Exhibit
10.2


 


CONFIDENTIAL


 


REDACTED
TEXT FOR 10Q FILING


 


CONFIDENTIAL
FIRST RENEWAL LICENSE AGREEMENT


FOR
NINTENDO DS


(EEA,
AUSTRALIA, AND NEW ZEALAND)


 


THIS FIRST RENEWAL
LICENSE AGREEMENT (“Agreement”) is entered into between NINTENDO CO., LTD.
(“NINTENDO”) at 11-1 Kamitoba Hokotate-cho, Minami-ku, Kyoto, Japan 601-8501,
Attn: General Manager, International Division, International Business
Department (Fax: 81.75.662.9620), and THQ
INC., whose address for contact is 29903 Agoura Road, Agoura Hills,
California 91301 (Fax: 818.871.7400), Attn: VP of Business and Legal Affairs; THQ INTERNATIONAL GmbH at Schweizergasse
14, 8001 Zurich, Switzerland; and THQ (UK)
LIMITED at Dukes Court, Duke Street, Woking, Surrey GU21 5BH, United
Kingdom; and THQ ENTERTAINMENT GmbH
at Kimplerstrabe 278, 47807 Krefeld, Germany; and THQ FRANCE  SARL
at 1 rue Saint Georges, 75009 Paris, France; and THQ ASIA PACIFIC PTY LTD. at Level 8, 606 St. Kilda Road,
Melbourne, VIC 3004, Australia; and THQ
NORDIC ApS, at Islands Brygge 43, 2300 Copenhagen S, Denmark; THQ INTERACTIVE ENTERTAINMENT ESPAÑA, SL,
at Avda de Europa 19, Edificio 1, 1a planta, Pozuela de Alarcón, 28224, Madrid,
Spain; and THQ ITALY SRL, at
Strada della Ronna 53, 21013 Gallarate (VA), Italy and a legal address at Via
Monte Rosa 91, 20149 Milan, Italy (together and severally: “LICENSEE”).
NINTENDO and LICENSEE agree as follows:


 


1.             RECITALS


 


1.1           NINTENDO designs, develops,
manufactures, markets and sells advanced design, high-quality video game
systems, including the Nintendo DS system.


 


1.2           LICENSEE desires use of the highly
proprietary programming specifications, development tools, unique and valuable
security technology, trademarks, copyrights and other valuable intellectual
property rights of NINTENDO, which rights are only available for use under the
terms of a license agreement, to develop, have developed, have manufactured,
advertise, market and sell video game software for play on the Nintendo DS
system.


 


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


 


1.4           By a prior agreement between the
parties effective July 20, 2005 (hereinafter the “Initial Agreement”),
NINTENDO granted to LICENSEE the right to develop video game software
compatible with the DS System, embodying and using the Licensed Intellectual
Properties. The Initial Agreement expired on July 20, 2008. However, the
parties have continued to operate under the terms of the Initial Agreement. The
parties desire to enter into a renewal agreement (hereinafter the “Agreement”)
effective as of the expiration date of the Initial Agreement, to continue the
relationship between the parties without interruption, with the Agreement
consisting of the terms and conditions set forth herein.


 


2.             DEFINITIONS


 


2.1           “Artwork” means the text and design
specifications for the Game Card Label and Printed Materials in the format
specified by NINTENDO in the Guidelines.


 


2.2           “Bulk Goods” means the Game Cards
with Game Card Labels affixed.


 


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


 


PAGE 1 OF 20


 













 


CONFIDENTIAL


 


2.4           “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.


 


2.5           “Effective Date” means the expiration
date of the Initial Agreement, or July 20, 2008.


 


2.6           “Finished Product(s)” means the fully
assembled Game Card with a Game Card label, Printed Materials, and packed in a
plastic storage case or other form of protective packaging.


 


2.7           “Game Card(s)” means custom card
media specifically manufactured under the terms of this Agreement for play on
the Nintendo DS system, incorporating semiconductor components in 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 the Nintendo DS system.


