Exhibit 10.9

[***] DENOTES CONFIDENTIAL MATERIALS OMITTED AND FILED

SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION
PURSUANT TO A REQUEST FOR CONFIDENTIAL TREATMENT

 

CONFIDENTIAL LICENSE AGREEMENT

FOR THE Wii CONSOLE

(Western Hemisphere)

THIS LICENSE AGREEMENT (“Agreement”) is entered into between NINTENDO OF AMERICA
INC. (“NOA”) at 4820 150th Avenue N.E., Redmond, WA  98052 Attn: General Counsel
(Fax: 425-882-3585) and ACTIVISION PUBLISHING, INC. (“LICENSEE”) at 3100 Ocean
Park Blvd., Santa Monica, CA 90405 Attn:  Suzan Rude (Fax: 310-255-2100).  NOA
and LICENSEE agree as follows:

1.                                      RECITALS

 

1.1           NOA markets and sells advanced design, high-quality video game
systems, including the Wii video game console (“Wii”).

1.2           LICENSEE desires use of the highly proprietary programming
specifications, unique and valuable security technology, trademarks, copyrights
and other valuable intellectual property rights of NOA and its parent company,
Nintendo Co., Ltd., which rights are only available for use under the terms of a
license agreement, to develop, have manufactured, advertise, market and sell
video game software for play on Wii.

1.3           NOA is willing to grant a license to LICENSEE on the terms and
conditions set forth in this Agreement.

2.                                      DEFINITIONS

 

2.1           “Artwork” means the text and design specifications for the Game
Disc label and the Printed Materials in the format specified by NOA in the
Guidelines.

2.2           “Bulk Goods” means Game Discs that have been printed with the Game
Disc label Artwork for delivery to LICENSEE without Printed Materials or other
packaging.

2.3           “Check Disc(s)” means the pre-production Game Discs to be produced
by Nintendo.

2.4           “Confidential Information” means the information described in
Section 8.1.

2.5           “Development Tools” means the development kits, programming tools,
emulators and other materials of Nintendo, or third parties authorized by
Nintendo, that may be used in the development of Games under this Agreement.

2.6           “Effective Date” means October 12, 2006.

2.7           “Game Discs(s)” means custom optical discs for play on Wii on
which a Game has been stored.

2.8           “Game(s)” means any interactive programs (including source and
object/binary code) developed to be compatible with Wii.

2.9           “Guidelines” means the then current version of “Wii Programming
Guidelines,” “Licensee Packaging Guidelines,” and “Nintendo Trademark
Guidelines,” together with other guidelines provided by NOA to LICENSEE from
time to time.

2.10         “Independent Contractor” means any individual or entity that is not
an employee of LICENSEE, including any independent programmer, consultant,
contractor, board member or advisor.

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2.11         “Intellectual Property Rights” means individually, collectively or
in any combination, Proprietary Rights owned, licensed or otherwise held by
Nintendo that are associated with the development, manufacturing, advertising,
marketing or sale of the Licensed Products, including, without limitation, (a)
registered and unregistered trademarks and trademark applications used in
connection with Wii including Nintendo®, Wii™, Official Nintendo Seal of
Quality®, and Mii™ , (b) select trade dress associated with Wii and licensed
video games for play thereon, (c) Proprietary Rights in the Security Technology
employed in the Games or Game Discs by Nintendo, (d) rights in the Development
Tools for use in developing the Games, excluding, however, rights to use,
incorporate or duplicate select libraries, protocols and/or sound or graphic
files associated with the Development Tools which belong to any third party and
for which no additional licenses or consents are required, (e) patents, design
registrations or copyrights which may be associated with the Game Discs or
Printed Materials, (f) copyrights in the Guidelines, and (g) other Proprietary
Rights of Nintendo in the Confidential Information.

2.12         “Licensed Products” means Bulk Goods after being assembled by or
for LICENSEE with the Printed Materials in accordance with the Guidelines.

2.13         “Marketing Materials” means marketing, advertising or promotional
materials developed by or for LICENSEE (or subject to LICENSEE’s approval) that
promote the sale of the Licensed Products, including but not limited to,
television, radio and on-line advertising, point-of-sale materials (e.g.,
posters, counter-cards), package advertising, print media and all audio or video
content other than the Game that is to be included on the Game Disc.

2.14         “NDA” means the non-disclosure agreement related to Wii previously
entered into between NOA and LICENSEE.

2.15         “Nintendo” means NOA’s parent company, Nintendo Co., Ltd., of
Kyoto, Japan, individually or collectively with NOA.

2.16         “Notice” means any notice permitted or required under this
Agreement.  All notices shall be sufficiently given when (a) personally served
or delivered, or (b) transmitted by facsimile, with an original sent
concurrently by first class U.S. mail, or (c) deposited, postage prepaid, with a
guaranteed air courier service, in each case addressed as stated herein, or
addressed to such other person or address either party may designate in a
Notice.  Notice shall be deemed effective upon the earlier of actual receipt or
two (2) business days after transmittal, provided, however, any Notice received
after the recipient’s normal business hours will be deemed received on the next
business day.

2.17         “Price Schedule” means the then current version of NOA’s schedule
of purchase prices and minimum order quantities for the Bulk Goods.

2.18         “Printed Materials” means a plastic disc storage case, title page,
instruction booklet, warranty card and poster incorporating the Artwork.

2.19         “Promotional Disc(s)” means custom optical discs compatible with
Wii that incorporate select game promotional or supplemental materials, as may
be specified or permitted in the Guidelines.

2.20         “Proprietary Rights” means any rights or applications for rights
owned, licensed or otherwise held in patents, trademarks, service marks,
copyrights, mask works, trade secrets, trade dress, moral rights and publicity
rights, together with all inventions, discoveries, ideas, technology, know-how,
data, information, processes, formulas, drawings and designs, licenses, computer
programs, software source code and object code, and all amendments,
modifications, and improvements thereto for which such patent, trademark,
service mark, copyright mask work, trade secrets, trade dress, moral rights or
publicity rights may exist or may be sought and obtained in the future.

2.21         “Rebate Program” means any then current version of NOA’s optional
rebate program, establishing select terms for price rebates under this
Agreement.

 

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2.22                           “Reverse Engineer(ing)” means, without
limitation, (a) the x-ray, electronic scanning or physical or chemical stripping
of semiconductor components, (b) the disassembly, decompilation, decryption or
simulation of object code or executable code, or (c) any other technique
designed to extract source code or facilitate the duplication of a program or
product.

2.23                           “Security Technology” means the highly
proprietary security features of the Wii and the Licensed Products to minimize
the risk of unlawful copying and other unauthorized or unsafe usage, including,
without limitation, any security signature, bios, data scrambling, password,
hardware security apparatus, watermark, hologram, encryption, digital rights
management system, copyright management information system, proprietary
manufacturing process or any feature which obstructs piracy, limits unlawful,
unsafe or unauthorized use, or facilitates or limits compatibility with other
hardware, software, accessories or peripherals, or with respect to a video game
system other than the Wii, or limits distribution outside of the Territory.

2.24                           “Term” means three (3) years from the Effective
Date.

2.25                           “Territory” means all countries within the
Western Hemisphere and their respective territories and possessions.

