Marketing Agreement	12 Months Ended
Jan. 31, 2013
Notes to Financial Statements
Marketing Agreement	5. MARKETING AGREEMENT On September 26, 2012 Painmaster Products Inc. (“Painmaster’) entered into a Marketing Agreement (“Agreement”) with Newmark, Inc. (“Newmark”). This Agreement grants to Painmaster the exclusive license to all intellectual property owned by or licensed to Newmark or its affiliates associated with the product to use in the field of alleviating pain (the “Field”), including, without limitations, all patents, technology, inventions, know-how, processes and trademarks for the term of ten (10) years with an automatic renewal of another ten (10) years. Painmaster has the right to terminate the Agreement at the end of any one year period at its own discretion. The Territory this Agreement covers is the United States and Canada including each of their respective, territories and possessions. Compensation Within five (5) days of signing the Agreement Painmaster shall pay to Newmark fifty thousand dollars ($50,000 - the amount has been paid). Further Painmaster shall pay to Newmark the sum of seven hundred thousand dollars ($700,000), of which seventy thousand dollars ($70,000) shall be paid monthly commencing on July 15, 2013 and continuing on the 15th of each of the nine succeeding months. The total of seven hundred and fifty thousand dollars ($700,000) and the fifty thousand dollar ($50,000) payment shall be considered an advance on Royalties payments. These sums shall be non-refundable even if Royalties do not exceed total amount advanced. Royalty Payments Newmark shall receive from Painmaster an amount equal to three percent (3%) of all Net sale of the DRTV marketing campaign. Newmark also shall receive from Painmaster ten per cent (10%) of all retail and wholesale revenue of any kind (the “Retail Sales Royalties”), less the $750,000 previously advanced to Newmark. The Retail Sales Royalty rate shall be reduced to 7.5% once aggregate Royalties/Advances (irrespective of Retail, wholesale or DRTV marketing) has totaled two million dollars ($2,000,000). The Retail Sales Royalty rate shall be further reduced to 5% once aggregate Royalties/Advances (irrespective of Retail, wholesale or DRTV marketing) has totaled five million dollars ($5,000,000).

Marketing Agreement

12 Months Ended

Jan. 31, 2013

5. MARKETING AGREEMENT

On September 26, 2012 Painmaster Products Inc. (“Painmaster’) entered into a Marketing Agreement (“Agreement”) with Newmark, Inc. (“Newmark”). This Agreement grants to Painmaster the exclusive license to all intellectual property owned by or licensed to Newmark or its affiliates associated with the product to use in the field of alleviating pain (the “Field”), including, without limitations, all patents, technology, inventions, know-how, processes and trademarks for the term of ten (10) years with an automatic renewal of another ten (10) years. Painmaster has the right to terminate the Agreement at the end of any one year period at its own discretion. The Territory this Agreement covers is the United States and Canada including each of their respective, territories and possessions.

Compensation

Within five (5) days of signing the Agreement Painmaster shall pay to Newmark fifty thousand dollars ($50,000 - the amount has been paid). Further Painmaster shall pay to Newmark the sum of seven hundred thousand dollars ($700,000), of which seventy thousand dollars ($70,000) shall be paid monthly commencing on July 15, 2013 and continuing on the 15th of each of the nine succeeding months. The total of seven hundred and fifty thousand dollars ($700,000) and the fifty thousand dollar ($50,000) payment shall be considered an advance on Royalties payments. These sums shall be non-refundable even if Royalties do not exceed total amount advanced.

Royalty Payments

Newmark shall receive from Painmaster an amount equal to three percent (3%) of all Net sale of the DRTV marketing campaign. Newmark also shall receive from Painmaster ten per cent (10%) of all retail and wholesale revenue of any kind (the “Retail Sales Royalties”), less the $750,000 previously advanced to Newmark. The Retail Sales Royalty rate shall be reduced to 7.5% once aggregate Royalties/Advances (irrespective of Retail, wholesale or DRTV marketing) has totaled two million dollars ($2,000,000). The Retail Sales Royalty rate shall be further reduced to 5% once aggregate Royalties/Advances (irrespective of Retail, wholesale or DRTV marketing) has totaled five million dollars ($5,000,000).

Avalon Holding Group, Inc. 10-K