 


2.9           “Guidelines” means the then-current
version of the “Nintendo DS Guidelines”; “Licensee Packaging Guidelines”,
pertaining to the layout, trademark usage and requirements of the Game Card
label, instruction manual and Game Card packaging; “Marketing Materials”;
“Nintendo DS Development Manual”; “Trademark Guidelines”; “Guidelines on
Ethical Content”; “Nintendo DS Software Submission Requirements”, together with
other guidelines that NINTENDO may provide to LICENSEE from time to time. The
Guidelines on Ethical Content are attached as Annex A, and the remainder of the
Guidelines have been provided to LICENSEE independent of this Agreement. The
Guidelines may be changed or updated from time to time without notice (provided
such changes or updates shall be delivered to LICENSEE as soon as possible
thereafter), and the versions current from time to time will be available on
request from NINTENDO.


 


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.


 


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 Games for the
Nintendo DS system including “NintendoTM”,
“Nintendo DSTM”, and the “Official Nintendo Seal of
QualityTM”, (b) select trade dress associated
with the Nintendo DS system and licensed Games for play thereon,
(c) Proprietary Rights in the Security Technology incorporated into the
Game Cards, (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, patent applications,
utility models, design registrations, or copyrights which may be associated
with the Game Cards, (f) copyrights in the Guidelines, and (g) other
Proprietary Rights of NINTENDO in the Confidential Information.


 


2.12         “Licensed Products” means (a) Bulk
Goods, and/or (b) Finished Products after being assembled and packaged
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 Card.


 


2.14         “NDA” means the non-disclosure
agreement providing for the protection of Confidential Information related to
the Nintendo DS system previously entered into between NINTENDO and/or NOA and
LICENSEE.


 


2.15 “NOA” means
NINTENDO’s subsidiary, Nintendo of America Inc., of Redmond, Washington, USA.


 


PAGE 2 OF 20


 













 


CONFIDENTIAL


 


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 mail, or (c) deposited, carriage
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, or (d) transmitted by e-mail with an express
written acknowledgement of receipt sent personally by or on behalf of the
recipient (which shall include any automated reply). 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 NINTENDO’s schedule of purchase prices and minimum order quantities
for the Finished Products and the Bulk Goods. The Price Schedule has been
provided to LICENSEE independent of this Agreement and may be changed or
updated from time to time without notice (provided such changes or updates
shall be delivered to LICENSEE as soon as possible thereafter), and the version
current from time to time will be available on request from NINTENDO.


 


2.18         “Printed Materials” means the Game Card
label and title page, user instruction booklet, poster, warranty card and
LICENSEE inserts incorporating the Artwork, together with a precautions booklet
and optional printed materials.


 


2.19         “Proprietary Rights” means any rights
or applications for rights to the extent recognized anywhere in the Territory
relating to the Nintendo DS System, and owned, licensed or otherwise held in
patents, patent applications, trademarks, service marks, copyrights and
neighboring rights, semiconductor chip layouts or masks, trade secrets, utility
models, registered design rights, unregistered design rights, database rights,
get up, trade dress, moral rights and publicity rights, together with all
inventions, discoveries, ideas, know-how, data, information, processes, methods,
procedures, formulas, drawings and designs, computer programs, software source
code and object code, and all amendments, modifications, and improvements
thereto for which such patents, patent applications, trademarks, service marks,
copyrights and neighboring rights, semiconductor chip layouts or masks, trade
secrets, utility models, registered design rights, unregistered design rights,
database rights, get up, trade dress, moral rights or publicity rights may
exist or may be sought and obtained in the future.


 


2.20         “Reverse Engineer(ing)” means, without
limitation, _ **** ____________________________________________


______________________________________________________________________________________________________


______________________________________________________________________________________________________


_______________________________________________________________.


 


2.21         “Security Technology” means the highly
proprietary security features of the Nintendo DS system 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 with
respect to a video game system other than the Nintendo DS system, or limits
distribution outside of the Territory.


 


2.22         “Sole License” means a license under
which only the licensor and a single licensee can utilize the subject matter of
the license.


 


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


 


2.24         “Territory” means any and all countries
within the European Economic Area; namely Albania, Austria, Belgium, Bosnia,
Bulgaria, Croatia, Cyprus, Czech Republic, Denmark, Estonia, Finland, France,
Germany, Greece, Herzegovina, Hungary, Iceland, Ireland, Italy, Latvia,
Liechtenstein, Lithuania, Luxembourg, Macedonia, Malta, Montenegro, the
Netherlands, Norway, Poland, Portugal, Romania, Serbia, Slovakia, Slovenia,
Spain, Sweden, and the United Kingdom.


