0001144204-11-016924.txt : 20110324 0001144204-11-016924.hdr.sgml : 20110324 20110324171623 ACCESSION NUMBER: 0001144204-11-016924 CONFORMED SUBMISSION TYPE: S-8 PUBLIC DOCUMENT COUNT: 4 FILED AS OF DATE: 20110324 DATE AS OF CHANGE: 20110324 EFFECTIVENESS DATE: 20110324 FILER: COMPANY DATA: COMPANY CONFORMED NAME: AAA PUBLIC ADJUSTING GROUP, INC. CENTRAL INDEX KEY: 0001424718 STANDARD INDUSTRIAL CLASSIFICATION: INSURANCE AGENTS BROKERS & SERVICES [6411] IRS NUMBER: 260325410 STATE OF INCORPORATION: FL FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: S-8 SEC ACT: 1933 Act SEC FILE NUMBER: 333-173049 FILM NUMBER: 11710200 BUSINESS ADDRESS: STREET 1: 6365 TAFT STREET SUITE 1003 CITY: HOLLYWOOD STATE: FL ZIP: 33024 BUSINESS PHONE: 954-894-0043 MAIL ADDRESS: STREET 1: 6365 TAFT STREET SUITE 1003 CITY: HOLLYWOOD STATE: FL ZIP: 33024 S-8 1 v215784_s8.htm S-8

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM S-8
 REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
 
AAA PUBLIC ADJUSTING GROUP, INC.
(Exact name of registrant as specified in its charter)
 
Florida
 
26-0325410
(State or other jurisdiction of incorporation or organization)
 
(I.R.S. Employer Identification No.)
 
1926 Hollywood Blvd. Suite 100 Hollywood, FL , 33020
 
 (Address of principal executive offices)
 
954-894-0043
 (Registrant’s telephone number, including area code)
 
EMPLOYEES AND CONSULTANTS STOCK COMPENSATION PLAN
(Full title of the plan)

Christopher Lombardi, CEO
AAA Public Adjusting Group, Inc.
1926 HOLLYWOOD BLVD Suite 101
HOLLYWOOD FL 33020
 (Name and Address of Agent for Service)

954-894-0043
 (Telephone number, including area code, of agent for service.)

Copy To:
Craig A. Huffman, Esq.
13046 Race Track Road Tampa, FL 33626
Telephone: 888-914-4144 Facsimile: (888) 783-4712
Email:  Craig@dslgpa.com
 
CALCULATION OF REGISTRATION FEE
 
Title of securities
to be registered
 
Amount to be
registered (2)
   
Proposed maximum
offering price
per share (1)
   
Proposed maximum
aggregate offering
price (1)
   
Amount of
registration fee
 
                         
Common Stock, par value $0.0001 (2)
    10,000,000     $ 0.03     $ 300,000     $ 34.83  
                                 
Total
    10,000,000     $ 0.03     $ 300,000     $ 34.83  

(1) Pursuant to Rule 457(c) and (h)(1) of the Securities Act of 1933, as amended, the proposed maximum offering price per share, the proposed maximum aggregate offering price and amount of registration fee were computed based on the average of the closing bid and asked prices for shares of the registrant’s common stock in the over the counter market on March 17, 2011.
(2)  Shares issuable in payment for services.

 
 

 

PART I

INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS

Item 1.  Plan Information.

(a)  General Plan Information

(1)  The title of the Plan is the “Employees and Consultants Stock Compensation Plan”.  This plan applies solely to common stock of AAA Public Adjusting Group, Inc. which is being issued to Employees and Consultants, including members of the Board of Directors, in payment for services to be rendered to the Company.

(2)  The nature of the plan is to enable AAA Public Adjusting Group, Inc. to obtain and pay for employment and consultant services with common stock instead of cash.

(3)  The plan is not subject to any provision of the Employee Retirement Income Security Act of 1974.

(4)  A plan participant may obtain additional information about the plan and its administrator from Christopher Lombardi  CEO of AAA Public Adjusting Group, Inc.  Mr. Lombardi’s address is AAA Public Adjusting Group, Inc. 1926 HOLLYWOOD BLVD #101 HOLLYWOOD FL 33020 and his telephone at that address is 954-894-0043

(b)  Securities to be Offered

AAA Public Adjusting Group, Inc.’s common stock is registered pursuant to Section 12 of the Securities Exchange Act of 1934.

(c)  Individuals  Who May Participate in the Plan

The following class of individuals may participate in the plan:

1.)  Employees
2.)  Consultants, including board members

(d)  Purchase of Securities Pursuant to the Plan and Payment for Securities Offered

(1) AAA Public Adjusting Group, Inc. is anticipating the payment of compensation of employees and consultants by issuance of 10,000,000 shares of its common stock in exchange for services.

 (2)  Services rendered by the employee or consultant, shall be deemed payment for the shares.

 (3)  Not applicable.

(4)  AAA Public Adjusting Group, Inc. does not make any contribution to the plan on behalf of the employee.

(5)  AAA Public Adjusting Group, Inc. will, upon written or oral request, provide a written report to the employee of the number of shares purchased on the fee payment date.

(6)  The common stock will be issued by AAA Public Adjusting Group, Inc., who will not pay any fees, commissions or other charges, other than ordinary transfer agent’s fees.

(e)  Resale Restrictions

There are no restrictions on resale of the common stock purchased under the plan.

