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) July 14, 2010

DREAMS, INC.

(Exact name of registrant as specified in its charter)

Utah	001-33405	87-0368170
(State or other jurisdiction of incorporation)	(Commission File Number)	(IRS Employer Identification No.)

2 South University Drive, Plantation, Florida	33324
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code: (954) 377-0002

Registrant’s facsimile number, including area code: (954) 475-8785

Not Applicable

(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 (see General Instruction A.2. below):

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

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

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

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

ITEM 1.01 Entry into a Material Definitive Agreement

On July 16, 2010, Dreams, Inc. (the “Company”) entered into a Subscription Agreement (the “Subscription Agreement’s”) with eleven accredited investors (the “Investors”), pursuant to which the Company has raised $5,999,999.20 through the issuance of 4,615,384 shares of the Company’s common stock (the “Shares”). The Shares are being issued under an S-3 Registration Statement which was declared effective by the SEC on July 14, 2010.

Pursuant to an engagement letter with a financial advisor to the Company, the financial advisor is entitled to receive a $350,000 fee for services rendered in connection with the offering.

The transaction set forth in the Subscription Agreement closed on July 20, 2010, upon receipt of the approval of the NYSE AMEX Equities Exchange for the listing of the Shares.

The description of the Subscription Agreement set forth herein is qualified in its entirety by the terms of the Subscription Agreement as attached hereto.

ITEM 8.01 Other Events

The Company has received and executed an 8 day extension, to July 23, 2010, of its existing senior secured credit facility with Comerica Bank (the “Comerica Facility”). The Comerica Facility was extended on the same terms and conditions as are currently in place.

ITEM 9.01 Financial Statements and Exhibits

(d) Exhibits

99.1	Subscription Agreement
99.2	Press Release dated July 20, 2010

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SIGNATURES

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

Date: July 20, 2010	DREAMS, INC.
	By:	/s/ Ross Tannenbaum
		Ross Tannenbaum Chief Executive Officer

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Exhibits

Exhibit No.	Description
99.1	Subscription Agreement
99.2	Press Release dated July 20, 2010

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EX-99.1

Exhibit 99.1

SUBSCRIPTION AGREEMENT

This subscription agreement (this “Subscription Agreement”) is dated July 16, 2010, by and between William Blair & Company, LLC (“William Blair”), for and on behalf of investors set forth on Schedule A (the “Investors”), and Dreams, Inc., a Utah corporation (the “Company”), whereby the parties agree as follows:

1.     Subscription.

a) Each Investor agrees to buy and the Company agrees to sell and issue to each Investor that number of shares of the Company’s common stock, no par value, set forth on the attached Schedule A, which collectively totals 4,615,384 shares (the “Shares”), for the purchase price set forth on Schedule A, with collectively totals $5,999,999.20 (the “Purchase Price”).

b) The Shares have been registered on a Form S-3, File No. 333-167765, which registration statement (the “Registration Statement”) has been declared effective by the Securities and Exchange Commission, has remained effective since such date and is effective on the date hereof. A prospectus supplement will be delivered as required by law.

c) On the date the Company receives the approval of the NYSE AMEX Equities Exchange (“AMEX”) for the listing of the Shares (the “Closing Date”), the Investors shall initiate wire transfers to the Company, pursuant to instructions provided by the Company, in a total amount equal to the Purchase Price. Upon receipt of such payment Company shall immediately cause the Shares to be delivered to Investors. The transfer of the Shares shall be made through the facilities of The Depository Trust Company’s (“DTC”) DWAC system in accordance with the instructions provided to the Company by the Investors, or in such other manner as is agreed upon by the parties.

2.    Company Representations and Warranties. The Company represents and warrants to the Investors as follows: (a) it has full right, power and authority to enter into this Subscription Agreement and to perform all of its obligations hereunder; (b) this Subscription Agreement has been duly authorized and executed by and constitutes a valid and binding agreement of the Company enforceable in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the rights and remedies of creditors generally; (c) the execution and delivery of this Subscription Agreement and the consummation of the transactions contemplated hereby do not conflict with or result in a breach of (i) the Company’s articles of incorporation or by-laws, or (ii) any material agreement or any law or regulation to which the Company is a party or by which any of its property or assets is bound; (d) the Shares have been duly authorized for sale and issuance, and when issued and delivered, will be validly issued, fully paid and nonassessable; (e) the Registration Statement and any post-effective amendment thereto filed pursuant to the Securities Act of 1933, as amended (the “Securities Act”), at the time it became effective, did not contain any untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein not misleading; (f) the prospectus, dated July 15, 2010

(the “Base Prospectus”) contained in the Registration Statement, and any prospectus supplement to the Base Prospectus, did not contain as of its respective date, and as of the date hereof does not contain, any untrue statement of a material fact or omit to state a material fact necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading; (g) except with respect to the transactions contemplated by this Subscription Agreement the Company has not provided the Investors or any of their officers or directors with any material, non-public information.

