8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

Current Report

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 11, 2010

ZOO ENTERTAINMENT, INC.

(Exact name of registrant as specified in its charter)

Delaware	333-124829	71-1033391
(State or Other Jurisdiction	(Commission File Number)	(I.R.S. Employer
of Incorporation)		Identification No.)

3805 Edwards Road, Suite 605

Cincinnati, OH  45209

 (Address of principal executive offices including zip code)

(513) 824-8297

 (Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

ITEM 3.02 UNREGISTERED SALES OF EQUITY SECURITIES.

The information contained in Item 5.02 of this Current Report on Form 8-K with respect to the issuance of the shares of restricted stock and options is incorporated herein by reference. 

ITEM 5.02 DEPARTURE OF DIRECTORS OR CERTAIN OFFICERS; ELECTION OF DIRECTORS; APPOINTMENT OF CERTAIN OFFICERS; COMPENSATORY ARRANGEMENTS OF CERTAIN OFFICERS.

(c)           On February 11, 2010, the board of directors of Zoo Entertainment, Inc. (the “Company”) appointed Steve Buchanan as the Chief Operating Officer of Zoo Publishing, Inc. (“Zoo Publishing”), a wholly-owned subsidiary of Zoo Games, Inc., a wholly-owned subsidiary of the Company.

Mr. Buchanan, age 50, has served as a consultant in various capacities at Zoo Publishing since March 2009. Mr. Buchanan has held various executive titles at Jack of All Games, a video game distribution company, including, Executive Vice President of Sales and Marketing and President from 1999 to 2009.  At various times between 1992 and 1999, he served as District Sales Manager, Eastern Zone Sales Manager and National Sales Director of Sega of America, a video game publisher. Mr. Buchanan also served as a Buyer Merchandiser, specializing in video games, at Meijer, a Michigan based hypermarket, from 1981 to 1992.

There are no arrangements or understandings between Mr. Buchanan and any other person pursuant to which he was appointed as Chief Operating Officer of Zoo Publishing, Inc.  Mr. Buchanan does not have family relations with any directors or executive officers of the Company.  There are no transactions to which the Company is a party and in which Mr. Buchanan has a material interest that are required to be disclosed under Item 404(a), as modified by Item 404(d)(1) of Regulation S-K.

Zoo Publishing entered into an employment agreement, effective February 15, 2010, with Mr. Buchanan pursuant to which he became Chief Operating Officer of Zoo Publishing.  The employment agreement expires on February 15, 2012 and provides for an annual base salary of $350,000.  Mr. Buchanan is also eligible to receive a bonus at the discretion of the board of directors.  The employment agreement may be terminated due to death, disability or by Zoo Publishing with or without cause (as defined in the employment agreement). In the event the employment agreement is terminated due to death or disability, Mr. Buchanan’s or his legal representatives, as applicable, will be entitled to any earned but unpaid base salary as of the termination date, plus any accrued paid vacation days and unreimbursed business expenses.  In the event the employment agreement is terminated with cause, Mr. Buchanan will be entitled to receive his earned but unpaid base salary through the date of termination, plus any unreimbursed business expenses.  In the event the employment agreement is terminated without cause, Mr. Buchanan will be entitled to any earned but unpaid base salary as of the termination date, any accrued paid vacation days and unreimbursed business expenses, and severance payments equal to an aggregate of 52 weeks of base salary.  Pursuant to the employment agreement, Mr. Buchanan also agreed not to engage in activities competitive with the Company’s business during his employment and for a period of one year following the termination of his employment agreement. The foregoing description of the employment agreement does not purport to be complete and is qualified in its entirety by reference to the employment agreement, a copy of which is attached hereto as Exhibit 10.1 and incorporated by reference herein.

On February 11, 2010, the board of directors also appointed Jay Wolf, currently a director and Secretary of the Company, as Chairman of the board of directors.

