Unassociated Document


    INDEPENDENT
      CONTRACTOR SERVICES AGREEMENT

    


    


    This
      Agreement is made and entered into as of December 15, 2006 (the “Effective
      Date”),
      by
      and between HandHeld Entertainment, Inc. (the “Company”),
      having a principal place of business at 539 Bryant Street, suite 403, San
      Francisco, California 94107 and Scott John Paul Worsnop, an individual having
      a
      principal place of business at calle Nicaragua 10, Javea, 03730, Alicante,
      Spain
      (“Contractor”).

     

    WHEREAS,
      the Company has acquired the Business relating to Yourdailymedia.com, which
      business was previously managed by Contractor; and

     

    WHEREAS,
      “Business” shall have the meaning set forth in the Asset Purchase Agreement
      executed by and between the Company and Contractor on even date herewith (the
      “Purchase
      Agreement”);
      and

     

    WHEREAS,
      the Company needs an experienced person to assist the Company with the
      successful transition of the Business from Contractor to the Company and to
      advise the Company regarding the Business; and 

     

    WHEREAS,
      the Company wishes to engage Contractor and Contractor wishes to be engaged
      by
      the Company for such purposes.

     

    NOW,
      THEREFORE, in consideration of the premises and the covenants contained herein,
      the parties hereby agree as follows: 

     

    1. Engagement
      of Services.
      Company
      may issue Project Assignments to Contractor in the form attached to this
      Agreement as Exhibit A
      (“Project
      Assignment”).
      Subject to the terms of this Agreement, Contractor will render the services
      set
      forth in each Project Assignment accepted by Contractor by the completion dates
      set forth in such Project Assignment. The Company and Contractor expect that
      Contractor will render such services remotely (i.e., outside of the United
      States). However, Contractor agrees to be available to render services to the
      Company for a period of no less than one (1) week per calendar month
      (“On
      Site Services”)
      at the
      Company’s San Francisco office, which is located at the address set forth
      above.

     

    2. Compensation;
      Timing.
      Company
      will pay Contractor the fee set forth in each Project Assignment for services
      rendered pursuant to this Agreement. Upon termination of this Agreement for
      any
      reason, Contractor will be paid fees on the basis stated in the Project
      Assignment(s) for services which have been completed. Contractor will be
      reimbursed only for expenses which are incurred prior to termination of this
      Agreement for any reason and which are either expressly identified in a Project
      Assignment or approved in advance in writing by a Company manager. Contractor
      will be reimbursed for such fees and expenses no later than thirty (30) days
      after Company’s receipt of Contractor’s invoice, provided that reimbursement for
      expenses may be delayed until such time as Contractor has furnished such
      documentation for authorized expenses as Company may reasonably
      request.

     

    3. Independent
      Contractor Relationship.
      Contractor’s relationship with Company is that of an independent contractor, and
      nothing in this Agreement is intended to, or should be construed to, create
      a
      partnership, agency, joint venture or employment relationship. Contractor will
      not be entitled to any of the benefits which Company may make available to
      its
      employees, including, but not limited to, group health or life insurance,
      profit-sharing or retirement benefits. Contractor is not authorized to make
      any
      representation, contract or commitment on behalf of Company unless specifically
      requested or authorized in writing to do so by a Company manager. Contractor
      is
      solely responsible for, and will file, on a timely basis, all tax returns and
      payments required to be filed with, or made to, any United States federal,
      state
      or local tax authority with respect to the performance of services and receipt
      of fees under this Agreement. Contractor is also solely responsible for, and
      will file, on a timely basis all tax returns and payments required by any
      foreign tax authority. Contractor is solely responsible for, and must maintain
      adequate records of, expenses incurred in the course of performing services
      under this Agreement. No part of Contractor’s compensation will be subject to
      withholding by Company for the payment of any social security, federal, state
      or
      any other employee payroll taxes (whether such taxes arise under United States
      or foreign law). Company will regularly report amounts paid to Contractor by
      filing Form 1099-MISC with the Internal Revenue Service as required by
      law.

     


    
      
         

      

      
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    4. Intellectual
      Property Rights.

