Document:

Exhibit 10.13

 

This is a translation of the original text in Chinese

 

Exclusive Technology Consulting and Training Agreement

 

This EXCLUSIVE TECHNICAL CONSULTING AND TRAINING AGREEMENT (this “Agreement”), dated September 16, 2005, is made in Shenzhen by and between:

 

Party A: Giganology (Shenzhen) Ltd.

 

And

 

Party B: Shenzhen Xunlei Networking Technologies Co., Ltd.

 

(Collectively, the “Parties”)

 

WHEREAS: Party A is a duly registered and formed wholly foreign owned enterprise, with strong strength and experience in technical development and training;

 

Party B needs the provision of technical support and services by a specialized technical company in the course of business operation; and

 

Party B intends to accept from Party A, and Party A intends to provide to Party B, such technology training services.

 

NOW, THEREFORE, the Parties agree and intend to be bound as follows through friendly negotiations and in accordance with the principles of equality and mutual benefit:

 

ARTICLE 1         DESCRIPTION OF SERVICES

 

1.1                               Both Parties agree that, Party B will designate Party A to provide the following consulting and training services to it in accordance with the conditions set forth herein:

 

(1)           to provide training with respect to Party B’s business operation, aiming to increase Party B’s professional qualification in technical development, lower Party B’s operating costs, and increase Party B’s competency in market;

 

(2)           to evaluate, analyze and summarize current system, procedure, and efficiency of Party B’s product development, and to provide improvement scheme;

 

(3)           based on the evaluation result, to provide counseling and technical training for Party B’s related staff, in order to improve the staff’s professional qualification; and

 

(4)           to provide other consulting and training services in relation to this Agreement.

 

1.2                               Party B agrees that the way of provision of consulting and training services by Party A is: Party B introduces the classes and technical specifications of the products under Party B’s development and provides related written materials to Party A; Party A prepares a survey report based on the information provided by Party B, then prepares a training plan, to specify the details of training services, including the appointment of training staff, specific number of training staff, the term of training, schedule and content of training, and provides training for Party B according to the plan. Notwithstanding the above mentioned provisions, the Parties

 

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may determine the specific way and content of the services to be provided according to the actual circumstance.

 

1.3                               Party B undertakes that during the term hereof it will not accept any technical consulting and training services provided by any third party without prior written consent from Party A.

 

ARTICLE 2         TERM OF SERVICES

 

2.1          The term of this Agreement is twenty (20) years, commencing from the effective date hereof.

 

2.2          Party B undertakes that from the effective date hereof the period of services hereunder shall not be shortened or early terminated, unless otherwise agreed by the Parties.

 

2.3          The Parties agree that Party A may elect to extend the term for another ten (10) years by providing a written notice before this Agreement expires. Party A may elect to make such extension for unlimited times.

 

ARTICLE 3         SERVICE FEE

 

3.1          The Parties agree that Party B shall, in accordance with provisions herein, pay Party A the service fee for technical consulting and training services provided by Party A in accordance with the Schedule to this Agreement. Such schedule may be changed subject to the Parties’ negotiations and the actual circumstance.

 

ARTICLE 4         PARTY A’S OBLIGATIONS

 

4.1          Party A shall make all endeavors to select high-qualified professional staff and organize a professional consulting team to provide the technical consulting and training services hereunder to Party B.

 

4.2          Party A shall work out a well-prepared consulting and training plan, be familiar with Party B’s work site to carry out the consulting work according to the plan, complete the consulting services within scheduled time, and provide related documents (in hard copy and electronic form) to Party B.

 

4.3          Party A shall maintain frequent communications with Party B, timely inform Party B of the progress of the whole project, and conduct sufficient discussion with Party B with respect the initial plan or periodic achievement.

 

4.4          Party A shall keep confidential all the information provided by Party B or related to Party B’s business operation (the “Information”).

 

ARTICLE 5         PARTY B’S OBLIGATIONS

 

5.1          Party B shall provide necessary information and documents according to Party A’s requirement. Party B shall designate specific staff to be responsible for communication and cooperation with Party A in this project, and shall actively corporate with Party A for the Party A’s on-site research and information collection on Party B’s work site. Party B shall also provide evaluation and feedback at proper timer regarding Party A’s work achievement.

 

5.2          When necessary, Party B shall provide proper working facilities and conditions for Party A’s designated technical staff, and bear related costs and expenses incurred by such staff during the provision of such consulting and training services.

 

5.3          Party B shall pay Party A the service fees periodically.

 

5.4          Party B shall provide Party A with necessary assistance as required by Party A.

 

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ARTICLE 6         REPRESENTATIONS AND UNDERTAKINGS

 

6.1          For the purpose of this Agreement and Party B’s interests, Party A hereby represents and undertakes as follows:

 

(1)           Party A is a legal person duly established and existing under laws of the People’s Republic of China, with full capacity for civil conduct;

 

(2)           The authorized representative of Party A signing this Agreement has been duly authorized by Party A. Party A shall have no defense against Party B on the ground of lack of authority for agency, agency in excess of authority, or any other defect in authority.

 

6.2          For the purpose of this Agreement and Party A’s interests, Party B hereby represents and undertakes as follows:

 

(1)           Party B is a legal person duly established and existing under laws of the People’s Republic of China, with full capacity for civil conduct to the extent of its registered capital;

 

(2)           During the term hereof, Party B will not enter into any other agreement identical with or similar to this Agreement with any third party other than Party A, or accept the any or all training services same with or similar to the services described in Article 1 hereof from any third party other than Party A;

 

(3)           The authorized representative of Party B signing this Agreement has been irrevocably, duly and fully authorized by Party B. Party B shall have no defense against Party A on the ground of lack of authority for agency, agency in excess of authority, or any other defect in authority.

 

6.3          If any Party breaches the aforesaid representations or undertakings which causes this Agreement to become invalid or the validity of this Agreement be prejudiced in other ways, or causes any loss to the other Party, the breaching Party shall be held liable for the losses of the non-breaching Party.

