common Stock is subject to Rule 15g-9 under the Exchange Act. This rule imposes additional sales practice requirements on broker-dealers that sell such securities to persons other than established customers and "accredited investors." For transactions covered by Rule 15g-9, a broker-dealer must make a special suitability determination for the purchaser and have received the purchaser's written consent to the transaction prior to sale. Consequently, the rule could affect the ability of broker-dealers to sell our securities and could affect the ability of purchasers to sell any of our securities in the secondary market. 9 RISK FACTORS AFFECTING WINMAX'S BUSINESS OPERATIONS. Winmax could be subject to fines, sanctions or shutdowns if it fails to comply with the laws and regulations applicable to its business or if those laws and regulations change. Winmax is subject to the laws and regulations of the jurisdictions in which it operates. Failure to abide by these laws could result in Winmax's operations being restricted or prohibited. Changes in laws or new interpretations of existing laws may have a dramatic effect on Winmax's business and results of operations. Continued pressure could reduce Winmax's margins and limit Winmax's ability to maintain or increase its market share. Certain competitors of Winmax may have or may obtain significantly greater financial and marketing resources than Winmax. As a result, Winmax could encounter increased competition in the future and face increase pricing pressure which would limit its ability to maintain or increase its market share. Winmax's future success depends significantly on the skills, experience and efforts of its chief executive officer, President and Director, Gerald E. Sklar. Mr. Sklar would be difficult to replace as he has developed, and is engaged in carrying out, Winmax's strategic business plan. The loss of the services of Mr. Sklar would seriously harm Winmax's ability to implement its strategy. A failure to implement Winmax Winmax's business strategy could result in the cessation of it's operations which would have a material adverse effect on our company and on your investment. The market for Winmax's product is rapidly changing and competitive. New products may be developed by others which could impair our ability to develop, grow or maintain our business and be competitive. Winmax's industry is subject to substantial technological and fashion change. Developments by others may render our planned jewelry and existing multi media products noncompetitive or obsolete or we may be unable to keep pace with technological developments or other market factors. Competition from other companies is intense and is expected to increase. Many of these entities have significantly greater capabilities and budgets than Winmax does, as well as substantially more marketing, manufacturing, financial and managerial resources. These entities represent significant competition for Winmax. Winmax is a development-stage enterprise and as such its resources are limited and it may experience technical challenges inherent in developing its technology and product lines. 10 USE OF PROCEEDS We will not receive any proceeds from the sale of the common stock by the selling stockholders under this prospectus. All such proceeds will be received by the selling securityholders. However, we expect to use the proceeds from the exercise of the options and other restricted stock awards for working capital and other general corporate purposes. SELLING SECURITY HOLDERS The shares offered by this prospectus are being registered for reoffers and resales by the selling securityholders, who may acquire such shares pursuant to the exercise of options or other stock awards granted under the Plans. No options or stock awards have been made to date. The selling securityholders who will be named by supplements to the prospectus are officers and directors who would be deemed to be affiliates of the Company and may resell all, a portion or none of such shares from time to time. In addition, certain non-affiliates of Winmax, not named, may also use this prospectus to sell shares acquired by them pursuant to the exercise of options or other stock awards granted to them under the Plans. PLAN OF DISTRIBUTION The shares may be sold or transferred for value by the selling securityholders, or by pledgees, donees, transferees or other successors in interest to the selling securityholders, in one or more transactions in the Pink Sheets, in negotiated transactions or in a combination of such methods of sale, at market prices prevailing at the time of sale, at prices related to such prevailing market prices or at prices otherwise negotiated. The selling securityholders may effect such transactions by selling the shares to or through broker-dealers, and such broker-dealers may receive compensation in the form of underwriting discounts, concessions or commissions from the selling securityholders and/or the purchasers of the shares for whom such broker-dealers may act as agent (which compensation may be less than or in excess of customary commissions). The selling securityholders, and any broker-dealers that participate in the distribution of the shares, may be deemed to be "underwriters" within the meaning of Section 2(11) of the Securities Act, and any commissions received by them and any profit on the resale of the shares sold by them may be deemed to be underwriting discounts and commissions under the Securities Act. All selling and other expenses incurred by individual selling securityholders will be borne by such selling securityholders. Upon our being notified by a selling securityholder that he has acquired options or shares under this prospectus or any material arrangement has been entered into with a broker or dealer for the sale of shares through a secondary distribution, or a purchase by a broker or dealer, we will file a prospectus supplement, if required, pursuant to Rule 424(b) under the Securities Act, disclosing (a) the name of each of such selling securityholder and the participating broker-dealers, (b) the number of shares involved, (c) the price at which such shares are being sold, (d) the commissions paid or the discounts or concessions allowed to such broker-dealers, (e) where applicable, that such broker-dealers did not conduct any investigation to verify the information set out or incorporated by reference in the prospectus, as supplemented, and (f) other facts material to the transaction. In addition to any such number of shares sold hereunder, a selling securityholder may, at the same time, sell any shares of common stock, including the shares offered by this prospectus, owned by such person in compliance with all of the requirements of Rule 144 under the Securities Act, regardless of whether such shares are covered by this prospectus. 11 There is no assurance that any of the selling securityholders will sell any or all of the shares offered by this prospectus. We will pay all expenses in connection with this offering, other than commissions and discounts of underwriters, dealers or agents. DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION FOR SECURITIES ACT LIABILITIES Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of Winmax, the SEC has expressed its opinion that such indemnification is against public policy as expressed in the Securities Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by Winmax of expenses incurred or paid by a director, officer or controlling person of Winmax in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the shares being registered, Winmax will, unless in the opinion of our counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by us is against public policy as expressed in the Securities Act and we will be governed by the final adjudication of such issue. LEGAL MATTERS Robinson & Cole LLP, 885 Third Avenue, Suite 2800, New York, NY 10022, will provide the Registrant with a legal opinion in connection with the Common Stock. EXPERTS The consolidated financial statements of the Registrant as of December 31, 2004 and 2003, incorporated by reference in this prospectus have been audited by Goldstein Golub Kessler LLP ("GGK"), independent auditors, as set forth in their report thereon included therein and incorporated herein by reference. Such consolidated financial statements are incorporated herein by reference in reliance on such report given on the authority of such firm as experts in accounting and auditing. CHANGE IN CERTIFYING ACCOUNTANTS On January 13, 2004, the Registrant engaged GGK as its independent auditors and accepted the resignation dated December 4, 2003, of Stark Winter Schenkein & Co., LLP ("Stark") from such position. The decision to change accountants was recommended and approved by the Registrant's Board of Directors. No reports on the financial statements prepared by Stark since they were retained as registrant's primary accountant on December 31, 1999, contained any adverse opinion or disclaimer of opinion, or was qualified or modified as to uncertainty, audit scope, or accounting principles, except that the reports on the financial statements for the years ended December 31, 2000, 2001 and 2002 contained going concern qualifications. The decision to change accountants was approved by the Registrant's Board of Directors. The Registrant did not consult with GGK, its new independent accountants, regarding any matter prior to its engagement. 