EXHIBIT 10.17
Contract No: YOJCHO7136
SOFTWARE LICENSING AGREEMENT
The parties to this agreement are:
A. Actoz Soft Co., Ltd. ("Licensor"), whose principal place of
business is Unsuk B/D 4th Floor. ▇▇▇-▇ ▇▇▇▇ ▇▇▇-▇▇▇▇ ▇▇▇▇
▇▇▇-▇▇, ▇▇▇▇▇, ▇▇▇▇▇ 136-020.
B. Shanghai ▇▇▇▇▇▇ Internet Development Co., Ltd. [Chinese name]
("Licensee"), whose principal place of business is ▇-▇▇,
▇▇▇▇▇▇▇▇▇▇ ▇▇., ▇▇▇▇▇▇▇▇▇▇ ▇▇-▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇
200122, P.R.C.
C. Shanghai Pudong New Area Imp. & Exp. Corp. [Chinese name]
("Import Agent"), whose principle place of
business is ▇▇. ▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇,
P.R.C.
I. SOFTWARE
1.01. The computer software, which is the subject of this Agreement,
consists of the following:
(1) A single computer program whose name or title is as
follows: Legend of Mir II.
(2) The program will be provided in the following medium:
CD-ROM Title & INTERNET (complete with client and
server). The detailed list of program is in Appendix
II.
(3) The program is designed to perform the following
functions: ON-LINE GAME SERVICE.
(4) The program is provided as follows:
Subject code language only (application program)
1.02. The license created by this Agreement also includes related
printed documentation, image files and films, including manuals covering the
installation, application and use of the computer program and published
specifications and trademark, logo and any artwork related to Legend of Mir.
1.03. The license also includes subsequent improvements to either the
computer program or the related printed documentation made by the Licensor.
1.04. All of the materials described in the preceding paragraphs of
this article are hereafter referred to as "Software."
II. LICENSE GRANT AND APPLICATION
2.01. Licensor hereby grants and Licensee accepts the sole and
exclusive license to use, promote, distribute, market adapt or modify, and
convert the Chinese language version of the Software subject to the conditions
and the period specified herein. The server will be located in Mainland China
and Hongkong only.
(1) The translation of the Software shall be done by the
Licensor.
(2) The translation of game manual shall be done by the
Licensee.
(3) Building a home page for the game shall be done by
the Licensee.
2.02. The license granted herein applies only to the territory of
Mainland China, the People's
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Republic of China and Hong Kong (hereinafter referred to as "China"). Licensee
has the right to appoint a general agent in Hongkong with the permission to
utilize, promote, market and distribute this software within the region.
2.03. The license granted herein shall remain in force for the minimum
term of TWO YEARS starting from the beta service in China. Unless either party
sends a written notice to the other party stating that it does not want to renew
this Agreement within sixty (60) days prior to the expiration of this Agreement,
this Agreement will be automatically extended for a further term of one year.
2.04. Licensee has the unrestricted right to copy and distribute the
client side of the Software.
2.05. Licensor shall notify Licensee when an updated version of the
computer program portion of the Software has been designed and is available for
distribution and shall provide Licensee with the originals of the client and
server side of the updated Software as soon as they are available. No expenses
should be charged for any updated versions. All the rights related to the
updated, modified, or upgraded materials which will be performed during the term
of this contract belong to the executant.
2.06. If Licensor stops providing the service of the Software in the
Korean Market, the Licensor shall give to Licensee at least those updates
requested by Licensee to continue the service.
2.07. During the term of this Agreement, in the event that the Licensor
intends to develop a Sequel and /or a pure subsequent versions the Licensor
shall give Licensee a right of first negotiation for the exclusive promoting,
user marketing and distribution rights for China in respect of such a Sequel.
2.08. Licensee should provide the Licensor with the price scheme
including the price for CD and the price for service of the legend of mir II in
China all the time.