2.26                           Wii Network Services” means and includes the Wii
Shop Channel Services, WiiConnect24, and any related services and material
delivered to a consumer’s Wii console over the Internet.

3.                                      GRANT OF LICENSE; LICENSEE RESTRICTIONS

 

3.1                                 Limited License Grant.  For the Term and for
the Territory, NOA grants to LICENSEE a nonexclusive, nontransferable, limited
license to use the Intellectual Property Rights to develop (or have developed on
LICENSEE’s behalf) Games for manufacture, advertising, marketing and sale by
LICENSEE as Licensed Products, subject to the terms and conditions of this
Agreement.  Except as permitted under a separate written authorization from
Nintendo, LICENSEE shall not use the Intellectual Property Rights for any other
purpose.

3.2                                 LICENSEE Acknowledgement.  LICENSEE
acknowledges (a) the valuable nature of the Intellectual Property Rights, (b)
the right, title and interest of Nintendo in and to the Intellectual Property
Rights, and (c) the right, title, and interest of Nintendo in and to the
Proprietary Rights associated with all aspects of Wii.  LICENSEE recognizes that
the Development Tools, Games, Game Discs and Licensed Products will embody
valuable rights of Nintendo and Nintendo’s licensors.  LICENSEE represents and
warrants that it will not undertake any act or thing which in any way impairs or
is intended to impair any part of the right, title, interest or goodwill of
Nintendo in the Intellectual Property Rights.  LICENSEE’s use of the
Intellectual Property Rights shall not create any right, title or interest of
LICENSEE therein.  Licensee is authorized and permitted to develop Games, and
have manufactured, advertise, market, and sell Licensed Products, only for play
on Wii and only in accordance with this Agreement.

3.3                                 LICENSEE Restrictions and Prohibitions. 
LICENSEE is not licensed to and covenants that, without the express, written
consent of NOA, it will not at any time, directly or indirectly, do or cause to
be done any of the following:

(a)           grant access to, distribute, transmit or broadcast a Game by
electronic means or by any other means known or hereafter devised, including,
without limitation, by wireless, cable, fiber optic, telephone lines, microwave,
radiowave, computer or other device network, except (a) as a part of wireless
Game play on and among Wii systems, or between Wii and Nintendo DS systems (b)
for the purpose of facilitating Game development under the terms of this
Agreement, or (c) as otherwise approved in writing by Nintendo.  LICENSEE shall
use reasonable security measures, customary within the high technology industry,
to reduce the risk of unauthorized interception or retransmission of any Game
transmission.  No right of retransmission shall attach to any authorized
transmission of a Game;

 

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(b)           authorize or permit any online activities involving a Game,
including, without limitation, multiplayer, peer-to-peer or online play, except
as expressly permitted by Nintendo in writing;

(c)           modify, install or operate a Game on any server or computing
device for the purpose of or resulting in the rental, lease, loan or other grant
of remote access to the Game;

(d)           emulate, interoperate, interface or link a Game for operation or
use with any hardware or software platform, accessory, computer language,
computer environment, chip instruction set, consumer electronics device or
device other than Wii, the Nintendo DS system, the Development Tools or such
other Nintendo system as NOA may authorize in the Guidelines;

(e)           embed, incorporate, or store a Game in any media or format except
the optical disc format utilized by Wii, except as may be necessary as a part of
the Game development process under this Agreement;

(f)            design, implement or undertake any process, procedure, program or
act designed to disable, obstruct, circumvent or otherwise diminish the
effectiveness or operation of the Security Technology;

(g)           utilize the Intellectual Property Rights to design or develop any
interactive video game program, except as authorized under this Agreement;

(h)           manufacture or reproduce a Game developed under this Agreement,
except through Nintendo; or

(i)            Reverse Engineer or assist in Reverse Engineering all or any part
of Wii, including the hardware, software (embedded or not) or the Security
Technology.

3.4                                 No Free-Riding; No Co-Publishing
Arrangements.  To protect Nintendo’s valuable Intellectual Property Rights, to
prevent the dilution of Nintendo’s trademarks and to preclude free-riding by
third parties on the goodwill associated with Nintendo’s trademarks, the license
granted under this Agreement is limited to LICENSEE and may not be delegated or
contracted out for the benefit of a third party, or to a division, affiliate, or
subsidiary of LICENSEE.  This Agreement, together with all submissions,
representations, undertakings and approvals contemplated of LICENSEE by this
Agreement, is and shall remain the right and obligation only of LICENSEE.  All
Printed Materials and Marketing Materials for a Game shall prominently and
accurately identify LICENSEE as NOA’s licensee.  NOA does not permit the
designation or identification of any third party co-publisher for a Game on any
Game Disc or Game Disc label Artwork, however, LICENSEE may identify a third
party as a co-publisher, licensor, developer or other partner of LICENSEE in
those Printed Materials (other than the Game Disc label), Marketing Materials or
Game credits, as authorized under the Guidelines.  For purposes of
clarification, LICENSEE’s name, or logo, will appear on the Licensed Product
Game Disc case and Game Disc label as it appears in the preamble of this
Agreement.

3.5                                 Development Tools.  NOA and Nintendo Co.,
Ltd. may lease, loan or sell Development Tools to LICENSEE to assist in the
development of Games under this Agreement.  Ownership and use of any Development
Tools shall be subject to the terms of this Agreement and any separate license
or purchase agreement required by Nintendo or any third party licensing the
Development Tools. LICENSEE acknowledges the respective interests of Nintendo,
and in the case of third-party Development Toots, such third parties, in and to
the Proprietary Rights associated with the Development Tools.  LICENSEE’s use of
the Development Tools shall not create any right, title or interest of LICENSEE
therein.  LICENSEE shall not, directly or indirectly, (a) use the Development
Tools for any purpose except the design and development of Games under this
Agreement, (b) reproduce or create derivatives of the Development Tools, except
in association with the development of Games under this Agreement, (c) Reverse
Engineer the Development Tools, or (d) sell, lease, assign, lend, license,
encumber or otherwise transfer the Development Tools.  Anything developed or
derived by LICENSEE as a result of a study of the performance, design or
operation of any Nintendo Development Tools shall be

 

4

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considered a derivative work of the Intellectual Property Rights and shall
belong to Nintendo, but may be retained and utilized by LICENSEE in connection
with this Agreement.  In no event shall LICENSEE (i) seek, claim or file for any
patent, copyright or other Proprietary Right with regard to any such derivative
work, (ii) make available any such derivative work to any third party, or (iii)
use any such derivative work except in connection with the design and
development of Games under this Agreement.  Anything developed or derived by
LICENSEE as a result of a study of the performance, design or operation of any
third-party Development Tools shall be governed by the terms of the license
agreement applicable to such Development Tools.  Notwithstanding any referral or
information provided or posted regarding third-party Development Tools, NOA and
Nintendo Co., Ltd. make no representations or warranties with regard to any such
third-party Development Tools.  LICENSEE acquires and utilizes third-party
Development Tools at its own risk.