 




* Confidential
portion omitted and filed separately with the Securities and Exchange
Commission.





 


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CONFIDENTIAL


 


The Territory also
includes Australia, New Zealand, Russia, South Africa, Switzerland and Turkey.
NINTENDO may add additional countries to the Territory upon written notice to
LICENSEE.


 


2.25         “TM” means trade mark of NINTENDO,
whether registered or not.


 


3.             GRANT
OF LICENSE; LICENSEE RESTRICTIONS


 


3.1           Limited License Grant. For the
Term and for the Territory, NINTENDO grants to LICENSEE a nonexclusive,
nontransferable, limited license to use the Intellectual Property Rights for
the purpose of and to the extent necessary, 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. _**** ______________


 


3.2           LICENSEE Acknowledgement.
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 the Nintendo DS system and only in accordance with
this Agreement. In the event that LICENSEE challenges NINTENDO’s ownership or
the validity of the Intellectual Property Rights, NINTENDO may terminate this
Agreement without any notice or procedure. Nothing contained herein shall be
deemed to grant NINTENDO any right, title or interest in and to those portions
of the Licensed Products that do not consist of NINTENDO’s Intellectual
Property Rights, Proprietary Rights or Confidential Information associated with
the Nintendo DS system.


 


3.3           Restrictions on License Grant.
NINTENDO does not guarantee that the hardware for the Nintendo DS system is
distributed throughout the Territory. Moreover, the present limited license to
LICENSEE does not extend to the use of the Intellectual Property Rights for the
following purposes:


 


(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 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;


 


(b)           authorize or permit any online activities
involving a Game, including, without limitation, multi-player, 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, telephone, cellphone, PDA, or other device,
including for purposes of data interchange, password usage or interactive video
game play, other than a Nintendo DS system, an application approved by
NINTENDO, or the Development Tools;


 


(e)           emulate
any past, current or future NINTENDO brand video game system, or any portion
thereof, in software or hardware or any combination thereof;


 


(f)            embed, incorporate, or store a Game
in any media or format except the Game Card format utilized by the Nintendo DS
system, except as may be necessary as a part of the Game development process
under this Agreement;


 


(g)           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;


 


	
  * Confidential portion omitted and filed separately
  with the Securities and Exchange Commission.

  



 


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CONFIDENTIAL


 


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


 


(i)            manufacture or reproduce a Game
developed under this Agreement, except through NINTENDO; or


 


(j)            Reverse Engineer or assist in
Reverse Engineering all or any part of the Nintendo DS system, including the
hardware, software (embedded or not), the Development Tools or the Security
Technology, except as specifically permitted under the laws and regulations
applicable in the Territory.


 


Nothing contained in this
Section 3.3 shall be deemed to prevent LICENSEE from developing a game or
games for other video game platforms, where such game or games have a similar
audiovisual display, look, feel, or game elements as found in the
Game(s) developed by LICENSEE under this Agreement; provided, however,
that LICENSEE hereby acknowledges that any use of NINTENDO’s Intellectual
Property Rights, Proprietary Rights, and/or Confidential Information in such
other game or games without the prior written consent of NINTENDO would be
deemed to be a breach of this Agreement and an infringement of Nintendo’s
Intellectual Property Rights.


 


3.4           Development Tools. NINTENDO
and NOA may lease, loan or sell Development Tools, including any improvements
made by NINTENDO or NOA from time to time, to LICENSEE to assist in the
development of Games under this Agreement on such terms as may be agreed
between the parties. Ownership and use of any Development Tools, whether
provided by NINTENDO or NOA, prior to or during the Term hereof, 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 Tools, 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. Any license to LICENSEE to use the Development Tools does not extend
to: (a) use of the Development Tools for any purpose except the design and
development of Games under this Agreement, (b) reproduction or creation of
derivatives of the Development Tools, except in association with the
development of Games under this Agreement, (c) Reverse Engineering of the
Development Tools (except as specifically permitted under the laws and/or
regulations applicable in the Territory), or (d) without NINTENDO’s prior
written approval, selling, leasing, assigning, lending, licensing, encumbering
or otherwise transferring the Development Tools. Any tools developed or derived
by LICENSEE as a result of a study of the performance, design or operation of
any NINTENDO Development Tools shall be considered a derivative work of the Intellectual
Property Rights, but may be retained and utilized by LICENSEE in connection
with this Agreement. Unless LICENSEE can demonstrate that such derivative work
has one or more applications that are independent of and separate from the
Intellectual Property Rights (“Independent Applications”), it shall be deemed
to have granted NOA and NINTENDO an indefinite, worldwide, royalty-free,
transferable and Sole License (including the right to sub-license) to such
derivative work. To the extent that LICENSEE can demonstrate one or more
Independent Applications, LICENSEE shall be deemed to have granted to NOA and
NINTENDO a royalty-free and transferable nonexclusive License (including the
right to sub-license) in relation to such Independent Applications for the
Term. Any tools 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, NINTENDO and NOA 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.