2.09. Licensor shall not provide service of the sequels of the Legend
of Mir II in mainland China and Hongkong within one year after this contract.
III. PROPERTY RIGHTS
3.01. Title to the Software is reserved to the Licensor. Licensee
acknowledges that Licensor is and shall remain the owner of the Software.
3.02. Licensee acknowledges that the Software is confidential in nature
and constitutes a trade secret belonging to Licensor. Licensee agrees not to
distribute or transfer the Software either during the term of this agreement and
two years thereafter, but Licensee may freely copy and distribute the client
side of the Software. Transfer and distribution to the Licensee's Hongkong
General Agent is permitted by this Agreement.
3.03. During the term of this Agreement, Licensee agrees to keep the
Software at a secure place under access and use restrictions designed to prevent
disclosure of the Software to unauthorized persons and not less strict than
those applicable to Licensee's own trade secrets.
3.04. Licensee further agrees to instruct its personnel to keep the
Software confidential by using the same degree of care and discretion that they
use with other data designated by Licensee as confidential.
IV. PAYMENT
4.01. In payment for the license granted under this Agreement, Licensee
shall assign the "Import Agent" to perform payment to Licensor an installation
fee of US$ 300,000 and a monthly royalty fee
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payable on the fifteenth day of each month whose method of payment is set forth
in Exhibit "1."
4.02. All the costs related to assigning "Import Agent" and the fees
"Import Agent" charges for the money transfer shall be the responsibility of the
Licensee.
4.03. Where tax is levied by tax authorities of China in respect of the
payment to be made by Licensee to Licensor, Licensee shall deduct such taxes
from payment made to Licensor and shall send to the Licensor tax certificates or
other official documents within one (1) month after the respective payment which
certify the payment by Licensee of such tax on behalf of Licensor.
4.04. Except for force majeure. Licensee takes the full responsibility
to make sure that "Import Agent" performs the payment as required.
V. DELIVERY, INSTALLATION AND TRAINING
5.01. Licensor shall deliver the original of the client and server side
of the Software (the Chinese Version) to Licensee no later than Sept 1, 2001.
The parties may mutually agree to change this date. At Licensee's request,
Licensor shall also provide the Software by computer transmission.
5.02. Licensee shall do all the translations related to the software
including game manuals, home pages, advertising materials, game command lists
etc except the translation of the software itself.
5.03. Licensor shall deliver all the documents in English or Korean
which are necessary for the service to Licensee no later than the 15th of July,
2001. Licensee shall deliver all the translated materials to the Licensor no
later than the 4th of Aug, 2001. If the installation of the Software is deferred
due to the late delivery of the translated materials, the Licensor takes no
responsibility on that respect.
5.04. Licensor shall be responsible for the installation of the
Software as needed. Licensor will provide technical services in connection with
the installation and maintenance of the Software at Licensee's site at no
additional charge throughout the term of this Agreement. Licensor is responsible
for eliminating all viruses or other deficiencies including deficiencies of the
system security in the Software throughout the term of this Agreement. If it is
necessary for Licensor to travel to Licensee's office in China, traveling cost
to the Licensee's office is the responsibility of the Licensor. The specific
installation time, place and standards are set forth in Appendix V.
5.05. Licensor shall provide Licensee with reasonable technical
orientation and training. The training schedule, place and contents are set
forth in Appendix VI. Traveling cost to Licensor's office is the responsibility
of the Licensee.
VI. WARRANTIES
6.01. Licensor warrants that it has good title to the Software and the
right to license its use to Licensee free of any proprietary right of any other
party or any other encumbrance whatsoever. Copyright Certificates for this
Software is attached in Appendix I.
6.02. Licensor shall indemnify and hold Licensee free and harmless
against any and all loss, liability, penalty, damage or expense (including
reasonable attorney's fees) resulting from any claim or suit by any third party
against Licensee alleging infringement of trade secrets, copyrights, patents,
trademark, trade name or other proprietary rights in each case, so long as such
claim or suit is based upon Licensee's use of the Software and its related
documents provided by Licensor.
