Exhibit 4.16
COPYRIGHT LICENSE CONTRACT (EXTENDED FOR YEAR 2005)
This "Copyright License Contract (Extended for Year 2005)" (hereinafter referred
to as "Contract") is executed between Shanghai Yide Networking Co., Ltd., which
is located at ▇▇▇▇ ▇▇▇, ▇▇▇▇▇▇▇▇ ▇, ▇▇▇▇▇ ▇▇▇, ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ (hereinafter
referred to as "Licensor"), and Shanghai Weilan Computer Co., Ltd., which is
located at ▇/▇, ▇▇.▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇. Shanghai (hereinafter referred to as
"Licensee") on the 1st day of September 2005 at the above mentioned legal
domicile of Licensor in Shanghai on the basis of "Copyright License and
Cooperation Contract" (hereinafter referred to as "Original Contract") signed in
December 2002.
Whereas Licensor has obtained the right to produce digital images and text
messages for mobile phones on basis of images and contents contained in volumes
16-41 of cartoon series publication "Crayon Shin Chan" (author: ▇▇▇▇▇▇▇ ▇▇▇▇) of
Japanese version published by Japanese corporate Futaba Corporation with prior
formal authorization from Japan Windmill Video Culture Development Corporation
and the succeeding volumes of the same cartoon series publication, and also an
exclusive right to sale via communication and mobile network to China Mobile
Communication Corporation's client in the use licensed territory (hereinafter
referred to as "Rights Obtained by Licensor") (Licensor proclaims that the
licensed right is formally authorized by the Japan Windmill Video Culture
Development Corporation ), Whereas Licensee and Licensor agree that in
consideration of the payment of copyright royalty to Licensor, Licensee has
right to produce digital images and text messages on basis of images and
contents in the Works, and an exclusive right to sell via communication and
mobile network to clients of the China Mobile Communication Corporation in the
licensed area. After amicable negotiations, the following terms and conditions
have been agreed upon by the Parties:
ARTICLE 1.-SCOPE OF COPYRIGHT LICENSE
Licensor permits Licensee to use the Work and copyright of the Work in the
following area, right scope, term, and by the following means. The scope of
licensing is strictly defined, detailed and explicit; other rights without
permission are out of the licensing scope. Unless otherwise specified, the terms
"Work", "Area of Licensing", "Term of Licensing" and "Right Scope of Licensing"
have the following meanings:
1. Works: Volume 16-41 of cartoon series publication "Crayon Shin Chan" (author:
▇▇▇▇▇▇▇ ▇▇▇▇) of Japanese version issued by Japanese corperate person Futaba
corporation (hereinafter referred to as 'Futaba') (hereinafter referred to as
"Works").
2. Territory of Licensing: People's Republic of China (excluding Hong Kong,
Macao, Taiwan).
3. Term of Licensing: From the 1 September 2005 to the 31 July 2006. If either
Party of Licensor or Licensee does not agree to extend the Term of
Licensing, he shall give a written notice to the other party thirty days before
the expiration of the Term of Licensing. If in the thirty days after the
expiration of the Term of Licensing, neither party of Licensor and Licensee
gives such a written notice to the other party to terminate this Contract, it is
deemed that the Parties agree to extend this Contract automatically for one
year.
4. Scope of licensing: Licensor permits Licensee to enjoy the right to produce
digital images and text messages on basis of images and contents in the Works,
and the exclusive right to provide wireless sale service (hereinafter referred
to as "Wireless Service") via communication and mobile network to China Mobile
Communication Corporation's clients (hereinafter referred to as "Mobile
Operator") in the territory of licensing. Licensee shall not delegate or
transfer the license arising out of this Contract to a third party.
5. This Contract: including the main this Contract, documents specified as
attachments to This Contract, and other written documents that is supplemented
or added henceforth and is agreed by the Parties in written form to be attached
hereto.
ARTICLE 2.-REPRESENTATIONS AND WARRANTIES
1. Licensee makes the following undertaking and guarantee to Licensor:
(a) Licensee is a legal and independent person incorporated under Chinese laws,
with qualification and ability of communication and network operation prescribed
by the Chinese government and is in possession of certain assets and ability of
normal operation, performance of this Contract and undertake liabilities under
this Contract.