3.6           Third Party Developers.  LICENSEE shall not disclose the
Confidential Information, the Guidelines or the Intellectual Property Rights to
any Independent Contractor, nor permit any Independent Contractor to perform or
assist in development work for a Game, unless and until such Independent
Contractor has signed a confidentiality agreement with LICENSEE that is no less
restrictive than the terms of Section 8 below, and that expressly includes the
following language [***]:

“Independent Contractor may have access to highly-confidential and proprietary
information, intellectual property, and trade secrets of Nintendo Co., Ltd.
and/or Nintendo of America Inc. (collectively, “Nintendo”).  Independent
Contractor expressly acknowledges (i) the valuable nature of such materials; and
(ii) Nintendo’s right, title and interest in such materials.  All such materials
constitute confidential information under this agreement and shall be treated by
Independent Contractor as such.  Independent Contractor shall not undertake any
act or thing which in any way impairs or is intended to impair any part of the
right, title, interest or goodwill of Nintendo in such materials.  Independent
Contractor’s use of such materials shall not create any right, title or interest
of Independent Contractor therein.  Nintendo Co., Ltd. and Nintendo of America
Inc. are intended third-party beneficiaries of this agreement.”

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[***] DENOTES CONFIDENTIAL MATERIALS OMITTED AND FILED SEPARATELY WITH THE
SECURITIES AND EXCHANGE COMMISSION PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT

 

3.7           Games Developed for Linked Play on Two Systems.  In the event the
Guidelines permit LICENSEE to develop a Game for simultaneous or linked play on
Wii and on another Nintendo video game system, LICENSEE shall be required to
acquire and maintain with NOA such additional licenses as are necessary for the
use of the Proprietary Rights associated with such other Nintendo video game
system.

3.8           In Game Advertising.  LICENSEE shall not include advertising or
product placements for products or services of third parties, whether in the
Game, as separate content on a Game Disc (e.g., a trailer), or in the Printed
Materials without Nintendo’s prior written consent.

3.9           Use of Wii Characters.  LICENSEE shall not develop any Game that
permits Nintendo’s Mii characters to appear in the Game without NOA’s prior
written consent.

 

5

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3.10         Sending Data to Consumers.  LICENSEE shall not, without the prior,
written consent of NOA, send any data, content, messages, advertising, or other
communications of any kind to any consumer’s Wii console through the Wii Network
Services or otherwise.

3.11         Downloadable Content.  If LICENSEE desires to develop Games, or
updates/additions of any kind for any Licensed Product, to be downloaded to
consumers through the Wii Network Services, the terms and conditions of such
development shall be separately agreed in writing between the parties.  LICENSEE
acknowledges that the rights granted herein do not include the right to use the
Intellectual Property Rights to develop downloadable content.

4.                                      SUBMISSION AND APPROVAL OF GAME AND
ARTWORK

 

4.1           Submission of a Completed Game to NOA.  Upon completion of a Game,
LICENSEE shall deliver a prototype of the Game to NOA in a format specified in
the Guidelines.  Delivery shall be made in accordance with the methods set forth
in the Guidelines.  Each Submission shall include such other information or
documentation deemed necessary by NOA, including, without limitation, a complete
set of written user instructions, a complete description of any security holes,
backdoors, time bombs, cheats, “easter eggs” or other hidden features or
characters in the Game and a complete screen text script.  LICENSEE must
establish that the Game and any other content included on the Game Disc complies
with the Advertising Code of Conduct of the Entertainment Software Ratings Board
(“ESRB”) and that the Game has been rated EC, E, El0+, T or M (or another
non-Adult Only category added by the ESRB) by the ESRB.  LICENSEE shall provide
NOA with a certificate of rating for the Game issued by the ESRB.

4.2           Testing of a Completed Game.  Upon submission of a completed Game,
NOA and Nintendo Co., Ltd. shall promptly test the Game with regard to its
technical compatibility with and error-free operation on Wii, utilizing the lot
check process.  Within a reasonable period of time after receipt, NOA shall
approve or disapprove such Game.  If a Game is disapproved, NOA shall specify in
writing the reasons for such disapproval and state what corrections are
necessary.  After making the necessary corrections, LICENSEE shall submit a
revised Game to NOA for testing.  NOA shall not unreasonably withhold or delay
its approval of any Game. Neither the testing nor approval of a Game by NOA or
Nintendo Co., Ltd. shall relieve LICENSEE of its sole responsibility for the
development, quality and operation of the Game or in any way create any warranty
by NOA or Nintendo Co., Ltd. relating to any Licensed Product.

4.3           Production of Check Discs.  By submission of a completed Game to
NOA in accordance with section 4.1, LICENSEE authorizes Nintendo to proceed with
production of Check Discs for such Game.  If NOA approves a Game, it shall
promptly, and without further notification to or instruction from LICENSEE,
submit such Game for the production of Check Discs.  Unless otherwise advised by
LICENSEE, following production of the Check Discs, NOA shall deliver to LICENSEE
approximately ten (10) Check Discs for content verification, testing and final
approval by LICENSEE.

4.4           Approval or Disapproval of Check Discs by LICENSEE.  If, after
review and testing, LICENSEE approves the Check Discs, it shall promptly
transmit to NOA a signed authorization for production in the form specified in
the Guidelines.  If LICENSEE does not approve the sample Check Discs for any
reason, LICENSEE shall advise NOA in writing and may, after undertaking any
necessary changes or corrections, resubmit the Game to NOA for approval in
accordance with the procedures set forth in this Section 4.  The absence of a
signed authorization form from LICENSEE within five (5) days after delivery of
the Check Discs to LICENSEE shall be deemed disapproval of such Check Discs. 
Production of any order for Bulk Goods shall not proceed without LICENSEE’s
signed authorization.

4.5           Cost of Check Discs and Disc Stamper.  If LICENSEE: (a)
disapproves the Check Discs for any reason; (b) fails to order the minimum order
quantity of any Game approved by NOA within six (6) months after the date the
Game was first approved by NOA; or (c) submits a revised version of the Game to
NOA after production of such Game has commenced, LICENSEE shall reimburse NOA
(or its designee) for the reasonable estimated cost of the production of the
Check Discs, including the cost of

 

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the disc stamper.  The payment will be due (i) thirty (30) days after NOA’s
written notification to LICENSEE of the Check Disc fee due NOA because of
LICENSEE’s failure to approve such Check Disc; (ii) six (6) months after the
date the Game was first approved by NOA; or (iii) upon the subsequent submission
by LICENSEE of a revised version of the Game to NOA, as the case may be.

4.6           Submission and Approval of Artwork.  Prior to submitting a
completed Game to NOA under Section 4.1, LICENSEE shall submit to NOA all
Artwork for the proposed Licensed Product.  Within ten (10) business days of
receipt, NOA shall approve or disapprove the Artwork. If any Artwork is
disapproved, NOA shall specify in writing the reasons for such disapproval and
state what corrections or improvements are necessary.  After making the
necessary corrections or improvements, LICENSEE shall submit revised Artwork to
NOA for approval.  NOA shall not unreasonably withhold or delay its approval of
any Artwork.  The approval of the Artwork by NOA shall not relieve LICENSEE of
its sole responsibility for the development and quality of the Artwork or in any
way create any warranty for the Artwork or the Licensed Product by NOA.  All
Artwork must be approved prior to submitting an order for the Bulk Goods, and
LICENSEE shall not produce any Printed Materials for commercial distribution
until such Artwork has been approved by NOA.