3.    Investors Representations, Warranties and Acknowledgments. William Blair represents and warrants on behalf of each Investor as follows: (a) William Blair has full right, power and authority to enter into this Subscription Agreement on behalf of each Investor and to perform all of its obligations hereunder; (b) this Subscription Agreement has been duly authorized and executed by and constitutes a valid and binding agreement of each Investor enforceable in accordance with its terms, except as such enforceability may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the rights and remedies of creditors generally; (c) the execution and delivery of this Subscription Agreement and the consummation of the transactions contemplated hereby do not conflict with or result in a breach of (i) Investor’s certificate of incorporation or by-laws (or other similar governing documents), or (ii) any material agreement or any law or regulation to which Investor is a party or by which any of their property or assets is bound; (d) prior to the execution hereof, Investor has had full access to and relied only upon (i) the Base Prospectus, (ii) any prospectus supplements to the Base Prospectus, including in each case information incorporated by reference therein, and (iii) the pricing and expense information contained in this Subscription Agreement; and (e) Investor has not directly or indirectly, nor has any person acting on behalf of or pursuant to any understanding with such Investor, engaged in any transactions in the securities of the Company (including, without limitations, any short sales (as defined in Rule 200(a) of Regulation SHO) involving the Company’s securities) since the time that such Investor was first contacted by the Company or its advisors regarding an investment in the Company. William Blair, on behalf of each Investor, covenants that neither the Investors nor any person acting on their behalf or pursuant to any understanding with them will engage in any transactions in the securities of the Company (including short sales) prior to the time that the transactions contemplated by this Subscription Agreement are publicly disclosed.

4.    Covenants.

a) The Company shall file an additional listing application with AMEX, seeking approval for the listing of the Shares on AMEX, concurrently with the execution of this Subscription Agreement.

b) The Company shall, within two business days of the date hereof, issue a press release disclosing the material terms of the transactions contemplated hereby, and issue a Current Report on Form 8-K including the Subscription Agreement as an exhibit thereto. From and after the issuance of such press release and Current Report on Form 8-K, the Company shall have publicly disclosed all material, non-public information delivered the Investors by the Company, if any, or any of its officers or directors in connection with the transactions contemplated hereby.

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5.    Miscellaneous.

a) This Subscription Agreement constitutes the entire understanding and agreement between the parties with respect to its subject matter and there are no agreements or understandings with respect to the subject matter hereof which are not contained in this Subscription Agreement. This Subscription Agreement may be modified only in writing signed by the parties hereto.

b) This Subscription Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument and shall become effective when counterparts have been signed by each party and delivered to the other parties hereto, it being understood that all parties need not sign the same counterpart. Execution may be made by delivery by facsimile or PDF.

c) The provisions of this Subscription Agreement are severable and, in the event that any court or officials of any regulatory agency of competent jurisdiction shall determine that any one or more of the provisions or part of the provisions contained in this Subscription shall, for any reason, be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision or part of a provision of this Subscription Agreement and this Subscription Agreement shall be reformed and construed as if such invalid or illegal or unenforceable provision, or part of such provision, had never been contained herein, so that such provisions would be valid, legal and enforceable to the maximum extent possible, so long as such construction does not materially adversely effect the economic rights of either party hereto.

d) All communications hereunder shall be in writing and shall be mailed, hand delivered, sent by a recognized overnight courier service such as Federal Express, or sent via facsimile and confirmed by letter, to the party to whom it is addressed at the following addresses or such other address as such party may advise the other in writing:

To the Company: as set forth on the signature page hereto.

To the Investors: as set forth on the signature page hereto.

All notices hereunder shall be effective upon receipt by the party to which it is addressed.

e) This Subscription Agreement shall be governed by and interpreted in accordance with the laws of the State of Florida for contracts to be wholly performed in such state and without giving effect to the principles thereof regarding the conflict of laws. To the extent determined by such court, the prevailing party shall reimburse the other party for any reasonable legal fees and disbursements incurred in enforcement of, or protection of any of its rights under this Subscription Agreement.

*****

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If the foregoing correctly sets forth our agreement, please confirm this by signing and returning to us the duplicate copy of this letter.