 
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(f)  Tax Effects of Plan Participation

AAA Public Adjusting Group, Inc. is required to withhold any federal and state income taxes and employee participant’s social security and medicare contributions from compensation. Normally, there is no income tax, social security or medicare withholding requirement for independent consultants, including board members. The Company is to provide the employee-participant with  the number of shares an employee-participant is eligible to purchase on any compensation payment date. The employee shall be solely responsible for payment of applicable federal and state taxes computed on income and social security and medicare contributions. The Company is to provide the employee-participant with a computation of federal and state taxes, and social security and medicare contributions on all shares eligible to purchase by the employee-participant on any compensation date.  It is the employee-participant’s responsibility to reimburse the Company for any federal and state tax withholding no later than the due date for the payment of withholding taxes by the Company. Any gain or loss on the sale of the common stock, as compared to the tax basis, will be short or long term capital gain, as appropriate. The employee’s tax basis for the common stock will be the greater of the market value of the shares on the date of issue or the value pursuant to the Employment Agreement.

(g)  Investment of Funds

Not applicable.

(h)  Withdrawal from Plan; Assignment of Interest

Not applicable.

(i)  Forfeitures and Penalties

Not applicable.

(j)  Charges and Deductions and Liens Therefore

Not applicable

Item 2. Registrant Information and Employee Plan Annual Information.

A participant in the plan, upon written or oral request, may obtain without charge once annually the documents incorporated by reference in Item 3 of Part II of this registration statement, and those documents are incorporated by reference in a Section 10(a) prospectus.  Participants in the plan, upon written or oral request, may obtain without charge once annually the documents identified in rule 428(b) under the Securities Act of 1933, as amended.  Any such request should be made to Christopher Lombardi, CEO, AAA Public Adjusting Group, Inc., 1926 Hollywood Blvd, #101, Hollywood, Florida 33020, telephone number 954-894-0043.
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

Item 3.  Incorporation of Documents by Reference.

The documents listed in (a) through (c) below are incorporated by reference in this registration statement; and, all documents subsequently filed by AAA Public Adjusting Group, Inc. pursuant to Sections 13(a), 13(c) and 14 of the Securities Exchange Act of 1934, as amended, prior to filing a post-effective which indicates that all securities offered by this registration statement have been sold or which deregisters all securities remaining unsold, shall be deemed to be incorporated by reference in this registration statement and to be a part hereof from the date of filing such document.

 
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(a)  AAA Public Adjusting Group, Inc.’s latest annual report for the fiscal year ended December 31, 2009 filed pursuant to Section 13(a) of the Securities Exchange Act of 1934 (the "Exchange Act").

(b)  All other reports filed by AAA Public Adjusting Group, Inc. pursuant to Section 13(a) of the Exchange Act since the end of the Company's fiscal year ended December 31, 2009.

(c)  The description of common stock contained in AAA Public Adjusting Group, Inc.’s registration statement on Form 10, as amended, Commission file no. 333-153679

Item 4.  Description of Securities.

Not applicable.

Item 5.  Interests of Named Experts and Counsel.

AAA Public Adjusting Group, Inc. will rely on the opinion of Craig A. Huffman, Esq. of Tampa, Florida for an opinion regarding the legality of the common stock issued pursuant to the plan.  Mr. Huffman is not a stockholder of AAA Public Adjusting Group, Inc. common stock.

The financial statements of AAA Public Adjusting Group, Inc. contained in reports incorporated by reference herein have been included in such reports in reliance on the report of Baum and Company of Miami, Florida, an independent registered certified public accounting firm, given on the authority of such firm as experts in auditing and accounting.

Item 6.  Indemnification of Directors and Officers.

Florida corporate law and AAA Public Adjusting Group, Inc.’s bylaws, in general, authorize AAA Public Adjusting Group, Inc. to indemnify its officers, directors and controlling persons, and any person serving at its request as an officer or director, against damages and loss if he or she acted in good faith and in a manner which he or she believed to be in, or not opposed to, the best interest of AAA Public Adjusting Group, Inc.  In the event, however, that such person is adjudged liable to the corporation, he or she will not be entitled to indemnification.  Furthermore, unless limited by its articles of incorporation, a corporation shall indemnify a director or officer who prevails in the defense of any proceeding to which he or she was a party because he or she is or was a director of AAA Public Adjusting Group, Inc.  Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of AAA Public Adjusting Group, Inc. pursuant to the foregoing provisions, or otherwise, AAA Public Adjusting Group, Inc. 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 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, AAA Public Adjusting Group, Inc. 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 of whether such indemnification by it is against policy as expressed in the Securities Act of 1933 and will be governed by the final adjudication of such issue.

Item 7.  Exemption from Registration Claimed.

Not Applicable.

 
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Item 8. Exhibits.

Exhibit No.
Description
   
5
Opinion of Craig A. Huffman, Esq. re: legality
10.E
Employees and Consultants Stock Compensation Plan, dated March 22, 2011
23.1
Consent of Craig A. Huffman, Esq., included in Exhibit 5
23.2
Consent of Baum & Company, Independent Accountants

Item 9.  Undertakings

The undersigned registrant undertakes to:

(1) File, during any period in which it offers or sells securities, a post-effective amendment to this registration statement to:

(i) Include any prospectus required by section 10(a)(3) of the Securities Act;

(ii) Reflect in the prospectus any facts or events which, individually or together, represent a fundamental change in the information in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) (§230.424(b) of the Securities Act of 1933) if, in the aggregate, the changes in volume and price represent no more than a 20% change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and

(iii) Include any additional or changed material information on the plan of distribution.

(2) For determining liability under the Securities Act, the undersigned registrant shall treat each post-effective amendment as a new registration statement of the securities offered, and the offering of the securities at that time to be the initial bona fide offering.
 