 

ARTICLE 7         INTELLECTURLA PROPERTIES AND CONFIDENTIALITY

 

7.1          Party A is solely and exclusively entitled to the rights and benefits with respect to any rights, titles, interests and intellectual properties developed by Party A or Party B that may arise from its performance of this Agreement, including without limitation to any copyrights, patents, expertise and business secrets.

 

7.2          Party B shall make reasonable efforts to ensure to keep confidential any or all of Party A’s information identified as “Confidential” or known to be confidential to Party B (“Confidential Information”). Without prior written consent from Party A, Party B shall not disclose any Confidential Information to any third party. Once this Agreement is terminated, Party B shall return to Party A upon A’s request or destroy any file, material or software bearing the confidential information, and delete such confidential information from any related storage device, and shall cease using such confidential information.

 

The Parties agree that this Article 7 will survive any change, rescission or termination of this Agreement.

 

ARTICLE 8         LIABILITY FOR BREACH

 

8.1          If either Party is in breach of this Agreement, it shall be held liable for any loss incurred by the non-breaching Party.

 

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8.2          Breach of this Agreement may not be waived unless by the non-breaching Party in writing. Any failure or delay to exercise any of its rights or remedies under this Agreement by either Party will not operate as its waiver of such right or remedy. Partial exercise of any right or remedy by either Party shall not impair its exercise of any other rights or remedies.

 

8.3          The validity of this term shall survive the termination or cancellation of this Agreement.

 

ARTICLE 9         RESCISSION OF AGREEMENT

 

9.1          If either Party commits serious breach of this Agreement, and further fails to cure such breach within thirty (30) days upon receiving the notice about the occurrence and existence of the breach from the non-breaching Party, the other Party shall be entitled to rescind this Agreement by giving a notice to the breaching Party. During the term hereof, Party A has the right to terminate this Agreement by giving a thirty (30)-day written notice to Party B at anytime.

 

9.2          In the event that this Agreement is terminated due to the reasons attributable to Party B, Party A shall be entitled to be indemnified the damages so caused by the termination of this Agreement and to obtain the compensation for the services it provides as of the termination hereof.

 

9.3          The rescission of this Agreement shall not impair the right of the affected Party to claim damages.

 

ARTICLE 10       FORCE MAJEURE

 

10.1        In the event that either Party cannot continue the performance of its any or all obligations hereunder due to any unforeseeable or unavoidable event or activity, any Party hereto may cease the performance of its obligations hereunder which cannot be performed due to the impact of such event of Force Majeure during such period of non-performance, provided that the affected Party shall make every possible effort to minimize the losses as soon as practical. The affected Party seeking the waiver of performance of its obligations provided under this Agreement or any term hereof shall timely notify the other Party of such waiver as well as the measures to be taken to perform such obligations.

 

ARTICLE 11       NOTICE AND DELIVERY

 

11.1        Any notice, consent, agreement or any communication in any other form made in accordance with or in accordance with this Agreement shall be provided in writing.

 

11.2        Unless otherwise provided hereunder, the notice or any other communication delivered in person shall be deemed received when delivered. The notice or any other communication sent by pre-paid mail shall be deemed received forty-eight (48) hours upon posting. The notice or any other communication sent by telex or facsimile shall be deemed received when sending out. Those sent by telegraph shall be deemed received twenty-four (24) hours upon sending.

 

ARTICLE 12       DISPUTE RESOLUTION

 

12.1        Any dispute arising from the performance of this Agreement or in connection with this Agreement shall be resolved by the Parties through friendly negotiations and, if the negotiations fail, shall be submitted to China International Trade and Economic Arbitration Commission for arbitration according to its then effective rules. The arbitration shall be conducted in Shenzhen. The arbitral award is final and binding upon both Parties.

 

12.2        Dispute mentioned in this Article 12 refers to the dispute between both Parties regarding whether this Agreement is duly concluded, the time of execution of this Agreement, interpretation hereof, performance hereof, liability for breach, and the change, assignment, rescission or termination of this Agreement.

 

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ARTICLE 13       EFFECTIVENESS AND MISCELLANEOUS

 

13.1        The Parties may enter into a supplement through friendly negotiations regarding any issue not contemplated herein. Any amendment or supplemental to this Agreement shall be made in writing.

 

13.2        The intellectual property rights arising from the provision of consulting and training servicess by the technical staff seconded by Party A to Party B shall be owned by Party A.

 

13.3        Unless otherwise provided herein, the “day” referred to herein shall mean one calendar day, and the “business day” referred to herein shall mean the day on which the commercial banks in China open for doing business.

 

13.4        The terms of confidentiality, dispute resolution and liability for breach herein shall survive the rescission or termination of this Agreement.

 

13.5        Neither Party may assign any or all of its rights or obligations hereunder to any third party without the other Party’s prior written consent.

 

13.6        The invalidity of any term herein shall not impair the validity of any other irrelevant terms herein.

 

13.7        This Agreement is made in two (2) original copies, each Party holding one (1) copy. The two (2) copies have the same legal effect.

 

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(Execution Page)
    	
 
    
	
 
    	
 
    
	
Party A: Giganology (Shenzhen) Ltd.
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/ Authorized Representative
    	
 
    
	
 
    	
 
    
	
(Affixed with common seal of the company)
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Party B: Shenzhen Xunlei Networking Technologies   Co., Ltd.
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/ Authorized Representative
    	
 
    
	
 
    	
 
    
	
(Affixed with common seal of the company)
    	
 
    

 

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[Schedule]

 

1.                                      The Parties agree that Party B shall pay service fee to Party A as consideration of the technical consulting and training provided by Party A as follows:

 

(1)           Basic Annual Fee

 

Party B shall pay Party A Renminbi [ ] Yuan (RMB[ ]) each year as the basic annual fee for the training servicess hereunder, which shall be paid in four installments evenly in four quarters. Party B shall transfer Renminbi [ ] Yuan (RMB[ ]) to the bank account designated by Party A within fifteen (15) business days commencing from the first day of each quarter.