     

    4.1 Disclosure
      and Assignment of Innovations.

     

    (a) Innovations;
      Company Innovations.
      “Innovations”
      includes processes, machines, compositions of matter, improvements, inventions
      (whether or not protectable under patent laws), works of authorship, information
      fixed in any tangible medium of expression (whether or not protectable under
      copyright laws), moral rights, mask works, trademarks, trade names, trade dress,
      trade secrets, know-how, ideas (whether or not protectable under trade secret
      laws), and all other subject matter protectable under patent, copyright, moral
      right, mask work, trademark, trade secret or other laws, and includes without
      limitation all new or useful art, combinations, discoveries, formulae,
      manufacturing techniques, technical developments, discoveries, artwork,
      software, and designs. “Company
      Innovations”
are
      Innovations that Contractor, solely or jointly with others, conceives, reduces
      to practice, creates, derives, develops or makes within the scope of
      Contractor’s work for Company under this Agreement. For avoidance of doubt,
      Company Innovations shall not include Innovations that relate solely to the
      Separate Businesses (as defined in the Purchase Agreement).

     

    (b) Disclosure
      and Ownership of Company Innovations.
      Contractor agrees to make and maintain adequate and current records of all
      Company Innovations, which records shall be and remain the property of Company.
      Contractor agrees to promptly disclose to Company every Company Innovation.
      Contractor hereby does and will assign to Company or Company’s designee
      Contractor’s entire worldwide right, title and interest in and to all Company
      Innovations and all associated records and intellectual property rights. To
      the
      extent any of the rights, title and interest in and to Company Innovations
      cannot be assigned by Contractor to Company, Contractor hereby grants to Company
      an exclusive, royalty-free, transferable, irrevocable, worldwide license (with
      rights to sublicense through multiple tiers of sublicensees) to practice such
      non-assignable rights, title and interest. To the extent any of the rights,
      title and interest in and to the Company Innovations can be neither assigned
      nor
      licensed by Contractor to Company, Contractor hereby irrevocably waives and
      agrees never to assert such non-assignable and non-licensable rights, title
      and
      interest against Company or any of Company’s successors in interest to such
      non-assignable and non-licensable rights.

     

    (c) Assistance.
      Contractor agrees to execute upon Company’s request a signed transfer of Company
      Innovations to Company in the form included in each Project Assignment for
      each
      of the Company Innovations, including, but not limited to, computer programs,
      notes, sketches, drawings and reports. Contractor agrees to assist Company
      in
      any reasonable manner to obtain, perfect and enforce, for Company’s benefit,
      Company’s rights, title and interest in any and all countries, in and to all
      patents, copyrights, moral rights, mask works, trade secrets, and other property
      rights in each of the Company Innovations. Contractor agrees to execute, when
      requested, for each of the Company Innovations (including derivative works,
      improvements, renewals, extensions, continuations, divisionals, continuations
      in
      part, or continuing patent applications thereof), (i) patent, copyright,
      mask work or similar applications related to such Company Innovation,
      (ii) documentation (including without limitation assignments) to permit
      Company to obtain, perfect and enforce Company’s right, title and interest in
      and to such Company Innovation, and (iii) any other lawful documents deemed
      necessary by Company to carry out the purpose of this Agreement. If called
      upon
      to render assistance under this paragraph, Contractor will be entitled to a
      fair
      and reasonable fee in addition to reimbursement of authorized expenses incurred
      at the prior written request of Company. In the event that Company is unable
      for
      any reason to secure Contractor’s signature to any document Contractor is
      required to execute under this Paragraph 4.1(c) (“Assistance”), Contractor
      hereby irrevocably designates and appoints Company and Company’s duly authorized
      officers and agents as Contractor’s agents and attorneys-in-fact to act for and
      in Contractor’s behalf and instead of Contractor, to execute such document(s)
      with the same legal force and effect as if executed by Contractor.

     


    
      
         

      

      
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    (d) Out-of-Scope
      Innovations.
      If
      Contractor incorporates any Innovations relating in any way to Company’s
      business or demonstrably anticipated research or development or business which
      were conceived, reduced to practice, created, derived, developed or made by
      Contractor either outside of the scope of Contractor’s work for Company under
      this Agreement or prior to the Effective Date (collectively, the “Out-of-Scope
      Innovations”)
      into
      any of the Company Innovations, Contractor hereby grants to Company or Company’s
      designees a royalty-free, irrevocable, worldwide, fully paid-up license (with
      rights to sublicense through multiple tiers of sublicensees) to practice all
      applicable patent, copyright, moral right, mask work, trade secret and other
      intellectual property rights relating to any Out-of-Scope Innovations which
      Contractor incorporates, or permits to be incorporated, in any Company
      Innovations. Contractor agrees that Contractor will not incorporate, or permit
      to be incorporated, any Innovations conceived, reduced to practice, created,
      derived, developed or made by others or any Out-of-Scope Innovations into any
      of
      the Company Innovations without Company’s prior written consent.