(3) File a post-effective amendment to remove from registration any of the securities that remain unsold at the end of the offering.

(4) For determining liability of the undersigned registrant under the Securities Act to any purchaser in the initial distribution of the securities, the undersigned registrant undertakes that in a primary offering of securities of the registrant pursuant to this registration statement, regardless of the underwriting method used to sell the securities to the purchaser, if the securities are offered or sold to such purchaser by means of any of the following communications, the undersigned registrant will be a seller to the purchaser and will be considered to offer or sell such securities to such purchaser:

(i) Any preliminary prospectus or prospectus of the undersigned registrant relating to the offering required to be filed pursuant to Rule 424 (§230.424 of the Securities Act of 1933);

(ii) Any free writing prospectus relating to the offering prepared by or on behalf of the undersigned registrant or used or referred to by the undersigned registrant;

(iii) The portion of any other free writing prospectus relating to the offering containing material information about the undersigned registrant or its securities provided by or on behalf of the undersigned registrant; and

(iv) Any other communication that is an offer in the offering made by the undersigned registrant to the purchaser.

 
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(d) The undersigned registrant will provide to any underwriter at the closing specified in the underwriting agreement certificates in such denominations and registered in such names as required by the underwriter to permit prompt delivery to each purchaser.

(e) Insofar as indemnification for liabilities arising under the Securities Act of 1933 (the “Act”) may be permitted to directors, officers and controlling persons of the small business issuer pursuant to the foregoing provisions, or otherwise, the small business issuer 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 undersigned registrant of expenses incurred or paid by a director, officer or controlling person of the small business issuer 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 undersigned 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 Securities Act of 1933 and will be governed by the final adjudication of such issue.

(g) That, for the purpose of determining liability under the Securities Act to any purchaser:

(1) If the undersigned registrant relies on Rule 430B (§230.430B of the Securities Act of 1933):

(i) Each prospectus filed by the undersigned registrant pursuant to Rule 424(b)(3) (§230.424(b)(3) of the Securities Act of 1933) shall be deemed to be part of the registration statement as of the date the filed prospectus was deemed part of and included in the registration statement; and

(ii) Each prospectus required to be filed pursuant to Rule 424(b)(2), (b)(5), or (b)(7) (§230.424(b)(2), (b)(5), or (b)(7) of the Securities Act of 1933) as part of a registration statement in reliance on Rule 430B relating to an offering made pursuant to Rule 415(a)(1)(i), (vii), or (x) (§230.415(a)(1)(i), (vii), or (x) of this chapter) for the purpose of providing the information required by section 10(a) of the Securities Act of 1933 shall be deemed to be part of and included in the registration statement as of the earlier of the date such form of prospectus is first used after effectiveness or the date of the first contract of sale of securities in the offering described in the prospectus. As provided in Rule 430B, for liability purposes of the undersigned registrant and any person that is at that date an underwriter, such date shall be deemed to be a new effective date of the registration statement relating to the securities in the registration statement to which that prospectus relates, and the offering of such securities at that time shall be deemed to be the initial  bona fide  offering thereof.  Provided, however,  that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such effective date, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such effective date; or

(2) If the undersigned registrant is subject to Rule 430C (§230.430C of the Securities Act of 1933), each prospectus filed pursuant to Rule 424(b)(§230.424(b) of this chapter) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A (§230.430A of this chapter), shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however,  that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.

 
- 6 -

 

SIGNATURES

Pursuant to the requirements of the Securities Act of 1933, AAA Public Adjusting Group, Inc. certifies that it has reasonable grounds to believe that it meets all of the requirements for filing 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 Hollywood, Florida, on March 18, 2011.

AAA Public Adjusting Group, Inc.

By: /s/ Christopher Lombardi
Christopher Lombardi, Chief Executive Officer

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:

Signature and Name:
Capacity in which signed:
Date:
     
/s/ Christopher Lombardi
Chief Executive Officer
March 18, 2011
Christopher Lombardi
   
     
/s/ Frederick Antonelli
Chairman and Director and Principal
March 18, 2011
Frederick Antonelli
Financial Officer
 

 
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EX-5 2 v215784_ex5.htm EX-5

Exhibit 5
Opinion Re:  Legality

Craig A. Huffman, Esquire
Securus Law Group, P.A.
14036 Racetrack Road, Number 243
Tampa, Florida 33626 
 
March 21, 2011
Board of Directors
AAA Public Adjusting Group, Inc.
1926 Hollywood Blvd. Suite 101
Hollywood, Florida 33020

Re:  Registration Statement on Form S-8

Gentlemen:

I am acting as special counsel for AAA Public Adjusting Group, Inc., a Florida corporation (the "Company"), in connection with the registration under the Securities Act of 1933, as amended (the "Act"), of the offer and sale of up to 10,000,000 shares (the "Shares") of the Company's common stock, par value $0.0001 per share (the "Common Stock") which the Company intends to offer and sell or grant to participants (as defined) in the Company’s “Employees and Consultants Compensation Plan” (the “Plan”).  A Registration Statement on Form S-8 covering the Shares (the "Registration Statement") is being filed under the Act with the Securities and Exchange Commission.

In rendering the opinion expressed herein, I have reviewed such matters of law as I have deemed necessary and have examined copies of such agreements, instruments, documents and records as I have deemed relevant.  In rendering the opinions expressed herein, I have assumed the genuineness and authenticity of all documents examined by us and of all signatures thereon, the legal capacity of all natural persons executing such documents, the conformity to original documents of all documents submitted to us as certified or conformed copies or photocopies and the completeness and accuracy of the certificates of public officials which I have examined.  I have made no independent factual investigation with regard to any such matters.