 

(2)           Floating Fee

 

In addition to the above mentioned basic annual fee, Party B shall pay Party A a floating fee annually based on the specific situation of the technical support and services provided. The amount of the floating fee for each quarter shall be determined by the Parties after considering:

 

(i)            Quantity and qualification of the employees used by Party A for purpose of  provision of consulting and training services to Party B in such quarter;

 

(ii)           Time consumed by employees of Party A for purpose of provision of  consulting and training services to Party B in such quarter;

 

(iii)          Contents and value of the consulting and training services provided by Party  A in such quarter; and

 

(iv)          Revenue of Party B.

 

2.                                      Party B shall provide Party A with all necessary financial materials for calculating the floating fee for each quarter within fifteen (15) days from the end of the quarter, and shall pay the floating fee to Party A within thirty (30) days from the end of each quarter. If Party A raises any issue in the financial materials provided by Party B, Party A may appoint a reputable independent accountant to audit such financial materials. Party B shall provide cooperation for conducting the audit, provided that the audit shall be conducted during normal business time and shall not interfere Party B’s normal business operation.

 

3.                                      If Party A believes that adjustment of the amount of service fee set forth in this Schedule is needed as a result of the change of circumstances, then Party B shall negotiate with Party A with active efforts and in good faith within seven (7) business days upon the issue of written notice for fee adjustment by Party A, so as to decide the new service fee payment standard or system.

 

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Supplemental Agreement to Exclusive Technical Consulting and Training Agreement

 

This SUPPLEMENTAL AGREEMENT TO EXCLUSIVE TECHNICAL CONSULTING AND TRAINING AGREEMENT (this “Supplemental Agreement”), dated November 15, 2006, is made in Shenzhen by and between:

 

Party A: Giganology (Shenzhen) Ltd., a wholly foreign owned enterprise established and existing in accordance with laws of the People’s Republic of China, with legal address located at 11th Floor, Shuguang Plaza, South District of High-tech Park, Nanshan District, Shenzhen, Guangdong, PRC;

 

And,

 

Party B: Shenzhen Xunlei Networking Technologies Co., Ltd., a limited liability company established and existing in accordance with laws of the People’s Republic of China, with legal address located at 11th Floor East, Shuguang Plaza, Ke Ji Nan Shi Er Road, Nanshan District, Shenzhen, Guangdong, PRC;

 

(Collectively, the “Parties”)

 

WHEREAS:

 

1.                                      Party A and Party B have entered into a certain Exclusive Technical Consulting and Training Agreement dated September 16, 2005 (the “Technical Consulting and Training Agreement”).

 

2.                                      Through friendly negotiations and adhering to principles of equality and mutual benefit, Party A and Party B agree to enter into this Supplemental Agreement to amend and supplement the Technical Consulting and Training Agreement.

 

The Parties hereby agree as follows:

 

1.                                      Article 12.1 of the Technical Consulting and Training Agreement shall be deleted and replaced in its entirety with the following:

 

“12.1      Any dispute arising from the execution, performance, termination or validity of this Agreement or in connection with this Agreement shall be resolved by both Parties through friendly negotiations and, if negations fail, shall be submitted to China International Trade and Economic Arbitration Commission South China Sub-commission (“CIETAC South China Sub-commission”) for arbitration according to its then effective rules and proceeding. The arbitration shall be conducted in Shenzhen. There will be one arbitrator who shall be appointed by the CIETAC South China Sub-commission according to above mentioned rules and proceeding. The arbitral award is final and binding upon the Parties. Unless otherwise provided by the arbitral award, the losing Party shall assume all the costs and expenses of arbitration and reimburse all the costs and expenses of arbitration incurred by the winning Party. If either Party needs to file a lawsuit for enforcement of the arbitral award, the losing Party shall reimburse the other Party for all reasonable expenses and legal fee so incurred by the other Party. During the period from the submission of dispute for arbitration to the rendering of arbitral award, both Parties shall continue to perform their obligations hereunder without prejudice to the final judgment made based on the aforesaid arbitral award.”

 

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2.                                      The Schedule to the Technical Consulting and Training Agreement shall be all deleted, and replaced in its entirety with the following:

 

“Schedule

 

Party A and Party B agree that, Party B shall, according to the following provisions, pay Party A the service fee as consideration of the technical consulting and training servicess provided by Party A to Party B hereunder:

 

(1)           Party B shall pay twenty percent (20%) (“Percentage”) of its pre-tax operating profit (“Income”) as the technical service fee to Party A (“Service Fee”) during the term hereof. Both Parties agree to review and adjust the above mentioned Percentage every six months according to the business operation and income of Party B, to make it consistently reflect the commercial value of the technical services and actual circumstance. The Parties agree to make a confirmation letter regarding the adjusted Percentage, which shall be supplemental terms of this Agreement, and shall be deemed as an integral part of this Agreement.

 

(2)           Party B shall make one-off payment of the Service Fee to Party A each month (“Payment Period”). Within seven (7) business days following the end of each Payment Period, Party B shall provide a written report to Party A, specifying the duly calculated Income of Party B during the Payment Period and the corresponding amount of Service fee to be paid.

 

(3)           Party B shall make payment to Party A within seven (7) business days upon its receipt of the Service fee payment notice from Party A. All the amount payable by Party B shall be made in RMB to the bank account notified by Party A to Party B in writing from time to time.

 

If Party B fails to pay any amount due and payable hereunder, Party B shall pay Party A  default interest for its overdue payment of such amount. The default interest rate shall be the lending interest rate of the Shenzhen Branch of Bank of China for the same period. The calculation period starts from the date on which the amount is due and payable and ends on the date of its actual payment.