     

    4.2 Confidential
      Information.

     

    (a) Definition
      of Confidential Information.
      “Confidential
      Information”
as
      used
      in this Agreement shall mean any and all technical and non-technical information
      including patent, copyright, trade secret, and proprietary information,
      techniques, sketches, drawings, models, inventions, know-how, processes,
      apparatus, equipment, algorithms, software programs, software source documents,
      and formulae related to the current, future and proposed products and services
      of Company, Company’s suppliers and customers, and includes, without limitation,
      Company Innovations, Company Property, and Company’s information concerning
      research, experimental work, development, design details and specifications,
      engineering, financial information, procurement requirements, purchasing
      manufacturing, customer lists, business forecasts, sales and merchandising
      and
      marketing plans and information.

     

    (b) Nondisclosure
      and Nonuse Obligations.
      Except
      as permitted in this paragraph, Contractor shall neither use nor disclose the
      Confidential Information. Contractor may use the Confidential Information solely
      to perform Project Assignment(s) for the benefit of Company. Contractor agrees
      that Contractor shall treat all Confidential Information of Company with the
      same degree of care as Contractor accords to Contractor’s own Confidential
      Information, but in no case less than reasonable care. If Contractor is not
      an
      individual, Contractor agrees that Contractor shall disclose Confidential
      Information only to those of Contractor’s employees who need to know such
      information, and Contractor certifies that such employees have previously
      agreed, either as a condition of employment or in order to obtain the
      Confidential Information, to be bound by terms and conditions substantially
      similar to those terms and conditions applicable to Contractor under this
      Agreement. Contractor agrees not to communicate any information to Company
      in
      violation of the proprietary rights of any third party. Contractor will
      immediately give notice to Company of any unauthorized use or disclosure of
      the
      Confidential Information. Contractor agrees to assist Company in remedying
      any
      such unauthorized use or disclosure of the Confidential
      Information.

     


    
      
         

      

      
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    (c) Exclusions
      from Nondisclosure and Nonuse Obligations.
      Contractor’s obligations under Paragraph 4.2(b) (“Nondisclosure and Nonuse
      Obligations”) with respect to any portion of the Confidential Information shall
      not apply to any such portion which Contractor can demonstrate, (a) was in
      the public domain at or subsequent to the time such portion was communicated
      to
      Contractor by Company through no fault of Contractor; (b) was rightfully in
      Contractor’s possession free of any obligation of confidence at or subsequent to
      the time such portion was communicated to Contractor by Company; or (c) was
      developed by employees of Contractor independently of and without reference
      to
      any information communicated to Contractor by Company. A disclosure of
      Confidential Information by Contractor, either (a) in response to a valid
      order by a court or other governmental body, (b) otherwise required by law,
      or (c) necessary to establish the rights of either party under this
      Agreement, shall not be considered to be a breach of this Agreement or a waiver
      of confidentiality for other purposes; provided, however, that Contractor shall
      provide prompt prior written notice thereof to Company to enable Company to
      seek
      a protective order or otherwise prevent such disclosure.

     

    4.3 Ownership
      and Return of Company Property.
      All
      materials (including, without limitation, documents, drawings, models,
      apparatus, sketches, designs, lists, and all other tangible media of expression)
      furnished to Contractor by Company, whether delivered to Contractor by Company
      or made by Contractor in the performance of services under this Agreement
      (collectively, the “Company
      Property”)
      are
      the sole and exclusive property of Company or Company’s suppliers or customers,
      and Contractor hereby does and will assign to Company all rights, title and
      interest Contractor may have or acquire in the Company Property. Contractor
      agrees to keep all Company Property at Contractor’s premises unless otherwise
      permitted in writing by Company. At Company’s request and no later than five (5)
      days after such request, Contractor shall destroy or deliver to Company, at
      Company’s option, (a) all Company Property, (b) all tangible media of
      expression in Contractor’s possession or control which incorporate or in which
      are fixed any Confidential Information, and (c) written certification of
      Contractor’s compliance with Contractor’s obligations under this
      sentence.

     

    4.4 Observance
      of Company Rules.
      At all
      times while on Company’s premises, Contractor will observe Company’s rules and
      regulations with respect to conduct, health and safety and protection of persons
      and property.