(e)  Subject to the effectiveness (the “Effective Date”) of those certain amendments to the Company’s Certificate of Incorporation authorizing an increase in the number of authorized shares of the Company’s common stock, par value $0.001 per share, from 250,000,000 shares to 3,500,000,000 shares and effecting a reverse stock split at a ratio of one for 600 shares of common stock (the “Charter Amendments”), on February 11, 2010, the Company issued an aggregate of  168,662,400 shares of restricted common stock and options to purchase 756,550,200 shares of common stock to various employees, directors and consultants, outside of the Company’s 2007 Employee, Director and Consultant Stock Plan, as set forth below.

The Company issued options to purchase 202,581,600 shares of common stock to each of Mark Seremet, a director, Chief Executive Officer and President of the Company, and David Rosenbaum, President of Zoo Publishing, Inc., in consideration for their continued personal guarantees of the payment and performance by the Company of certain obligations in connection with a previously entered into purchase order financing, pursuant to Fee Letters entered into between the Company and each of Messrs. Seremet and Rosenbaum, dated as of May 12,2009, as amended on August 31, 2009 and November 20, 2009.  The options have an exercise price of $0.0025 per share and vest as follows: commencing as of the Effective Date, 72% vest immediately, 14% on May 12, 2010 and 14% vest on May 12, 2011.

The Company issued to Jay Wolf, a director and Secretary of the Company, 159,510,000 shares of restricted common stock in consideration for Mr. Wolf agreeing to serve as Chairman of the board of directors, and options to purchase 21,847,800 shares of common stock in consideration for his services as a director of the Company.  The options have an exercise price of $0.0041 per share and vest as follows: commencing as of the Effective Date, 25% vest immediately, and 25% vest on each of the first, second and third anniversaries of the date of grant.

In consideration for agreeing to serve as Chief Operating Officer of Zoo Publishing, the Company also issued to Steve Buchanan options to purchase 105,597,600 shares of common stock.  The options have an exercise price of $0.0041 per share and commencing as of the Effective Date, 25% vest on each of the first, second, third and fourth anniversaries of the date of grant.

Additionally, the Company issued to David Fremed, Chief Financial Officer of the Company, options to purchase 36,412,800 shares of common stock in consideration for his services as Chief Financial Officer.  The options have an exercise price of $0.0041 per share and vest as follows: commencing as of the Effective Date, 70% vest immediately, and 15% vest on each of the first and second anniversaries of the date of grant. Effective February 15, 2010, Zoo Games, Inc. also entered into Amendment Number Two to the June 4, 2007 David Fremed Employment Agreement (the “Amended Employment Agreement”) with Mr. Fremed, which amended his original employment agreement, dated June 4, 2007, as amended on August 8, 2008 (the “Original Employment Agreement”), pursuant to which he became Chief Financial Officer. The term of the Amended Employment Agreement is for two years, at an annual base salary of $335,000.  He is also eligible to receive a bonus at the discretion of the board of directors.  The material terms of the Original Employment Agreement were disclosed in that Current Report on Form 8-K filed with the Securities and Exchange Commission on September 18, 2008, which are incorporated by reference herein.  The foregoing description of the Amended Employment Agreement does not purport to be complete and is qualified in its entirety by reference to the Amended Employment Agreement, a copy of which is attached hereto as Exhibit 10.2 and incorporated by reference herein.

In consideration for their services as directors, the Company issued options to purchase 12,744,600 shares, 7,282,800 shares, 7,282,800 shares, 12,744,600 shares and 15,293,400 shares, respectively, to each of Drew Larner, David Smith, Moritz Seidel, John Bendheim and Barry Regenstein.  The options have an exercise price of $0.0041 per share and vest as follows: commencing as of the Effective Date, 25% vest immediately, and 25% vest on each of the first, second and third anniversaries of the date of grant.  The Company issued 2,743,800 shares, 1,829,400 shares and 4,573,200 shares, respectively, of restricted common stock to each of  Drew Larner, John Bendheim and Barry Regenstein in consideration for each of them serving as a member of the Company’s compensation committee.