 

(4)           Party B shall provide Party A with an audited true and correct statement regarding Party B’s Income and the payable amount of the Service fee of the previous calendar year within sixty (60) days following the end of the previous calendar year. In the event that there is any inconsistency between such audited statement and the written report mentioned in above paragraph (2), then the Service fee shall be adjusted in the next Payment Period.

 

(5)           Throughout the term hereof, Party A has the right to send its employees, or engage a registered accountant at its own cost, to audit Party B’s books and records, including without limitation the financial statements relating to the Income of Party B for the Payment Periods. Party B shall provide to Party A’s appointed employees or engaged registered accountant with all related materials, books, records, data and information, and shall provide necessary facility and support to such employee or accountant. The audit report prepared by Party A’s appointed employees or engaged accountant (“Audit Report”) shall be final and conclusive unless Party B raises any issue regarding such Audit Report within seven (7) days. Party A has the right to give Party B at anytime a payment notice regarding the outstanding amount of Service fee specified in the Audit Report. Party B shall make corresponding payment for it in accordance with the above paragraph (3) within seven (7) business days following the receipt of the payment notice.

 

3.                                      This Supplemental Agreement shall become effective upon being signed by both Parties. As a supplement to the Technical Consulting and Training Agreement, this Supplemental

 

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Agreement shall have the same legal effect with the Technical Consulting and Training Agreement. If there is any inconsistency between this Supplemental Agreement and the Technical Consulting and Training Agreement, this Supplemental Agreement shall prevail. The Technical Consulting and Training Agreement shall be referred to and complied with where there is no any inconsistency.

 

4.                                      Any dispute arising from the execution, exercise, termination or validity of this Agreement or in connection with this Agreement shall be resolved by both Parties through friendly negotiations, failing which, shall be submitted to China International Trade and Economic Arbitration Commission South China Sub-commission (“CIETAC South China Sub-commission”) for arbitration according to its then effective rules and proceeding. The arbitration shall be conducted in Shenzhen. There is one arbitrator who shall be appointed by the CIETAC South China Sub-commission according to abovementioned rules and proceeding. The arbitral award is final and binding upon both Parties. Unless otherwise provided by the arbitral award, the losing Party shall assume all the costs and expenses of arbitration and reimburse all the costs and expenses of arbitration incurred by the winning Party. If either Party needs to file a lawsuit for enforcement of the arbitral award, the losing Party shall reimburse the other Party for all reasonable expenses and legal fee so incurred by the other Party. During the period from the submission of dispute for arbitration to the rendering of arbitral award, both Parties shall continue to perform their obligations hereunder without prejudice to the final judgment made based on the aforesaid arbitral award.

 

5.                                      This Supplemental Agreement has two (2) original copies, each Party holding one (1) copy. The two (2) copies have the same legal effect.

 

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(Execution   Page)
    	
 
    
	
 
    	
 
    
	
Party A:   Giganology (Shenzhen) Ltd.
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/   Authorized Representative
    	
 
    
	
 
    	
 
    
	
(Affixed   with common seal of the company)
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Party B:   Shenzhen Xunlei Networking Technologies Co., Ltd.
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/ Authorized   Representative
    	
 
    
	
 
    	
 
    
	
(Affixed   with common seal of the company)
    	
 
    

 

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Second Supplemental Agreement to Exclusive Technology Consulting and Training Agreement

 

This Second Exclusive Technology Consulting And Training Agreement (this “Supplemental Agreement”), dated March 10, 2014, is made in Shenzhen by and between:

 

Party A: Giganology (Shenzhen) Ltd., a wholly foreign owned enterprise established under laws of the PRC, with registered address at Room 802, Building 11, Shenzhen Software Park, Central District of High-tech Park, Nanshan District, Shenzhen, Guangdong, PRC;

 

And

 

Party B: Shenzhen Xunlei Networking Technologies Co., Ltd., a limited liability company established under laws of the PRC, with registered address at 7th and 8th Floor, Building 11, Shenzhen Software Park,  Ke Ji Zhong Er Road, Nanshan District, Shenzhen, Guangdong, PRC.

 

(Collectively, the “Parties”)

 

WHEREAS:

 

(1)                                 The Parties have entered into an Exclusive Technology Consulting and Training Agreement on September 16, 2005 and a Supplemental Agreement to the Exclusive Technology Consulting and Training Agreement on November 15, 2006 (Collectively, the “Original Exclusive Technology Consulting and Training Agreement”);

 

(2)                                 The Parties through friendly negotiation and based on the principle of equality and mutual benefit, agree to enter into this Supplemental Agreement to amend and supplement the Original Exclusive Technology Consulting and Training Agreement.

 

The Parties hereby agree:

 

1.                            To delete and replace Section 9.1 of the Original Exclusive Technology Consulting and Training Agreement with the following provision:

 

If either Party commits a material breach under this Agreement, and further fails to cure such a breach within thirty (30) days upon receiving the notice from the non-breaching Party about the occurrence and existence of the breach , the other Party shall be entitled to rescind this Agreement by giving a notice to the breaching Party. During the term hereof, Party A has the right to terminate this Agreement by giving a thirty (30)-day written notice to Party B at any time.

 

2.                            Unless otherwise stated in this Supplemental Agreement, the terms applied in this Supplemental Agreement have the same meaning as given to them in the Original Exclusive Technology Consulting and Training Agreement.

 

3.                            This Supplemental Agreement becomes effective upon its execution by the Parties at a date

 

 

first written above. This Supplemental Agreement is a supplement to the provisions in the Original Exclusive Technology Consulting and Training Agreement and shall have the same legal effect as the Original Exclusive Technology Consulting and Training Agreement. This Supplemental Agreement shall prevail should there be any conflict with the Original Exclusive Technology Consulting and Training Agreement.

 

4.                            This Supplemental Agreement is executed in Chinese in two (2) counterpart with the same legal effect, each Party holding one counterpart.