4.7           Promotional Discs.  In the event NOA issues Guidelines in the
future that permit LICENSEE to develop and distribute Promotional Discs, either
separately or as a part of the Licensed Product, the content and specifications
of such Promotional Disc shall be subject to all of the terms and conditions of
this Agreement, including, without limitation, the Guidelines, the Price
Schedule and the submission and approval procedures provided for in this Section
4.

5.                                      ORDER PROCESS, PURCHASE PRICE, PAYMENT
AND DELIVERY

 

5.1           Submission of Orders by LICENSEE.  After receipt of NOA’s approval
for a Game and Artwork, LICENSEE may at any time submit a written purchase order
to NOA for Bulk Goods for such Game.  The terms and conditions of this Agreement
shall control over any contrary or additional terms of such purchase order or
any other written documentation or verbal instruction from LICENSEE.  All orders
shall be subject to acceptance by NOA in Redmond, WA.

5.2           Purchase Price and Minimum Order Quantities.  The purchase price
and minimum order quantities for the Bulk Goods shall be set forth in NOA’s then
current Price Schedule. Unless otherwise specifically provided for, the purchase
price includes the cost of manufacturing a single Game Disc, together with a
royalty for the use of the Intellectual Property Rights.  No taxes, duties,
import fees or other tariffs related to the development, manufacture, import,
marketing or sale of the Licensed Products (except for taxes imposed on NOA’s
income) are included in the purchase price and all such taxes are the
responsibility of LICENSEE.  The Price Schedule is subject to change by NOA at
any time without Notice, provided however, that any price increase shall be
applicable only to purchase orders submitted, paid for, and accepted by NOA
after the effective date of the price increase.

5.3           Payment.  Upon placement of an order with NOA, LICENSEE shall pay
the full purchase price either (a) by tender of an irrevocable letter of credit
in favor of NOA (or its designee) and payable at sight, issued by a bank
acceptable to NOA and confirmed, if requested by NOA, at LICENSEE’s expense, or
(b) in cash, by wire transfer to an account designated by NOA.  Alt letters of
credit shall comply with NOA’s written instructions and all associated banking
charges shall be for LICENSEE’s account.

5.4           Delivery of Bulk Goods.  Bulk Goods shall be delivered to LICENSEE
FCA Torrance, California, USA, or such other delivery point within the
continental United States as may be specified by NOA.  Orders may be delivered
in partial shipments, at NOA’s option.  Title to Bulk Goods shall vest in
LICENSEE in accordance with the terms of the applicable letter of credit, or in
the absence thereof, upon delivery to LICENSEE and receipt by NOA of full
payment for the shipment at issue.  The term “FCA” shall have the same meaning
for purposes of this Section as given by INCOTERMS 2000.

5.5           Rebate Program.  NOA, at its sole option, may elect to offer
LICENSEE a Rebate Program.  The terms and conditions of any Rebate Program shall
be subject to NOA’s sole discretion.

 

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LICENSEE shall not be entitled to offset any claimed rebate amount against other
amounts owing NOA.  No interest shall be payable by NOA to LICENSEE on any
claimed rebate.  The Rebate Program is subject to change or cancellation by NOA
at any time without Notice.

6.                                      MANUFACTURE OF THE LICENSED PRODUCT

 

6.1           Manufacturing.  Nintendo Co., Ltd. shall be the exclusive source
for the manufacture of the Game Discs, Check Discs and Promotional Discs, with
responsibility for all aspects of the manufacturing process, including the
selection of the locations and specifications for any manufacturing facilities,
determination of materials and processes, appointment of suppliers and
subcontractors and management of all work-in-progress.  Upon acceptance by NOA
of a purchase order from LICENSEE and receipt of payment as provided for at
Section 5.3 herein, NOA shall place the order with Nintendo Co., Ltd. who shall
(through its suppliers and subcontractors) arrange for manufacturing.

6.2           Security Features.  The final release version of the Game, the
Game Disc and the Printed Materials shall include such Security Technology as
Nintendo, in its sole discretion, deems necessary or appropriate to (a) reduce
the risk of unlawful copying or other unlawful, unsafe or unauthorized uses, (b)
protect the Proprietary Rights of Nintendo and of the LICENSEE, (c) promote
consumer confidence, and (d) increase the quality, reliability or operation of
Wii.

6.3           Printed Materials for Bulk Goods.  Upon delivery to LICENSEE of
Bulk Goods, LICENSEE shall assemble the Printed Materials and Bulk Goods into
the Licensed Products in accordance with the Guidelines.  No other materials,
items, products or packaging may be included or assembled with the Bulk Goods
without NOA’s prior written consent.  Bulk Goods may be sold or distributed by
LICENSEE only when fully assembled in accordance with the Guidelines.

6.4           Prior Approval of LICENSEE’s Independent Contractors.  Prior to
the placement of a purchase order for Bulk Goods, LICENSEE shall obtain NOA’s
approval of any Independent Contractors selected to perform the production and
assembly operations.  LICENSEE shall provide NOA with the names, addresses and
all business documentation reasonably requested by NOA for such Independent
Contractors.  NOA may, prior to approval and at reasonable intervals thereafter,
(a) require submission of additional business or financial information regarding
the Independent Contractors, (b) inspect applicable facilities of the
Independent Contractors, and (c) be present to supervise any work on the
Licensed Products to be done by the Independent Contractors. If at any time NOA
deems the Independent Contractor to be unable to meet quality, security or
performance standards reasonably established by NOA, NOA may refuse to grant its
approval or withdraw its approval upon Notice to LICENSEE.  LICENSEE may not
proceed with the production of the Printed Materials or assembly of the Licensed
Product by such Independent Contractor until NOA’s concerns have been resolved
to its satisfaction or until LICENSEE has selected and received NOA’s approval
of another Independent Contractor.  NOA may establish preferred or required
supply sources for select components of the Printed Materials, or for assembly
of Printed Materials and Bulk Goods into Licensed Products, which sources shall
be deemed preapproved in accordance with this Section 6.4.  LICENSEE shall
comply with all sourcing requirements established by NOA.

6.5           Sample Printed Materials.  Within a reasonable period of time
after LICENSEE’s assembly of an initial order for Bulk Goods for a Game title,
LICENSEE shall provide NOA with (a) six (6) samples of the fully assembled
Licensed Product, and (b) seventy-five (75) samples of the LICENSEE produced
Printed Materials (excluding the plastic disc storage case, warranty card, and
poster) for such Game title.

6.6           Retention of Sample Licensed Products by NOA.  NOA or Nintendo
may, at their own expense, manufacture reasonable quantities of the Bulk Goods,
and make a reasonable number of copies of the Printed Materials to be used for
archival purposes, legal proceedings against infringers of the Intellectual
Property Rights and for other lawful purposes.