12 During the registrant's two most recent fiscal years, and any subsequent interim period preceding the resignation on December 4, 2003, there were no disagreements with the former accountant, Stark, or any other former accountant on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreement(s), if not resolved to the satisfaction of Stark , would have caused them to make reference to the subject matter of the disagreement(s) in connection with their reports, except that Stark stated in their response letter to our filing on Form 8-K on June 4, 2004 that they were unable to complete their review of the September 30, 2003 financial statements because the registrant could not provide adequate documentation to support its revenue recognition and related party transactions. 13 PART II INFORMATION REQUIRED IN THE REGISTRATION STATEMENT Item 3. Incorporation of Documents by Reference. The Registrant incorporates the following documents by reference in this Registration Statement: (a) The Registrant's Annual Report on Form 10-KSB for the fiscal year ended December 31, 2004, which was filed with the Securities and Exchange Commission on May 19, 2005; (b) The Registrant's Quarterly Report on Form 10-QSB and amendments thereto for the quarter ended March 31, 2005, which was filed with the Securities and Exchange Commission on May 20, 2005; (c) The Registrant's Articles of Incorporation and Amendments thereto, and the Registrant's Bylaws; and (d) All other documents filed by Registrant after the date of this Registration Statement under Section 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, prior to the filing of a post-effective amendment to this Registration statement that registers securities covered hereunder that remain unsold. For the purposes of this Registration Statement, any statement contained in a document incorporated in this Registration Statement by reference shall be deemed to be modified or superseded for the purpose of this Registration Statement to the extent that a statement contained in this Registration Statement modifies or supercedes a statement in such document. Any statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Registration Statement. Item 4. Description of Securities. The class of securities to be offered hereby is subject to the reporting requirements of the Securities Exchange Act of 1934, as amended. The Registrant's authorized capitalization is 751,000,000 shares of which 750,000,000 shares are Common Stock, $.001 par value and 1,000,000 shares are preferred stock, no par value. As of May 20, 2005, there are 22,641,162 shares of Common Stock issued and outstanding held by 63 shareholders of record. Holders of the Common Stock are entitled to one vote per share on each matter submitted to vote at any meeting of shareholders. Shares of Common Stock do not carry cumulative voting rights and therefore, holders of a majority of the outstanding shares of Common Stock will be able to elect the entire board of directors and, if they do so, minority shareholders would not be able to elect any members to the board of directors. The Registrant's board of directors has authority, without action by the Registrant's shareholders, to issue all or any portion of the authorized but unissued shares of Common Stock, which would reduce the percentage ownership of the Registrant of its shareholders and which would dilute the book value of the Common Stock. Shareholders of the Registrant have no preemptive rights to acquire additional shares of Common Stock. The Common Stock is not subject to redemption and carries no subscription or conversion rights. In the event of liquidation of the Registrant, the shares of Common Stock are entitled to share equally in corporate assets after the satisfaction of all liabilities. Holders of Common Stock are entitled to receive such dividends as the board of directors may from time to time declare out of funds legally available for the payment of dividends. During the last two fiscal years the Registrant has not paid cash dividends on its Common Stock and does not anticipate that it will pay cash dividends in the foreseeable future. 14 Item 5. Interests of Named Experts and Counsel. Robinson & Cole LLP, 885 Third Avenue, Suite 2800, New York, NY 10022, will provide the Registrant with a legal opinion in connection with the Common Stock. Item 6. Indemnification of Officers and Directors. The Registrant is a Florida corporation. Section 607.0850 of the General Corporation Law of Florida provides authority for broad indemnification of directors, officers, employees and agents. The Registrant's Articles of Incorporation, as Amended, incorporate the indemnification provisions of the General Corporation Law of Florida to the fullest extent provided. The Registrant has entered into indemnification agreements with its Directors indemnifying them against liability and reasonable costs and expenses incurred in litigation arising by reason of the fact that he or she is or was a director, officer, stockholder, employee, or agent of the Registrant, provided that the director acted in good faith and in a manner reasonably intended to be in or not opposed to the best interests of the Registrant, and with respect to any criminal action or proceeding, had no reasonable cause to believe his or her conduct was unlawful. Indemnification of Officers or persons controlling the corporation for liabilities arising under the Securities Act of 1933, as amended, is held to be against public policy by the Securities and Exchange Commission and therefore, unenforceable. Item 7. Exemption from Registration Claimed. Not Applicable. Item 8. Exhibits Exhibit Description 5.1 Opinion of Robinson & Cole, LLP. 10.1 2005 Non-Qualified Stock Award and Option Plan 10.2 Year 2005 Stock Award Plan 10.3 Form of Option Agreement 23.2 Consent of Goldstein Golub Kessler LLP, Certified Public Accountants Item 9. Undertakings. A. The undersigned Registrant hereby undertakes: (1) To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement to include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement. 15 (2) That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities offered at that time shall be deemed to be the initial bona fide offering thereof. (3) To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering. B. The undersigned Registrant hereby undertakes that, for purposes of determining any liability under the Securities Act of 1933, each filing of the Registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934 (and, where applicable, each filing of an employee benefit plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is incorporated by reference in the registration statement shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof. C. Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the Registrant pursuant to the foregoing provisions, or otherwise, the Registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the Registrant of expenses incurred or paid by a director, officer, or controlling person of the Registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the Registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by final adjudication of such issue. 16 SIGNATURES Pursuant to the requirements of the Securities Act of 1933, the Registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing the Registration Statement on Form S-8 and has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Calgary, Province of Alberta, Canada By: Winmax Trading Group, Inc. (Registrant) By: /s/ Gerald Sklar Date: July 8, 2005 - --------------------------- Gerald Sklar, President, Chief Executive Officer and Director Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed by the following persons in the capacities and on the dates indicated. By: /s/ Anthony Miller Date: July 8, 2005 - --------------------------- Anthony Miller - Director By: /s/ David Young Date: July 8, 2005 - --------------------------- David Young - Director By: /s/ Elaine Prober Date: July 8, 2005 - --------------------------- Elaine Prober - Director 17 POWER OF ATTORNEY WINMAX TRADING GROUP, INC. REGISTRATION STATEMENT ON FORM S-8 2005 Non-Qualified Stock Award and Option Plan Year 2005 Stock Award Plan Each of the undersigned Directors and/or Officers of Winmax Trading Group, Inc., a Florida corporation (the "Company"), hereby constitutes and appoints Gerald Sklar, the true and lawful attorney-in-fact of such Director and/or Officer, with full power of substitution and resubstitution, for him or her and in his or her name, place, and stead, in any and all capacities, to do any and all acts and execute any and all