EXHIBIT 10.11
CONFIDENTIALITY, SHAREHOLDERS AND DEVELOPMENT AGREEMENT
This AGREEMENT made and entered into this 15th day of January 2008, by and
between:
SUNGAME CORPORATION (hereinafter referred to as "SUN"), a business
corporation duly organized, registered and existing under and by
virtue of the laws of the United States, with principal office address
at 000 Xxxxxxxxxx Xxxx, Xxxxx 000, Xxxxxxxxxx, XX 00000, XXX, herein
represented by its Chief Executive Officer, XX. XXX X. XXXXXX;
-and-
SLYCESOFT GAMES DEVELOPMENT (hereinafter referred to as "SGD"), a
business proprietorship duly registered and existing under and by
virtue of the laws of the Philippines, with principal office address
at 0 X. Xxxxxx, Xxx Xxxx Xxxx, Xxxxx Xxxxxx, Xxxxxxxxxxx, herein
represented by its President, MR. RANULF X. XXXX (hereinafter referred
to as "XXXX").
WITNESSETH,THAT:
WHEREAS, XXXX has been responsible for the successful development of
Virtual World solutions for SUN during the year 2007. Said development has been
financed and is owned by SUN. The first version will be launched on January 2008
WHEREAS, XXXX is the sole owner of SGD which is currently not in operation.
SGD does not have any debts and is not involved in any legal dispute.
WHEREAS, SUN is interested in placing all development related operation in
a formal development vehicle in the Philippines. Hence, rather than establishing
a new company in the Philippines, SUN manifests its intention of seeking the
professional expertise of SGD in achieving the same, considering the latter as
suitable to be the said vehicle.
NOW, THEREFORE, the parties hereto have agreed, and they hereby agree, as
follows:
TERM OF AGREEMENT
This Agreement shall be effective for a period of three (3) years from the
date the same is duly signed unless any of the following events occur: (a) SUN
has acquired and paid in full for SGD; or (b) upon mutual agreement by the
parties in writing.
In the event that any of the aforementioned events occur, this Agreement
shall be deemed terminated.
CONFIDENTIALITY
SGD, as represented by XXXX, is committed to preserve confidential SUN
proprietary business information. Therefore, it shall keep all information
provided by SUN completely confidential; and SGD shall not provide any
information related to or in connection with any engaged project to any external
person or entity without first obtaining the consent of SUN. This paragraph
shall survive for a period of two (2) years after the termination of this
Agreement.
Confidentiality, Shareholders And Development Agreement
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OPERATIONAL ACTIVITIES
SGD shall be responsible for the continued development of the SUN Virtual
World project as agreed upon and approved by SUN. The quarterly operational
expense projections shall be provided to SUN for approval.
All expenses, as well as receivables, including the financing from SUN,
detailed in this agreement, will be properly book kept and included in yearly
tax return statements by XXXX according to applicable laws.
It is understood that there are well-known business entities in the
Philippines that have expressed interest in availing the services of SGD. This
is highly encouraged by SUN but, to avoid delays in the internal development of
Virtual World project, any offers to such business entities shall require prior
approval of SUN.
COMMITMENT FEE
SUN shall provide and guarantee the amount of THIRTY FIVE THOUSAND US
DOLLARS ($ 35,000.00 USD) to SGD as an initial fee, to be used in the manner
provided for in the breakdown reflected in Annex "A" attached hereof.
This fee shall be paid in two payments: (1) 50% thereof, on the date this
Agreement is duly signed; and (2) the remaining 50%, thirty (30) days
thereafter. The risk compensation mentioned in the table reflected in Annex "A"
attached hereof shall not be paid until after the second payment has been
received by XXXX.
Immediately after the first payment, XXXX will start moving into managing
and operating SGD for the development of the Virtual World project of SUN on a
full time basis.
XXXX will, in cooperation with SUN, establish all necessary processes to
ensure optimal efficiency at SGD.
FINANCING OF SGD
SUN shall be solely responsible for the financial support of SGD's business
operation during the term of this Agreement. As an initial fund to SGD's
operation, SUN shall guarantee to SGD a minimum amount of TWO HUNDRED THOUSAND
US DOLLARS ($ 200,000.00 USD) including the above mentioned commitment fee, for
its 2008 operational expenses, pending approved external financing. SUN will,
each quarter in advance, provide the budgeted amount to SGD starting from the
time the said financing is available.