Additionally, the Company issued options to purchase an aggregate of 132,180,600 shares of common stock to various employees of the Company in consideration for their services, at an exercise price of $0.0041 per share and with the vesting schedule as set forth in each option holder’s respective option agreement.

The issuances of all of the shares of restricted stock and options described above are conditioned upon, and cannot vest prior to, the effectiveness of the filing of the Charter Amendments, and in the event the Charter Amendments are not filed prior to September 1, 2010, the shares of restricted stock and options shall be deemed immediately canceled.

Effective February 11, 2010, the Company’s board of directors approved and adopted the Second Amendment (the “Second Amendment”) to the Company’s 2007 Employee, Director and Consultant Stock Plan, as amended (the “Stock Plan”).  The Second Amendment was adopted in order to modify the number of shares of common stock issuable pursuant to the Stock Plan from 4,000,000 shares to 1,208,409 shares, after giving effect to the Charter Amendments, and to modify the maximum number of shares with respect to which stock rights may be granted to any participant in any fiscal year under the Stock Plan from 750,000 shares to 300,000 shares, after giving effect to the Charter Amendments.  All other terms of the Stock Plan remain in full force and effect. The board of directors intend to submit the Second Amendment to the Company’s stockholders for approval.  The foregoing description of the Second Amendment does not purport to be complete and is qualified in its entirety by reference to the Second Amendment, a copy of which is attached hereto as Exhibit 10.3 and incorporated herein by reference.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.

(d) Exhibits

Number	Description
10.1	Employment Agreement, by and between Zoo Publishing, Inc. and Steve Buchanan, effective as of February 15, 2010.
10.2	Amendment Number Two to the June 4, 2007 David Fremed Employment Agreement, by and between Zoo Games, Inc. and David Fremed, effective as of February 15, 2010.
10.3	Amendment No. 2 to the 2007 Employee, Director and Consultant Stock Plan.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Date: February 18, 2010

ZOO ENTERTAINMENT, INC.
By:	/s/ David Fremed
Name:	David Fremed
Title:	Chief Financial Officer

EX-10.1

EMPLOYMENT AGREEMENT

EMPLOYMENT AGREEMENT, dated as of February 15, 2010, by and between Zoo Publishing, Inc., a New Jersey corporation with its offices at 3805 Edwards Road, Cincinnati, Ohio 45209 (the “Company”), and Steve Buchanan, an individual residing at ________________(“Executive”).

NOW, THEREFORE, in consideration of the mutual covenants contained herein and for other good and valuable consideration, the parties agree as follows:

1.  Term of Employment. Executive’s employment under this Employment Agreement will commence on February 15, 2010 (the “Commencement Date”) and will expire, subject to earlier termination pursuant to Section 7 hereof, two (2) years thereafter (the “Employment Term”)..

2.  Positions.

(a)  Executive shall serve as the Chief Operating Officer for the Company.

(b)  The Executive shall report to the Chief Executive Officer of the Company or his designee. The Executive may be given such further reasonably related supervisory duties, powers and prerogatives as may be delegated to him from time to time by the Chief Executive Officer.

(c)  During the Employment Term, Executive shall devote substantially all of his business time and efforts to the performance of his duties hereunder.

 3.  Base Salary.   During the Employment Term and after the date of this Amendment, the Company shall pay Executive a base salary at the annual rate of not less than $350,000. Base salary shall be payable in accordance with the usual payroll practices of the Company.  Executive’s Base Salary shall be subject to annual review by the Board of the Company in December of each year and may be increased, but not decreased, from time to time upon recommendation of the Compensation Committee. The base salary as determined as aforesaid from time to time shall constitute “Base Salary” for purposes of this Employment Agreement.

 4.  Bonus.  For each year during the Employment Term, Executive shall be eligible to receive a bonus on such terms and conditions as the Board in the exercise of its sole and absolute discretion may determine.   

5.  Employee Benefits and Vacation.

(a)  During the Employment Term, Executive shall be entitled to participate in all pension, retirement, savings, welfare and other employee benefit plans and arrangements and fringe benefits and perquisites generally maintained by the Company from time to time for the benefit of the senior executives of the Company.