instruments which the said attorneys may deem necessary or advisable to enable the Company to comply with the Securities Act of 1933, as amended (the "Securities Act"), and any rules and regulations and requirements of the Securities and Exchange Commission in respect thereof, in connection with the registration under the Securities Act of an aggregate of 3,000,000 shares of the Company's common stock, $.001 par value per share, issued or which may be issued under the terms of the Winmax Trading Group, Inc. 2005 Non-Qualified Stock Award and Option Plan, and 3,500,000 shares of the Company's Common Stock under the Year 2005 Stock Award Plan, as amended from time to time, including specifically, but without limiting the generality of the foregoing, the power and authority to sign the name of the undersigned in his or her capacity as Director and/or Officer of the Company to a Registration Statement on Form S-8 to be filed with the Securities and Exchange Commission with respect thereto, to any and all amendments, including post-effective amendments, to the said Registration Statement, and to any and all instruments and documents filed as a part of or in connection with the said Registration Statement or amendments thereto; and each of the undersigned hereby ratifies and confirms all that the said attorneys, or any of them, has done, shall do, or cause to be done by virtue hereof. IN WITNESS WHEREOF, each of the undersigned has executed this power of attorney this ___ day of July 2005. /s/ /s/ - ----------------------------- ----------------------------- Gerald Sklar Anthony Miller /s/ /s/ - ----------------------------- ----------------------------- David Young Elaine Prober 18 EX-5.1 2 v021206_ex5-1.txt Exhibit 5.1 Letterhead of Robinson & Cole LLP July 8, 2005 Winmax Trading Group, Inc. 5920 Macleod Trail, Suite 800 Calgary, Alberta T2H 0K2 Re: Registration Statement on Form S-8 Ladies and Gentlemen: We have acted as counsel to Winmax Trading Group, Inc, a Florida corporation (the "Company"), in connection with its Registration Statement on Form S-8 to be filed with the Securities and Exchange Commission with respect to the registration under the Securities Act of 1933, as amended, of an aggregate of 3,000,000 shares of common stock of the Company, $0.001 par value per share, to be offered and sold by the Company pursuant to the Company's 2005 Non-Qualified Stock Award and Option Plan; and 3,500,000 shares of common stock of the Company, $0.001 par value per share, to be offered and sold by the Company pursuant to the Company's Year 2005 Stock Award Plan (collectively, the "Plans"). This opinion is being delivered in accordance with the requirements of Item 601(b)(5) of Regulation S-B under the Act. We have examined originals or certified copies of such corporate records, certificates of officers of the Company and/or public officials and such other documents and have made such other factual and legal investigations as we have deemed relevant and necessary as the basis for the opinions set forth below. In such examination, we have assumed the genuineness of all signatures, the authenticity of all documents submitted to us as originals, the conformity to original documents of all documents submitted to us as conformed or photostatic copies and the authenticity of the originals of such copies. Based upon our foregoing examination, subject to the assumptions stated above and relying on the statements of fact contained in the documents that we have examined, we are of the opinion that the issuance of the Shares upon exercise of the options granted pursuant to the Plans have been duly and validly authorized and, when such Shares have been paid for and delivered in accordance with the terms of the Plans, such Shares will be legally issued, fully paid and non-assessable. The opinions set forth in this letter are based solely on, and are limited to, the internal laws of the State of New York and the federal laws of the United States of America. We are admitted to practice in the State of New York, and are not admitted to practice in the State of Florida. We express no opinion as to the laws of the State of Florida. Although the Company is a Florida corporation, and the issuance of shares would be governed by Florida law, we assume for the purposes of this opinion that the laws of the State of Florida governing the issuance of the securities by a Florida corporation are the same as New York law governing the issuance of securities by a New York corporation. We hereby consent to the filing of this opinion as an exhibit to the Form S-8 relating to the registration of the Shares. In giving this consent, we do not thereby admit that we are within the category of persons whose consent is required under Section 7 of the Securities Act of 1933, as amended, or the rules and regulations of the Securities and Exchange Commission. Very truly yours, Very truly yours, Robinson & Cole LLP By: ------------------------------------- Elliot Lutzker EX-10.1 3 v021206_ex10-1.txt EXHIBIT 10.1 2005 Non-Qualified Stock Award and Option Plan 1. NAME. The name of this plan is the Winmax Trading Group, Inc. 2005 Non-Qualified Stock Award and Option Plan. 2. DEFINITIONS. For the purposes of the Plan, the following terms shall be defined as set forth below: (a) 'Affiliate' means any partnership, corporation, firm, joint venture, association, trust, unincorporated organization or other entity (other than a Subsidiary) that, directly or indirectly through one or more intermediaries, is controlled by the Company, where the term 'controlled by' means the possession, direct or indirect, of the power to cause the direction of the management and policies of such entity, whether through the ownership of voting interests or voting securities, as the case may be, by contract or otherwise. (b) 'Board' means the board of directors of the Company. (c) 'Cause' as applied to any Participant means: (i) the conviction of such individual for the commission of any felony; (ii) the commission by such individual of any crime involving moral turpitude (e.g., fraud, larceny, embezzlement, willfully violent conduct) or (iii) substantial refusal to comply or default in complying with the directions of the Board. (d) 'Code' means the Internal Revenue Code of 1986, as amended from time to time and the Treasury regulations promulgated thereunder. (e) 'Committee' means the Board or a committee appointed by the Board to administer the Plan as provided in Section 4(a). Such Committee shall consist of any two Directors. (f) 'Common Stock' means the $.001 par value common stock of the Company or any security of the Company identified by the Committee as having been issued in substitution or exchange therefor or in lieu thereof. (g) 'Company' means Winmax Trading Group, Inc., a Florida corporation. (h) `Eligible Consultant' means any natural person who provides bona fide services to the Company not in connection with the offer or sale of securities in a capital raising transaction, and whose services do not directly or indirectly promote or maintain a market for the Company's securities. (i) 'Director' means an individual who is now, or hereafter becomes, a member of the Board or of the board of directors of any Subsidiary or Affiliate. (j) 'Employee' means an individual employed by the Company, a Subsidiary, or an affiliate whose wages, if an employee in the United States, are subject to the withholding of federal income tax under Section 3401 of the Code. (k) 'Exchange Act' means the Securities Exchange Act of 1934, as amended from time to time, or any successor statute. (l) 'Fair Market Value' of a Share as of a specified date means, except as otherwise reasonably determined by the board or Committee based on reported prices of a Share, (i) the average of the closing prices for one share of stock or (ii) the average of the highest and lowest market prices of a Share on the over-the-counter market, the average of the highest bid and lowest asked prices per Share on the specified date (or the next preceding date on which trading was reported) as reported through the NASDAQ National Market system or any successor thereto. (m) 'NQSO Plan' means the Company's 2005 Amended Non-Qualified Stock Award and Option Plan. (n) 'NQSO' means a stock option granted under the NQSO Plan, which option does not qualify for favorable tax treatment under Sections 421, 422 or 423 of the Code. (o) 'Officer' means an individual elected or appointed by the Board or by the board of directors of a Subsidiary or Affiliate or chosen in such other manner as may be prescribed by the by-laws of the Company, a Subsidiary or Affiliate, as the case may be, to serve as such, or, in the case of an Affiliate which is not a corporation, any individual elected or appointed to fulfill a similar function by a body or individual exercising similar authority. (p) 'Option' means a NQSO granted under the Plan. (q) 'Participant' means an individual who is granted an Option under the Plan. (r) 'Plan' means this 2005 Non-Qualified