(b) Licensee has accomplished all legal formalities and company internal
procedures required for the execution and performance of this Contract.
(c) Licensee has valid governmental permits required for the execution,
performance and implementation of this Contract.
(d) None of execution, implementation, performance of this Contract and payment
made on the payment day in respect of this Contract is in contradiction to
Chinese laws.
(e) Licensee agrees that Licensor may submit the copy of this Contract to Japan
Windmill Video Culture Development Corporation for its reference.
(f) Licensee will endeavor to assist the right safeguard action taken by
Licensor according to article 9 of this Contract.
(g) Licensee undertakes that without a prior consent of Licensor, Licensee shall
not use the images and text contents in the Works outside the licensing scope.
(h) Licensee undertakes to promptly submit a written report containing authentic
data to Licensor and make payments conforming to the provisions of this
Contract.
2. Licensor makes the following undertaking and guarantee to Licensee:
(a) Licensor is a legal and independent person incorporated under Chinese law
and is in possession of certain assets and ability of normal operation,
performance of this Contract and undertaking liabilities in this Contract.
(b) Licensor has accomplished all the legal formalities and company internal
procedures required for the execution and performance of this Contract.
(c) Licensor has valid governmental permits required for the execution,
performance and implementation of this Contract.
(d) Licensor undertakes that he possesses legally, consistently, completely, in
the above-mentioned licensing term, territory and scope, the exclusive right to
permit Licensee to use the Works.
(e) Licensor does not permit any third party other than Licensee to use the
Works in the Area of Licensing, in the scope of right before or at the time of
the execution of this Contract.
(f) Licensor undertakes to be responsible for legality of the source of any
information and article related to the Works submitted by him to Licensee and
confirmed by in written form mutually signed for accomplishing the delivery
procedures.
(g) Licensor agrees that for the purposes of generalization of "Wireless
Service" on basis of Works, Licensee could use images and text contents in the
Works in the scope determined by this Contract and by the means agreed in this
Contract.
(h) Licensor undertakes that Licensee is the only cooperative partner authorized
to provide "Wireless Service" in the scope determined in this Contract.
(i) From now on shall Licensor obtain new license (hereinafter referred to as
'New License') related to images of cartoon of the Works other than "Rights
Obtained by Licensor" and provided that Licensee fully observes the undertaking
and guarantee contemplated in paragraph 1, article 2 of this Contract, Licensor
undertakes to give priority to Licensee and continue the cooperation under the
same conditions.
ARTICLE 3.-OBJECT, MEANS, CONTENT AND PRICE OF WIRELESS SERVICE
Object of Wireless Service: mobile phone users of China Mobile Communication
Corporation.
Wireless Service platform: platform of message service (special service code
2000), WAP, multicolor message of Licensee, and platforms providing same type of
service which has been declared by Licensee, approved in written form by
Licensor and purchased totally by Licensee.
Method of Wireless Service: to order with common message, with STK card message,
with web site, WAP, MMS, or wireless download on basis JAVA technology mobile
phone digital images and text message of Crayon Shin Chan. The charge method of
Wireless Service could be charge method approved by the Mobile Operator such as
charge by piece, by month, by flux etc.
Content of Wireless Service: service that could be provided to the mobile phone
users
includes: black and white picture, color picture, short message game,
information service and multimedia color message etc. The forms of the content
could be pure picture, pure word, or integrated forms of picture and word, and
picture and word could be black and white, unicolor or chromatic.
Price of Wireless Service: The lowest price of Picture service by month is 5
Yuan RMB; the lowest price of message service by month is 3 Yuan RMB. The final
price varies with the content of Wireless Service provided by Licensee, and
shall be applied with and approved by Mobile Operator, once the application is
approved, the price approbated by Mobile Operator will be the basis of
determination of rate and settlement of expense between Parties, but Licensee
shall notice in written form to Licensor the service price, and the service
price will be the final price in this Contract and will be an attachment to this
Contract. Users of Mobile Operator will receive Wireless Service provided by
Licensee by means determined in this Contract, and pay to Mobile Operator the
expense according to the above final price.
With prior negotiation between Parties and prior written consent of Parties, in
the purpose of popularizing Wireless Service, the above Wireless Service methods
could be used in non-profit service.
