Glonghui, April 19 | Leroy Entertainment (02306.HK) announced that on April 19, 2024, Leroy Limited (a wholly-owned subsidiary of the company) entered into a series of transactions with the seller relating to the acquisition of target assets at a total cost of RMB 30.0 million: (1) Asset Transfer Agreement I with Seller I, whereby the buyer agreed to purchase Target Asset I; (2) Asset Transfer Agreement II with Seller II and Seller III (and 3) With the seller II's patent license agreement, according to which the licensee is authorized to execute the licensed patent within the scope of the agreement by paying royalties to Seller II for a period of five years. Unless either party under the agreement requests that it not be repeated, this period will automatically be extended for one year.
The assets that the buyer will acquire from Seller I include assets relating to the operation of the target business, including (i) code, (ii) copyright, (iii) domain names, (iv) equipment, and (v) accounts. The assets that the buyer will acquire from Seller II and Seller III include (i) trademarks, (ii) copyright, and (iii) equipment.
Since its debut in June 2020, A-SOUL has been widely welcomed by more and more young netizens in China. For the Group, keeping up with the development of Internet services and information technology is essential, as it is the basic technology for developing virtual artists, which helps increase the company's market exposure and participation in the virtual artist field. However, developing relevant technology yourself and recruiting R&D personnel may incur unnecessary additional expenses. Therefore, the company plans to purchase target assets, which will more efficiently and effectively enhance the company's comprehensive ability to develop virtual artists and further manage A-SOUL, thereby maintaining the company's leading position in the virtual artist field and the pan-entertainment market.
Furthermore, on April 19, 2024, Leroy Limited and Nice Future signed a business cooperation framework agreement on target business operations. According to this, Nice Future and one of its wholly-owned subsidiaries will be exclusively authorized by Leroy Limited to operate and manage the relevant rights of A-SOUL and other virtual artists owned by Leroy Limited.
Nice has always been an important market participant in virtual artist cooperation in the future, and has accumulated some experience over the years. The directors believe that future cooperation with Nice will further enhance the company's business capabilities in the virtual artist market and effectively enhance its business performance in the pan-entertainment market.