Stock Award and Option Plan as it may be amended from time to time. (s) 'Rule 16b-3' means Rule 16b-3 promulgated by the Securities and Exchange Commission under the Exchange Act, or any successor or replacement rule adopted by the Securities and Exchange Commission. (t) 'Share' means one share of Common Stock of the Company. (u) 'Stock Option Agreement' means the written agreement between the Company and the Participant that contains the terms and conditions pertaining to an Option. (v) 'Subsidiary' means any corporation of which the Company, directly or indirectly, is the beneficial owner of fifty percent (50%) or more of the total combined voting power of all classes of its stock having voting power and which qualifies as a subsidiary corporation pursuant to Section 424(f) of the Code. 3. PURPOSE. The purpose of the Plan is to enable the Company to provide incentives, which are linked directly to increases in shareholder value, to certain employees and eligible consultants in order that they will be encouraged to promote the financial success and progress of the Company thereby encouraging such persons to accept or continue their relationships with the Company; to align the interests of such persons with those of the Company's stockholders through stock ownership; and furnishing such persons with an incentive to improve operations and increase profits of the Company. 4. ADMINISTRATION. (a) COMPOSITION OF THE COMMITTEE. The Plan shall be administered by the Board or a committee appointed by the Board. Members of that committee shall be entitled to participate in the Plan. Subject to the provisions of the first sentence of this Section 4(a), the Board may from time to time remove members from, or add members to, that committee. Vacancies on that committee, however caused, shall be filled by the Board. (b) ACTIONS BY THE COMMITTEE. The Committee shall hold meetings (in person or telephonically) at such times and places as it may determine. Acts approved by a majority of the members of the Committee present at a meeting at which a quorum is present, or acts reduced to or approved in writing by a majority of the members of the Committee, shall be the valid acts of the Committee. (c) POWERS OF THE COMMITTEE. Subject to the express terms and conditions hereof, the Committee shall have the authority to administer the Plan in its sole and absolute discretion. To this end, the Committee is authorized to construe and interpret the Plan, to prescribe, amend and rescind rules and regulations relating to it, and to make all other determinations necessary or advisable for the administration of the Plan, including, but not limited to, the authority to determine the eligible individuals who shall be granted Options, the number of Options to be granted, the vesting period, if any, for all Options granted hereunder, the date on which any Option becomes first exercisable and the number of Shares subject to each Option. The Committee may delegate to an Officer its authority to grant Options to eligible individuals under the Plan who are not Officers; provided, however, that Options to purchase no more than 1,000,000 Shares may be granted to any individual in any calendar year pursuant to such delegation of authority. Any determination, decision or action of the Committee in connection with the construction, interpretation, administration or application of the Plan shall be final, conclusive and binding upon all Participants and any person validly claiming under or through a Participant. Any controversy or claim arising out of or related to this Plan shall be determined by the Committee. (d) LIABILITY OF COMMITTEE MEMBERS. No member of the Board or the Committee will be liable for any action or determination made in good faith by the Board or the Committee with respect to the Plan or any grant or exercise of an Option thereunder. (e) OPTION ACCOUNTS. The Committee shall maintain or cause to be maintained a journal in which a separate account for each Participant shall be established. Whenever an Option is granted to or exercised by a Participant, the Participant's account shall be appropriately credited or debited. Appropriate adjustment shall also be made in the journal with respect to each account in the event of an adjustment pursuant to Section 10(b) hereof. 5. EFFECTIVE DATE AND TERM OF THE PLAN. (a) EFFECTIVE DATE OF THE PLAN. The Plan was adopted by the Board on July 8, 2005 and became effective on such date (the "Effective Date"). (b) TERM OF PLAN. No Option shall be granted pursuant to the Plan on or after ______, 2010, but Options theretofore granted may extend beyond that date. 6. TYPE OF OPTIONS AND SHARES SUBJECT TO THE PLAN. Options granted under the Plan are NQSOs. If any Option granted under the Plan expires or is terminated for any reason, any Shares as to which the Option has not been exercised shall again be available for purchase under Options subsequently granted; PROVIDED, HOWEVER, that at all times during the term of the Plan, the Company shall reserve and keep available for issuance sufficient common shares to issue upon the exercise of all the outstanding Options. The aggregate total of all options to be granted to Participants under this Plan shall be 3,000,000 options to purchase 3,000,000 shares of common stock. 7. SOURCE OF SHARES ISSUED UNDER THE PLAN. Common Stock issued under the Plan may consist, in whole or in part, of authorized or unissued Shares or treasury Shares, as determined in the sole and absolute discretion of the Committee. No fractional Shares shall be issued under the Plan. 8. ELIGIBILITY. The individuals eligible for the grant of Options under the Plan shall be: (i) all Directors, Officers and Employees and (ii) such eligible consultants determined by the Committee to be rendering substantial services as a consultant or independent contractor to the Company or any Subsidiary or Affiliate of the Company, as the Committee shall determine from time to time in its sole and absolute discretion. 9. OPTIONS. (a) GRANT OF OPTIONS. Subject to any applicable requirements of the Code and any regulations issued thereunder, the date of the grant of an Option shall be the date on which the Committee determines to grant the Option. (b) EXERCISE PRICE OF OPTIONS. The exercise price of each option shall be fifty cents ($.50) per option. Each option is convertible into one share of common stock ($.001 par value per share) of the Company. (c) EXERCISE PERIOD. Each Option granted hereunder shall vest and become first exercisable as determined by the Committee in its sole and absolute discretion and set forth in the Stock Option Agreement. (d) TERMS AND CONDITIONS. All Options granted pursuant to the Plan shall be evidenced by a Stock Option Agreement (which need not be the same for each Participant or Option), approved by the Committee which shall be subject to the following express terms and conditions and the other terms and conditions as are set forth in this Section 9, and to such other terms and conditions as shall be determined by the Committee in its sole and absolute discretion which are not inconsistent with the terms of the Plan: (i) the failure of an Option to vest when due to vest pursuant to its terms for any reason whatsoever shall cause the unvested Option to expire and be of no further force or effect; (ii) unless terminated earlier pursuant to Sections 9(i) or 11 hereof, the term of any Option granted under the Plan shall be specified in the Stock Option Agreement but shall be no greater than five years from the date of grant; and (iii) no Option or interest therein may be pledged, hypothecated, encumbered or otherwise made subject to execution, attachment or similar process, and no Option or interest therein shall be assignable or transferable by the holder otherwise than by will or by the laws of descent and distribution or to a beneficiary upon the death of a Participant, and an Option shall be exercisable during the lifetime of the holder only by him or by his guardian or legal representative, except that an Option may be transferred to one or more transferees during the lifetime of the Participant, and may be exercised by such transferee in accordance with the terms of such Option, but only if and to the extent such transfers are permitted by the Committee pursuant to the express terms of the Stock Option Agreement (subject to any terms and conditions which the Committee may impose thereon). A transferee or other person claiming any rights under the Plan from or through any Participant shall be subject to all terms and conditions of the Plan and any Stock Option Agreement applicable to such Participant, except as otherwise determined by the Committee, and to any additional terms and conditions deemed necessary or appropriate by the Committee. (e) ADDITIONAL MEANS OF PAYMENT. Any Stock Option Agreement may, in the sole and absolute discretion of the Committee, permit payment by any other form of legal consideration consistent with applicable law and any rules and regulations relating