 


3.5           In-Game Advertising. LICENSEE
shall not include advertising or produce placements for products or services of
LICENSEE or third parties, whether in the Game, as separate content (e.g., a
trailer), or in the Printed Materials, without NINTENDO’s prior written
consent, which consent shall not be unreasonably withheld or delayed.


 


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CONFIDENTIAL


 


4.             SUBMISSION OF GAME AND ARTWORK
FOR APPROVAL


 


4.1           Development and Sale of the Games.
LICENSEE may develop or have developed Games and have manufactured, advertise,
market and sell Licensed Products for play on the Nintendo DS system only in
accordance with this Agreement.


 


4.2:          Third Party Developers.
LICENSEE shall not disclose the Confidential Information (as defined in Section 8
below), 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 that requires use of the Confidential Information,
unless and until such Independent Contractor has been approved by NINTENDO and
has executed a written confidentiality agreement with NINTENDO (or with
LICENSEE as provided in Section 8) relating to the Nintendo DS system.
Upon request by LICENSEE, NINTENDO shall, within a reasonable period of time,
inform LICENSEE whether any such third party is approved by NINTENDO.


 


4.3           Delivery of Completed Game.
Upon completion of a Game, LICENSEE shall deliver a prototype of the Game to
NINTENDO 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 NINTENDO,
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 (of which LICENSEE is
aware) and a complete screen text script. NINTENDO shall promptly evaluate the
Game with regard to its technical compatibility with and error-free operation
on the Nintendo DS system. LICENSEE must establish that the Game and any other
content included on the Game Card complies with the guidelines of the Pan
European Game Information System (PEGI), the Unterhaltungssoftware
Selbstkontrolle (USK), the Office of Film and Literature Classification (OFLC),
or any other applicable national or regional game rating system that NINTENDO
may accept, as applicable. LICENSEE shall be responsible for the submission of
the Game to the appropriate national or regional game rating organization and
shall provide NINTENDO with a statement or certificate in writing from the
relevant organization, confirming the rating for the Game. Where any such game
has been rated as being suitable only for players aged 18 and over (or an
equivalent rating), LICENSEE must submit a certificate in writing that confirms
the game is rated as no higher than “M” (Mature) by the Entertainment Software
Rating Board (ESRB) of the U.S. In addition, NINTENDO reserves the right to
require LICENSEE to provide NINTENDO with such additional written indemnification
for damages, claims, loss, liability, fine or penalty resulting from the
marketing, distribution or sale of a Game with such an age rating, as NINTENDO,
in its sole discretion, may request. If any such age rating is subsequently
changed by the relevant organization, LICENSEE shall inform NINTENDO forthwith
in writing of that fact and LICENSEE shall then comply with the above
provisions in relation to such new age rating.


 


4.4           Approval of Completed Game.
NINTENDO shall, within a reasonable period of time after receipt, approve or
disapprove each submitted Game in writing, which may include by e-mail. If a
Game is disapproved, NINTENDO shall specify in writing the reasons for such
disapproval and state what corrections or improvements are necessary to receive
approval. After making the necessary corrections or improvements, LICENSEE
shall submit a revised Game to NINTENDO for approval. NINTENDO shall not
unreasonably withhold or delay its approval of any Game. The approval of a Game
by NINTENDO shall not relieve LICENSEE of its sole responsibility for the
development, quality and operation of the Game or in any way create any
warranty for a Game or a Licensed Product by NINTENDO.