 

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(Execution   Page)
    
	
 
    
	
 
    
	
Party A:
    	
/s/ Giganology   (Shenzhen) Ltd.
    	
 
    
	
 
    
	
 
    
	
Party B:
    	
/s/ Shenzhen   Xunlei Networking Technologies Co., Ltd.
    	
 
    

 

3Exhibit 10.14

 

This is a translation of the original text in Chinese

 

Proprietary Technology License Contract

 

This Proprietary Technology License Contract (this “Agreement”) dated March 1, 2012, is made by and between:

 

(1)             Giganology (Shenzhen) Ltd. a wholly foreign owned enterprise established under laws of the PRC, with registered address located at Room 802, Building 11, Shenzhen Software Park, Central District of High-tech Park, Nanshan District, Shenzhen, Guangdong, PRC. (the “Licensor”); and

 

(2)             Shenzhen Xunlei Networking Technologies Co., Ltd.a limited liability company established and existing under laws of the PRC, with registered address located at 7th and 8th Floor, Building 11, Shenzhen Software Park, Ke Ji Zhong Er Road, Nanshan District, Shenzhen, Guangdong, PRC. (“Licensee”).

 

(Each a “Party” and collectively, the “Parties”)

 

WHEREAS:

 

(1)             The Parties have entered into a software and proprietary technology license contract on November 15, 2006 (the “Original License Agreement”) and the Parties agree to modify and amend such agreement to replace the Original License Agreement.

 

(2)                     The Licensor is the lawful and beneficiary owner of certain proprietary technology as set out in the Schedule to this Agreement and/or owns legal and effective right to use, and the license to use (as the case may be) such proprietary technology.

 

(3)                     The Licensee intends to acquire a non-exclusive license in accordance with terms and conditions herein, to utilize such proprietary technology.

 

NOW, THEREFORE, the Parties agree as follows:

 

1.                          Definitions

 

The following terms shall have the meanings given below unless otherwise specified herein:

 

1.1                   “Designated Region” means mainland China, excluding Hong Kong, Macau and Taiwan Special Administrative Regions for purpose of this Agreement;

 

 

1.2                   “Business” means the Internet content provider services engaged by the Licensee in accordance with value-added services and telecommunication business operation license issued the Licensee has obtained.

 

1.3                   “Business Day” means the day on which the commercial banks in Shenzhen normally open for doing business.

 

1.4                   “Work Site” means Shenzhen, the People’s Republic of China (“PRC”), the place where the Licensee uses the Proprietary Technology to provide Internet content provider services to the public.

 

1.5                   “Proprietary Technology” means the proprietary technology previously and currently held by the Licensor as set out in the Schedule to this Agreement and the software, computer program, technical knowledge, data, index, tables and charts, design and any other Technical Materials to be developed and owned by the Licensee from time to time hereafter, or held by the Licensee through legal authorization or acquisition, and delivered by the Licensor to the Licensee on or after the date hereof.

 

1.6                   “Technical Materials” means all the documents, books, records, data and information in relation to the Proprietary Technology.

 

1.7                   “Improvement” means all the improvement, upgrade, development, renew or amendment made by the Licensor or the Licensee with respect to the Proprietary Technology during the term hereof.

 

2.                          Scope of License

 

2.1                   During the term hereof, the Licensor agrees to grant to the Licensee, and the Licensee agrees to acquire a non-exclusive and non-relicensable license (“License”), in order to install, store, upload, execute and display the Proprietary Technology and the Improvement (collectively, “Use”). The Use is only limited within the scope of Business engaged by the Licensee inside the Designated Region. Unless expressly provided herein, no any other license is given in a expressly or implied way under this Agreement.

 

2.2                   Unless approved by the Licensor in writing in advance, the Licensee shall not sell, transfer, assign or sub-license, or use the Proprietary Technology and shall not use or improve the Proprietary Technology in any way not allowed herein. The Licensee shall not entirely or partially assign its rights and obligations hereunder, or create any security interest over its rights hereunder.

 

2.3                   The Licensee should not use the Proprietary Technology and the Improvement

 

 

under the following circumstances:

 

(1)                     at any time, for any other purpose, outside the Designated Region, or beyond its Business scope; and/or

 

(2)                     after this Agreement expires or terminates; and/or

 

(3)                     in any other way not specified herein.

 

2.4                   Unless otherwise expressly provided herein, and except for the License granted in accordance with the Article 2.1 herein, this Agreement does not grant any title to or any other rights associated with the Proprietary Technology and the Improvement. Such title and rights are ultimately owned by the Licensor.

 

3.                          License Fee and Payment Method

 

3.1                   As the consideration of use of the License granted by the Licensor to the Licensee, the Licensee hereby agree to pay the license fee to the Licensor (“License Fee”), and the License Fee consists of the annual royalties.

 

3.2                   The Licensee shall make an annual payment of forty percent (40%) (“Rate”) of its pre-tax operating profit (“Income”) to the Licensor as the License Fee for use of the Proprietary Technology (“Royalty”).

 

3.3                   The Licensee shall make one-off payment of the Royalty to the Licensor each quarter (“Payment Period”). Within seven (7) business days following the end of each Payment Period, the Licensee shall provide a written report to the Licensor, specifying the duly calculated Income of the Licensee during the Payment Period and the corresponding amount of Royalty to be paid.

 

3.4                   The Licensee shall make payment to the Licensor within seven (7) business days upon its receipt of the Royalty payment notice from the Licensor with respect to related Payment Period. All the amount payable by the Licensee shall be made in RMB to the bank account notified by the Licensor to the Licensee in writing from time to time.

 

If the Licensee fails to pay any amount due and payable hereunder, the Licensee shall pay the Licensor default interest for its overdue payment of such amount. The default interest rate shall be the lending interest rate of the Bank of China for the same period. The calculation period starts from the date on which the amount is due and payable and ends on the date of its actual payment.