thereto. Other forms of payment include: the surrender of stock then owned by the Participant, the surrender of the portion of the Option which represents the Exercise Price, the cancellation of indebtedness, the waiver of consideration due for services rendered, or the tender of a full recourse promissory note. (f) EXERCISE. The holder of an Option may exercise the same by filing with the Corporate Secretary of the Company a written election, in such form as the Committee may determine, specifying the number of Shares with respect to which such Option is being exercised, and accompanied by payment in full of the exercise price for such Shares. Notwithstanding the foregoing, the Committee may specify a reasonable minimum number of Shares that may be purchased on any exercise of an Option, provided that such minimum number will not prevent the Participant from exercising the Option with respect to the full number of Shares as to which the Option is then exercisable. (g) WITHHOLDING TAXES. Prior to issuance of the Shares upon exercise of an Option, the Participant shall pay or take adequate provision for the payment of any federal, state, local or foreign withholding obligations of the Company or any Subsidiary or Affiliate of the Company, if applicable. In the event a Participant shall fail to make adequate provision for the payment of such obligations, the Company shall have the right to withhold an amount of Shares otherwise deliverable to the Participant sufficient to pay such withholding obligations or, in the discretion of the Committee, to refuse to honor the exercise. (i) TERMINATION OF OPTIONS. Options granted under the Plan shall be subject to the following events of termination, unless otherwise provided in the Stock Option Agreement: (i) in the event a Participant who is a Director (but not an Officer or Employee) is removed from the Board or the board of directors of a Subsidiary or an Affiliate, as the case may be, for cause (as contemplated by the charter, by-laws or other organizational or governing documents), all unexercised Options held by such Participant on the date of such removal (whether or not vested) shall expire immediately; (ii) In the event the employment of a Participant who is an Officer or Employee is terminated for Cause, or in the event the services of a Participant who is a eligible consultant are terminated for Cause, all unexercised Options held by such Participant on the date of such termination (whether or not vested) shall expire immediately; and (iii) in the event a Participant is no longer a Director, Officer, Employee, consultant or independent contractor, other than for the reasons set forth in Sections 9(i)(i) or 9(i)(ii) hereof, all Options which remain unvested on the date the Participant ceases to be a Director, Officer or Employee, as the case may be, shall expire immediately, and all Options which have vested prior to such date shall expire twelve months thereafter unless by their terms they expire sooner. 10. RECAPITALIZATION. (a) CORPORATE FLEXIBILITY. The existence of the Plan and the Options granted hereunder shall not affect or restrict in any way the right or power of the Board or the shareholders of the Company, in their sole and absolute discretion, to make, authorize or consummate any split-up, adjustment, recapitalization, reorganization or other change in the Company's capital structure or its business, any merger or consolidation of the Company, any issue of bonds, debentures, common stock, preferred or prior preference stock ahead of or affecting the Company's capital stock or the rights thereof, the dissolution or liquidation of the Company or any sale or transfer of all or any part of its assets or business, or any other grant of rights, issuance of securities, transaction, corporate act or proceeding and notwithstanding the fact that any such activity, proceeding, action, transaction or other event may have, or be expected to have, an impact (whether positive or negative) on the value of any Option or underlying Shares. (b) ADJUSTMENTS UPON CHANGES IN CAPITALIZATION. Except as otherwise provided in Section 11, in the event of any change in capitalization affecting the Common Stock of the Company, such as a stock dividend, stock split or recapitalization, the Committee shall make proportionate adjustments with respect to: (i) the aggregate number of Shares available for issuance under the Plan; (ii) the number of Shares available for any individual award; (iii) the number and exercise price of Shares subject to outstanding Options; PROVIDED, HOWEVER, that the number of Shares subject to any Option shall always be a whole number; and (iv) such other matters as shall be appropriate in light of the circumstances. 11. CHANGE OF CONTROL (a) In the event of a Change of Control (as defined below), unless otherwise determined by the Committee at the time of grant or by amendment (with the holder's consent) of such grant, all Options not vested on or prior to the effective time of any such Change of Control shall vest immediately prior to such effective time. Unless otherwise determined in the event of a Change of Control, all by the Committee in the Stock Option Agreement or at the time of a Change of Control, outstanding Options shall terminate and cease to be outstanding immediately following the Change of Control; PROVIDED, HOWEVER, that no such Option termination shall occur unless a Participant shall have been given five business days, following prior written notice, to exercise such Participant's outstanding vested Options at the effective time of the Change of Control, or at the discretion of the Committee to receive cash in an amount per Share subject to such Options equal to the amount by which the price paid for a Share (determined on a fully diluted basis and taking into account the exercise price, as determined by the Committee) in the Change of Control exceeds the per share exercise price of such Options. The Committee in its sole and absolute discretion may make provisions for the assumption of outstanding Options, or the substitution for outstanding Options of new incentive awards covering the stock of a successor corporation or a parent or subsidiary thereof, with appropriate adjustments as to the number and kind of shares and prices so as to prevent dilution or enlargement of rights. (b) A 'Change of Control' will be deemed to occur on the date any of the following events occur: (i) any person or persons acting together which would constitute a 'group' for purposes of Section 13(d) of the Exchange Act; (ii) persons other than the Current Directors (as herein defined) constitute a majority of the members of the Board (for these purposes, a 'Current Director' means any member of the Board as of the date of this Agreement) or (B) an agreement providing for the merger or consolidation of the Company (1) in which the Company is not the continuing or surviving corporation (other than a consolidation or merger with a wholly-owned subsidiary of the Company in which all shares of Common Stock of the Company or common stock in the Significant Subsidiary outstanding immediately prior to the effectiveness thereof are changed into or exchanged for all or substantially all of the common stock of the surviving corporation and (if the Company ceases to exist) the surviving corporation assumes all outstanding Options) or (2) pursuant to which, even though the Company is the continuing or surviving corporation, the shares of Common Stock of the Company or common stock in the Significant Subsidiary are converted into cash, securities or other property; PROVIDED, HOWEVER, that no 'Change of Control' shall be deemed to occur as the result of a consolidation or merger of the Company or a Significant Subsidiary in which the holders of the shares of Common Stock of the Company immediately prior to the consolidation or merger have, as a result thereof, directly or indirectly, at least a majority of the combined voting power of all classes of voting stock of the continuing or surviving corporation or its parent immediately after such consolidation or merger or in which the Board immediately prior to the merger or consolidation would, immediately after the merger or consolidation, constitute a majority of the board of directors of the continuing or surviving corporation or its parent; or (iii) the consummation of an agreement (or agreements) providing for the sale or other disposition (in one transaction or a series of transactions) of all or substantially all of the assets of the Company or a Significant Subsidiary other than such a sale or disposition immediately after which such assets will be owned directly or indirectly by the stockholders of the Company in substantially the same proportions as their ownership of the shares of Common Stock immediately prior to such sale or disposition. 