 

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7.                                      MARKETING AND ADVERTISING

 

7.1           Approval of Marketing Materials.  LICENSEE represents and warrants
that the Printed Materials and the Marketing Materials shall be of high quality
and comply with (a) the Guidelines, (b) the ESRB’s Advertising Code of Conduct
and Principles and Guidelines for Responsible Advertising, and (c) all
applicable laws and regulations in those jurisdictions in the Territory where
they will be used or distributed, including without limitation all applicable
privacy laws such as the Children’s Online Privacy Protection Act.  Prior to
actual use or distribution, LICENSEE shall submit to NOA for review samples of
all proposed Marketing Materials.  NOA shall, within ten (10) business days of
receipt, approve or disapprove of the quality of such samples.  If any of the
samples are disapproved, NOA shall specify the reasons for such disapproval and
state what corrections and/or improvements are necessary.  After making the
necessary corrections and/or improvements, LICENSEE shall submit revised samples
for approval by NOA.  No Marketing Materials shall be used or distributed by
LICENSEE without NOA’s prior written approval.  NOA shall not unreasonably
withhold or delay its approval of any proposed Marketing Materials.

7.2           No Bundling.  To protect Nintendo’s valuable Intellectual Property
Rights, to prevent the dilution of Nintendo’s trademarks and to preclude
free-riding by non-licensed products on the goodwill associated with Nintendo’s
trademarks, LICENSEE shall not market or distribute any Games or Game Discs that
have been bundled with (a) any peripheral designed for use with Wii that has not
been licensed or approved in writing by NOA, or (b) any other product or service
where NOA’s association, approval or endorsement might be suggested by bundling
the products or services.

7.3           Warranty and Repair.  LICENSEE shall provide the original consumer
with a minimum ninety (90) day limited warranty on all Licensed Products. 
LICENSEE shall also provide reasonable product service, including
out-of-warranty service, for all Licensed Products.  LICENSEE shall make such
warranty and repair information available to consumers as required by applicable
federal and state law.

7.4           Business Facilities.  LICENSEE agrees to develop and maintain (a)
suitable office facilities within the United States, adequately staffed to
enable LICENSEE to fulfill all responsibilities under this Agreement, (b)
necessary warehouse, distribution, marketing, sales, collection and credit
operations to facilitate proper handling of the Licensed Product, and (c)
customer service and game counseling, including telephone service, to adequately
support the Licensed Products.

7.5           No Sales Outside the Territory.  LICENSEE covenants that it shall
not market, sell, offer to sell, import or distribute the Licensed Products
outside the Territory, or within the Territory when LICENSEE has actual or
constructive knowledge that a subsequent destination of the Licensed Product is
outside the Territory.

7.6           Defects and Recall.  In the event of a material programming defect
in a Licensed Product that would, in NOA’s reasonable judgment, significantly
impair the ability of a consumer to play the Game, NOA may, after consultation
with LICENSEE, require the LICENSEE to recall the Licensed Product and undertake
suitable repairs or replacements.

7.7           NOA Promotional Materials, Publications and Events.  At its option
and expense, NOA may (a) utilize screen shots, Artwork and information regarding
the Licensed Products in Nintendo Power, Nintendo Power Source, official
Nintendo sponsored web sites or other advertising, promotional or marketing
media, which promote Nintendo products, services or programs, and (b) exercise
public performance rights in the Games and use related trademarks and Artwork in
connection with NOA sponsored contests, tours, conventions, trade shows, press
briefings and similar events which promote Wii.

7.8           Nintendo Gateway System.  To promote and increase demand for games
on Nintendo video game systems, NOA licenses select games in various non-coin
activated commercial settings such as commercial airlines, cruise ships, rail
systems and hotels, where customers play games on specially adapted Nintendo
video game hardware referred to as the “Nintendo Gateway System”.  If NOA
identifies

 

9

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a Game for possible license on the Nintendo Gateway System, the parties agree to
conduct good faith negotiations to determine commercially reasonable terms for
such participation.

8.                                      CONFIDENTIAL INFORMATION

 

8.1           Definition.  Confidential Information means information provided
to LICENSEE by Nintendo or any third party working with Nintendo relating to the
hardware and software for Wii or the Development Tools, including, but not
limited to, (a) all current or future information, know-how, techniques,
methods, information, tools, emulator hardware or software, software development
specifications, proprietary manufacturing processes and/or trade secrets, (b)
any information on patents or patent applications, (c) any business, legal,
marketing, pricing or sales data or information, and (d) any other information
or data relating to development, design, operation, manufacturing, marketing or
sales.  Confidential Information shall include all confidential information
disclosed, whether in writing, orally, visually, or in the form of drawings,
technical specifications, software, samples, pictures, models, recordings, or
other tangible items which contain or manifest, in any form, the above listed
information.  Confidential Information shall not include (i) data and
information which was in the public domain prior to LICENSEE’s receipt of the
same hereunder, or which subsequently becomes part of the public domain by
publication or otherwise, except by LICENSEE’s wrongful act or omission, (ii)
data and information which LICENSEE can demonstrate, through written records
kept in the ordinary course of business, was in its possession without
restriction on use or disclosure, prior to its receipt of the same hereunder and
was not acquired directly or indirectly from Nintendo under an obligation of
confidentiality which is still in force, and (iii) data and information which
LICENSEE can show was received by it from a third party who did not acquire the
same directly or indirectly from Nintendo and to whom LICENSEE has no obligation
of confidentiality.

8.2           Disclosures Required by Law.  LICENSEE shall be permitted to
disclose Confidential Information if such disclosure is required by an
authorized governmental or judicial entity, provided that LICENSEE shall notify
NOA at least thirty (30) days prior to such disclosure.  LICENSEE shall use its
best efforts to limit the disclosure to the greatest extent possible consistent
with LICENSEE’s legal obligations, and if required by NOA, shall cooperate in
the preparation and entry of appropriate protective orders.

8.3           Disclosure and Use.  NOA may provide LICENSEE with highly
confidential development information, Guidelines, Development Tools, systems,
specifications and related resources and information constituting and
incorporating the Confidential Information to assist LICENSEE in the development
of Games.  LICENSEE agrees to maintain all Confidential Information as strictly
confidential and to use such Confidential Information only in accordance with
this Agreement.  LICENSEE shall limit access to the Confidential Information to
LICENSEE’s employees, and Independent Contractors that are in compliance with
the requirements of Section 3.6 above, having a strict need to know and shall
advise such individuals of their obligation of confidentiality as provided
herein.  LICENSEE shall require each such individual retain in confidence the
Confidential Information pursuant to a written non-disclosure agreement with
LICENSEE.  LICENSEE shall use its best efforts to ensure that individuals who
are permitted hereunder to work with or otherwise having access to Confidential
Information shall not disclose or make any unauthorized use of the Confidential
Information.

8.4           Agreement Confidentiality.  LICENSEE agrees that the terms,
conditions and contents of this Agreement shall be treated as Confidential
Information.  Any public announcement or press release regarding this Agreement
or the release dates for Games developed by LICENSEE under this Agreement shall
be subject to NOA’s prior written approval.  The parties may disclose this
Agreement (a) to accountants, banks, financing sources, lawyers, parent
companies and related parties under substantially equivalent confidentiality
obligations, (b) in connection with any formal legal proceeding for the
enforcement of this Agreement, (c) as required by the regulations of the
Securities and Exchange Commission (“SEC”), provided that all Confidential
Information shall be redacted from such disclosures to the maximum extent
allowed by the SEC, and (d) in response to lawful process, subject to a written
protective order approved in advance by NOA.