6.03. Licensor warrants that the Software shall conform to the
Licensor's published functional specifications when delivered to Licensee.
Licensor shall provide programming services to correct Software
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defects that cause the Software to fail to conform to Licensor's published
functional specifications. The technical parameters and functions of the
Software are set forth in Appendix III and IV.
6.04 Licensor undertakes that no logical bombshell exists in this
Software and an effective system has been established inside to prevent illegal
intrusion. Without the permission of the licencee, the Licensor shall not make
any actions of a nature which causes amendments on the Software installed in the
sever which is provided by the Licensee.
VII. TERMINATION
7.01. The license granted herein shall be terminated upon the
occurrence of any of the followings:
(A) Expiration of the term specified herein, or any
optional renewal term;
(B) Unauthorized disclosure of the Software to a third
party other than Licensee's Hongkong Agent.
(C) Failure to pay the monthly licensee fee for two
consecutive months;
(D) Cessation of business by the Licensee.
(E) Licensee suffers bankruptcy, whether voluntarily or
involuntarily.
7.02. Licensee agrees that upon termination of the license, it shall
return the original versions of the Software to Licensor and all the Software
related databases.
7.03. Licensee shall have the right to terminate this Agreement in the
event that (i) the game server stops due to Licensor's material breach and fails
to restart the server within ten (10) days of the Licensee's written notice to
cure; or (ii) the Licensor ceases or terminates its business, or its marketing
of the Software and fails to cure within ten (10) days after receipt of notice,
or suffers bankruptcy, whether voluntarily or involuntarily, or any other
reorganization, or an arrangement is made on behalf of Licensor's creditors or
fails to cure its deficiencies which can cause shut-down of the game server
within ten (10) days after receipt of notice or (iii) the Licensor infringes or
violates any terms, guarantee clauses or obligations made in this agreement.
VIII. GENERAL TERMS AND CONDITIONS
8.01 Any notice required or permitted to be given to either party under
this Agreement shall be delivered in written (including Facsimile) via express
mail service or fax to the address below. The notice will take effect 72 hours
after the mail is received by the express mail service company or 24 hours after
the send-out of the fax.
Actoz Soft Co., Ltd. ("Licensor")
Unsuk ▇/▇ ▇▇▇ ▇▇▇▇▇, ▇▇▇-▇ ▇▇▇▇ ▇▇▇-▇▇▇▇ ▇▇▇▇ ▇▇▇-▇▇, ▇▇▇▇▇,
▇▇▇▇▇ 136-020.
tel : ▇▇▇-▇-▇▇▇-▇▇▇▇
fax : ▇▇▇-▇-▇▇▇-▇▇▇▇
Shanghai ▇▇▇▇▇▇ Internet Development Co., Ltd. ("Licensee")
14/F, ▇▇▇ ▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇.▇.▇.
tel : ▇▇▇-▇▇-▇▇▇▇▇▇▇▇
fax : ▇▇▇-▇▇-▇▇▇▇▇▇▇▇
SHANGHAI PUDONG NEW AREA IMP. & EXP. CORP. ("Import Agent")
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2/2FL, ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇.▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇.▇.▇.
tel:▇▇▇-▇▇-▇▇▇▇-▇▇▇▇
fax:▇▇▇-▇▇-▇▇▇▇-▇▇▇▇
8.02. Licensee shall not assign or otherwise transfer its rights under
this agreement, nor transfer or assign the Software without the prior written
consent of the Licensor with the Hongkong Agent as an exception.
8.03. This Agreement may be modified only by a written agreement duly
executed by persons authorized to execute agreements on their behalf.
8.04. This Agreement shall be governed and construed by in accordance
with the laws of Singapore. All disputes arising under this Agreement shall be
submitted to final and binding arbitration. The arbitration shall be held in
Singapore in accordance with the Rules of Arbitration of the International
Chamber of Commerce.