12. SECURITIES LAW REQUIREMENTS. No Shares shall be issued under the Plan unless and until: (i) the Company and the Participant have taken all actions required to register the Shares under the Securities Act of 1933, as amended, or perfect an exemption from the registration requirements thereof; and (ii) any other applicable provision of state or federal law has been satisfied. The Company shall be under no obligation to register the Shares with the Securities and Exchange Commission or to effect compliance with the registration or qualification requirements of any state securities laws or stock exchange. 13. AMENDMENT AND TERMINATION. (a) MODIFICATIONS TO THE PLAN. The Board may, insofar as permitted by law, from time to time, with respect to any Shares at the time not subject to Options, suspend or terminate the Plan or revise or amend the Plan in any respect whatsoever. (b) RIGHTS OF PARTICIPANT. No amendment, suspension or termination of the Plan or of any Option that would adversely affect the right of any Participant with respect to an Option previously granted under the Plan will be effective without the written consent of the affected Participant. No amendment shall increase the maximum number of shares which may be awarded under the Plan, materially increase the benefits accruing to a Participant or materially modify the eligibility requirements. 14. SECURITIES LAW REQUIREMENTS. (a) The Board may require an individual as a condition of the grant and of the exercise of an option, to represent and establish to the satisfaction of the Board that all shares of Common Stock to be acquired upon the exercise of such option will be acquired for investment and not for resale. The Board shall cause such legends to be placed on certificates evidencing shares of Common Stock issued upon exercise of an option as, in the opinion of the Company's counsel, may be required by federal and applicable state securities laws. (b) No shares of Common Stock shall be issued upon the exercise of any option unless and until counsel for the Company determines that: (i) the Company and the optionee have satisfied all applicable requirements under the Securities Act of 1933 and the Securities Exchange Act of 1934; (ii) any applicable listing requirement of any stock exchange on which the Company's Common Stock is listed has been satisfied; and (iii) all other applicable provisions of state and federal law have been satisfied. 15. MISCELLANEOUS. (a) SHAREHOLDERS' RIGHTS. No Participant and no beneficiary or other person claiming under or through such participant shall acquire any rights as a shareholder of the Company by virtue of such Participant having been granted an Option under the Plan. No Participant and no beneficiary or other person claiming under or through such Participant will have any right, title or interest in or to any Shares allocated or reserved under the Plan or subject to any Option, except as to Shares, if any, that have been issued or transferred to such Participant. No adjustment shall be made for dividends or distributions or other rights for which the record date is prior to the date of exercise of an Option, except as may be provided in the Stock Option Agreement. The Company shall issue stock certificates required to be issued in connection with the exercise of an Option with reasonable promptness after such exercise. (b) OTHER COMPENSATION ARRANGEMENTS. Nothing contained in the Plan shall prevent the Board from adopting other compensation arrangements, subject to shareholder approval if such approval is required. Such other arrangements may be either generally applicable or applicable only in specific cases. (c) TREATMENT OF PROCEEDS. Proceeds realized from the exercise of Options under the Plan shall constitute general funds of the Company. (d) COSTS OF THE PLAN. The costs and expenses of administering the Plan shall be borne by the Company. (e) NO RIGHT TO CONTINUE EMPLOYMENT OR SERVICES. Nothing contained in the Plan or in any instrument executed pursuant to the Plan will confer upon any Participant any right to continue to render services to the Company, a Subsidiary or Affiliate; to continue as a Director, Officer, Employee, consultant or independent contractor; or affect the right of the Company, a Subsidiary, an Affiliate, the Board, the board of directors of a Subsidiary or an Affiliate, the shareholders of the Company or a Subsidiary, or the holders of interests of an Affiliate, as applicable, to terminate the directorship, office, employment or consultant or independent contractor relationship, as the case may be, of any Participant at any time with or without Cause. The term 'Cause' as defined herein is included solely for the purposes of the Plan and is not, and shall not be deemed to be: (i) a restriction on the right of the Company, a Subsidiary or Affiliate, as the case may be, to terminate any Officer or Employee for any reason whatsoever; or (ii) a part of the employment relationship (whether oral or written, express or implied) of any such individual. (f) SEVERABILITY. The provisions of the Plan shall be deemed severable and the validity or unenforceability of any provision shall not affect the validity or enforceability of the other provisions hereof. (g) GOVERNING LAW. The Plan and all actions taken thereunder shall be enforced, governed and construed by and interpreted under the laws of the State of Florida applicable to contracts made and to be performed wholly within such State without giving effect to the principles of conflict of laws thereof. (h) HEADINGS. The headings contained in this Plan are for reference purposes only and shall not affect in any way the meaning or interpretation of this Plan. (i) NO VIOLATION. Notwithstanding any provisions in this Plan to the contrary, no Option may be granted and no Shares may be repurchased by the Company if such grant or repurchase would otherwise violate the terms of any agreement entered into by the Company. EX-10.2 4 v021206_ex10-2.txt EXHIBIT 10.2 YEAR 2005 STOCK AWARD PLAN 1. Purpose. This Year 2005 Stock Award (the 'Plan') of Winmax Trading Group, Inc. (the 'Company') for selected employees, officers, directors and key consultants and advisors to the Company is intended to advance the best interests of the Company by providing personnel who have substantial responsibility for the management and growth of the Company and its subsidiaries with additional incentive by increasing their proprietary interest in the success of the Company, thereby encouraging them to remain in the employ of the Company or any of its subsidiaries. 2. Administration. The Plan shall be administered by the Board of Directors of the Company (the 'Board') or a committee which shall keep the minutes of its proceedings with regard to the Plan and all records, documents, and data pertaining to its administration of the Plan. A majority of the members of the Board shall constitute a quorum for the transaction of business, and the vote of a majority of those members present at any meeting shall decide any question brought before that meeting. In addition, the Board may take any action otherwise proper under the Plan by the affirmative vote, taken without a meeting, of a majority of its members. Any decision or determination reduced to writing and signed by a majority of the members shall be as effective as if it had been made by a majority vote at a meeting properly called and held. All questions of interpretation and application of the Plan shall be subject to the determination of the Board. The actions of the Board in exercising all of the rights, powers and authorities set out in this Plan, when performed in good faith and in its sole judgment, shall be final, conclusive, and binding on the parties. 3. Shares Available Under the Plan. The stock subject the Stock Awards shall be shares of the Company's Common Stock, $.001 par value (the 'Common Stock'). The total number of shares of Common Stock available under the Plan shall not exceed in the aggregate 3,500,000. Such shares may be treasury shares or authorized but unissued shares. 4. Eligibility. The individuals who shall be eligible to participate in the Plan shall be any officer, director, employee, consultant, advisor or other person providing key services to the Company who are not engaged in any prohibited activity (hereinafter such persons may sometimes be referred to as the 'Eligible Individuals.') Prohibited Activity shall include the following: i. services rendered to the Company not in connection with a capital raising or market making transaction; ii. services in connection with the offer or sale of securities in a capital-raising transaction that directly or indirectly promotes or maintains a market for the Company's securities; iii. services by current or future auditors of the Company; iv. services performed by compensate promoters of the Company; v. services involving any promotion or marketing of the Company or shareholderor investor relations services and vi. services in connection with a shell merger. 