Statement of Work #1, dated as of February 21, 2024, by and between RiskOn International, Inc. and MeetKai, Inc

Exhibit 10.3

STATEMENT OF WORK #1

In the case of conflict with any other term or condition in this Statement of Work (this “SOW”) and the Master Services Agreement (the “Agreement”) dated February 21, 2024 by and between RiskOn International, Inc. (“ROI”) and MeetKai, Inc. (“MeetKai”), the terms of this SOW shall govern. Any capitalized terms used in this SOW but not defined shall have the meaning ascribed to them in the Agreement.

Summary:

This SOW outlines the rights and obligations relating to MeetKai granting ROI rights (which shall be exclusive for the first five years) to use, sub-license and/or resell MeetKai's generative AI platform, as further described on Exhibit A hereto (the “Platform”), during the term, within the territory of North America (the United States of America and all its territories, Canada and Mexico) (the “Territory”) under white-labeling (the “Licensing”), subject to the terms and conditions set forth herein.

License Pricing:

The license fee (the “Licensing Fee”) for the license of the Platform (subject to continued payment of the Maintenance Fee below) during the Term (as hereinafter defined) and in the Territory will be $15,000,000 and paid as follows: $10,000,000 due at the Effective Time; $3,000,000 on the first anniversary of the Effective Time; and $2,000,000 on the second anniversary of the Effective Time. In addition, ROI shall pay MeetKai an annual maintenance fee (the “Maintenance Fee” and together with the Licensing Fee, the “Fees”) for the maintenance of the Platform starting in the fourth year of the Term, which will be due thirty (30) days after the third and subsequent anniversaries of the Effective Time (the “Maintenance Period”).

ROI and MeetKai acknowledge and agree that both parties shall incur fees and expenses in connection with the Licensing (the “Expenses”), with ROI incurring fees and expenses relating to, among other items, marketing and sales of the Platform. ROI and MeetKai further acknowledge and agree that it is the belief of both parties that the Revenue Share (as hereinafter defined) is expected to be a material component of this SOW and will be sufficient to cover all the Expenses during the Maintenance Period. The parties shall review the Revenue Share 30 days prior to the beginning of year during the Maintenance Period, and if the Revenue Share has not become material, regardless of the cause, and/or MeetKai believes that the Revenue Share is not reasonable in relation to Expenses during the upcoming year and determines that a Maintenance Fee is required for the upcoming year, the parties shall use good faith efforts to determine if a Maintenance Fee is required, and if so, what is an appropriate Maintenance Fee. In the event that ROI and MeetKai cannot agree on whether a Maintenance Fee is required or the amount of such Maintenance Fee, the parties agree to submit the dispute to binding arbitration, the fees and expenses of which shall be borne equally by the parties.

The Licensing Fee and the Maintenance Fee, if any, will be paid through the issuance of shares of preferred stock of ROI having a stated value equal to the Fees (the “Preferred Stock”). ROI and MeetKai shall enter into a securities purchase agreement (the “SPA”) simultaneously with this SOW, pursuant to which ROI shall agree to issue and sell to MeetKai the Preferred Stock. The rights, privileges and preferences of the Preferred Stock shall be set forth in the certificate of designation relating to the Preferred Stock (the “COD”). In addition, ROI agrees to pay MeetKai a share of revenue from the Platform, as set forth on Exhibit B hereto (the “Revenue Share”).

Term:

This SOW shall commence on the Effective Time and, unless otherwise terminated herein or in the Agreement, continue in perpetuity (the “Term”). This SOW may be terminated by (i) either party (A) upon written notice to the other party if ROI and MeetKai fail to execute SOW #2 for the development of the End User-facing interface incorporating the Platform within 30 days after the Effective Time (the “SOW #2 Failure”), (B) at any time, if the other party materially breaches this SOW and fails to cure such breach within such timeframes as set forth in Exhibit A from receipt of written notice thereof (provided that the notice provides sufficient details regarding the breach and expressly states the intent to terminate if not cured), or (C) at any time after the fifth anniversary of the from the Effective Time, for any or no reason, upon sixty (60) days prior written notice to the other party or (ii) by ROI at any time after 34 months from the Effective Time, for any or no reason, upon sixty (60) days prior written notice to MeetKai.

In the event that either party terminates this SOW because of the SOW #2 Failure, then MeetKai shall return all Fees received. In the event that ROI terminates this SOW because of a material breach by MeetKai that is not cured as set out in subsection (i) above, then the Fees shall be pro-rated for the period of time for that year, and MeetKai shall, at its election, either: (i) return a pro-rata amount of Preferred Stock for the amount of the Fees from the date of termination through the end of the annual period (the “Refund Period”), (ii) pay ROI in cash equal to the stated value of the number of shares of Preferred Stock that are required to be returned for the Refund Period, or (iii) a combination of (i) and (ii).