(b)  During the Employment Term, Executive shall be entitled to four (4) weeks vacation each year in accordance with the Company’s policies in effect from time to time.  Executive shall also be entitled to such periods of sick leave as is customarily provided by the Company for its senior executive employees.

6.  Business Expenses. The Company shall reimburse Executive for the travel, entertainment and other business expenses incurred by Executive in the performance of his duties hereunder, in accordance with the Company’s policies as in effect from time to time.

7.  Termination.

(a) The employment of Executive under this Employment Agreement shall terminate upon the occurrence of any of the following events:

(i)  the death of Executive;

(ii)  the termination of Executive’s employment by the Company due to Executive’s  Disability pursuant to Section 7(b) hereof;

(iii)  the termination of Executive’s employment by the Company without Cause;

(iv)  the termination of Executive’s employment by the Company for Cause pursuant to Section 7(c);

(b)  Disability. If Executive is unable to carry out his material duties pursuant to this Employment Agreement for more than thirty (30) days during any twelve (12) month period by reason of any physical or mental impairment, or suffers any medically determined physical or mental impairment that can be expected to result in death or that can be expected to render the Executive incapable of performing his duties to the Company for thirty (30) days or more (a “Disability”), the Company may terminate Executive’s employment for Disability, at any time, upon not less than ten (10) days prior written notice (a “Notice of Disability Termination”).

(c)  Termination By The Company.  Upon written notice, Executive’s employment hereunder may be terminated by the Company either for Cause or without Cause.  For purposes of this Employment Agreement, the term “Cause” shall include:

(i)  the refusal of Executive to follow the proper written direction of the Chief Executive Officer;

(ii)  failure by Executive to perform the material duties required of him hereunder (other than any such failure resulting from incapacity due to physical or mental illness) which goes uncured for a period of two (2) business days after a written demand for performance is delivered to Executive by the Chief Executive Officer;

(iii)  Executive being convicted of a felony (other than a felony involving a motor vehicle);

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(iv)  any material breach of this Agreement by Executive; or

(v)  Executive’s dishonesty, misappropriation or fraud with regard to the Company (other than good faith expense account disputes).

8.  Consequences of Termination of Employment.  

(a)  Death.  If Executive’s employment is terminated during the Employment Term by reason of Executive’s death, the employment period under this Employment Agreement shall terminate as of the date of death without further obligations to Executive’s legal representatives under this Employment Agreement except for:

(i)  any Base Salary earned but not yet paid through the end of the month of Executive’s death; and

(ii)  any accrued vacation pay payable pursuant to the Company’s policies and any unreimbursed business expenses payable pursuant to Section 6 which amounts shall be promptly paid in a lump sum to Executive’s estate;

(b)  Disability. If Executive’s employment is terminated by reason of Executive’s Disability, Executive shall be entitled to receive the payments and benefits to which his representatives would be entitled in the event of a termination of employment by reason of his death.

(c)  Termination by the Company with Cause.  If Executive’s employment hereunder is terminated by the Company for Cause, Executive shall be entitled to receive only his Base Salary through the date of termination and any unreimbursed business expenses payable pursuant to Section 6.

(d)  Termination by the Company without Cause.  If the Executive’s employment is terminated by the Company without Cause, the Executive shall be entitled to receive:

(i)  all of the benefits set forth in Section 8(a) above, plus

(ii)  a severance equal to fifty-two (52) weeks of Base Salary (the “Severance Benefit”).   The Severance Benefit shall be payable over a fifty-two week period commencing on the first payroll date following the termination of employment in equal installments on the Company’s normal payroll dates during said period.

