EXHIBIT 10.28
ANNEX C
ONLINE GAME DISTRIBUTION AND SERVICE AGREEMENT II
THE AGE
ONLINE GAME DISTRIBUTION AND SERVICE AGREEMENT II
THE AGE
JULY 14, 2004
SHENGQU INFORMATION TECHNOLOGY (SHANGHAI) CO., LTD.
SHANGHAI XXXXXX NETWORKING CO., LTD.
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THIS ONLINE GAME DISTRIBUTION AND SERVICING AGREEMENT (this "Agreement") is
entered into as of July ___, 2004 ("Effective Date") by and between:
(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 Xxxx 000-0, Xxxxxxxx 0,
000 Xxxxxxxxxxx Xxxx, Xxxxxxxxxx Hi-Tech Park, Shanghai, the PRC
("Shengqu"); and
(2) SHANGHAI XXXXXX NETWORKING CO., LTD., a corporation organized and existing
under the laws of the PRC and having its registered address at Xxxx 000-X,
000 Xxxxxxxxxxx Xxxx, Xxxxxx New Area, Shanghai, the PRC ("Xxxxxx
Networking").
RECITALS
WHEREAS, Shengqu engages in the business of developing, distributing and selling
computer games, including online games played by multiple users;
WHEREAS, Xxxxxx Networking engages in the business of the operating, publishing
and selling online games;
WHEREAS, Shengqu has been granted by Shanghai Shengpin Network Technology
Development Co., Ltd. (the "Developer") a license to (i) distribute and sell an
online game known as The Age (the "Game", as defined in clause 1.4) in mainland
China and Hong Kong Special Administrative Region (the "Territory"); (ii) manage
and operate servers for the Game, to provide technical support to users of the
Game, to xxxx users, and to provide marketing services (the "Services"), each in
the Territory and (iii) sublicense to a third party.
WHEREAS, Shengqu desires to xxxxx Xxxxxx Networking (i) a license to distribute
and sell The Game within the Territory and (ii) a right to provide the Services
within the Territory; and
WHEREAS, Xxxxxx Networking desires to distribute and sell the Game and to
provide the Services within the Territory, all in accordance with the terms and
conditions of this Agreement.
NOW, THEREFORE, in consideration of the premises and the mutual consideration
received and to be received pursuant to this Agreement, the parties agree as
follows:
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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 Shengqu obtained from the Developer known
as The Age, which can be played by a user with other users by installing
the Client Software onto a user's computer and then accessing the Server
Software connected to the Internet.
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, 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
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(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).
2. DISTRIBUTION LICENSE
2.1 Shengqu grants Xxxxxx Networking an exclusive license to distribute and
sell the Game and its peripheral products in the Territory. In addition,
Shengqu grants Xxxxxx Networking a license to use any and all trademarks
of Shengqu and the Developer, whether now possessed by Shengqu and the
Developer or hereafter acquired, in connection with the distribution and
sale of the Game and its peripheral products in the Territory.
2.2 Xxxxxx Networking shall, during the term of this Agreement, diligently and
faithfully provide the Services, distribute 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. Xxxxxx Networking 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, Xxxxxx Networking 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 the right to license
the Game, Client Software, Server Software to Xxxxxx Networking.
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 Xxxxxx Networking, who will have the exclusive right to protect the
same.
3.3 Xxxxxx Networking acknowledges that 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 are
proprietary in nature and that Shengqu claims all related Intellectual
Property Rights granted by or available under law therein. Title and sole
ownership rights in and to the Game, in its
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original and/or localized form and any part thereof, the game engine, the
Client Software, the Server Software, and the contents of related
documentation, and Intellectual Property Rights therein or associated
therewith, will remain with Shengqu or the Developer, who will have the
exclusive right to protect the same.
3.4 Xxxxxx Networking agrees 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. Xxxxxx
Networking agrees to assist Shengqu in enforcing or obtaining protection
of such items and acknowledges that Shengqu or the Developer 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 Xxxxxx Networking of any term or condition of this Agreement
or by Xxxxxx Networking's willful misconduct, in which case such
assistance shall be at Xxxxxx Networking's expense.
4. INITIAL PAYMENT
4.1 Xxxxxx Networking agrees to pay to Shengqu an initial licensing fee of RMB
5,000,000 for the rights granted under this Agreement (the "Initial
Payment"). The Initial Payment shall be non-refundable, except in the
event that Shengqu breaches the Agreement, and shall not be construed as
an advance payment of any part of the revenue sharing fee set forth in
Clause 5.
4.2 Shengqu shall provide with Xxxxxx Networking the receipt by the 15th day
after Xxxxxx Networking makes such payment.
5. MONTHLY ROYALTY PAYMENTS
Xxxxxx Networking shall make monthly royalty payments to Shengqu as set
forth:
5.1 Xxxxxx Networking shall pay to Shengqu 26% of the revenues received in
connection with operating the Game.
5.2 Xxxxxx Networking 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 Xxxxxx Networking shall pay to Shengqu the monthly royalty payment for
each month by the 30th day of
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the month after the month in which Shengqu confirms the income statement
under Clause 5.2.
5.4 Shengqu shall provide Xxxxxx Networking the receipt for a monthly royalty
payment by the 15th day after Xxxxxx Networking makes such monthly royalty
payment.
6. TERM
The term of this Agreement shall be for a period of twelve (12) months begging
on May 1, 2004.
7. RIGHTS ON TERMINATION
Upon termination of this Agreement:
7.1 All of Xxxxxx Networking's rights with respect to 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 will
automatically and immediately terminate, and Xxxxxx Networking 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 Xxxxxx Networking.
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
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rights and remedies provided by this Agreement or at law or in equity.
9. INDEMNIFICATION
9.1 Xxxxxx Networking 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 Xxxxxx Networking of any of the provisions of this
Agreement; and
9.1.2 Any gross misconduct or intentional acts or omissions on the part of
Xxxxxx Networking or its employees or agents.
9.2 Shengqu shall indemnify, defend and hold Xxxxxx Networking 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 follows:
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 Indemnifying 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 Indemnifying Party.
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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 Xxxxxx Networking 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: /s/ Tianqiao Chen
___________________________
Name: Tianqiao Chen
Title: Executive Director
SHANGHAI XXXXXX NETWORKING CO., LTD.
By: /s/ Xxxxxx Xxxx
___________________________
Name: Xxxxxx Xxxx
Title: Supervisor
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