 

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8.5           Notification Obligations.  LICENSEE shall promptly notify NOA of
the unauthorized use or disclosure of any Confidential Information by LICENSEE
or any of its employees, or any Independent Contractor or its employees, and
shall promptly act to recover any such information and prevent further breach of
the obligations herein.  The obligations of LICENSEE set forth herein are in
addition to and not in lieu of any other legal remedy that may be available to
NOA under this Agreement or applicable law.

8.6           Continuing Effect of the NDA.  The terms of this Section 8
supplement the terms of the NDA, which shall remain in effect.  In the event of
a conflict between the terms of the NDA and this Agreement, the provisions of
this Agreement shall control.

9.                                      REPRESENTATIONS AND WARRANTIES

 

9.1                                 LICENSEE’s Representations and Warranties. 
LICENSEE represents and warrants that:

(a)           it is a duly organized and validly existing corporation and has
full authority to enter into this Agreement and to carry out the provisions
hereof,

(b)           the execution, delivery and performance of this Agreement by
LICENSEE does not conflict with any agreement or understanding to which LICENSEE
may be bound, and

(c)           excluding the Intellectual Property Rights, LICENSEE is either (i)
the sole owner of all right, title and interest in and to the trademarks,
copyrights and all other Proprietary Rights incorporated into the Game or the
Artwork or used in the development, advertising, marketing and sale of the
Licensed Products or the Marketing Materials, or (ii) the holder of such rights,
including trademarks, copyrights and all other Proprietary Rights which belong
to any third party but have been licensed from such third party by LICENSEE, as
are necessary for incorporation into the Game or the Artwork or as are used in
the development, advertising, marketing and sale of the Licensed Products or the
Marketing Materials under this Agreement.

9.2                                 NOA’s Representations and Warranties.  NOA
represents and warrants that:

(a)           it is a duly organized and validly existing corporation and has
full authority to enter into this Agreement and to carry out the provisions
hereof, and

(b)           the execution, delivery and performance of this Agreement by NOA
does not conflict with any agreement or understanding to which NOA may be bound.

9.3                                 INTELLECTUAL PROPERTY RIGHTS DISCLAIMER. 
NOA (ON ITS OWN BEHALF AND ON BEHALF OF NINTENDO CO., LTD. AND ITS AFFILIATES,
LICENSORS, SUPPLIERS AND SUBCONTRACTORS) EXPRESSLY DISCLAIMS ALL REPRESENTATIONS
AND WARRANTIES CONCERNING THE SCOPE OR VALIDITY OF THE INTELLECTUAL PROPERTY
RIGHTS.  NOA (ON ITS OWN BEHALF AND ON BEHALF OF NINTENDO CO., LTD. AND ITS
AFFILIATES, LICENSORS, SUPPLIERS AND SUBCONTRACTORS) EXPRESSLY DISCLAIMS ANY
WARRANTY THAT THE DESIGN, DEVELOPMENT, ADVERTISING, MARKETING OR SALE OF THE
LICENSED PRODUCTS OR THE USE OF THE INTELLECTUAL PROPERTY RIGHTS BY LICENSEE
WILL NOT INFRINGE UPON ANY PATENT, COPYRIGHT, TRADEMARK OR OTHER PROPRIETARY
RIGHTS OF A THIRD PARTY.  ANY WARRANTY THAT MAY BE PROVIDED IN ANY APPLICABLE
PROVISION OF THE UNIFORM COMMERCIAL CODE OR ANY OTHER COMPARABLE LAW OR STATUTE
IS EXPRESSLY DISCLAIMED.  LICENSEE HEREBY ASSUMES THE RISK OF INFRINGEMENT.

9.4                                 GENERAL DISCLAIMER.  NOA (ON ITS OWN BEHALF
AND ON BEHALF OF NINTENDO CO., LTD. AND ITS AFFILIATES, LICENSORS, SUPPLIERS AND
SUBCONTRACTORS) EXPRESSLY DISCLAIMS ANY AND ALL WARRANTIES WITH RESPECT TO THE
BULK GOODS AND THE LICENSED PRODUCTS, INCLUDING, WITHOUT LIMITATION, THE
SECURITY TECHNOLOGY.  LICENSEE PURCHASES AND ACCEPTS ALL BULK GOODS AND LICENSED
PRODUCTS ON AN “AS IS” AND ‘WHERE IS” BASIS.  NOA (ON ITS OWN BEHALF AND ON
BEHALF OF NINTENDO CO., LTD.

 

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AND ITS AFFILIATES, LICENSORS, SUPPLIERS AND SUBCONTRACTOR) EXPRESSLY DISCLAIMS
ALL WARRANTIES UNDER THE APPLICABLE LAWS OF ANY COUNTRY, EXPRESS OR IMPLIED,
INCLUDING IMPLIED WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A GENERAL OR
PARTICULAR PURPOSE.

9.5                                 LIMITATION OF LIABILITY.  TO THE MAXIMUM
EXTENT PERMITTED BY LAW, NEITHER NOA NOR NINTENDO CO., LTD. (NOR THEIR
AFFILIATES, LICENSORS, SUPPLIERS OR SUBCONTRACTORS) SHALL BE LIABLE FOR LOSS OF
PROFITS, OR FOR ANY SPECIAL, PUNITIVE, INCIDENTAL OR CONSEQUENTIAL DAMAGES OF
LICENSEE OR ITS CUSTOMERS ARISING OUT OF OR RELATED TO THIS AGREEMENT,
INCLUDING, WITHOUT LIMITATION, THE BREACH OF THIS AGREEMENT BY NOA, THE
MANUFACTURE OF THE BULK GOODS OR THE USE OF THE BULK GOODS ON ANY NINTENDO VIDEO
GAME SYSTEM BY LICENSEE OR BY ANY END USER.

10.                               INDEMNIFICATION

 

10.1                           Claim.  “Claim” means any and all third party
claims, demands, actions, suits, proceedings, losses, liabilities, damages,
expenses and costs, including, without limitation, reasonable attorneys’ fees
and costs and any expenses incurred in the settlement or avoidance of any such
claim.  “Claim” shall specifically include civil, criminal, and regulatory
matters, and those brought by any third party (including governmental
authorities or agencies) under any federal, state, or foreign law or regulation,
or the rules of any self-regulatory body (e.g., ESRB).

10.2                           LICENSEE’s Indemnification.  LICENSEE shall
indemnify and hold harmless NOA and Nintendo Co., Ltd. (and any of their
respective affiliates, subsidiaries, licensors, suppliers, officers, directors,
employees or agents) from any Claims which are alleged to result from or be in
connection with:

(a)           a breach by LICENSEE of any of the provisions in this Agreement,

(b)           any infringement of a third party’s Proprietary Rights as a result
of the design, development, advertising, marketing, sale or use of any aspect of
the Licensed Products, Promotional Materials or the Marketing Materials,

(c)           a defect, failure to warn, bodily injury (including death) or
other personal or property damage arising out of, or in connection with, the
design, development, advertising, marketing, sale or use of any aspect of the
Licensed Products, and

(d)           the design, development, advertising, marketing, sale or use of
any aspect of the Licensed Products, Promotional Materials or the Marketing
Materials.