(e)  The Company’s obligation to provide the payments pursuant to Paragraph 8(e) hereof is expressly conditioned upon the Executive’s execution and delivery to the Company of a release agreement, satisfactory to the Company, including, but not limited to:

(i)  An unconditional release of all rights to any claims, charges, complaints, grievances, known or unknown to the Executive, through the date of the Executive’s termination from employment;

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(ii)  A representation and warranty that the Executive has not filed or assigned any claims, charges, complaints, or grievances against the Company;

(iii)  An agreement not to use, disclose or make copies of any confidential information of the Company, as well as to return any such confidential information and property to the Company upon execution of such release;

(iv)  An agreement to maintain the confidentiality of the release;

(v)  A reaffirmation of his restrictive covenant; and

(v)  An agreement to indemnify the Company, in the event that the Executive breaches any portion of such release.

9.  Confidentiality/Noncompetition.  

(a)  The Company and Executive acknowledge and agree that the services to be provided by Executive pursuant to this Employment Agreement are unique and extraordinary and, as a result of such employment, Executive will be in possession of Confidential Information relating to the business practices of the Company.  The term “Confidential Information” shall mean any and all information (verbal and written) relating to the Company or any of its affiliates, or any of their respective activities, other than general business practices not unique to Company but commonly practiced in the interactive entertainment industry and such information which can be shown by the Executive to be in the public domain or otherwise know to the public other than as a result of a breach of this Section 9, including but not limited to information relating to trade secrets, personnel lists, financial information, research projects, services used, pricing, customers, customer lists and prospects, product sourcing, marketing, selling and servicing.  Executive agrees that he will not, during or after the termination of employment, directly or indirectly, use, communicate, disclose or disseminate to any person, firm or corporation any Confidential Information of the Company.

(b)  Executive agrees that he shall not, during the Employment Term and for a period of one year thereafter, directly or indirectly take any action which constitutes an interference with or a disruption of any of the Company’s business activities, including without limitation, solicitations of the Company’s customers or employees. For purposes of clarification, but not of limitation, Executive acknowledges and agrees that the provisions of this Section 9 shall prohibit him from directly or indirectly hiring, offering to hire, enticing, soliciting or in any manner persuading or attempting to persuade any officer, employee, agent, lessor, lessee, licensor, licensee or customer who has been previously contacted by a representative of the Company, including the Executive, to discontinue or alter his, her or its relationship with the Company.

(c)  Executive agrees that he shall not, during the Employment Term and for a period of one (1) year thereafter directly or indirectly, alone or as a partner, joint venturer, officer, director, employee, consultant, agent, independent contractor, member or stockholder of any company or business, engage in any business activity which is directly or indirectly competitive with any of the products or services being developed, marketed, distributed, planned, sold or otherwise provided by the Company or its subsidiaries at such time.  The ownership by the Executive of not more than one percent of the shares of stock of any corporation having a class of equity securities registered under the Securities Exchange Act of 1934, as amended, shall not be deemed, in and of itself, to violate the prohibitions of this paragraph.

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(d)  The Executive recognizes that the Company would suffer irreparable damage if the Executive were to violate the provisions of this Section 9.  In the event the Executive shall violate any of the terms or provisions of this Section 9, the Company shall have, in addition to any and all remedies of law, the right to seek and obtain, without bond or notice, ex parte or after a hearing, an injunction, specific performance or other equitable relief to prevent the violation of the Executive’s obligations hereunder and in connection therewith shall be entitled to collect all reasonable costs and expenses of suit, including, but not limited to, attorneys’ fees.  If it shall be finally determined by any court of competent jurisdiction in ruling on this Agreement that the scope or duration of any limitation contained in this paragraph 9 is too extensive to be legally enforceable, then the parties hereto agree that the scope or duration of such limitation shall be deemed to be the maximum scope or duration which shall be legally enforceable, and Executive’s hereby consents to the enforcement of such limitation as so modified.

10.  Miscellaneous.

(a)  Governing Law.  This Employment Agreement shall be governed by and construed in accordance with the laws of the State of New York without reference to principles of conflict of laws.