Without limiting MeetKai’s other termination rights in the Agreement or herein, this SOW may be terminated by MeetKai at any time, if ROI fails to issue any shares of Preferred Stock due (that is not contested by ROI in good faith) and then fails to issue such shares within ten (10) days after receipt of two (2) written late notices (delivered to ROI at least five (5) days apart), expressly stating the intent to terminate if the shares of Preferred Stock are not received.

Rights and Obligations:

Our Agreement:

This SOW, including the exhibits attached hereto, form our entire agreement for this scope of work. The parties may amend or modify this SOW on mutual written agreement. ROI and MeetKai hereto have caused this SOW to be executed by their duly authorized representatives below indicating acceptance of said SOW.

[signature page follows]

AGREED AND ACCEPTED:

RISKON INTERNATIONAL, INC.

MEETKAI, INC.

Exhibit A: Description of Platform

1. Introduction

This exhibit summarizes the Generative AI platform to be provided by MeetKai to ROI. For purposes of the SOW, “Generative AI” refers to artificial intelligence technologies that can generate new content, whether it be text, images, music, or other forms of media, which encompasses any type of technologies and methods, including, but not limited to, deep learning models like neural networks, and is not limited to any specific type of content or application.

2. Provision of Generative AI Platform

2.1 Platform Development and API Provision

3. Document Retrieval Platform

4. Data Ingestion Support

5. MeetKai Obligations

5.1 Access to MeetKai Developed LLMs

5.2 Continuous Development

Service Levels Agreement

5. Breach and Remediation:

6. ROI Obligations

6.1 ROI will act in good faith to support overall service availability and must maintain the following:

      - Current on payments

      - Access and authorization to systems available at all times

      - Network availability to applications available at all times.

7. Exclusions

7.1 The following conditions are excluded from the calculation of monthly unavailability events:

8 Service Credits

In the event MeetKai is unable to meet the availability target for a calendar month ROI shall be entitled to a return of a portion of the Preferred Stock issued as Fees (“Service Credits”) from MeetKai.  MeetKai agrees to hold and not convert a portion of the Preferred Stock it receives as the Fees (the “Holdback Shares”) until the end of the eleventh (11^th) month after the Fees are paid (the “Holdback Period”) in the event it needs to issue Service Credits to ROI. The Amount of Holdback Shares shall be ten percent (10%) during the first year of the Term (10,000 shares of Preferred Stock), five percent (5%) during the second year of the Term (1,500 shares of Preferred Stock), three percent (3%) during the third year of the Term (600 shares of Preferred Stock) and three percent (3%) during the fourth and each subsequent year of the Term (300 shares of Preferred Stock). As the Preferred Stock will be issued in book entry format by ROI, MeetKai acknowledges and agrees that MeetKai shall have no right, and ROI no obligation, to convert any of the Holdback Shares prior to the completion of the Holdback Period. Service Credits shall be paid by MeetKai to ROI, whereby ROI shall cancel the corresponding number of Holdback Shares equal to the value of the Service Credits, upon delivery by ROI of written notice to MeetKai with specificity (including calculations) regarding the failure to meet the required service level requirements. In the event that the number of Holdback Shares are insufficient to satisfy Service Credits, ROI shall have the right, in its sole discretion, to (i) cancel a corresponding number of other shares of Preferred Stock issued to MeetKai as the Fees that are still outstanding, if any, (ii) cancel a corresponding number of shares of Preferred Stock to be issued to MeetKai in a subsequent year as the Fees, or (iii) a combination of (i) and (ii). In no event shall MeetKai be required to pay Service Credits in cash or any other manner other than by a return/cancellation of Preferred Stock.

Calculation of Credits:

Credits are based on a percentage of the Fees paid for the calendar month in which MeetKai failed to meet the availability target. Fees for a calendar month are 1/12^th of the Fees paid for the then-current contract year.

9. Definitions

For purposes of this SOW, the following terms shall be defined as follows:

“Service Credits” shall mean means the sums referred to below as being payable by MeetKai to ROI in response to MeetKai’s failure to meet a service level in accordance with this SOW.

“System Availability” means the total number of minutes in a month, minus the number of minutes of Downtime in a month, divided by the total number of minutes in a month.

“Downtime” means the period of time in whole minutes where the MeetKai service is unavailable to ROI and/or its End Users. Downtime does not include:

Any period of downtime less than half of one minute will not be counted as Downtime.

“Scheduled Maintenance” means the period of time in minutes of unavailability of the Platform that is used to conduct service maintenance activities. Scheduled maintenance excludes normal operating maintenance activities that do not incur service downtime which affects ROI.

“Emergency Maintenance” means the period of time in minutes of unavailability of the Platform that is used to conduct maintenance activities which cannot be planned and may be used to address a security issue, prevent Service disruption, prevent data corruption, or comply with legislative requirements.

Exhibit B: Revenue Share

Sales