Consulting Agreement
Effective January 29, 2007 This Agreement is between:
Sungold International Holdings Corp.,
(Hereinafter referred to as SIHC)
940 The East Mall, Suite 300
Toronto, Ontario, CANADA M9B 6J7
And,
Todd Stinson
(Hereinafter referred to asTS)
4332 N 21stST.
Lincoln, NE 68521
Whereas, SIHCwishes to contract withTSto:
(a) Assist in the technical process in general forSIHCwith particular reference to the further development of the patent application for the Horsepower World Lottery Pool. Completion of the Horsepower software program, including upgrading the graphics component to current industry standards, and interfacing with the appropriate internet and totalizing applications, and content providers for the live venue;
(b) Assist in arranging operating contracts for product installation on all venues, including but not limited to; internet, legal betting shops, kiosks, VLTs, and satellite simulcast, and;
(c) Assist in arranging corporate financing, and;
(d) Act in a capacity overseeing the implementation and on-going operations.
Now therefore and in consideration of the foregoing, it is hereby agreed as follows:
- The term of this agreement, which takes full effect upon signing, shall be for one year from date of signing. This term is for the Consulting Fee compensation only. This term is not applicable for the license and gross allowances as evidenced below.
- This agreement will become effective only whenSIHCdemonstrates the financial abilities and wherewithal to facilitate obligations outlined within this agreement. Or atTS’s discretion.
- The Consulting Fee agreement can be extended upon termination, by mutual agreement between both parties, in accordance with negotiations between the parties, which shall begin prior to the expiration of this initial agreement.
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| • | The Title assumed byTSwill be Industry Consultant. It is understood and agreed that this title is not an Officer ofSIHC. Nor willTSbe held liable in any capacity from the on going operations ofSIHC. It is also understood that any announcement or press release of this appointment or contemplated licensing ofTS’s proprietary IP provisional application(s) and contemplated issuance, will be approved as to content and timing byTS. |
| • | TSshall be issued 500,000 Common shares ofSIHCat the time of signing. |
| • | TSshall receive an initial consulting fee of $5,000 U.S. upon signing. In addition to this signing feeTSshall receive $2,500 U.S. per month, prorated for part months, payable at the end of each month. Said monthly consulting will be agreed to have commenced on December 15th2006, as compensation for “work to date”, which includes all expenses incurred to date. A portion of these monies owed ($2,500 U.S.) to be offset against provisional patent filing only. |
| • | TSshall receive additional allocations ofSIHCCommon shares as the followingBench Marksare achieved: |
| • | TSshall receive an additional allocation of 500,000 Common shares ofSIHCat the time of the graphics upgrade, in either the virtual or the live demo of the products discussed within this agreement. |
| • | TSshall receive an additional allocation of 500,000 Common shares ofSIHCat the time thatSIHCsigns a Horsepower® World Pool application contract with a revenue generating entity. |
| • | TSshall receive an additional allocation of 750,000 Common shares ofSIHCat the time thatSIHCsuccessfully commences Horsepower® World Pool live wagering operations or operations in any capacity that generates revenue toSIHC. |
| • | TSshall receive an additional allocation of 500,000 Common shares ofSIHCat the time thatSIHCsigns a Horsepower® World Pool Lottery application contract with any Lottery organization and or jurisdiction. Including but not limited to outsourced lottery vendors. |
| • | TSshall receive an additional allocation of 1,000,000 Common shares ofSIHCimmediately upon commencement of the Horsepower® World Pool Lottery wagering operations. |
| • | TSshall receive an additional 250,000 Common shares for theSIHCacquisition of the Breezestreams.com opportunity. It is understood that all or a good portion of these shares will be used to satisfy payment to the original designer of the Breezestreams concept. |
| • | TSshall receive an additional 1,000,000 Common shares upon issuance of patent protection. As evidenced by the USPTO issuance certificate. This allocation is only applicable if exclusivity is still in effect under the terms of this agreement. |
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- TSshall receive cash compensation for Supervising the live operation of the Horsepower® World Pool product equal to 1% (one percent) of the Sungold/Horsepower share of the Gross Revenue earned from the Horsepower® World Pool Internet and Betting shop operation, not exceeding Three percent (3%) of the Net Income from this operation as long asTS continues to supervise these operations.
- In exchange for registering, as the inventor, a new patent(s) in the name ofSIHC, TSshall receive cash compensation from the operations of the Horsepower® World Pool Lottery products equal to 10% (ten percent) of the Sungold/Horsepower share of the Gross Revenue earned from the Horsepower® World Pool Lottery operations. (operations that are directly attributed to TS including the patent(s) applications as of 1-12-07) in perpetuity from the date of commencing these operations.
- TSagrees to license the rights toSIHCto market the lottery products under its provisional patent protection and subsequent issuance. This “License Agreement”, to be defined in a separate “License Agreement”, will include the following restrictions and performance clauses to be borne bySIHCto maintain its exclusive position in the intellectual property.
| | 1. | SIHCbears the cost of filings, both provisional and the subsequent prosecution to issuance. |
| | 2. | SIHCagrees that this is a marketing license only, and understands that its exclusivity position remains in effect only as long as its ability to financially support the prosecution, marketing, and industry standard respect of the intellectual property. |
| | 3. | SIHCagrees that this intellectual property is not assignable. |
| | 4. | SIHCagrees that any material change in the capital structure ofSIHCwill cause the exclusivity exclusion. (Material change to be defined in “License Agreement”). |
- TSshall be reimbursed by the company for pre-approved expenses incurred on behalf of the company.
- TSagrees to sign theSIHCstandard non-competition agreement.
It is further understood and agreed by the parties that during the term of this agreement the company may undertake additional projects which have been discussed in principle and in such casesSIHCandTS will agree on the nature of the project and the compensation arrangements forTSto supervise them in each case. Examples of these projects include a Video Lottery Terminal version of the product.
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EFFECTIVE DATE
This agreement shall be in full force and effect immediately upon acceptance as signed and witnessed below.
This agreement represents the complete and entire agreement between the parties, and there are no prior or pre-existing agreements.
The parties agree that an executed copy received by telefax or digitally signed will represent a completed agreement.
This agreement has been approved and accepted by the following individuals who have full and complete authority to legally bind each party respectively:
| Sungold International Holdings Corp., | Witnessed by: |
| /T.K. Blackwell/. | /Larry Simpson/. |
| T. Keith Blackwell, Chief Executive Officer | Larry Simpson, Director |
And,
| _/Stiny/. | |
| Todd Stinson | Witnessed by:/CChessmore/. |
| | Print Name: Cynthia J. Chessmore |
Dated this 29th day of January, 2007.
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