 

3.5                   The Licensee shall provide the Licensor with an audited authentic and correct statement regarding the Licensee’s Income and the payable amount of the 

 

 

Royalty of the previous calendar year within sixty (60) days following the end of the previous calendar year. In the event that there is any inconsistency between such audited statement and the written report mentioned in above Article 3.3, then the Royalty shall be adjusted in the next Payment Period.

 

3.6                   The Licensee shall establish and maintain a separate accounting book for the use of Proprietary Technology and the Improvement. Throughout the term hereof, the Licensor has the right to send its employees, or engage a registered accountant at its own cost, to audit the Licensee’s books and records, including without limitation the income statements of the Licensee for the Payment Periods. The Licensee shall provide to the Licensor’s appointed employees or engaged registered accountant with all related materials, books, records, data and information, and shall provide necessary facility and support to such employees or accountant. The audit report prepared by the Licensor’s appointed employees or engaged accountant (“Audit Report”) shall be final and conclusive unless the Licensee raises any issue regarding such Audit Report within seven (7) days following its receipt of such Audit Report. The Licensor has the right to give the Licensee at anytime a payment notice regarding the outstanding amount of Royalty specified in the Audit Report. The Licensee shall make corresponding payment for it in accordance with the above Article 3.4 within seven (7) business days following the receipt of the payment notice.

 

4.                          Licensor’s Warranties

 

4.1                   As the consideration of grant of the License by the Licensor to the Licensee, the Licensee hereby warrants and undertakes to the Licensor that during the term hereof, without the prior written consent form the Licensor, the Licensee will not:

 

(1)                     use its own resources, or outsource or purchase any recourse from any party other than the Licensor, for provision of technical services;

 

(2)                     enter into any agreement, or make any arrangement, or become liable to any third party;

 

(3)                     be engaged in any business competitive with the business the Licensor is engaged in (including with limitation the technical services provided by the Licensor);

 

(4)                     engage or intend to engage any employee of the Licensor or its affiliate;

 

(5)                     adopt or amend its budget or operation plan; however, the Licensee shall provide its budget and operation plan draft for each fiscal year at least sixty (60) days before the beginning of each fiscal year to the Licensor for

 

 

the Licensor’s approval; or

 

(6)                     enter into any agreement with any third party for any matter same with or similar to the subject matter hereof.

 

4.2                   As the consideration of grant of the License by the Licensor to the Licensee, the Licensee hereby warrants to the Licensor that during the term hereof:

 

(1)                     the Licensee will obtain from or renew with related governmental and administrative authorities any related approval, consent, license, registration and permit necessary for its establishment and valid existing (including without limitation the establishment approval certificate and business license), or any approval, consent, license, registration and permit in relation to the existing and operation of the value-added telecommunication permit, value-added telecommunication business or any other Internet content provider business, and maintain the validity of above mentioned approval, consent, license, registration and permit.

 

(2)                     the Licensee will not cease or change the current scope of Business, or be engaged in or incur any business or expenses beyond the approved and valid budget and operation plan, or cease the value-added telecommunication business;

 

(3)                     the Licensee with not change the nature of Internet content provider business it is currently engaged in; or

 

(4)                     the Licensee will operate Business lawfully, and will not engage in any business in violation of related laws.

 

5.                          Delivery of Technical Materials

 

The Licensor shall deliver to the Licensee the technical materials related to the Proprietary Technology and the Improvement through the medium and method accepted to both Parties.

 

6.                          Visit to Licensee’s Work Site

 

Notwithstanding any provision in this Agreement or any other agreement, the Licensor is entitled to visit the Licensee’s Work Site during the term hereof.

 

7.                          Improvement to Proprietary Technology

 

The Licensor or the person designated by it has the title to any Improvement to the Proprietary Technology made by the Licensor and/or the Licensee based on

 

 

such Proprietary Technology, notwithstanding such Improvement can or cannot be independently registered as a copyright, patent or any intellectual property in any other form in accordance with any laws of intellectual property within any jurisdiction. For avoidance of any doubt, unless consented by the Licensor in writing, the Licensee is not entitled to transfer, assign or license the above-mentioned Improvement.

 

8.                          Intellectual Property Rights of Licensor

 

8.1                   The Licensee acknowledges that, the Licensor or the person designated by it owns the absolute title to the goodwill, intellectual property and other rights of and related to the Proprietary Technology and the Improvement, no matter if it into existence before or after the execution of this Agreement. And both Parties hereby agree that, such above-mentioned rights shall be owned by the Licensor or its designated person all the time and for all purposes.

 

8.2                   In any circumstances, the Licensee shall not file an application for registration anywhere in the world as the owner of the Proprietary Technology and the Improvement. On the other hand, the Licensee shall make every possible effort to provide necessary assistance in the event that the Licensor or its designated person intends to file an application for the registration of the Proprietary Technology or the Improvement somewhere in the world. If the provisions or limitations of law make the Licensee become the owner of the Proprietary Technology and the Improvement, then the Licensee shall at the Licensor’s request and at its own cost, transfer the registration and all the other rights of the Proprietary Technology and the Improvement to the Licensor or its designated person, at a nominal price of Renminbi 1.00 Yuan (RMB 1.00).

 

8.3                   The Licensee confirms all the software copyrights and patents it holds and applied were developed and registered based on the Proprietary Technology licensed under this Agreement, and the Licensee shall transfer all the software copyrights and patents according to Section 8.2 upon the request from the Licensor.

