Amendment to License Agreement


 


This Amendment (this “Amendment”) to that certain License
Agreement (the “Agreement”), dated as of June 20, 2005, by and between Smart Kids Group, Inc. (“Smart Kids”),
a Florida corporation, and Smart Kids International Holdings, Inc. (“SKIH”) is made effective as of this 25th day of
October, 2011 (the “Amendment Effective Date”).


 


WITNESSETH:


 


WHEREAS, there is a licensing fees of $5,000 per month under the
Agreement to SKIH in exchange for Smart Kids’ use of the trademarks, domain names and copyrights, concepts and characters
and rights to manufacture, distribute, sell, advertise, and profit from the products relating to the Be Alert Bert® and Full
Motion FitnessTM intellectual property.


 


WHEREAS, the parties desire to amend the Agreement to allow Smart
Kids the option of making payments to SKIH in the form of common stock in lieu of cash.


 


NOW, THEREFORE, in consideration of the foregoing and of the promises,
agreements, representations, warranties, and covenants herein contained, and intended to continue to be bound to the Agreement,
as amended by this Amendment, the Parties hereby agree as follows:


 


1. Capitalized terms used but not otherwise defined in this Amendment
shall have the meanings ascribed to them in the Agreement.


 


2. Section 3 of the Agreement is hereby amended in its entirety
to read as follows:


 


3 ROYALTY 


 


3.1 The Licensor and the Licensee agree that in the event
of the Licensee exercising its option to extend the term of this License Agreement in perpetuity at the end of the initial twenty
five (25) year term granted by this License Agreement, or immediately upon the Licensor's ownership of the Licensee becoming equal
to or less than (12) percent, the Licensor and the Licensee shall enter into negotiations to determine a Royalty payable by the
Licensee to the Licensor, pursuant to Article 4.2 herein.


 


3.2 The Licensor and the Licensee agree that the Royalty payable
to the Licensor in the event of the Licensee exercising its option to extend the term of the License Agreement in perpetuity shall
be based upon fair market value but in no event shall exceed fifteen (15) per cent of the value of gross sales of the Licensed
Products before expenses or other deductions.


 


3.3 In the event that the Licensor and the Licensee are unable
to agree on the Royalty pursuant to Article 4.2 within 120 days of the commencement of negotiations as specified in Article 4.1,
the Licensor and the Licensee agree that the matter shall be submitted for final and binding arbitration pursuant to the provisions
of Article 11 herein.


 


3.4 The Licensor and the Licensee agree that the royalties
may be paid in the form of common stock in Licensee at the option of Licensee.



    	 



    	 



    



 


3. All other terms and conditions under the Agreement not otherwise
amended, modified or affected by this Amendment shall continue to be in effect and bind the parties. The Agreement or this Amendment
may only be modified with prior written agreement from both parties.


 


IN WITNESS WHEREOF, the parties hereto have caused this Amendment
to be duly executed on the last date written below, effective as of the Amendment Effective Date.


 


	
        Smart Kids International Holdings,
        Inc.

         

         

        /s/ Richard Shergold



        By: Richard Shergold

         

        Title: President

         

        Date: October 25, 2011


	
        Smart Kids Group, Inc.

         

         

        /s/ Lisa Yakiwchuk

        By: Lisa Yakiwchuk

         

        Title: Secretary

         

        Date:  October 25, 2011

		


 



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