Based upon the foregoing and subject to the qualifications stated herein, it is my opinion that the Shares to be issued, when issued and delivered in accordance with the Plan, will be validly issued, fully paid and non-assessable.  The opinion expressed herein is limited to matters involving the federal laws of the United States and to the corporate laws of the State of Florida, and I express no opinion as to the effect on the matters covered by this opinion of the laws of any other jurisdiction.

I hereby consent to the use of this opinion as an exhibit to the Registration Statement and the reference to me therein under the caption "Interests of Named Experts and Counsel."  The opinion expressed herein is rendered solely for your benefit in connection with the transaction described herein.  Except as otherwise provided herein, this opinion may not be used or relied upon by any person, nor may this letter or any copies thereof be furnished to a third party, filed with a governmental agency, quoted, cited or otherwise referred to without my prior written consent.

Very truly yours

/s/ Craig A. Huffman

Craig A. Huffman

 
 

 
EX-10.E 3 v215784_ex10e.htm EX-10.E

Exhibit 10.E

AAA PUBLIC ADJUSTING GROUP, INC.
2011 EMPLOYEES AND CONSULTANTS STOCK COMPENSATION PLAN
MARCH 21, 2011

1. Purposes of the Plan. The purposes of this Stock Compensation Plan are:

• to attract and retain the best available personnel for positions of substantial responsibility,
• to provide additional incentive to Employees and Consultants, including board members, and providing services to the Company and/or any of its subsidiaries.
• to promote the success of the Company’s business.

2. Definitions. As used herein, the following definitions shall apply:

(a) “Administrator” means the Board or any of its Committees as shall be administering the Plan, in accordance with Section 4 of the Plan.

(b) “Applicable Laws” means the requirements relating to the administration of the stock compensation plan under U.S. state corporate laws, U.S. Federal and state securities laws, the Code, any stock exchange or quotation system on which the Common Stock is listed or quoted and the  applicable laws of any foreign country or jurisdiction where shares are, or will be, granted under the Plan.

(c) “Board” means the Board of Directors of the Company.

(d) “Code” means the Internal Revenue Code of 1986, as amended.

(e) “Committee” means a committee of Directors appointed by the Board in accordance with Section 4 of the Plan.

(f) “Common Stock” means the Common Stock of the Company.

(g) “Company” means AAA Public Adjusting Group Inc.

(h) “Consultant” means any person, including an advisor, engaged by the Company or a Parent or Subsidiaries to render services to such entity.

(i) “Director” means a member of the Board.

(j) “Disability” means total and permanent disability as defined in Section 22(e)(3) of the Code.

(k) “Employee” means any individual, including Officers, employed by the Company or any Parent or Subsidiaries of the Company. For purposes of the Plan, the employment relationship shall be treated as continuing intact while the individual (i) is on any bona fide leave of absence approved by the Company or (ii) transfers between locations of the Company or between the Company, its Parent, any Subsidiaries, or any successor. Neither service as a Director nor payment of a director’s fee by the Company shall be sufficient to constitute “employment” by the Company.
 
 
Exhibit 10.E — Page 1

 

(l) “Exchange Act” means the Securities Exchange Act of 1934, as amended.

(m) “Fair Market Value” means, as of any date, the value of Common Stock determined as follows:

(i) If the Common Stock is listed on any established stock exchange or a national market system, including without limitation the Nasdaq National Market or The Nasdaq SmallCap Market of The Nasdaq Stock Market, its Fair Market Value shall be the closing sales price for such  stock (or the closing bid, if no sales were reported) as quoted on such exchange or system for the last market trading day on the date of such determination, as reported in The Wall Street Journal or such other source as the Administrator deems reliable;

(ii) If the Common Stock is regularly quoted by a recognized securities dealer but selling prices are not reported, the Fair Market Value of a Share of Common Stock shall be the mean between the high bid and low asked prices for the Common Stock on the last market trading day prior to the day of determination, as reported in The Wall Street Journal or such other source as the Administrator deems reliable;

(iii) In the absence of an established market for the Common Stock, the Fair Market Value shall be determined in good faith by the Administrator.

(n) “Notice of Grant” means a written or electronic notice evidencing certain terms and conditions of an individual grant. The Notice of Grant is part of the Common Stock Agreement.

(o) “Officer” means a person who is an officer of the Company within the meaning of Nasdaq guidelines, including all employees with the corporate rank of vice-president or higher, and employees with lesser rank but comparable authority.

(p) “Common Stock Agreement” means an agreement between the Company and a Grantee evidencing the terms and conditions of an individual Common Stock grant. The Stock Grant agreement is subject to the terms and conditions of the Plan.

(q) “Grantee” means the holder of an outstanding Common Stock granted under the Plan.

(r) “Parent” means a “parent corporation,” whether now or hereafter existing, as defined in Section 424(e) of the Code.

(s) “Plan” means this 2011 Employees and Consultants Stock Compensation Plan.

(t) “Service Provider” means an Employee, Consultant or Director.

(u) “Share” means a share of the Common Stock, as adjusted in accordance with Section 12 of the Plan.

(v) “Subsidiaries” means a “subsidiary corporation,” whether now or hereafter existing, as defined in Section 424(f) of the Code.

 
Exhibit 10.E — Page 2

 

3. Stock Subject to the Plan. Subject to the provisions of Section 12 of the Plan, the maximum aggregate number of Shares, which may be available for grants under the Plan, is ten million (10,000,000) Shares. The Shares may be authorized, but unissued, or reacquired Common Stock.