 

9.                          Confidentiality

 

9.1                   All the Proprietary Technology and the Improvement and all the technical materials and other information related thereto delivered to the Licensee from time to time are the property of the Licensor or its designated person for all the time. The Licensee undertakes to the Licensor and its designated person:

 

(1)                     it will use the Proprietary Technology or any Improvement thereof, and any related Technical Materials and other related information only inside Designated Region, and will not make any other use thereof for any 

 

 

purpose not contemplated herein; and

 

(2)                     without the prior written consent from the Licensor, it will not disclose the Proprietary Technology and the Improvement, or any Technical Materials and other information related thereto, to any person, enterprise or company upon the execution hereof, except the disclosure made to the principal employees, staff, directors and management staff strictly adhering to the “need-to-know” principle; and it will cause such principal employees, staff, directors and management be strictly bound by the confidentiality obligations, and it is liable to the Licensor for compliance of the confidentiality obligation by the above mentioned persons.

 

9.2                   The Licensee shall establish and maintain proper security measures and procedures, in order to safely store the Proprietary Technology and the Improvement, as well as related Technical Materials; and shall ensure that any unauthorized person cannot gain access to any such Proprietary Technology and the Improvement, as well as related Technical Materials.

 

9.3                   The Licensor has the right to visit and inspect the Licensee’s Work Site to ensure that the Licensee is in compliance with this Article.

 

9.4                   Notwithstanding the provision of above Article 9.1, the confidential obligation shall not apply to:

 

(1)                     any information obtained from the other Party, which has become available to the public not due to the willful misconduct or negligence of this Party or any of its agents, consultants, directors, officers, employees or representatives;

 

(2)                     any disclosure made at requirement of applicable laws or any other competent governmental authorities or agencies, or in accordance with regulations or rules of relevant administrative and regulatory authorities; and

 

(3)                     any disclosure made by either Party to its banks, financial counsels, legal counsels or any other counsels for the purpose of this Agreement.

 

9.5                   The confidentiality obligations set forth in this Article survive the termination of this Agreement for unlimited period of time, unless any confidential information becomes available to the public in accordance with the above mentioned provisions.

 

 

10.                   Claim

 

10.1            The Licensee shall be solely liable for any claim, lawsuit or administrative litigation arising from the improper manipulation or use of the Proprietary Technology and the Improvement by the Licensee.

 

10.2            In the event that the Licensee discovers that any person is illegally using the Proprietary Technology and the Improvement inside the region where the Licensee is granted the License herein, the Licensee shall notify the Licensor of it immediately. The Licensee shall at the Licensor’s request, provide reasonable and sufficient assistance and cooperation to the Licensor with respect to any lawsuit, claim or any other legal proceeding filed or to be filed regarding the Proprietary Technology and the Improvement.

 

11.                   Early Termination

 

11.1            Early termination of this Agreement is permitted in any of the following circumstances:

 

(1)                     agreed by both Parties in writing;

 

(2)                     by the Licensor in the event that the Licensee commits a material breach of this Agreement and fails to cure such default within thirty (30) days after the written notice of requirement for cure of default from the Licensor; or

 

(3)                     by the Licensor in the event that the Licensee commenced any liquidation proceeding, or any successor or similar officially appointed person is designated for all or substantial or major part of the business, properties or assets of the Licensee.

 

11.2            The termination of this Agreement in accordance with this Article does not impair the accumulative rights and obligations of both Parties prior to the termination of this Agreement.

 

11.3            In the event that this Agreement is terminated for any reason, then:

 

(1)                     the License for Use granted in accordance with the Article 2 hereof shall terminate with immediate effect;

 

(2)                     the Licensee shall immediately cease the Use of the Proprietary Technology and the Improvement, as well as all related intellectual property;

 

(3)                     the Licensee shall immediately return the Proprietary Technology and the Improvement, and the Technical Materials and other information delivered to it to the Licensor;

 

 

(4)                     the Licensee shall immediately transfer any software copyrights and patents registered under its own name and involving the Proprietary Technology to the Licensor according to this Agreement and other relevant agreements; and

 

(5)                     the Licensor is entitled to deregister the registration of this Agreement with related Chinese competent authorities (i.e., National Copyright Administration of PRC). And the Licensee shall at the Licensor’s request, assist the Licensor with the deregistration and other necessary formalities, to eliminate the Licensee’s right to use the Software and Proprietary Technology and the Improvement.

 

12.                   Indemnification

 

12.1            The Licensee shall indemnify the Licensor for any direct or indirect losses, expenses and costs (including without limitation any legal fee) incurred by the Licensor caused by any claim raised by any person for the execution and performance of this Agreement, unless such claim is attributable to the willful misconduct, default or material negligence of the Licensor.

 

12.2            The Licensor is not liable to the Licensee for any losses, damage, expenses and costs incurred by the Licensee caused by the existence of this Agreement or any other reason, unless such losses, damage, expenses or costs are caused by the willful misconduct, default or material negligence of the Licensor, however, provided that, in any circumstance, the Licensor shall not be held liable for any indirect losses caused to the Licensee by the breach of this Agreement.

 

12.3            The liability for breach assumed by the Licensor shall not exceed the amount of Royalty the Licensee shall pay to the Licensor hereunder for the year in which such liability comes into existence.

 

13.                   Entire Agreement

 

This Agreement constitutes the entire agreement reached by the Parties with respect to the subject matter of this Agreement, and replaces and terminates all the preceding oral and written discussions, negotiations, notices, memorandums of understanding, documents, and agreements, including the Original License Agreement among the Parties regarding the subject matter of this Agreement. The Parties agree that this Agreement should not be amended unless being consented by the Parties in writing.

 

 

14.                   Assignment

 

Without the written consent by the other Party, neither Party should assign any of its rights and obligations hereunder to any third party. Any intention to affect the transfer of any right, obligation, or liability hereunder is invalid without obtaining the above mentioned consent.

 

15.                   Further Warranties

 

Each Party hereto shall sign, and take all necessary measures within its scope of power to cause any other persons, companies or subsidiaries (if necessary) to sign, any further document, agreement and deed, and take any other act, necessary for making all the terms of this Agreement fully effective.

