CDC Corporation's (CHINA) subsidiary CDC Games announced a comprehensive settlement of its legal disputes and the end of all outstanding litigation with Mgame.

The original lawsuit was filed in October 2007 by CDC Games in Hong Kong for breach of contract and alleged that Mgame has not been providing adequate technical support for Yulgang, and Mgame had not been supporting CDC Games in their efforts to combat pirate servers. Then a second lawsuit was filed days later for breach of contract and alleged that Mgame had breached contractual obligations owed to CDC Corporation by failing to provide certain financial and operating data and other information which Mgame is required to provide to CDC Corporation as a shareholder of Mgame.

"We are very happy to reach an amicable settlement with Mgame," said Jeffrey Longoria, president of CDC Games International. "This is very good news for our loyal game players and allows us to refocus our energy and resources on enhancing the Yulgang player experience going forward. We will be highly focused on regaining the confidence of our large, loyal base of game players and our market share in China for this widely popular game."

The two companies reached an amicable resolution which calls for CDC Games to have exclusive distribution rights to Yulgang in China until March 2010 with an option to extend for an additional year. The companies also agreed to work together to launch the Version 2.0 upgrade to Yulgang as soon as possible.

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