4. Administration of the Plan.

(a) Administration. The Plan shall be administered by (i) the Board or (ii) a Committee, which Committee shall be constituted to satisfy Applicable Laws.

(b) Powers of the Administrator. Subject to the provisions of the Plan, and in the case of a Committee, subject to the specific duties delegated by the Board to such Committee, the Administrator shall have the authority, in its discretion:

(i) to determine the Fair Market Value of the Common Stock;
(ii) to select the Service Providers to whom Common Stock may be granted hereunder;
(iii) to determine whether and to what extent Common Stock are granted hereunder;
(iv) to approve forms of agreement for use under the Plan;
(v) to determine the terms and conditions, not inconsistent with the terms of the Plan, of any award granted hereunder. Such terms and conditions include, but are not limited to, the time or times when Common Stock are granted (which may be based on performance criteria), any vesting acceleration or waiver of forfeiture restrictions, and any restriction or limitation regarding any Common Stock relating thereto, based in each case on such factors as the Administrator, in its sole discretion, shall determine;
(vii) to construe and interpret the terms of the Plan and awards granted pursuant to the Plan;
(viii) to prescribe, amend and rescind rules and regulations relating to the Plan, including rules and regulations relating to sub-plans established for the purpose of qualifying for preferred tax treatment under foreign tax laws;
(ix) to modify or amend each grant (subject to Section 14(b) of the Plan);
(x) to authorize any person to execute on behalf of the Company any instrument required to effect the Common Stock grant previously granted by the Administrator;
(xi) to determine the terms and restrictions applicable to the grant;
(xii) to allow Grantee to satisfy withholding tax obligations by electing to have the Company withhold from the Shares to be issued having a Fair Market Value equal to the amount required to be withheld (but not more than the amount required to be withheld). The Fair Market Value of the Shares to be withheld shall be determined on the date that the amount of tax to be withheld is to be determined. All elections by an Grantee to have Shares withheld for this purpose shall be made in such form and under such conditions as the Administrator may deem necessary or advisable; and
(xiii) to make all other determinations deemed necessary or advisable for administering the Plan.

(c) Effect of Administrator’s Decision. The Administrator’s decisions, determinations and interpretations shall be final and binding on all Grantees and any other holders of Options.
 
 
Exhibit 10.E — Page 3

 
 
AAA Public Adjusting Group, Inc. is required to withhold any federal and state income taxes and employee participant’s social security and medicare contributions from compensation. Normally, there is no income tax, social security or medicare withholding requirement for independent consultants, including board members. The Company is to provide the employee-participant with  the number of shares an employee-participant is eligible to purchase on any compensation payment date. The employee shall be solely responsible for payment of applicable federal and state taxes computed on income and social security and medicare contributions. The Company is to provide the employee-participant with a computation of federal and state taxes, and social security and medicare contributions on all shares eligible to purchase by the employee-participant on any compensation date.  It is the employee-participant’s responsibility to reimburse the Company for any federal and state tax withholding no later than the due date for the payment of withholding taxes by the Company. Any gain or loss on the sale of the common stock, as compared to the tax basis, will be short or long term capital gain, as appropriate. The employee’s tax basis for the common stock will be the greater of the market value of the shares on the date of issue or the value pursuant to the Employment Agreement
5. Eligibility. Stock Grants may be granted to Service Providers, Officers and employees.
  
6. Limitation. Neither the Plan nor any Option shall confer upon a Grantee any right with respect to continuing the Grantee’s relationship as a Service Provider with the Company, nor shall they interfere in any way with the Grantee’s right or the Company’s right to terminate such relationship at any time, with or without cause.

7. Term of Plan. The Plan shall become effective upon its adoption by the Board. It shall continue in effect for ten (10) years, unless sooner terminated under Section 14 of the Plan.

8. Term of Option. The term of each Option shall be stated in the Option Agreement.

9. Option Exercise Price and Consideration.

(a) Exercise Price. The per share exercise price for the Shares to be issued pursuant to exercise of an Option shall be determined by the Administrator.

(b) Waiting Period and Exercise Dates. At the time an Option is granted, the Administrator shall fix the period within which the Option may be exercised and shall determine any conditions which must be satisfied before the Option may be exercised.
 
 
Exhibit 10.E — Page 4

 
 
(c) Form of Consideration. The Administrator shall determine the acceptable form of consideration for exercising an Option, including the method of payment. Such consideration may consist entirely of:

(i) cash;
(ii) check;
(iii) other Shares which (A) in the case of Shares acquired upon exercise of an option, have been owned by the Grantee for more than six months on the date of surrender, and (B) have a Fair Market Value on the date of surrender equal to the aggregate exercise price of the Shares as to which said Option shall be exercised;
(iv) consideration received by the Company under a cashless exercise program implemented by the Company in connection with the Plan;
(v) such other consideration and method of payment for the issuance of Shares to the extent permitted by Applicable Laws; or
(vi) any combination of the foregoing methods of payment.

10. Exercise of Option.

(a) Procedure for Exercise; Rights as a Shareholder. Any Option granted hereunder shall be exercisable according to the terms of the Plan and at such times and under such conditions as determined by the Administrator and set forth in the Option Agreement. An Option may not be exercised for a fraction of a Share. An Option shall be deemed exercised when the Company receives:
(i) written or electronic notice of exercise (in accordance with the Option Agreement) from the person entitled to exercise the Option, and
(ii) full payment for the Shares with respect to which the Option is exercised. Full payment may consist of any consideration and method of payment authorized by the Administrator and permitted by the Option Agreement and the Plan. Shares issued upon exercise of an Option shall be issued in the name of the Grantee or, if requested by the Grantee, in the name of the Grantee and his or her spouse. Until the Shares are issued (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company), no right to vote or receive dividends or any other rights as a shareholder shall exist with respect to the Optioned Stock, notwithstanding the exercise of the Option. The Company shall issue (or cause to be issued) such Shares promptly after the Option is exercised. No adjustment will be made for a dividend or other right for which the record date is prior to the date the Shares are issued, except as provided in Section 12 of the Plan. Exercising an Option in any manner shall decrease the number of Shares thereafter available, both for purposes of the Plan and for sale under the Option, by the number of Shares as to which the Option is exercised.
   