ARTICLE 4.-COPYRIGHT ROYALTY, PERFORMANCE GUARANTEE AND SETTLEMENT
1. The Parties agree that the last day of each month is the base date of
calculation of copyright royalty, and the first day to the last day of
considered month is a calculation period.
2. The Parties agree that: Licensee copyright royalty to be paid by Licensee to
Licensor is equal to 40% of the final price of contents of Wireless Services
specified in article 3 of this Contract, and during each calculation period,
copyright royalty to be paid by Licensee to Licensor shall not lower than fifty
thousand (50,000) Yuan RMB.
3. To secure the stabilization of the quality and income of Wireless Service,
the performance guarantee to be paid by Licensee to Licensor is two hundred
forty thousand (240,000) Yuan RMB, valid period of which is three months from
the execution date, i.e. three calculation periods. During the three calculation
periods, if copyright royalty to be paid by Licensee is more than performance
guarantee, the extra part shall be settled according to paragraphs 1, 2, 4 of
this article.
4. Payment of performance guarantee: Within thirty days after the execution date
of this Contract, Licensee shall pay the performance guarantee provided in
paragraph 3 of this article before October 1, 2005, i.e. two hundred forty
thousand Yuan (240,000) RMB. If Licensee delays to pay to Licensor, the latter
is entitled to choose to terminate this Contract unilaterally or to charge
Licensee a penalty equal to one
percent (1%) of the arrears each day.
5. Licensee shall report to Licensor in written form every month. Fifteen days
after termination of each calculation period, Licensee shall provide to Licensor
detailed Wireless Service operation performance and sale of that calculation
period; once Licensor confirms the report, within ten Working days after receipt
of the invoices from Licensor, Licensee shall adequately pay the above copyright
royalty of the period. If Licensee delays to pay, Licensor shall notify Licensee
immediately. If Licensee does not pay the due sums within ten days after the
notice of Licensor because of Licensee, Licensor is entitled to choose to
terminate this Contract unilaterally or to charge Licensee a penalty equal to
one percent (1%) of the arrears each day. If Licensee does not pay due sums
because Licensor does not issue invoice, Licensee will not assume any
responsibility; if Licensee delays to pay the due sums because the Mobile
Operator has not submit data report in time, Licensee will not assume any
responsibility, but Licensee shall provide corresponding certificates evidencing
that the Mobile Operator has not submit data report in time.
6. Considering that there is certain loss in charge to the users by the Mobile
Operator, the average loss rate is 20%.
7. The Parties agree that "Copyright Licensing Contract (Extension of 2004)"
expires automatically since the execution date of this Contract; the payable
expense shall be settled within one month upon execution date of this Contract.
ARTICLE 5.-PROVISION OF MATERIALS, DERIVATIVE WORKS AND COMMERCIAL PROMOTION
1. Licensee undertakes that he will not use or transfer to a third party all
kinds of materials, information, documents, digital images obtained form
Licensor outside the scope of this Contract and the use of its digital images
and translated texts based on the Works shall be limited to the "Wireless
Service" provided in this Contract. Documents of digital images (including
software) is defined as derivative works and the ownership of mobile phone image
derivative works developed by Licensee belongs to Licensee. Without Licensor's
written consent, Licensee shall not unilaterally use the above mentioned
derivative works for commercial purposes outside the "Wireless Service" provided
in this Contract, no matter this Contract has expired or not.
2. While providing Wireless Service under this Contract, Licensee shall prepare
with Licensor the content, price, products plan and commercial popularization
plans of Wireless Service, and all the above plans and method of sales
promotion, articles of sales promotion and the production sample of
propagandistic materials of plane sale promotion in Article 7 of this Contract
and its quantity shall be confirmed by Licensor beforehand. Licensor shall
respond within eight (8) Working days after receipt of the popularization design
sample from Licensee, default of which response will entitle
Licensee to deem have got relevant consent.
3. Licensee undertakes to endeavor to add the services in the above article 3 of
this Contract to the area of MZONE, STK card or other sale tools in favor of
improving the operation performance.
4. Licensee shall establish and often update the concerning web pages presenting
the content specified in article 3 of this Contract on all its websites, place
the advertisement related to Wireless Service content at notable place of the
homepages in all the websites specified in this paragraph, and place shortcut
link at website navigation bar.