5. Authority to Grant Stock Awards. The Board in its discretion and subject to the provisions of the Plan, may grant the following from time to time to eligible individuals of the Company: (a) Stock Awards. The Board may award and issue shares of Common Stock under the Plan to an eligible individual ('Stock Award'). Stock Awards may be made in lieu of cash compensation or as additional compensation. Stock Awards may also be made pursuant to performance based goals established by the Board. Subject only to any applicable limitations set forth in the Plan, the number of shares of Common Stock covered by any Stock Award, and the vesting period, if any, shall be determined by the Board. 6. Stock Awards. (a) Awards in Lieu of Compensation. The Board may grant Common Stock to an Eligible Individual under the Plan, without any payment by the individual, in lieu of certain cash compensation or as additional compensation. The Stock Award is subject to appropriate tax withholding. After compliance with the tax withholding requirements, a stock certificate shall be issued to the individual recipient of the Stock Award. The certificate shall bear such legend, if any, as the Board determines is reasonably required by applicable law. Prior to receipt of a Stock Award, the individual must comply with appropriate requests of the Board to assure compliance with all relevant laws. (b) Performance Based Awards. The Board may award shares of Common Stock, without any payment for such shares, to designated individuals if specified performance goals established by the Board are satisfied. The designation of an employee eligible for a specific performance based Stock Award shall be made by the Board in writing prior to the beginning of the 12-month period for which the performance is measured. The Board shall establish the number of shares to be issued to a designated employee if the performance goal is met. The Board must certify in writing that a performance goal has been met prior to issuance of any certificate for a performance based Stock Award to any employee. If the Board certifies the entitlement of an employee to the performance based Stock Award, the certificate shall be issued to the employee as soon as administratively practicable, and subject to other applicable provisions of the Plan, including but not limited to, all legal requirements and tax withholding. Performance goals determined by the Board may be based on specified increases in net profits, stock price, Company or segment sales, market share, earnings per share, and/or return on equity. (c) Vesting. The Common Stock granted hereunder shall vest as determined by the Board in its sole and absolute discretion. 7. The Company may, but shall not be obligated to, register any securities covered by a Stock Award pursuant to the 1933 Act (as now in effect or as hereafter amended) and, in the event any shares are registered, the Company may remove any legend on certificates representing these shares. The Company shall not be obligated to take any other affirmative action in order to cause the Stock Award to comply with any law or regulation of any governmental authority. 8. Employment Obligation. The granting of any Stock Award shall not impose upon the Company any obligation to employ or continue to employ any grantee; and the right of the Company to terminate the employment of any officer or other employee shall not be diminished or affected by reason of the fact that a Stock Award has been granted to him. 9. Changes in the Company's Capital Structure. The existence of outstanding Stock Awards shall not affect in any way the right or power of the Company or its shareholders to make or authorize any or all adjustments, recapitalizations, reorganizations or other changes in the Company's capital structure or its business, or any merger or consolidation of the Company, or any issue of bonds, debentures, preferred or prior preference stock ahead of or affecting the Common Stock or the rights thereof, or the dissolution or liquidation of the Company, or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether of a similar character or otherwise. If the Company effects a subdivision or consolidation of shares or other capital readjustment, the payment of a dividend in capital stock or other equity securities of the Company on, its Common Stock, or other increase or reduction of the number of shares of the Common Stock outstanding, without receiving consideration therefore in money, services, or property, or the reclassification of its Common Stock, in whole or in part, into other equity securities of the Company, then (a) the number, class and per share price of shares of Common Stock subject to Stock Awards hereunder shall be appropriately adjusted (or in the case of the issuance of other equity securities as a dividend on, or in a reclassification of, the Common Stock, the Stock Awards shall extend to such other securities) in a manner so as to entitle a grantee to receive, for the same aggregate cash consideration, and for an award of pending performance based Stock Awards, the same total number and class or classes of shares or in the case of a dividend of, or reclassification into, other equity securities, those other securities) he would have held after adjustment if the Stock Award was earned, immediately prior to the event requiring the adjustment, or, if applicable, the record date for determining shareholders to be affected by the adjustment; and (b) the number and class of shares then reserved for issuance under the Plan (or in the case of a dividend of, or reclassification into, other equity securities, those other securities)shall be adjusted by substituting for the total number and class of shares of stock then reserved, the number and class or classes of shares of stock (or in the case of a dividend of, or reclassification into, other equity securities, those other securities) that would have been received by the owner of an equal number of outstanding shares of Common Stock as a result of the event requiring the adjustment. Comparable rights shall accrue to each employee in the event of successive subdivisions, consolidations, capital adjustments, dividends or reclassifications of the character described above. Appropriate adjustments shall also be made to pending Stock Awards. Except as hereinbefore expressly provided, the issue by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, for cash or property, or for labor or services either upon direct sale or upon the exercise of rights or warrants to subscribe therefore, or upon conversion of shares or obligations of the Company convertible into such shares or other securities, shall not affect, and no adjustment by reason thereof shall be made with respect to, the number or price of shares of Common Stock then subject to outstanding Stock Awards. 10. Amendment or Termination of Plan. The Board may at any time alter, suspend or terminate the Plan. 11. Forfeitures. Notwithstanding any other provisions of this Plan, if the Board finds by a majority vote after full consideration of the facts that the employee, before or after termination of his employment with the Company or its subsidiaries for any reason (a) committed or engaged in fraud, embezzlement, theft, commission of a felony, or proven dishonesty in the course of his employment by the Company or its subsidiaries, which conduct damaged the Company or its subsidiaries, or disclosed trade secrets of the Company or its subsidiaries, or (b) participated, engaged in or had a financial or other interest, whether as an employee, officer, director, consultant, contractor, shareholder, owner, or otherwise, in any commercial endeavor in the United States which is competitive with the business of the Company or its subsidiaries without the written consent of the Company or its subsidiaries, the employee shall forfeit all outstanding Stock Awards (whether or not fully vested), including all rights related to such matters, and including any performance based Stock Awards to which he may be entitled, and other elections pursuant to which the Company has not yet delivered a stock certificate. Clause (b) shall not be deemed to have been violated solely by reason of the employee's ownership of stock or securities of any publicly owned corporation, if that ownership does not result in effective control of the corporation. The decision of the Board as to the cause of the employee's discharge, the damage done to the Company or its subsidiaries, and the extent of the employee's competitive activity shall be final. No decision of the Board, however, shall affect the finality of the discharge of the employee by the Company or its subsidiaries in any manner. To provide the Company with an opportunity to enforce this Section, no certificate for Stock may be issued under this Plan without the certification by the Board that no action forbidden by this provision has been raised for their determination. 12. Tax Withholding. The Company shall be entitled to deduct from other compensation payable to each employee any sums required by federal, state, or local tax law to be withheld with respect to the grant, vesting, as appropriate, of an Stock Award. In the alternative, the Company may require the employee (or other person receiving the Stock Award) to pay the sum directly to the employer corporation. 