(b)  Entire Agreement and Amendment.  This Employment Agreement and the instruments contemplated herein, contain the entire understanding of the parties with respect to the employment of Executive by the Company from and after the date hereof and supersedes any prior agreements between the Company and Executive, including, but not limited to the Original Agreement.  There are no restrictions, agreements, promises, warranties, covenants or undertakings between the parties with respect to the subject matter herein other than those expressly set forth herein and therein.  This Employment Agreement may not be altered, modified, or amended except by written instrument signed by the parties hereto.

(c)  No Waiver. The failure of a party to insist upon strict adherence to any term of this Employment Agreement on any occasion shall not be considered a waiver of such party’s rights or deprive such party of the right thereafter to insist upon strict adherence to that term or any other term of this  Employment Agreement. Any such waiver must be in writing and signed by Executive or an authorized officer of the Company, as the case may be.

(d)  Assignment. This Employment Agreement shall not be assignable by Executive.

(e)  Successors; Binding Agreement; Third Party Beneficiaries.   This Employment Agreement shall inure to the benefit of and be binding upon the personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees legatees and permitted assignees of the parties hereto.

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(f)  Communications. For the purpose of this Employment Agreement, notices and all other communications provided for in this  Employment Agreement shall be in writing and shall be deemed to have been duly given (i) when delivered by hand, or (ii) two business days after being mailed by United States registered or certified mail, return receipt requested, postage prepaid, or sent via reputable overnight courier addressed to the respective addresses set forth on the initial page of this  Employment Agreement, provided that all notices to the Company shall be directed to the attention of the General Counsel of the Company, or to such other address as any party may have furnished to the other in writing in accordance herewith.  Notice of change of address shall be effective only upon receipt.

(g)  Withholding Taxes. The Company may withhold from any and all amounts payable under this Employment Agreement such Federal, state and local taxes as may be required to be withheld pursuant to any applicable law or regulation.

(h)  Survivorship. The respective rights and obligations of the parties hereunder shall survive any termination of Executive’s employment to the extent necessary to the agreed preservation of such rights and obligations.

(i)  Counterparts. This Employment Agreement may be signed in counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument.

(j)  Headings. The headings of the sections contained in this Employment Agreement are for convenience only and shall not be deemed to control or affect the meaning or construction of any provision of this Employment Agreement.

(k)  Executive’s Representation. Executive represents and warrants to the Company that there is no legal impediment to him performing his obligations under this Employment Agreement and neither entering into this Employment Agreement nor performing his contemplated service hereunder will violate any agreement to which he is a party or any other legal restriction. The Executive further represents and warrants that his performance of all the terms of this Agreement and as an employee of the Company does not and will not breach any agreement or obligation to keep in confidence proprietary information, knowledge or data acquired by him in confidence or in trust prior to his employment with the Company, and he will not disclose to the Company or induce the Company to use any confidential or proprietary information or material belonging to any previous employer or others.

(l)  BOTH PARTIES HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVE THE RIGHT TO A TRIAL BY JURY IN RESPECT OF ANY CLAIM BASED HEREON, ARISING OUT OF, UNDER OR IN CONNECTION WITH THIS EMPLOYMENT AGREEMENT OR ANY ANCILLARY DOCUMENT CONTEMPLATED TO BE EXECUTED IN CONNECTION HEREWITH OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY PARTY.  THIS WAIVER CONSTITUTES A MATERIAL INDUCEMENT FOR THE EMPLOYER TO HIRE EXECUTIVE.

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IN WITNESS WHEREOF, the parties hereto have duly executed this Employment Agreement as of the day and year first above written.