NOA and LICENSEE shall give prompt Notice to the other of any Claim which is or
which may be subject to indemnification under this Section 10.  With respect to
any such Claim, LICENSEE, as indemnitor, shall have the right to select counsel
and to control the defense and/or settlement thereof.  NOA may, at its own
expense, participate in such action or proceeding with counsel of its own
choice.  LICENSEE shall not enter into any settlement of any Claim in which (i)
NOA or Nintendo Co., Ltd. has been named as a party, or (ii) Intellectual
Property Rights have been asserted, without NOA’s prior written consent.  NOA
shall provide reasonable assistance to LICENSEE in its defense of any Claim.

10.3                           LICENSEE’s Insurance.  LICENSEE shall, at its own
expense, obtain a comprehensive policy of general liability insurance (including
coverage for advertising injury and product liability Claims) from an insurance
company rated at least B+ by A.M. Best.  Such policy of insurance shall be in an
amount of not less than Five Million Dollars ($5,000,000 US) on a per occurrence
basis and shall provide for adequate protection against any Claims.  Such policy
shall name NOA and Nintendo Co., Ltd. as additional insureds and shall specify
it may not be canceled without thirty (30) days’ prior written Notice to NOA.  A
Certificate of Insurance shall be provided to NOA’s Licensing Department not
later than the date of the initial order of Bulk Goods under this Agreement.  If
LICENSEE fails to provide NOA’s Licensing

 

12

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Department with such Certificate of Insurance or fails to maintain such
insurance at any time during the Term and for a period of two (2) years
thereafter, NOA, in its sole discretion may 1) terminate this Agreement in
accordance with Section 13.2 herein; and/or 2) secure comparable insurance, at
LICENSEE’s expense, for the sole benefit and protection of NOA and Nintendo Co.,
Ltd. .

10.4                           Suspension of Production.  In the event NOA deems
itself at risk with respect to any Claim under this Section 10, NOA may, at its
sole option, suspend production, delivery or order acceptance for any Bulk
Goods, in whole or in part, pending resolution of such Claim.

11.                               PROTECTION OF PROPRIETARY RIGHTS

 

11.1                           Joint Actions against Infringers.  LICENSEE and
NOA may agree to jointly pursue cases of infringement involving the Licensed
Products, as such Licensed Products will contain Proprietary Rights owned by
each of them.  Unless the parties otherwise agree, or unless the recovery is
expressly allocated between them by the court, in the event of such an action,
any recovery shall be used first to reimburse LICENSEE and NOA for their
respective reasonable attorneys’ fees and costs, pro rata, and any remaining
recovery shall be distributed to LICENSEE and NOA, pro rata, based upon the fees
and costs incurred in bringing such action.

11.2                           Actions by LICENSEE.  LICENSEE, without the
consent of NOA, may bring any action or proceeding relating to an infringement
or potential infringement of LICENSEE’s Proprietary Rights in the Licensed
Products.  LICENSEE shall make reasonable good faith efforts to inform NOA of
such actions in a timely manner.  LICENSEE will have the right to retain all
proceeds it may derive from any recovery in connection with such actions.

11.3                           Actions by NOA.  NOA, without the consent of
LICENSEE, may bring any action or proceeding relating to an infringement or
potential infringement of NOA’s Intellectual Property Rights in the Licensed
Products.  NOA shall make reasonable, good faith efforts to inform LICENSEE of
such actions likely to affect LICENSEE’s rights in a timely manner.  NOA will
have the right to retain all proceeds it may derive from any recovery in
connection with such actions.

12.                               ASSIGNMENT

 

12.1                           Definition.  “Assignment” means every type and
form of assignment, transfer, sale, sublicense, delegation, encumbrance, pledge
and/or hypothecation of LICENSEE’s rights or obligations under this Agreement,
including, but not limited to, (a) a voluntary assignment, transfer, sale,
sublicense, delegation, encumbrance, pledge and/or hypothecation by LICENSEE of
all or any portion of its rights or obligations under this Agreement, (b) the
assignment, transfer, sale, sublicense, delegation, encumbrance, pledge and/or
hypothecation of all or any portion of LICENSEE’s rights or obligations under
this Agreement to or by LICENSEE’s trustee in bankruptcy, receiver, or other
individual or entity appointed to control or direct the business and affairs of
LICENSEE, (c) an involuntary assignment, transfer, sale, sublicense, delegation,
encumbrance, pledge or hypothecation of all or a portion of LICENSEE’s rights or
obligations under this Agreement, including but not limited to a foreclosure by
a third party upon assets of LICENSEE, (d) the merger or consolidation of
LICENSEE if LICENSEE is a corporation, and (e) any other means or method whereby
rights or obligations of LICENSEE under this Agreement are sold, assigned or
transferred to another individual or entity for any reason. Assignment also
includes the sale, assignment, transfer or other event affecting a change in the
controlling interest of LICENSEE, whether by sale, transfer or assignment of
shares in LICENSEE, or by sale, transfer or assignment of partnership interests
in LICENSEE, or otherwise.

12.2                           No Assignment by LICENSEE.  This Agreement and
the subject matter hereof are personal to LICENSEE.  No Assignment of LICENSEE’s
rights or obligations hereunder shall be valid or effective without NOA’s prior
written consent, which consent may be withheld by NOA for any reason whatsoever
in its sole discretion.  In the event of an attempted Assignment in violation of
this provision, NOA shall have the right at any time, at its sole option, to
immediately terminate this Agreement.  Upon

 

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such termination, NOA shall have no further obligation under this Agreement to
LICENSEE or to LICENSEE’s intended or purported assignee.

12.3                           Proposed Assignment.  Prior to any proposed
Assignment of this Agreement, LICENSEE shall give NOA not less than thirty (30)
days prior written Notice thereof, which Notice shall disclose the name of the
proposed assignee, the proposed effective date of the Assignment and the nature
and extent of the rights and obligations that LICENSEE proposes to assign.  NOA
may, in its sole discretion, approve or disapprove such proposed Assignment.
Unless written consent is given by NOA to a proposed Assignment, any attempted
or purported Assignment shall be deemed disapproved and NOA shall have the
unqualified right, in its sole discretion, to terminate this Agreement at any
time.  Upon termination, NOA shall have no further obligation under this
Agreement to LICENSEE or to LICENSEE’s intended or purported assignee.

12.4                           LICENSEE’s Obligation of Non-Disclosure. 
LICENSEE shall not (a) disclose Nintendo’s Confidential Information to any
proposed assignee of LICENSEE, or (b) permit access to Nintendo’s Confidential
Information by any proposed assignee or other third party, without the prior
written consent of NOA to such disclosure.

13.                               TERM AND TERMINATION

 

13.1                           Term.  This Agreement shall commence on the
Effective Date and continue for the Term, unless earlier terminated as provided
for herein.

13.2                           Default or Breach.  In the event that either
party is in default or commits a breach of this Agreement, which is not cured
within thirty (30) days after Notice thereof, then this Agreement shall
automatically terminate on the date specified in such Notice.