8.05. This Agreement constitutes the entire agreement between the
parties and is a complete and exclusive statement of the mutual understanding of
the parties. It supersedes and cancels all previous written and oral agreements
and communications relating to the subject matter of this agreement.
8.06. The term of this Agreement are confidential. Neither party shall
disclose to any third party except Hongkong General Agent, its terms during the
term of this Agreement and two years thereafter.
8.07. In the case either party infringes or violates any terms,
guarantee clauses or obligations, is liable for and will indemnify the aggrieved
party from and against all loss. The agreement-abiding party has the right to
require the delinquent party to make proper remedies to continue Agreement
Before the completion of indemnities or remedies by the delinquent party, the
agreement-abiding party has no obligations to fulfill the actions required by
the Agreement but is still entitled to the rights under the Agreement.
8.08. This Agreement and its Appendices bear the same legal effect.
Executed on 29th of June 2001 at the licensor's office in Shanghai,
China.
LICENSOR LICENSEE
By: /s/ JongHyun ▇▇▇ By: /s/ ▇▇▇ ▇▇▇▇
---------------------------- ----------------------------
JongHyun ▇▇▇ ▇▇▇ ▇▇▇▇
CEO & President CEO & President
[SEAL]
IMPORT AGENT
By: /s/ Shao Jan Nan
----------------------------
Shao Jan Nan
General Manager
[SEAL]
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EXHIBIT ONE
Payments will be made by Import Agent on behalf of Licensee to Licensor
as follows:
1. For the right to distribute the Software in China, Licensee shall
pay a non-refundable fee of 300,000 US dollars (Cases stated in Clause 7.03
shall be considered as exception) to Licensor as an installation fee at the
signing of this contract. But with mutual consent, the payment schedule of the
fee can be adjusted
2. Licensee will pay royalties to Licensor as follows:
A. The royalty will be paid only when the commercial
service is being provided.
B. The commercial service should start no later than
3 months after installation of the software to the
Licensee's servers.
C. The royalty rate is 27% of total sales of the
Software.
D. The total sales include the sales of CDs, prepaid
cards and any other forms of sales of the Software
which shall not include sales expenses for
distributors.
E. True and correct accounts shall be kept by the
Licensee and maintained at the head office of the
Licensee. And all the money due under this Agreement
shall be paid to Licensor within 2 weeks after the
end date of each month.
F. All the payment is paid in U.S Dollars: the exchange
rate is based on the rate published by the HSBC,
shanghai on the end date of each month.
▇
▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ I: Copyright Certificates for this Software
Appendix II: Language for the Software program
client program : ▇▇▇▇▇▇ Delphi4
Server program (including installation program and installation
documents) : ▇▇▇▇▇▇ Delphi4
Database : ▇▇▇▇▇▇ Delphi4
Management program : ▇▇▇▇▇▇ Delphi4
Appendix III : Technical parameters for Legend of Mir II
- MPOG (RPG):oriental back ground mixed with fantasy
- Client Requirements
- Minimum Requirements: Pentium 233MHZ,Ram 64M,SVGA, Necessary HDD 400M
- Recommended: Celeron 400Mhz,Ram 128M,SVGA, HDD 600M
- Developing Tools, Programming Language & Protocol
- Server & Gateway: Borland Delphi4, Windows NT 4.0
- Client: Borland Delphi4, Windows NT 4.0
- Protocol: TCP/IP
- Server Specifications (Complete Configuration)
- Login Serve : P-III 600Mhz, 10G, 128M
- Game Server 1 : P-III 1Ghz Dual, 105G, 512M 1 Server per 2,000 Concurrent
Users
- Game Server 2 : P-III 1Ghz Dual, 105G, 512M
- Game Server 3 : P-III 1Ghz Dual, 105G, 512M
- DB Server : P-III 8000MHz, 20G, 256M
- Gateway Server 1 : P-III 800Mhz Dual, 10G, 128M 1 Server per 1,400
Concurrent Users
- Gateway Server 2 : P-III 800Mhz Dual, 10G, 128M
- Gateway Server 3 : P-III 800Mhz Dual, 10G, 128M
- Gateway Server 4 : P-III 800MHz Dual, 10G, 128M
- Sever Specifications (Basic Configuration for Beta Test)
- Game Server : Login + Game + DB
- Gateway Server
- Server OS: Windows 2000 Pro
- Required Bandwidth
- T1 covers 350 concurrent users
- E1 covers 400 concurrent users
- T3 covers 10,000 concurrent users
Appendix IV: list of the functions of the software
The manual provided by Atoz Soft Co., Ltd. is only a guidance for
newcomers and does not give a complete description on the functions
that will be used by clients of above grade 11. We are looking forward
to a detailed and complete list of all the functions, including
description on the Guild, for the purpose to make convincing
advertising.