Zoo Publishing, Inc.
By:	/s/ Mark Seremet
	Title: Chief Executive Officer

By:	/s/ Steve Buchanan
	Steve Buchanan

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EX-10.2

AMENDMENT NUMBER TWO

TO THE JUNE 4, 2007 DAVID FREMED EMPLOYMENT AGREEMENT

This amendment number two (“Amendment 2 </font”), effective as of February 15, 2010 (the “Amendment 2 Effective Date”), amends the Employment Agreement, dated June 4, 2007, between Zoo Games, Inc. (f/k/a Green Screen Interactive Software, Inc.) (“Zoo”), as amended by Amended Number 1 thereto, dated as of August 8, 2008, and David Fremed, an individual having an address at 849 Longview Avenue, North Woodmere, New York 11581, in full force and effect as of the date hereof  (the “Employment Agreement”). This Amendment 2, when fully executed, shall constitute the further understanding between the parties with respect to the Employment Agreement, as follows:

1. Term of Employment. Section 1 of the Employment Agreement is hereby deleted in its entirety and replaced  with:

“Executive’s employment under this Employment Agreement shall commence on February 15, 2010 (the “ Commencement Date ”) and will expire on February 15, 2012 (the “ Employment Term”).”

2. Base Salary. Section 3 of the Employment Agreement is hereby deleted in its entirety  and replaced with:

“During the first 12 months of the Employment Term, Employer shall pay Executive a base salary at the annual rate of not less than $335,000. Base Salary shall be subject to review for increases in accordance with the usual practices of Employer; not withstanding the foregoing, in no event shall Base Salary be less than $335,000 during the Employment Term.  Base salary shall be payable in each case in accordance with the usual payroll practices of Employer. The base salary as determined as aforesaid from time to time shall constitute “Base Salary” for purposes of this Employment Agreement.”

3.  Other Compensation.

a. Section 4(a) of the Employment Agreement is hereby deleted in its entirety  and replaced with:

“Bonus.  For each year during the Employment Term, Executive shall be eligible to receive a bonus on such terms and conditions as the Board in the exercise of its sole and absolute discretion may determine.”

b. Section 4(b) of the Employment Agreement is hereby deleted in its entirety and replaced with: “Intentionally Omitted.”

Except as expressly or by necessary implication modified or amended by this Amendment 2, the terms of the Employment Agreement are hereby ratified and confirmed without limitation or exception. Capitalized terms used in this Amendment 2 and not otherwise defined shall have the same meaning ascribed to them as set forth in the Employment Agreement.

The parties hereto have executed this Amendment 2, which shall be effective as of the Amendment 2 Effective Date.

Zoo Games, Inc.
By:	/s/ Mark Seremet	/s/ David Fremed
Name:	Mark Seremet
Title:	Chief Executive Officer

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EX-10.3

ZOO ENTERTAINMENT, INC.

AMENDMENT NO. 2 TO 2007 EMPLOYEE, DIRECTOR AND

CONSULTANT STOCK PLAN

This Amendment No. 2 (the “Amendment”) to the Zoo Entertainment, Inc. (the “Company”) 2007 Employee, Director and Consultant Stock Plan, as amended (the “Plan”), is hereby effective as of February 11, 2010.  Capitalized terms used in this Amendment and not otherwise defined herein shall have the meanings ascribed to them in the Plan.

WHEREAS, the Company enacted the Plan in accordance with the purposes set forth therein; and

WHEREAS, Section 31 of the Plan reserves to the Company’s board of directors (the “Board”) the power in its discretion to amend the Plan at any time and from time to time subject to applicable law and the rights of the Participants on the date of such action; and

WHEREAS, the Board deems it appropriate to amend the Plan to revise the aggregate number of Shares which may be issued from time to time pursuant to the Plan from four million (4,000,000) shares to one million, two hundred eight thousand, four hundred and nine (1,208,409) shares; and

WHEREAS, the Board deems it appropriate to amend the Plan to revise the maximum number of Shares with respect to which Stock Rights may be granted to any Participant in any fiscal year from seven hundred fifty thousand (750,000) to three hundred thousand (300,000).

NOW, THEREFORE, the Plan is hereby amended as set forth below:

1.  Section 3(a) of the Plan is hereby amended by deleting “four million (4,000,000)” from the second line thereof and inserting “one million, two hundred eight thousand, four hundred and nine (1,208,409)” in its place.

2.  Section 4(c) of the Plan is hereby amended by deleting “750,000” from the third line thereof and inserting “300,000” in its place.

3.  The Plan shall remain in full force and effect except as specifically amended herein.