In case of failure on the part of SUN to provide the minimum amount of ONE
HUNDRED THOUSAND US DOLLARS ($ 100,000.00 USD) within the first half of the year
2008, and/or the remaining amount of ONE HUNDRED THOUSAND US DOLLARS ($
100,000.00 USD) within the year 2008, this Agreement is automatically
terminated. Consequently, XXXX and SGD shall be released from any and/or all of
its commitment to SUN.
Confidentiality, Shareholders And Development Agreement
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OPTIONAL RIGHT TO AQUIRE
SUN has the option to acquire SGD at any time within three (3) years from
the date this Agreement was duly signed. The following sequential steps will be
followed if SUN decides to acquire SGD:
1. SUN will notify SGD in writing that SUN has decided to acquire SGD;
2. SUN will request SGD in writing to convert SGD to a Stock Corporation;
3. Upon receipt of the said written request, not later than fifteen (15)
days thereof, XXXX will initiate and manage the legal and
administrative processes in converting SGD from a Single
Proprietorship to a Stock Corporation. However, all necessary and
incidental expenses resulting from said processes shall be shouldered
by SUN until the aforesaid task is fully accomplished; and
4. As soon as SGD becomes a Stock Corporation and allowed by law, SUN
will buy every issued share (Common Stocks) of SGD for the amount of
ONE US DOLLAR ($ 1.00 USD).
IP RIGHTS AND SOURCE CODES
Every and all development provided by SGD under this Agreement are solely
owned by SUN and all Intellectual Property Rights and source codes shall be
owned by SUN and may not be offered or distributed to any external party without
the written approval from SUN.
COMPLETE AGREEMENT
It is understood that this Agreement constitutes the complete and exclusive
expression of the terms and conditions between the parties and there are no
promises, representations or inducements except such as are herein provided. Any
other prior agreements or understandings are hereby rescinded and unenforceable.
This Agreement shall inure to the benefit of and be binding upon the
parties hereto and their respective heirs, legal representatives, successors and
assigns.
SEPARABILITY CLAUSE
If any paragraph, subparagraph or part of this Agreement is declared
contrary to law or public policy, or is otherwise declared invalid, such shall
not affect the other paragraphs, sub-paragraphs or parts of this Agreement, and
to which shall remain in full force and effect.
JURISDICTION/CONSTRUCTION
The laws of the State of Delaware, USA shall govern this Agreement as to
the construction/interpretation of the terms and conditions.
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IN WITNESS WHEREOF, the parties hereto have signed this Agreement on the
date first written above.
SUNGAME CORPORATION SLYCESOFT GAMES DEVELOPMENT
By: /s/ Guy M. Xxxxxx By: /s/ Ranulf X. Xxxx
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GUY M. XXXXXX RANULF X. XXXX
CHIEF EXECUTIVE OFFICER PRESIDENT
SIGNED IN THE PRESENCE OF:
Signature: Signature: /s/ Xxxxxx Xxxx
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Name: Name: Xxxxxx Xxxx
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Address: Address: 3 X. Xxxxxx St.
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Address: Address: Xxx Xxxx Xxxx 0000 Xxxxxxxxxxx
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Confidentiality, Shareholders And Development Agreement
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ANNEX "A"
COMMITMENT FEE BREAKDOWN
ITEM AMOUNT ( USD )
------------------------------------------------------------------------------ ---------------------
1. Salary compensation to XXXX for the first two (2) months operating SGD
under this Agreement USD 8,000.00
2. Non-refundable additional salary compensation to XXXX as a risk
compensation for leaving his current employer 8,000.00
3. Bond compensation of XXXX towards current employer 1,500.00
4. Lease of new SGD office with lease contract to be approved by SUN 6,000.00
5. Internet connections for new SGD office 1,500.00
6. Consulting fees of Senior staff covering the first sixty (60) days of
operation 5,500.00
7. Consulting fees of Junior staff covering the first sixty (60) days of
operation 2,500.00
8. Other administrative expenses within the discretion of XXXX 2,000.00
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Total USD 35,000 00