13.3                           Bankruptcy.  At NOA’s option, this Agreement may
be terminated immediately and without Notice in the event that LICENSEE (a)
makes an assignment for the benefit of creditors, (b) becomes insolvent, (c)
files a voluntary petition for bankruptcy, (d) acquiesces to any involuntary
bankruptcy petition, (e) is adjudicated as a bankrupt, or (f) ceases to do
business.

13.4                           Termination Other Than by Breach.  Upon the
expiration of this Agreement or its termination other than by LICENSEE’s breach,
LICENSEE shall have a period of one hundred eighty (180) days to sell any unsold
Licensed Products.  All Licensed Products in LICENSEE’s control following the
expiration of such sell-off period shall be destroyed by LICENSEE within ten
(10) days and Notice of such destruction (with proof certified by an officer of
LICENSEE) shall be delivered to NOA.

13.5                           Termination by LICENSEE’s Breach.  If this
Agreement is terminated by NOA as a result of a breach of its terms and
conditions by LICENSEE, LICENSEE shall immediately cease all distribution,
advertising, marketing or sale of any Licensed Products.  All Bulk Goods and
Licensed Products in LICENSEE’s control as of the date of such termination shall
be destroyed by LICENSEE within ten (10) days and Notice of such destruction
(with proof certified by an officer of LICENSEE) shall be delivered to NOA.

13.6                           Breach of NDA or other NOA License Agreements. 
At NOA’s option, any breach by LICENSEE of (a) the NDA, or (b) any other license
agreement between NOA and LICENSEE relating to the development of games for any
Nintendo video game system, which breach is not cured within the time period for
cure allowed under the applicable agreement, shall be considered a material
breach of this Agreement entitling NOA to terminate this Agreement in accordance
with Section 13.5 herein.

13.7                           No Further Use of the Intellectual Property
Rights.  Upon expiration or termination of this Agreement, LICENSEE shall cease
all use of the Intellectual Property Rights for any purpose, except as may be
required in connection with the sale of the Licensed Products authorized under
Section 13.4 herein.  LICENSEE shall, within thirty (30) days of expiration or
termination, (a) return to NOA all Development Tools provided to LICENSEE by
Nintendo, and (b) return to NOA or destroy any and all

 

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copies of materials constituting, relating to, or disclosing any Confidential
Information, including but not limited to Guidelines, writings, drawings,
models, data, and tools, whether in LICENSEE’s possession or in the possession
of any past or present employee, agent or Independent Contractor who received
the information through LICENSEE.  Proof of such return or destruction shall be
certified by an officer of LICENSEE and promptly provided to NOA.

13.8         Termination by NOA’s Breach.  If this Agreement is terminated by
LICENSEE as a result of a breach of its terms or conditions by NOA, LICENSEE may
continue to sell the Licensed Products in the Territory until the expiration of
the Term, at which time the provisions of Section 13.4 shall apply.

14.                               GENERAL PROVISIONS

 

14.1         Export Control.  LICENSEE agrees to comply with the export laws and
regulations of the United States and any other country with jurisdiction over
the Intellectual Property Rights, the Licensed Products or the Development
Tools.

14.2         Force Majeure.  Neither party shall be liable for any breach of
this Agreement occasioned by any cause beyond the reasonable control of such
party, including governmental action, war, riot or civil commotion, fire,
natural disaster, labor disputes, restraints affecting shipping or credit, delay
of carriers, inadequate supply of suitable materials, or any other cause which
could not with reasonable diligence be controlled or prevented by the parties. 
In the event of material shortages, including shortages of materials or
production facilities necessary for production of the Bulk Goods, NOA reserves
the right to allocate such resources among itself and its licensees.

14.3         Records and Audit.  During the Term and for a period of two (2)
years thereafter, LICENSEE agrees to keep accurate, complete and detailed
records relating to the use of the Confidential Information, the Development
Tools and the Intellectual Property Rights.  Upon reasonable Notice to LICENSEE,
NOA may, at its expense, audit LICENSEE’s records, reports and other information
related to LICENSEE’s compliance with this Agreement; provided, however, that
NOA shall not, during the course of the audit, access LICENSEE’s source code,
development plans, marketing plans, internal business plans or other items
deemed confidential by LICENSEE, except to the extent such materials
incorporate, disclose or reference Nintendo’s Confidential Information or
Intellectual Property Rights.

14.4         Waiver, Severability Integration, and Amendment.  The failure of a
party to enforce any provision of this Agreement shall not be construed to be a
waiver of such provision or of the right of such party to thereafter enforce
such provision.  In the event that any term, clause or provision of this
Agreement shall be construed to be or adjudged invalid, void or unenforceable,
such term, clause or provision shall be construed as severed from this
Agreement, and the remaining terms, clauses and provisions shall remain in
effect.  Together with the NDA, this Agreement constitutes the entire agreement
between the parties relating to the subject matter hereof.  All prior
negotiations, representations, agreements and understandings are merged into,
extinguished by and completely expressed by this Agreement and the NDA.  Any
amendment to this Agreement shall be in writing, signed by both parties.

14.5         Survival.  In addition to those rights specified elsewhere in this
Agreement, the rights and obligations set forth in Sections 3, 8, 9, 10, 11,
12.4, 13.4, 13.7, 13.8 and 14 shall survive any expiration or termination of
this Agreement to the degree necessary to permit their complete fulfillment or
discharge.

14.6         Governing Law and Venue.  This Agreement shall be governed by the
laws of the State of Washington, without regard to its conflict of laws
principles.  Any legal actions (including judicial and administrative
proceedings) with respect to any matter arising under or growing out of this
Agreement, shall be brought in a court of competent jurisdiction in King County,
Washington.  Each party hereby consents to the jurisdiction and venue of such
courts for such purposes.

14.7         Equitable Relief.  LICENSEE acknowledges that in the event of its
breach of this Agreement, no adequate remedy at law may be available to NOA and
that NOA shall be entitled to seek injunctive or other equitable relief in
addition to any relief available at law.

 

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14.8         Attorneys’ Fees.  In the event it is necessary for either party to
this Agreement to undertake legal action to enforce or defend any action arising
out of or relating to this Agreement, the prevailing party in such action shall
be entitled to recover from the other party all reasonable attorneys’ fees,
costs and expenses relating to such legal action or any appeal therefrom.

14.9         Counterparts and Signature by Facsimile.  This Agreement may be
signed in counterparts, which shall together constitute a complete Agreement.  A
signature transmitted by facsimile shall be considered an original for purposes
of this Agreement.

IN WITNESS WHEREOF, the parties have entered into this Agreement on the dates
set forth below.

 

NOA:

 

LICENSEE :

NINTENDO OF AMERICA INC.

 

ACTIVISION PUBLISHING, INC.

 

 

 

 

 

 

 

 

 

 

By:

/s/ James R. Cannataro

 

By:

/s/ Greg Deutsch

Name:

James R. Cannataro

 

Name:

Greg Deutsch

Title:

Executive VP, Administration

 

Title:

Vice President, Business and Legal Affairs

Date:

Sept. 26, 2007

 

Date:

Sept. 12, 2007

 

 

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