ARTICLE 6.-PRODUCTION, PROPORTIONATE MODIFICATION AND OPERATION PERMISSION
1. On principle of assuming responsibility and expense by himself, Licensee has
the right to use the content of the Works in this Contract to produce digital
images and text messages of mobile phone, make proportionate modification and
translation to meet language usage of users and display modes of different
mobile phones. Production, translation and proportionate modification shall
respect personal right of the author. The proportionate modification refers to
modifications made by Licensee other than those on the image of personage (i.e.
position, action of personage).
2. Before formally launching the Wireless Service to telecommunication or mobile
network operation, Licensee shall notice Licensor in written form of operation
website, date of commencement, territory to be covered, content design, method
of use, price, estimated income and market popularization plan, and put them
into practice after obtaining written consent from Licensor.
3. Before launching the digital images used in mobile phone to communication and
mobile network operation, Licensee shall upload the digital images to be
launched to communication and mobile network operations to the servers specified
by Licensor, and obtain approval from Licensor. During the operation service, if
Licensee launches new images to operation, he shall also obtain the approval
from Licensor according to the above procedure. After Licensee uploads the
digital image to the above websites and gives notice to Licensor, if Licensor
does not make an objection within five (5) Working days, it is deemed as
approved.
4. When required by Licensor, Licensee shall provide to Licensor all the
facilities to inspect images and text messages used and to be used in mobile
phones.
5. In thirty (30) days after the execution of this Contract, Licensee shall
begin the operation of the above Wireless Services provided in article 3 of this
Contract, and Licensor shall be responsible for operation delay caused by him.
If for Licensee's reason, the operation of Wireless Services mentioned above in
article 3 of this
Contract fails to begin in thirty (30) days after the execution of this
Contract, Licensor has the right to terminate this Contract without any
responsibility to Licensee.
ARTICLE 7.-IDENTIFICATION OF COPYRIGHT AND LICENSING INFORMATION
By prior application and written consent of Licensor, and for purposes of
popularizing its communication and network operation service, Licensee could use
in total or in part the picture materials in the Works to produce plane sale
promotion materials such as advertisement, poster, newspaper, magazine, and
website and network advertisement, but all the above mentioned propagandistic
materials shall identify clearly and explicitly copyright and licensing
information by the following means:
(C)▇▇▇▇ ▇▇▇▇▇▇▇/FUTABASHA
LICENSED BY MULAN (Parts in English shall be shown in capital letters)
This user permission right is authorized formally by Japan Windmill Video
Culture Development Corporation Or (CHINESE CHARACTER)
Authorization of (CHINESE CHARACTER)
Or U/F
LICENSED BY MULAN
Identification to lay out copyright and licensing information of multicolor
message:
(C)U/F/M
ARTICLE 8.-BRAND AND REGISTRATION THEREOF
Licensee shall not use the contents related to the Works to apply for
registration of brand or service identification, and shall not use contents
related to the Works as brand, service identification or any other
identification in the commodities or services.
ARTICLE 9.-PRESERVATION/INSPECTION AND SUPERVISION
1. When operating Wireless Service, Licensee shall save details such as times of
click and download, breakdown of expense and income in a manner convenient for
inspection by Licensor in the server or accounting books.
2. For purpose of inspection of implementation and performance of this Contract,
Licensor has the right to click, consult and copy all the images and text
messages used by or to be used by Licensee in the mobile phone according to this
Contract, data determined in paragraph 1 of this article. To carry out the above
inspection, Licensor may employ lawyer, accountant and other personnel at the
expense of Licensor.
ARTICLE 10.-INFRINGEMENT BY A THIRD PARTY
When discovering that any third party infringes copyright of origin author,
legal rights of Licensor or conduct unfair competition to the operations
authorized to Licensee
under this Contract (hereinafter referred to as "infraction by a third party"),
Licensee is responsible to give a written notice to Licensor. If infraction by
such third party occurs in the licensing territory, Licensor has the right to
take proper measures to inspect the third party infraction or take remedial
measures, and Licensee shall do its endeavor to cooperate with and assist the
measures taken by Licensor.
The Licensor: Shanghai Yide Networking Co., Ltd.
Authorized representative: Sealed
The Licensee: Shanghai Weilan Computer Co., Ltd.
Authorized representative: Sealed