COMPANY: DREAMS, INC.
Signature:	/s/ Ross Tannenbaum
Printed Name:	Ross Tannenbaum
Title:	Chief Executive Officer
Address for Notice:
Two South University Drive, Ste. 325 Plantation, Florida 33324 Facsimile: 954-475-8785 Attention: Chief Executive Officer
With a copy to:
Roetzel & Andress 350 East Las Olas Boulevard, Ste. 1150 Fort Lauderdale, Florida 33301 Facsimile: 954-462-4260 Attention: Joel D. Mayersohn
FOR AND ON BEHALF OF EACH INVESTOR LISTED ON SCHEDULE A: WILLIAM BLAIR & COMPANY, LLC
Signature:	/s/ Michael P. Balkin
Printed Name:	Michael P. Balkin
Title:	Portfolio Manager
Address for Notice:
222 W. Adams Chicago, Illinois 60606 Facsimile: 773-409-5572 Attention: Walter R. Randall, Jr.

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SCHEDULE A

Buyer/Account Registration	Share Quantity	Purchase Price
THE DEPT OF PERSONNEL ADMINISTRATION OF THE STATE OF CALIFORNIA	229,912	$	298,885.60
DAI, INC	48,880	$	63,544.00
CITY OF DEARBORN GENERAL EMPLOYEES RETIREMENT SYSTEM	32,753	$	42,578.90
CITY OF DEARBORN POLICEMEN & FIREMEN REV RETIREMENT SYSTEMS	70,540	$	91,702.00
HEWITT INVESTMENT GROUP- CRAWFORD & CO	44,228	$	57,496.40
NEW BROOKDALE PARTNERS, LP	6,398	$	8,317.40
RUSH UNIVERSITY MEDICAL CENTER ENDOWMENT ACCOUNT	76,113	$	98,946.90
RUSH UNIVERSITY MEDICAL CENTER PENSION & RETIREMENT	81,926	$	106,503.80
THE 1199SEIU HEALTH CARE EMPLOYEES PENSION FUND	174,148	$	226,392.40
THE 1199SEIU GREATER NEW YORK PENSION FUND	60,108	$	78,140.40
SMALL CAP GROWTH FUND	3,790,378	$	4,927,491.40
TOTALS	4,615,384	$	5,999,999.20

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EX-99.2

Exhibit 99.2

Dreams Receives $6 Million from Premier Small Cap Growth Fund

Funds to fuel growth and expansion of web syndication portfolio

Plantation, FL: Dreams, Inc. (NYSE Amex: DRJ) the vertically integrated leader in the licensed sports products industry, announced that it has accepted $6 million dollars from a group led by the William Blair Small Cap Growth Fund under the terms filed in a prospectus supplement dated July 16, 2010 with the Securities and Exchange Commission.

Ross Tannenbaum, Dreams’ President & CEO stated, “with our team delivering so many exciting business opportunities to our environment it was important to continue to strengthen the balance sheet. This dynamic, coupled with the formidable brand of William Blair made this an easy decision.”

“The William Blair Small Cap Growth Fund is pleased to be a new shareholder in Dreams, Inc. We are very excited about the company’s growth prospects in both the FansEdge stores and their internet distribution and fulfillment platform. Ross Tannenbaum and his team have done an excellent job in creating a better shopping experience for the sports enthusiast,” declared Michael Balkin, Co-Portfolio Manager of the Fund.

Roth Capital Partners and Ladenburg Thalmann & Co. Inc., a subsidiary of Ladenburg Thalmann Financial Services Inc. (NYSE Amex: LTS) acted as financial advisors to Dreams on this transaction.

DREAMS, INC. trades under the ticker symbol: NYSE Amex: DRJ

www.dreamscorp.com

Dreams, Inc. Investor Relations Contact Info:

David M. Greene, Senior Vice-President

Phone: 954-377-0002

Fax: 954-475-8785

dgreene@dreamscorp.com

Public Relations for Dreams, Inc.:

Boardroom Communications

Jennifer Clarin and/or Caren Berg

Phone: (954) 370-8999, Fax: (954) 370-8892

Email: jclarin@boardroompr.com

Statements contained in this press release, which are not historical facts, are forward looking statements. The forward-looking statements in this press release are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to

be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such statements are indicated by words or phrases such as “anticipates,” “projects,” “management believes,” “Dreams believes,” “intends,” “expects,” and similar words or phrases. Such factors include, among others, the following: competition; seasonality; success of operating initiatives; new product development and introduction schedules; acceptance of new product offerings; franchise sales; advertising and promotional efforts; adverse publicity; expansion of the franchise chain; availability, locations and terms of sites for franchise development; changes in business strategy or development plans; availability and terms of capital including the continuing availability of our credit facility with Comerica Bank or a similar facility with another financial institution; labor and employee benefit costs; changes in government regulations; and other factors particular to the Company.