EXHIBIT 4.23
ONLINE GAME SOFTWARE
DISTRIBUTION AND LICENSE AGREEMENT
THE SIGN
DECEMBER 28, 2004
SHENGQU INFORMATION TECHNOLOGY (SHANGHAI) CO., LTD.
SHANGHAI ▇▇▇▇▇▇ NETWORKING CO., LTD.
NANJING ▇▇▇▇▇▇ NETWORKING CO., LTD.
HANGZHOU BIANFENG NETWORKING CO., LTD.
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ONLINE GAME SOFTWARE
DISTRIBUTION AND LICENSE AGREEMENT
THIS ONLINE GAME SOFTWARE DISTRIBUTION AND LICENSE AGREEMENT (this "Agreement")
is entered into as of December 28, 2004 ("Effective Date") by and among:
(1) SHENGQU INFORMATION TECHNOLOGY (SHANGHAI) CO., LTD., a corporation
organized and existing under the laws of the People's Republic of China
(the "PRC") and having its registered address at Room 638-7, Building 2,
No. 351 Guoshoujing Road, Zhangjiang Hi-Tech Park, Shanghai, the PRC
("Shengqu" or "Licensor");
(2) SHANGHAI ▇▇▇▇▇▇ NETWORKING CO., LTD., a corporation organized and existing
under the laws of the PRC and having its registered address at ▇▇▇▇ ▇▇▇-▇,
▇▇. ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇ New Area, Shanghai, the PRC ("▇▇▇▇▇▇
Networking");
(3) NANJING ▇▇▇▇▇▇ NETWORKING CO., LTD., a corporation organized and existing
under the laws of the PRC and having its registered address at Room 801,
18 F International Garden Apartment, High-technology Area, Nanjing, the
PRC ("Nanjing ▇▇▇▇▇▇ "); and
(4) HANGZHOU BIANFENG NETWORKING CO., LTD., a corporation organized and
existing under the laws of the PRC and having its registered address at
▇▇▇▇▇ ▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, the PRC ("Bianfeng").
For the purpose of this Agreement, ▇▇▇▇▇▇ Networking, Nanjing ▇▇▇▇▇▇ and
Bianfeng shall be referred to collectively as the "Licensees".
RECITALS
WHEREAS, Shengqu engages in the business of developing, distributing and selling
computer games, including online games played by multiple users;
WHEREAS, the Licensees engage in the business of the operating, publishing and
selling online games;
WHEREAS, Shengqu and ▇▇▇▇▇▇ Networking had entered into a online game software
distribution and license agreement on June 1, 2004 and Shengqu granted the
▇▇▇▇▇▇ Networking from June 1, 2004 to
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May 31, 2005 (i) a license to distribute and sell an online game known as the
Game (as defined in clause 1.4) in specific districts (the "Territory", as
defined in clause 1.6) and (ii) a right to manage and operate servers for the
Game, to provide technical support to users of the Game, to ▇▇▇▇ users, and to
provide marketing services, each in the Territory (the "Services"); and
WHEREAS, ▇▇▇▇▇▇ Networking desires to sublicense and distribute the Game to
Nanjing ▇▇▇▇▇▇ and Bianfeng from January 1, 2005 to May 31, 2005. Shengqu agrees
to the sublicense and distribution and Nanjing ▇▇▇▇▇▇ and Bianfeng desires to
gain the sublicense and distribution.
WHEREAS, Shengqu desires to license and distribute the Game to ▇▇▇▇▇▇
Networking, Nanjing ▇▇▇▇▇▇ and Bianfeng in specific regions from June 1, 2005 to
December 31, 2005.
NOW, THEREFORE, in consideration of the premises and the mutual consideration
received and to be received pursuant to this Agreement, the parties agree as
following. This Agreement will replace the online game software distribution and
license agreement between ▇▇▇▇▇▇ Networking and Shengqu dated on June 1, 2004.
1. DEFINITIONS.
In this Agreement, unless the context otherwise requires, the following
expressions shall have the meanings set forth below:
1.1 "Business Day" shall mean any day other than a Saturday, a Sunday or a
legal holiday in the PRC.
1.2 "Client Software" shall mean software sold, provided or distributed to the
users and therefore, to be loaded onto the user's personal computer.
1.3 "Server Software" shall mean system software and a proprietary database
(including the content and records located in such database) located on
servers connected to the Internet.
1.4 "Game" shall mean an online game known as The Sign.