 

16.                   Severability and Enforceability

 

16.1            If one or multiple terms hereof is announced or determined by any competent authority to be illegal or invalid, or becomes unenforceable in accordance with any applicable law in any jurisdiction, then,

 

(1)                     such term shall be deemed to be isolated from the remaining terms hereof, and the remaining terms hereof continue to be valid;

 

(2)                     without prejudice to the capacity of filing claim before competent authorities, such invalid or unenforceable terms shall be eliminated from this Agreement, provided that, if the elimination of such terms have substantially affected or changed the commercial basis of this Agreement, the Parties shall faithfully agree to replace such invalid or unenforceable terms with new terms. The newly added terms shall be valid and enforceable, and shall be able to express the meanings which the original invalid and unenforceable terms are trying to express.

 

16.2            If any applicable law fully or partially prohibits or limits the performance of this Agreement, or in any way affect the performance by any Party hereto of its rights hereunder, then the Parties agree they will sign an additional agreement including commercial terms similar to those herein, to ensure the full performance of rights and obligations hereunder.

 

17.                   Costs and Expenses

 

The Licensee shall bear all the costs and expenses incurred by both Parties for the preparation of, negotiation about and execution of this Agreement.

 

18.                   Notices

 

18.1            Any notice given by one Party to the other Party shall be delivered in person, by 

 

 

facsimile, prepaid registered mail, or publicly recognized courier to the following addresses or facsimile numbers, which may be changed from time to time. The initial address and facsimile number of each Party are set forth as follows:

 

	
Licensor
    	
:
    	
 
    
	
Facsimile
    	
:
    	
 
    
	
Address
    	
:
    	
 
    
	
Attention
    	
:
    	
Zou Shenglong
    
	
 
    	
 
    	
 
    
	
Licensee
    	
:
    	
Shenzhen Xunlei   Networking Technologies Co., Ltd.
    
	
Facsimile
    	
:
    	
 
    
	
Address
    	
:
    	
 
    
	
Attention
    	
:
    	
Zou Shenglong
    

 

18.2            Any such notice or communication is deemed given when::

 

(1)                     when delivered if in person; or

 

(2)                     on the fifth (5th) Business Day after being posted if by prepaid mail; or

 

(3)                     if delivered by facsimile, when the sender receives the facsimile report, showing such notice or communication has been entirely sent to the receiver’s facsimile machine or any other similar receiving machine; or

 

(4)                     on the third (3rd) business day after the courier receives the notice or communications.

 

For purpose of evidencing certain notices or communications have been given, the sending Party needs to prove that such notices or communications have been delivered in person, or the envelope embedded with such notices or communications have been correctly put address on and posted as prepaid mail, or the facsimile report shows that the facsimile has been successfully transmitted, or the package with such notices or communications in has been correctly specified address and delivered to courier.

 

19.                   Waiver

 

Any failure or delay to exercise any of its rights or remedies under this Agreement by either Party will not operate as its waiver of such right or remedy. Single or partial exercise of any right or remedy by either Party shall not exclude its exercise of any other rights or remedies. The rights described hereunder is accumulative, and does not exclude the rights or remedies provided by laws.

 

 

20.                   Governing Law and Jurisdiction

 

20.1            This Agreement is governed by and interpreted in accordance with laws of the PRC.

 

20.2            Any dispute arising from the execution, performance, termination or validity of this Agreement or in connection with this Agreement shall be resolved by both Parties through friendly negotiations and, if negations fail, shall be submitted to China International Trade and Economic Arbitration Commission South China Sub-commission (“CIETAC South China Sub-commission”) for arbitration according to its then effective rules and proceeding. The arbitration shall be conducted in Shenzhen. There will be one arbitrator who shall be appointed by the CIETAC South China Sub-commission according to above mentioned rules and proceeding. The arbitral award is final and binding upon the Parties. Unless otherwise provided by the arbitral award, the losing Party shall assume all the costs and expenses of arbitration and reimburse all the costs and expenses of arbitration incurred by the winning Party. If either Party needs to file a lawsuit for enforcement of the arbitral award, the losing Party shall reimburse the other Party for all reasonable expenses and legal fee so incurred by the other Party. During the period from the submission of dispute for arbitration to the rendering of arbitral award, both Parties shall continue to perform their obligations hereunder without prejudice to the final judgment made based on the aforesaid arbitral award.

 

21.                   Counterpart

 

This Agreement may be signed in multiple counterparts. Each singed counterpart shall be deemed as a original copy of this Agreement. All the counterparts constitute identical documents.

 

22.                   Miscellaneous

 

22.1            This Agreement becomes effective from the date first written above upon execution. The Parties agree and confirm the terms and conditions of this Agreement effect from November 15, 2006. This Agreement replaces the Original License Agreement upon the effectiveness of this Agreement.

 

22.2            Unless this Agreement terminates in advance according to this Agreement, the term of validity of this Agreement is ten (10) years. Prior to the expiration of this Agreement, subject to the written confirmation of the Licensor, this Agreement may be renewed. The term of renewal is ten (10) years or a term as agreed by the Parties. The Licensee is not entitled to confirm the renewal of this Agreement.

 

 

22.3            This Agreement is written in Chinese in two (2) original counterparts with same legal effect, each Party holding one (1) counterpart.

 

22.4           All the issues not contemplated herein shall be determined by the Parties through negotiations.

 

[The reminder of this page intentionally left blank]

 

 

IN WITNESS WHEREOF, the Parties have executed this Agreement as of the day and year first above written.

 

 

	
Licensor:   Giganology (Shenzhen) Ltd.
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/ Zou Shenglong
    	
 
    
	
Legal/Authorized   representative (Signature and Seal)
    	
 
    
	
[Affixed with company   seal]
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Licensee:   Shenzhen Xunlei Networking Technologies Co., Ltd.
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:
    	
/s/ Zou Shenglong
    	
 
    
	
Legal/Authorized   representative (Signature and Seal)
    	
 
    
	
[Affixed with company   seal]
    	
 
    

 

 

Schedule 1

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