Gothic 4 - BVT Games Fund III & JoWooD Gothic 4 Deal Details

Gorath

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A lot of interesting infos about the Gothic 4 deal can be found in a document on BVT´s homepage. Addendum No.2 to the BVT Games Fund III Dynamic brochure explains the contract between the BVT Games Fund III Dynamic and JoWooD.

Please note that the excerpts and summaries below are taken out of context and are only meant to illustrate the deal. Several expressions have been replaced with similar but not identical English terms, which makes different legal meanings and lack of precision inevitable.
The German source on the other hand is the official document for investors, and as such subject to legal restraints. We can safely assume that both the BVT Games Fund III and JoWooD had the German text checked by their lawyers and that everything in it was correct as of 11/22/2007, the date of the addendum.
  • BVT Games Fund III participates in the project Gothic 4 as a producer by closing a "Development Agreement" and a "Publishing / Distribution Agreement".
  • The project shall be produced for the platforms PC and XBox 360.
"Development Agreement" (10/15/2007)
  • Per the "Development Agreement" JoWooD is assigned the development and creation of Gothic 4 in form of true contract work.
  • JoWooD committed to finishing the programming and development work on the XBox 360 version until 12/16/2009 and on the PC version on 02/01/2010 at at the latest.
  • JoWooD has [...] to deliver a master copy including source code and standard documentation.
  • Owner of all rights to Gothic 4 shall be the BVT Games Fund III.
  • The sum raised in return shall be a total of 3.485.900,00 EUR.
  • The budget will be paid in milestones.
"Publishing / Distribution Agreement" (10/15/2007)
  • In the "Publishing / Distribution Agreement" for Gothic 4 JoWooD has been assigned the worldwide distribution and marketing.
  • JoWooD is obliged to release Gothic 4 at least in Europe, the US and Canada.
  • The BVT Games Fund III receives royalties on the revenue. The royalty rate is 80% until the BVT Games Fund III has collected 120% of the game´s budget. Then it is reduced, depending on time, until it reaches 32%.
  • Furthermore JoWooD will pay the BVT Games Fund III a fixed advance against royalties in the amount of 70% of the game´s budget. The advance payment is due 120 days after the contractually agreed Gothic 4 release on 02/25/2010, but at the latest on 06/15/2010.
  • Moreover JoWooD has been granted a purchase option for all rights to the project. JoWooD can draw this option for 6 months after BVT Games Fund III has collected 120% of the game´s budget. This has no influence on the agreed royalties.
More information.
 
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Squeek

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So JoWood reduces its risk in exchange for 20%, and can simply walk away entirely by not exercising its buy-back option. In the meantime, the work stays the same. Right?
 
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Gorath

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Don´t forget the royalties. They´re 32% minimum.
 
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Acleacius

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Thanks for the infos Gorath. :)
 
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