1.5 "Intellectual Property" shall mean any and all (by whatever name or term
known or designated) tangible and intangible and now known or hereafter
existing (a) rights associated with works of authorship throughout the
universe, including, but not limited to, copyrights (including without
limitation, the sole and exclusive right to prepare "derivative works of
the copyrighted work and to copy, manufacture,
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reproduce, distribute copies of, modify, perform and display the
copyrighted work and all derivative works thereof), moral rights
(including without limitation any right to identification of authorship
and any limitation on subsequent modification) and mask-works; (b) rights
in and relating to the protection of trademarks, service marks, trade
names, goodwill, rights of publicity, merchandising rights, advertising
rights and similar rights; (c) rights in and relating to the protection of
trade secrets and confidential information; (d) patents, designs,
algorithms and other industrial property rights and rights associated
therewith; (e) other intellectual and industrial property and proprietary
rights (of every kind and nature throughout the universe and however
designated) relating to intangible property that are analogous to any of
the foregoing rights (including without limitation logos, rental rights
and rights to remuneration), whether arising by operation of law,
contract, license or otherwise; (f) registrations, applications, renewals,
extensions, continuations, divisions or reissues thereof now or hereafter
in force throughout the universe (including without limitation rights in
any of the foregoing); and (g) rights in and relating to the sole and
exclusive possession, ownership and use of any of the foregoing throughout
the universe, including without limitation, the right to license and
sublicense, assign, pledge, mortgage, sell, transfer, convey, grant, gift
over, divide, partition and use (or not use) in any way any of the
foregoing now or hereafter (including without limitation any claims and
causes of action of any kind with respect to, and any other rights
relating to the enforcement of, any of the foregoing).
1.6 "Territory" shall include East China, North-east China, North China,
North-west China, South-west China, and Central-south China. East China
include Shanghai, Jiangsu province, Zhejiang province, Anhui province,
Fujian province, Jiangxi province and Shandong province; North-east China
include Liangning province, Jilin province and Heilongjiang province;
North China include Beijing, Tianjin, Hebei province, Shanxi province and
Inner Mongolia autonomous region; North-west China include Shanxi
province, Gansu province, Qinghai province, Ningxia autonomous region and
Xinjiang autonomous region; South-west China include Chongqin, Sichuan
province, Guizhou Province, Yunnan province and Xizhang autonomous region.
Central-south China include Henan province, Hubei province, Guangdong
province, Guangxi autonomous region and Hainan province.
2. DISTRIBUTION LICENSE
2.1 ▇▇▇▇▇▇ Networking shall reserve an exclusive right to distribute and sell
the Game and its peripheral products in North China, North-west China and
South-west China;
▇▇▇▇▇▇ Networking grants Nanjing ▇▇▇▇▇▇ an exclusive license to distribute
and sell the Game and its peripheral products in Central-south China and
East China;
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▇▇▇▇▇▇ Networking grants Bianfeng an exclusive license to distribute and
sell the Game and its peripheral products in North-east China.
2.2 The Licensees shall, during the term of this Agreement, diligently and
faithfully provide the Services, distribution and sell the Game and its
peripheral products in the Territory and shall use its best endeavors to
maintain the goodwill of Shengqu in the Territory. The Licensees shall
leave in position and not cover or erase any notices or other marks
(including, without limitation, details of patents or notices that a
trademark design or copyright relating to the Game is owned by Shengqu or
a third party) which Shengqu may place or affix to the Game.
2.3 During the term of this Agreement, the Licensees shall not sell,
sublicense, export or assist in or be a party to the export of the Game
outside the Territory.
3. INTELLECTUAL PROPERTY RIGHTS
3.1 Shengqu expressly covenants and warrants that it has good title or
authorization to the Game, Client Software, Server Software and the right
to license their use to the Licensees free of any proprietary rights of
any other party or any other encumbrance whatsoever.
3.2 Shengqu acknowledges that ownership rights in all data and data files
(including, but not limited to, user data, data recorded and stored in the
game database, connection log, billing log, chatting log and other related
data) which are generated by the servers during operation of the Game
within the Territory, and the contents of related documentation, and
Intellectual Property Rights therein or associated therewith, will remain
with The Licensees, who will have the exclusive right to protect the same.
3.3 The Licensees agree to report to Shengqu any known infringements, illegal
uses or misuses of the Intellectual Property Rights of Shengqu in
connection with the Game in its original and/or localized form and any
part thereof, the game engine, the Client Software, the Server Software,
and the contents of related documentation in the Territory. The Licensees
agrees to assist Shengqu in enforcing or obtaining protection of such
items and acknowledges that Shengqu shall have the sole right to bring a
legal action or suit for infringement thereof. Such assistance shall be at
Shengqu's expense unless the matter to which such assistance applies
arises out of or from or is related in any way to the breach by the
Licensees of any term or condition of this Agreement or by the Licensees'
willful misconduct, in which case such assistance shall be at the
Licensees' expense.
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4. INITIAL PAYMENT
4.1 In consideration of the rights have been granted by Shengqu to ▇▇▇▇▇▇
Networking from January 1, 2005 to May 31, 2005, and ▇▇▇▇▇▇ Networking had
paid to Shengqu the initial fees of RMB 5,000,000, now (i) Nanjing ▇▇▇▇▇▇
should pay to ▇▇▇▇▇▇ Networking the sublicense fees of RMB 1,460,000, and
(ii) Bianfeng should pay to ▇▇▇▇▇▇ Networking the sublicense fees of RMB
210,000
4.2 Shengqu shall grant the Licensees the license and distribution right in
the Territory from June 1,2005 to December 31, 2005, the Licensees will
pay the initials in this period: (i) ▇▇▇▇▇▇ Networking should pay to
Shengqu RMB 580,000; (ii) Nanjing ▇▇▇▇▇▇ should pay to Shengqu RMB
2,030,000; and (iii) Bianfeng should pay to Shengqu RMB 290,000.