     

    5. No
      Conflict of Interest.
      Except
      as provided in Section 2.3 of the Purchase Agreement, and during the term of
      this Agreement, Contractor will not accept work, enter into a contract, or
      accept an obligation, inconsistent or incompatible with Contractor’s
      obligations, or the scope of services rendered for Company, under this
      Agreement. Contractor warrants that, to the best of Contractor’s knowledge,
      there is no other contract or duty on Contractor’s part which conflicts with or
      is inconsistent with this Agreement. Contractor agrees to indemnify Company
      from
      any and all loss or liability incurred by reason of the alleged breach by
      Contractor of any services agreement with any third party.

     

    6. Term
      and Termination.

     

    6.1 Term.
      This
      Agreement is effective as of the Effective Date set forth above and will
      continue until December 31, 2007, unless sooner terminated pursuant to the
      provisions set forth herein (the “Term”).

     

    6.2 Termination
      by Company.
      Company
      may terminate this Agreement without cause at any time, with termination
      effective immediately upon Company’s delivery to Contractor of written notice of
      termination.

     


    
      
         

      

      
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    6.3 Termination
      by Contractor.
      Contractor may terminate this Agreement without cause at any time, with
      termination effective immediately upon Contractor’s delivery to Company of
      written notice of termination.

     

    6.4 Survival.
      The
      definitions contained in this Agreement and the rights and obligations contained
      in Paragraphs 4 (“Intellectual Property Rights”), 6.4 (“Survival”),
      and (“General Provisions”) will survive any termination or expiration of this
      Agreement.

     

    7. General
      Provisions.

     

    7.1 Successors
      and Assigns.
      Contractor may not subcontract or otherwise delegate Contractor’s obligations
      under this Agreement without Company’s prior written consent. Subject to the
      foregoing, this Agreement will be for the benefit of Company’s successors and
      assigns, and will be binding on Contractor’s assignees.

     

    7.2 Notices.
      Any
      notice required or permitted by this Agreement shall be in writing and shall
      be
      delivered as follows, with notice deemed given as indicated: (a) by
      personal delivery, when delivered personally; (b) by overnight courier,
      upon written verification of receipt; (c) by telecopy or facsimile
      transmission, upon acknowledgment of receipt of electronic transmission; or
      (d) by certified or registered mail, return receipt requested, upon
      verification of receipt. Notice shall be sent to the addresses set forth in
      the
      Purchase Agreement or to such other address as either party may specify in
      writing.

     

    7.3 Governing
      Law.
      This
      Agreement shall be governed in all respects by the laws of the United States
      of
      America and by the laws of the State of California, as such laws are applied
      to
      agreements entered into and to be performed entirely within California between
      California residents. Each of the parties irrevocably consents to the exclusive
      personal jurisdiction of the federal and state courts located in California,
      as
      applicable, for any matter arising out of or relating to this Agreement, except
      that in actions seeking to enforce any order or any judgment of such federal
      or
      state courts located in California, such personal jurisdiction shall be
      nonexclusive.

     

    7.4 Severability.
      If any
      provision of this Agreement is held by a court of law to be illegal, invalid
      or
      unenforceable, (i) that provision shall be deemed amended to achieve as
      nearly as possible the same economic effect as the original provision, and
      (ii) the legality, validity and enforceability of the remaining provisions
      of this Agreement shall not be affected or impaired thereby.

     

    7.5 Waiver;
      Amendment; Modification.
      No term
      or provision hereof will be considered waived by Company, and no breach excused
      by Company, unless such waiver or consent is in writing signed by Company.
      The
      waiver by Company of, or consent by Company to, a breach of any provision of
      this Agreement by Contractor, shall not operate or be construed as a waiver
      of,
      consent to, or excuse of any other or subsequent breach by Contractor. This
      Agreement may be amended or modified only by mutual agreement of authorized
      representatives of the parties in writing.

     

    7.6 Injunctive
      Relief for Breach.
      Contractor’s obligations under this Agreement are of a unique character that
      gives them particular value; Contractor’s breach of any of such obligations will
      result in irreparable and continuing damage to Company for which there will
      be
      no adequate remedy at law; and, in the event of such breach, Company will be
      entitled to injunctive relief and/or a decree for specific performance, and
      such
      other and further relief as may be proper (including monetary damages if
      appropriate).

     

    7.7 Entire
      Agreement.
      This
      Agreement constitutes the entire agreement between the parties relating to
      this
      subject matter and supersedes all prior or contemporaneous oral or written
      agreements concerning such subject matter. The terms of this Agreement will
      govern all Project Assignments and services undertaken by Contractor for
      Company.