 
Exhibit 10.E — Page 5

 
 
(b) Termination of Relationship as a Service Provider. If an Grantee ceases to be a Service Provider, other than upon the Grantee’s death or Disability, the Grantee may exercise his or her Option, but only within such period of time as is specified in the Option Agreement, and only to the extent that the Option is vested on the date of termination (but in no event later than the expiration of the term of such Option as set forth in the Option Agreement). In the absence of a specified time in the Option Agreement, the Option shall remain exercisable for three (3) months following the Grantee’s termination. If, on the date of termination, the Grantee is not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option       shall revert to the Plan. If, after termination, the Grantee does not exercise his or her Option within the time specified by the Administrator, the Option shall terminate, and the Shares covered by such Option shall revert to the Plan.

(c) Disability of Grantee. If an Grantee ceases to be a Service Provider as a result of the Grantee’s Disability, the Grantee may exercise his or her Option within such period of time as is specified in the Option Agreement, to the extent the Option is vested on the date of termination (but in no event later than the expiration of the term of such Option as set forth in the Option Agreement). In the absence of a specified time in the Option Agreement, the Option shall remain exercisable for twelve (12) months following the Grantee’s termination. If, on the date of termination, the Grantee is not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option shall revert to the Plan. If, after termination, the Grantee does not exercise his or her Option within the time specified herein, the Option shall terminate, and the Shares covered by such Option shall revert to the Plan.

(d) Death of Grantee. If an Grantee dies while a Service Provider, the Option may be exercised within such period of time as is specified in the Option Agreement (but in no event later than the expiration of the term of such Option as set forth in the Notice of Grant), by the Grantee’s estate or by a person who acquires the right to exercise the Option by bequest or inheritance, but only to the extent that the Option is vested on the date of death. In the absence of a specified time in the Option Agreement, the Option shall remain exercisable for twelve (12) months following the Grantee’s termination. If, at the time of death, the Grantee is not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option shall immediately revert to the Plan. The Option may be exercised by the executor or administrator of the Grantee’s estate or, if none, by the person(s) entitled to exercise the Option under the Grantee’s will or the laws of descent or distribution. If the Option is not so exercised within the time specified herein, the Option shall terminate, and the Shares covered by such Option shall revert to the Plan.

(e) Buyout Provisions. The Administrator may at any time offer to buy out for a payment in cash or Shares, an Option previously granted based on such terms and conditions as the Administrator shall establish and communicate to the Grantee at the time that such offer is made.

11. Assignability. A Common Stock Grant may not be assigned without the approval of the administrator.

12. Adjustments Upon Changes in Capitalization, Dissolution, Merger or Asset Sale.
 
 
Exhibit 10.E — Page 6

 
 
(a) Changes in Capitalization. Subject to any required action by the shareholders of the Company, the number of shares of Common Stock which have been authorized for issuance under the Plan but as to which have yet been granted, shall be proportionately adjusted for any increase or decrease in the number of issued shares of Common Stock resulting from a stock split, reverse stock split, stock dividend, combination or reclassification of the Common Stock, or any other increase or decrease in the number of issued shares of Common Stock effected without receipt of consideration by the Company; provided, however, that conversion of any convertible securities of the Company shall not be deemed to have been “effected without receipt of consideration.” Such adjustment shall be made by the Board, whose determination in that respect shall be final, binding and conclusive. Except as expressly provided herein, no issuance by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number or price of shares of Common Stock subject to the Plan.

(b) Dissolution or Liquidation. In the event of the proposed dissolution or liquidation of the Company, the Administrator shall notify each Grantee as soon as practicable prior to the effective date of such proposed transaction. The Administrator in its discretion may provide for       an Grantee to have the right to exercise his or her Option until ten (10) days prior to such transaction as to all of the Optioned Stock covered thereby, including Shares as to which the Option would not otherwise be exercisable. In addition, the Administrator may provide that any Company       repurchase option applicable to any Shares purchased upon exercise of an Option shall lapse as to all such Shares, provided the proposed dissolution or liquidation takes place at the time and in the manner contemplated. To the extent it has not been previously exercised, an Option will terminate immediately prior to the consummation of such proposed action.

(c) Merger or Asset Sale. In the event of a merger of the Company with or into another corporation, or the sale of substantially all of the assets of the Company, each outstanding Option shall be assumed or an equivalent option or right substituted by the successor corporation or a Parent or Subsidiaries of the successor corporation. In the event that the successor corporation refuses to assume or substitute for the Option, the Grantee shall fully vest in and have the right to exercise the Option as to all of the Optioned Stock, including Shares as to which it would not otherwise be vested or exercisable. If an Option becomes fully vested and exercisable in lieu of assumption or substitution in the event of a merger or sale of assets, the Administrator shall notify the Grantee in writing or electronically that the Option shall be fully vested and exercisable for a period of fifteen (15) days from the date of such notice, and the Option shall terminate upon the expiration of such period. For the purposes of this paragraph, the Option shall be considered assumed if, following the merger or sale of assets, the option or right confers the right to purchase or receive, for each Share of Optioned Stock, immediately prior to the merger or sale of assets, the consideration (whether stock, cash, or other securities or property) received in the merger or sale of assets by holders of Common Stock for each Share held on the effective date of the transaction (and if holders were offered a       choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding Shares); provided, however, that if such consideration received in the merger or sale of assets is not solely common stock of the successor corporation or its Parent, the Administrator       may, with the consent of the successor corporation, provide for the consideration to be received upon the exercise of the Option, for each Share of Optioned Stock to be solely common stock of the successor corporation or its Parent equal in fair market value to the per share consideration received by holders of Common Stock in the merger or sale of assets.
 