5. MONTHLY ROYALTY PAYMENTS
The Licensees shall make monthly royalty payments to Shengqu as following:
5.1 The Licensees shall pay to Shengqu 26 % of the revenues received in
connection with operating the Game.
5.2 The Licensees shall provide an income statement for each month to Shengqu
for its review and confirmation by the 10th day of the following month.
5.3 The Licensees shall pay to Shengqu the monthly royalty payment for each
month by the 30th day of the month after the month in which Shengqu
confirms the income statement under Clause 5.2.
5.4 Shengqu shall provide The Licensees the receipt for a monthly royalty
payment by the 15th day after the Licensees makes such monthly royalty
payment.
6. TERM
The term of this Agreement shall be for a period from January 1, 2005 to
December 31, 2005.
7. RIGHTS ON TERMINATION
Upon termination of this Agreement:
7.1 All of the Licensees's rights with respect to the Game, in its original
and/or localized form and any part
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thereof, the game engine, the Client Software, the Server Software, the
tools, and the codes will automatically and immediately terminate, and The
Licensees shall immediately cease to use the Game in its original and/or
localized form and any part thereof, the game engine, the Client Software,
the Server Software, the tools, and the codes, and shall destroy or return
(at Shengqu's option) any materials representing the same to Shengqu,
along with a written confirmation of destruction or return, signed by an
officer of The Licensees.
7.2 Any termination of this Agreement shall not affect any rights and
obligations accrued as of the date of the termination. For the avoidance
of doubt, any monthly royalty payment accrued prior to the termination
shall be payable notwithstanding the termination and the payment shall be
governed to the same extent by the terms of monthly royalty payment under
this Agreement.
8. DEFAULT
8.1 For the purposes of this Agreement, a party shall be in default if (i) it
materially breaches a term of this Agreement causing serious harm to the
goodwill and advantages of the other party, and such breach continues for
a period of sixty (60) days after the party committing the breach has been
notified of the breach, or (ii) it become insolvent.
8.2 Upon occurrence of an event of default as described in the clause 8.1, the
party not in default may immediately terminate this Agreement by giving
written notice to the party in default. The rights and remedies provided
to the parties in this Clause shall not be exclusive and are in addition
to any other rights and remedies provided by this Agreement or at law or
in equity.
9. INDEMNIFICATION
9.1 The Licensees shall indemnify, defend and hold Shengqu and its affiliates,
directors, officers, employees, shareholders, and agents harmless from and
against any and all claims, losses, liabilities, costs and expenses
arising out of any third-party claim relating to:
9.1.1 Any violation by The Licensees of any of the provisions of this
Agreement; and
9.1.2 Any gross misconduct or intentional acts or omissions on the part of
The Licensees or its employees or agents.
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9.2 Shengqu shall indemnify, defend and hold The Licensees and its affiliates,
directors, officers, employees, shareholders, and agents harmless from and
against any and all claims, losses, liabilities, costs and expenses
arising out of any third-party claim relating to:
9.2.1 Any violation by Shengqu of any of the provisions of this Agreement;
and
9.2.2 Any gross misconduct or intentional acts or omissions on the part of
Shengqu or its employees or agents.
9.3 Indemnification procedure shall be as following:
9.3.1 A party seeking indemnification (the "Indemnified Party") will
promptly notify the other party (the "Indemnifying Party") in
writing of any claim for indemnification.
9.3.2 The Indemnifying Party will, if requested by the Indemnified Party,
give assistance to the Indemnified Party in defense of any claim.
9.3.3 The Indemnified Party will have the right to consent to the entry of
judgment with respect to, or otherwise settle, an indemnified claim
with the prior written consent of the Indemnified Party.
10. GOVERNING LAW
This Agreement shall be governed by and construed in accordance with the laws of
the PRC.
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IN WITNESS WHEREOF, Shengqu and the Licensees have each caused this Agreement to
be executed and delivered by a duly authorized representative, officer or agent,
effective as of the Effective Date.
SHENGQU INFORMATION TECHNOLOGY (SHANGHAI) CO., LTD.
By:___________________________
Name: Chen Tianqiao
Title: Chief Executive Officer
SHANGHAI ▇▇▇▇▇▇ NETWORKING CO., LTD.
By:___________________________
Name: ▇▇▇▇ ▇▇▇▇▇▇
Title: Senior Vice President
NANJING ▇▇▇▇▇▇ NETWORKING CO., LTD.
By:___________________________
Name: Tang Jun
Title: President
HANGZHOU BIANFENG NETWORKING CO., LTD.
By:___________________________
Name: Wang Jingying
Title: Vice President
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