     


    
      
         

      

      
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    IN
      WITNESS WHEREOF, the parties have executed this Agreement as of the date first
      written above.

     

    
      	
              “Company”

               

              HANDHELD
                ENTERTAINMENT, INC.

               

               

              By:
                /s/ Jeff Oscodar

               

              Name:
                Jeff Oscodar

               

              Title:
                President & CEO

            	
              “Contractor”

               

              SCOTT
                JOHN PAUL WORSNOP

               

               

              By:
                /s/ Scott John Paul Worsnop

               

              Name:
                Scott John Paul Worsnop

               

              Title:
                

            


    

    



    
      
         

      

      
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    EXHIBIT A

    


    PROJECT
      ASSIGNMENT

    


    Services:
      Contractor agrees to do the following: (i) advise the Company regarding the
      transition of the Business from Contractor to the Company; (ii) manage the
      Business, which shall include, without limitation, updating the
      Yourdailymedia.com website with media content, maintaining link trades,
      answering user questions, and, in general, ensuring that the Business is
      properly functioning.

    


    Compensation:
      Contractor will be compensated as follows: 

    


    
      	 	
              ·

            	
              The
                Company shall pay Contractor Two Thousand Dollars ($2,000) per calendar
                month for each month of Services rendered to the Company (the
                “Fee”).
                The Fee (or such portion thereof as shall have been earned by Contractor
                at such time) shall be payable on the 15th
                and the last day of each calendar month during the
                Term.

            


    

     

    
      	 	
              ·

            	
              In
                the event that the Company terminates Contractor’s consulting relationship
                with the Company other than for Cause (as defined in Exhibit
                B
                to
                this Agreement) or Contractor terminates the consulting relationship
                with
                the Company for Good Reason (as also defined in Exhibit
                B
                to
                this Agreement), then Company shall pay to Contractor a termination
                fee
                equal to one (1) month of the then-current
                Fee.

            


    

    


    Expenses.
      Company
      will reimburse Contractor for all reasonable expenses incurred in connection
      with this Project Assignment upon receipt of proper documentation of those
      expenses from Contractor. All expenses in excess of Two Hundred Fifty Dollars
      ($250) in the aggregate, excluding travel and lodging expenses incurred in
      connection with the On-Site Services, which shall require separate prior
      approval, incurred in a single month will require prior approval from the
      Company.

    


    NOTE:
      This
      Project Assignment is governed by the terms of an Independent Contractor
      Services Agreement in effect between Company and Contractor. Any item in this
      Project Assignment which is inconsistent with that Agreement is
      invalid.

    


    IN
      WITNESS WHEREOF, the parties have executed this Project Assignment as of the
      date first written above.

     

    
      
        	
                “Company”

                 

                HANDHELD
                  ENTERTAINMENT, INC.

                 

                 

                By:
                  /s/ Jeff Oscodar

                 

                Name:
                  Jeff Oscodar

                 

                Title:
                  President & CEO

              	
                “Contractor”

                 

                SCOTT
                  JOHN PAUL WORSNOP

                 

                 

                By:
                  /s/ Scott John Paul Worsnop

                 

                Name:
                  Scott John Paul Worsnop

                 

                Title:
                  

              


      

      

        
          
             

          

          
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    EXHIBIT
      B

    


    DEFINITIONS

    


     

    


    1. “Cause”
is
      defined as (a) Contractor’s willful act or omission involving material injury to
      the Company; (b) Contractor’s willful disobedience of reasonable directives of
      the Board or Contractor’s supervisor(s); or (c) Contractor’s conviction of any
      felony. No act, omission or failure to act by Contractor shall be deemed
“willful” unless committed without good faith and without reasonable belief that
      the act, omission or failure to act was in the Company’s best interests.


    


    2. “Good
      Reason”
is
      defined as (a) a reduction in Contractor’s Fee, without Contractor’s written
      consent; (b) a material change in Contractor’s position, responsibilities and
      duties measured against such position, again, without Contractor’s written
      consent; or (c) the Company’s requirement that Contractor move his or her
      primary business location more than fifty (50) miles from its current location
      .
      Contractor hereby acknowledges and agrees that rendering On Site Services
      pursuant to the Agreement shall not constitute a move of Contractor’s primary
      business location for purposes of Definition 2(c) above. 

    


    
      
         

      

      
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