basically the filter on the end is less restrictive than the stock one so the engine can breath more easily, if the engine takes in more air, it will need more fuel to get the mixture right, this increased fuel/air combination in the chamber gives a stronger burn and therefore more power.
10hp at the flywheel is only about 2hp at the wheel mind you, but if you also add a better flowing exhaust and cams they will all work together giving a much greater improvement over stock.
as for looks..... nice one.