Meanwhile, during waiting for the complete version, we have to take
larger business risks and input new capital investments. Therefore, we
hope the a complete version of new functions, such as music,
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can be provided so as to enable us to make decision instead of keep
waiting.
APPENDIX V: INSTALLATION STANDARDS, TIME AND PLACE
Installation Place: Shanghai or Hongkong
Installation time: The licensor promises that the installation shall be
no later than September 1st; in the case that the licensee provides
server and bandwidth, the installation shall not last more than 10
days. Installation standards: including but not limited to: clients can
successfully gain the identity to enter the Software
Clients can utilize the Software with no considerable difficulty or
obstacles, and the content of the Software is in accordance with the
what stated in Appendix II and the client manual.
Server load is accordance with the technical standards.
The security of statistics is guaranteed.
APPENDIX VI: TRAINING SCHEDULE, PURPOSE AND PLACE:
Training place: Shanghai
Training time: Finishing no later than 10 days after the completion of
the installation
Training purpose: Including but not limited to: Tasks able to be
handled by licensee engineer and GM: Independent Installation, testing
of the server program,
Ensure the stability of daily operation, able to handle common
technical emergency or accidents. Give technical support to the payment
system of the Software and the logging of all types of data. GM can
face clients directly and manage the daily operation of the whole
Software independently and use the management program with proficiency.
APPENDIX VII: RELATED ADVERTING MATERIALS AND TIME
The licensor shall give active support to the licensee to conduct
advertising in mainland China and provide licensee with materials including but
not limited to: market advertising materials, current outer packaging material,
market promotion materials, website design material, advertising pictures,
Software introduction books and etc. The licensee has the right to utilize these
materials for commercial purposes.
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EXHIBIT TWO
Payments will be made by Import Agent on behalf of Licensee to Licensor
as follows:
1. For the right to distribute the Software in China, Licensee shall
pay a non-refundable fee of 300,000 US dollars to Licensor as an installation
fee.
A. $100,000 shall be paid by the Licensee at the signing
of this contract.
B. $100,000 shall be paid by the Licensee at the start
of Beta Test in China.
C. The rest of the installation fee ($100,000) shall be
paid by the Licensee within 2 months after the start
of Commercial service in China.
2. Licensee will pay royalties to Licensor as follows:
G. The royalty will be paid only when the commercial
service is being provided.
H. The commercial service should start no later than 3
months after installation of the software to the
Licensee's servers.
I. The royalty rate is 27% of total sales of the
Software.
J. The total sales include the sales of CDs, prepaid
cards and any other forms of sales of the Software.
K. True and correct accounts shall be kept by the
Licensee and maintained at the head office of the
Licensee. And all the money due under this Agreement
shall be paid to Licensor within 2 weeks after the
end date of each month.
L. All the payment is paid in U.S Dollars; the exchange
rate is based on the rate published by the HSBC,
shanghai on the end date of each month.
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