 
Exhibit 10.E — Page 7

 
 
13. Date of Grant. The date of grant of an Option shall be, for all purposes, the date on which the Administrator makes the determination granting such Option, or such other later date as is determined by the Administrator. Notice of the determination shall be provided to each Grantee within a reasonable time after the date of such grant.

14. Amendment and Termination of the Plan.

 (a) Amendment and Termination. The Board may at any time amend, alter, suspend or terminate the Plan.

 (b) Effect of Amendment or Termination. No amendment, alteration, suspension or termination of the Plan shall impair the rights of any Grantee, unless mutually agreed otherwise between the Grantee and the Administrator, which agreement must be in writing and signed by the       Grantee and the Company. Termination of the Plan shall not affect the Administrator’s ability to exercise the powers granted to it hereunder with respect to grants under the Plan prior to the date of such termination.

15. Conditions Upon Issuance of Shares.  Legal Compliance. Shares shall not be issued pursuant to the exercise of an Option unless the exercise of such Option and the   issuance and delivery of such Shares shall comply with Applicable Laws and shall be further subject to the approval of counsel for the Company with respect to such compliance.

16. Inability to Obtain Authority. The inability of the Company to obtain authority from any regulatory body having jurisdiction, which authority is deemed by the Company’s counsel to be necessary to the lawful issuance and sale of any Shares hereunder, shall relieve the Company of      any liability in respect of the failure to issue or sell such Shares as to which such requisite authority shall not have been obtained.

17. Reservation of Shares. The Company, during the term of this Plan, will at all times reserve and keep available such number of Shares as shall be sufficient to satisfy the requirements of the Plan.
 
18.  Notice of Grant of Stock Options and Option Agreement

 
Company:
AAA Public Adjusting Group Inc.
   
Grantee:
Name:
 
 
Address:
 
 
Effective [DATE], you have been granted a(n) Non-Qualified Stock Option to buy [SHARES] shares of AAA Public Adjusting Group Inc. (the Company) stock at $[PRICE] per share.

The total option price of the shares granted is $[PRICE]. Shares in each period will become fully vested on the date shown.

 
 
Exhibit 10.E — Page 8

 
 
Shares Vest Type Full Vest  [months] Term of Expiration [months]

By your signature and the Company’s signature below, you and the Company agree that these Common Stock shares were granted under and governed by the terms and conditions of the Company’s 2011 Employees and Consultants Stock Compensation Plan and the Common Stock Agreement, all of which are attached and made a part of this document.
  
AAA Public Adjusting Group Inc.

   
Date

[GRANTEE]

   
Date

 
Exhibit 10.E — Page 9

 
 
AAA PUBLIC ADJUSTING GROUP INC.
2011 EMPLOYEES AND CONSULTANTS STOCK COMPENSATION PLAN
  
Unless otherwise defined herein, the terms defined in the Plan shall have the same defined meanings in this Option Agreement.

I. NOTICE OF STOCK OPTION GRANT
You have been granted an option to purchase Common Stock of the Company, subject to the terms and conditions of the Plan and this Option Agreement, as indicated on this “Notice of Grant of Stock Options and Option Agreement.”

Vesting Schedule: Subject to the Grantee continuing to be a Service Provider on such dates, this Option shall vest and become exercisable in accordance with the provisions indicated on the attached “Notice of Grant of Stock Options and Option Agreement,” subject to Grantee remaining a Service Provider on such vesting dates.

Termination Period: This Option may be exercised for three months after Grantee ceases to be a Service Provider. Upon the death or Disability of the Grantee, this Option may be exercised for twelve months following Grantee’s termination as a Service Provider. In no event shall this Option be exercised later than the Term/Expiration Date as provided on the attached “Notice of Grant of Stock Options and Option Agreement.”

II. AGREEMENT

1. Grant of Option. The Plan Administrator of the Company hereby grants to the Grantee named in the Notice of Grant attached as Part I of this Agreement (the “Grantee”) an option (the “Option”) to purchase the number of Shares, as set forth in the Notice of Grant, at the exercise price per share set forth in the Notice of Grant (the “Exercise Price”), for the exercise period,   subject to the terms and conditions of the Plan, which is incorporated herein by reference. Subject to Section 14(b) of the Plan, in the event of a conflict between the terms and conditions of the Plan and the terms and conditions of this Option Agreement, the terms and conditions of the Plan shall prevail.

2. Exercise of Option:

(a) Right to Exercise. This Option is exercisable during its term in accordance with the Vesting Schedule set in the Notice of Grant and the applicable provisions of the Plan and this Option Agreement.