13. Written Agreement. Each Stock Award granted hereunder shall be embodied in a written agreement, which shall be subject to the terms and conditions prescribed herein, and shall be signed by the grantee and by an appropriate officer of the Company on behalf of the Company. Each agreement shall contain other provisions which the Board in its discretion shall deem advisable. 14. Governing Law and Interpretation. This Plan shall be governed by the laws of the state of Florida. Headings contained in this Plan are for convenience only and shall in no manner be construed as part of this Plan. 15. Effective Date of Plan. The Plan shall become effective as of July 8, 2005 (the 'Effective Date') and shall terminate on the 1st anniversary of the Effective Date. EX-10.3 5 v021206_ex10-3.txt EXHIBIT 10.3 FORM OF OPTION AGREEMENT Winmax Trading Group, Inc. Date: ______________ Dear _____________________: The Board of Directors of Winmax Trading Group Inc. (the "Corporation") is pleased to award you an Option pursuant to the provisions of the 2005 Non-Qualified Stock Award and Option Plan (the "Plan"). This letter will describe the Option granted to you. Attached to this letter is a copy of the Plan. The terms of the Plan also set forth provisions governing the Option granted to you. Therefore, in addition to reading this letter you should also read the Plan. Your signature on this letter is an acknowledgment to us that you have read and understand the Plan and that you agree to abide by its terms. All terms not defined in this letter shall have the same meaning as in the Plan. 1. Type of Option. You are granted [a] Non Qualified Stock Option[s]. 2. Rights and Privileges. (a) Subject to the conditions hereinafter set forth, we grant you the right to purchase __________ shares of Common Stock at fifty cents ($.50) per share. 3. Time of Exercise. The Option may be exercised at any time and from time to time beginning when the right to purchase the shares of Common Stock accrues and ending when they terminate as provided in Section 5 of this letter. 4. Method of Exercise. The Options shall be exercised by written notice to the Chairman of the Board of Directors at the Corporation's principal place of business. The notice shall set forth the number of shares of Common Stock to be acquired and shall contain a check payable to the Corporation in full payment for the Common Stock or that number of already owned shares of Common Stock equal in value to the total Exercise Price of the Option. We shall make delivery of the shares of Common Stock subject to the conditions described in Section 13 of the Plan. 5. Termination of Option. To the extent not exercised, the Option shall terminate upon the first to occur of the following dates: (a) Five years from the date of grant; or (b) On the date your employment terminates with the Corporation and any of its subsidiaries included in the Plan for any reason, other than by reason of death or permanent disability. As used herein, "permanent disability" means your inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than 12 months. 6. [Heading] (i) the failure of an Option to vest when due to vest pursuant to its terms for any reason whatsoever shall cause the unvested Option to expire and be of no further force or effect; (ii) unless terminated earlier pursuant to Sections 9(i) or 11 of the Plan, the term of any Option granted under the Plan shall be specified in the Stock Option Agreement but shall be no greater than five years from the date of grant; (iii) no Option or interest therein may be pledged, hypothecated, encumbered or otherwise made subject to execution, attachment or similar process; and (iv) no Option or interest therein shall be assignable or transferable by the holder otherwise than by will or by the laws of descent and distribution or to a beneficiary upon the death of a Participant, and an Option shall be exercisable during the lifetime of the holder only by him or by his guardian or legal representative, except that an Option may be transferred to one or more transferees during the lifetime of the Participant, and may be exercised by such transferee in accordance with the terms of such Option, but only if and to the extent such transfers are permitted by the Board pursuant to the express terms of the Stock Option Agreement (subject to any terms and conditions which the Board may impose thereon). A transferee or other person claiming any rights under the Plan from or through any Participant shall be subject to all terms and conditions of the Plan and any Stock Option Agreement applicable to such Participant, except as otherwise determined by the Board, and to any additional terms and conditions deemed necessary or appropriate by the Board. 7. MEANS OF PAYMENT. Any Stock Option Agreement may, in the sole and absolute discretion of the Board, permit payment by any other form of legal consideration consistent with applicable law and any rules and regulations relating thereto. 8. EXERCISE. The holder of an Option may exercise the same by filing with the Corporate Secretary of the Company a written election, in such form as the Board may determine, specifying the number of Shares with respect to which such Option is being exercised, and accompanied by payment in full of the exercise price for such Shares. Notwithstanding the foregoing, the Board may specify a reasonable minimum number of Shares that may be purchased on any exercise of an Option, provided that such minimum number will not prevent the Participant from exercising the Option with respect to the full number of Shares as to which the Option is then exercisable. 9. WITHHOLDING TAXES. Prior to issuance of the Shares upon exercise of an Option, the Participant shall pay or take adequate provision for the payment of any federal, state, local or foreign withholding obligations of the Company or any Subsidiary or Affiliate of the Company, if applicable. In the event a Participant shall fail to make adequate provision for the payment of such obligations, the Company shall have the right to withhold an amount of Shares otherwise deliverable to the Participant sufficient to pay such withholding obligations or, in the discretion of the Board, to refuse to honor the exercise. 10. TERMINATION OF OPTIONS. Options granted under the Plan shall be subject to the following events of termination, unless otherwise provided in the Stock Option Agreement: (i) in the event a Participant who is a Director (but not an Officer or Employee) is removed from the Board or the board of directors of a Subsidiary or an Affiliate, as the case may be, for cause (as contemplated by the charter, by-laws or other organizational or governing documents), all unexercised Options held by such Participant on the date of such removal (whether or not vested) shall expire immediately; (ii) In the event the employment of a Participant who is an Officer or Employee terminated for Cause, or in the event the services of a Participant who is a eligible consultant are terminated for Cause, all unexercised Options held by such Participant on the date of such termination (whether or not vested) shall expire immediately; and (iii) in the event a Participant is no longer a Director, Officer, Employee, consultant or independent contractor, other than for the reasons set forth in Sections 9(i)(i) or 9(i)(ii) of the Plan, all Options which remain unvested on the date the Participant ceases to be a Director, Officer or Employee, as the case may be, shall expire immediately, and all Options which have vested prior to such date shall expire twelve months thereafter unless by their terms they expire sooner. 11. SECURITIES LAWS. The Corporation has no obligations to ever register the Option or the shares of Common Stock underlying the Option. 12. BINDING EFFECT. The rights and obligations described in this letter shall inure to the benefit of and be binding upon both of us, and our respective heirs, personal representatives, successors and assigns. 13. DATE OF GRANT. The Option shall be treated as having been granted to you on the date of this letter even though you may sign it at a later date. Very truly yours, By: _______________________________ President AGREED AND ACCEPTED:________________________ Date: __________________ EX-23.2 6 v021206_ex23-2.txt CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM To the Board of Directors Winmax Trading Group, Inc. We hereby consent to the use in this Registration Statement on Form S-8 of our report dated April 22, 2005 on the financial statements of Winmax Trading Group, Inc. as of and for each of the two years in the period ended December 31, 2004 which appear in such Registration Statement. We also consent to the reference to our Firm under the caption "Experts" in such Registration Statement. GOLDSTEIN GOLUB KESSLER LLP New York, New York July 7, 2005 -----END PRIVACY-ENHANCED MESSAGE-----