(b) Method of Exercise. This Option is exercisable by delivery of an exercise notice, in the form attached as Exhibit A (the “Exercise Notice”, which shall state the election to exercise the Option, the number of Shares in respect of which the Option is being exercised (the “Exercised Shares”), and such other representations and agreements as may be required by the Company pursuant to the provisions of the Plan. The Exercise Notice shall be completed by the Grantee and delivered to the Stock Option Administrator. The Exercise Notice shall be accompanied by payment of the aggregate Exercise Price as to all Exercised Shares. This Option shall be deemed to be exercised upon receipt by the Company of such fully executed Exercise Notice accompanied by such aggregate Exercise Price.
 
 
Exhibit 10.E — Page 10

 
 
No Shares shall be issued pursuant to the exercise of this Option unless such issuance and exercise complies with Applicable Laws. Assuming such compliance, for income tax purposes the Exercised Shares shall be considered transferred to the Grantee on the date the Option is exercised with respect to such Exercised Shares.

3. Method of Payment. Payment of the aggregate Exercise Price shall be by any of the following, or a combination thereof, at the election of the Grantee:

(a) cash;
(b) check;
(c) consideration received by the Company under a cashless exercise program implemented by the Company in connection with the Plan; or
(d) surrender of other Shares which (i) in the case of Shares acquired upon exercise of an option, have been owned by the Grantee for more than six (6) months of the date of surrender, and (ii) have a Fair Market Value on the date of surrender equal to the aggregate Exercise Price of the Exercised Shares.

4. Transferability of Option. This Option may be transferred only by consent of the Grantor in writing, and in any manner otherwise than by will or by the laws of descent or distribution and may be exercised during the lifetime of Grantee only by the Grantee. The terms of the Plan and this Option Agreement shall be binding upon the executors, administrators, heirs, successors and assigns of the Grantee.

5. Term of Option. This Option may be exercised only within the term set out in the Notice of Grant, and may be exercised during such term only in accordance with the Plan and the terms of this Option Agreement.

6. Tax Consequences. Some of the federal tax consequences relating to this Option, as of the date of this Option, are set forth below. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. THE GRANTEE SHOULD CONSULT A TAX ADVISOR BEFORE EXERCISING THIS OPTION OR DISPOSING OF THE SHARES.

(a) Exercising the Option. The Grantee may incur regular federal income tax liability upon exercise of an NSO. The Grantee will be treated as having received compensation income (taxable at ordinary income tax rates) equal to the excess, if any, of the Fair Market Value of the Exercised Shares on the date of exercise over their aggregate Exercise Price. If the Grantee is an Employee of a former Employee, the Company will be required to withhold from his or her compensation or collect from Grantee and pay to the applicable taxing authorities an amount in cash equal to a percentage of this compensation income at the time of exercise, and may refuse to honor the exercise and refuse to deliver Shares if such withholding amounts are not delivered at the time of exercise.

(b) Disposition of Shares. If the Grantee holds NSO Shares for at least one year, any gain realized on disposition of the Shares will be treated as long-term capital gain for federal income tax purposes.
 
 
Exhibit 10.E — Page 11

 
 
7. Entire Agreement: Governing Law. The Plan is incorporated herein by reference. The Plan and this Option Agreement constitute the entire agreement of the parties with respect to the subject matter hereof and supersede in their entirely all prior undertakings and agreements of the Company and Grantee with respect to the subject matter hereof, and may not be modified adversely to the Grantee’s interest except by means of a writing signed by the Company and Grantee. This agreement is governed by the internal substantive laws, but not the choice of law rules, of Texas.

8. NO GUARENTEE OF CONTINUED SERVICE: GRANTEE ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO THE VESTING SCHEDULE HEREOF IS EARNED ONLY BY CONTINUING AS A SERVICE PROVIDER AT THE WILL OF THE COMPANY (AND NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED AN OPTION OR PURCHASING SHARES HEREUNDER). GRANTEE FURTHER ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE TRANSACTIONS COMTEMPLATED HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND SHALL NOT INTERFERE WITH GRANTEE’S RIGHT OR THE COMPANY’S RIGHT TO TERMINATE GRANTEE’S RELATIONSHIP AS A SERVICE PROVIDER AT ANY TIME, WITH OR WITHOUT CAUSE.

By your signature and the signature of the Company’s representative on the attached “Notice of Grant of Stock Options and Option Agreement” of this Option Agreement, you and the Company agree that this Option is granted under and governed by the terms and conditions of the Plan and this Option Agreement. Grantee has reviewed the Plan and this Option Agreement in their entirety, has had an opportunity to obtain the advice of counsel prior to executing this Option Agreement and fully understands all provisions of the Plan and Option Agreement. Grantee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Administrator upon any questions relating to the Plan and Option Agreement. Grantee further agrees to notify the Company upon any change  in the residence address indicated on the attached “Notice of Grant of Stock Options and Option Agreement.”

 
Exhibit 10.E — Page 12

 
 
EX-23.2 4 v215784_ex23-2.htm EX-23.2
Exhibit 23.2
Consent of Independent Registered Public Accounting Firm
 
The Board of Directors
AAA Public Adjusting Group, Inc.:
 
We consent to the incorporation by reference in the registration statement on Form S-8 of AAA Public Adjusting Group, Inc. of our report dated May 5, 2010, with respect to the balance sheets of AAA Public Adjusting Group, Inc. (the Company) as of December 31, 2009 and December 31, 2008, and the related statements of operations, shareholders’ deficit, and cash flows for each of the years in the two-year period ended December 31,2009, which report expresses an qualified opinion and includes an explanatory paragraph relating to substantial doubt as to the Company’s ability to continue as a going concern, and which report appears in the 2009 Annual Report on Form 10-K of AAA Public Adjusting Group, Inc..
 
/s/ AUDITOR
Baum & Company, P.A.
Miami Beach, Florida
 
March 22, 2011