 


4.5           Submission and Approval of Artwork.
Prior to submitting a completed Game to NINTENDO under Section 4.3,
LICENSEE shall prepare and submit to NINTENDO all Artwork for the proposed
Licensed Product. Within ten (10) business days of receipt, NINTENDO shall
approve or disapprove the Artwork in writing, which may include e-mail. If any
Artwork is disapproved, NINTENDO shall specify in writing the reasons for such
disapproval and state what corrections or improvements are necessary to obtain
approval from NINTENDO. After making the necessary corrections or improvements,
LICENSEE shall submit revised Artwork to NINTENDO for approval. NINTENDO shall
not unreasonably withhold or delay its approval of any Artwork. The approval of
the Artwork by NINTENDO shall not relieve LICENSEE of its sole responsibility
for the development and


 


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CONFIDENTIAL


 


quality of the Artwork or
in any way create any warranty for the Artwork or any Licensed Product by
NINTENDO. All Artwork must be approved prior to submitting an order for the
Bulk Goods or Finished Products, and LICENSEE shall not produce any Printed
Materials for commercial distribution until such Artwork or Finished Products
has been approved by NINTENDO.


 


4.6           Artwork for Bulk Goods. If
LICENSEE intends to submit an order for Bulk Goods, all Artwork and other
materials to be included with the Licensed Product shall be submitted to
NINTENDO in accordance with Section 4.5 herein. No Printed Materials shall
be produced by LICENSEE until such Artwork has been approved by NINTENDO under Section 4.5
herein.


 


5.             ORDER PROCESS, PURCHASE PRICE,
PAYMENT AND DELIVERY


 


5.1           Submission of Orders by LICENSEE.
After receipt of NINTENDO’s approval for a Game, LICENSEE may at any time
submit written purchase orders to NINTENDO for any approved Licensed Product
title. The purchase order shall specify whether it is for Finished Products or
Bulk Goods. The terms and conditions of this Agreement shall take precedence
over any contrary or additional terms of such purchase order or any other
written documentation or verbal instructions from LICENSEE. All orders shall be
subject to acceptance by NINTENDO or its designee.


 


5.2           Purchase Price and Minimum Order
Quantities. The purchase price and minimum order quantities for Finished
Products and Bulk Goods shall be set forth in NINTENDO’s then current Price
Schedule. Unless otherwise specifically provided for, the purchase price
includes the cost of manufacturing the Licensed Products. 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 NINTENDO’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 NINTENDO
at any time without Notice, provided, however, that any price increase shall be
applicable only to purchase orders submitted, paid for, and accepted by
NINTENDO after the date of the price increase, and provided that such changes
shall be delivered to LICENSEE as soon as possible thereafter.


 


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


 


5.4           Delivery of Licensed Products.
NINTENDO shall deliver the Finished Products and Bulk Goods ordered by LICENSEE
to LICENSEE FOB Japan, CIP European Destination or ex-warehouse Grossostheim,
per the terms in the Price Schedule. Also per the Price Schedule,
______________________ ****______________________. Upon mutual consent of
NINTENDO and LICENSEE, orders may be delivered in partial shipments with a
minimum shipment quantity as specified in the Price Schedule. Such orders shall
be delivered only to countries within the Territory. Title to the Licensed
Products shall vest in accordance with the terms of the applicable letter of
credit or, in the absence thereof, per Incoterms 2000.


 


6.             MANUFACTURE OF THE LICENSED
PRODUCT


 


6.1           Manufacturing. Given NINTENDO’s
ownership of the valuable Intellectual Property Rights, NINTENDO shall be the
exclusive source for the manufacture of the Game Cards, and shall control 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.


 


6.2           Manufacture of the Licensed
Products. Upon acceptance by NINTENDO of a purchase order from LICENSEE for
an approved Licensed Product title and receipt of payment as provided for under
Section 5.3 herein, NINTENDO (through its suppliers and subcontractors)
shall arrange for the manufacture of Finished Product or Bulk Goods, as specified
in LICENSEE’s purchase order. In this regard, LICENSEE shall submit to NINTENDO
certain technical information as set forth


 




* Confidential portion omitted and filed separately
with the Securities and Exchange Commission.





 


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CONFIDENTIAL


 


in a questionnaire
entitled “Software Submission Requirements” which has been provided to LICENSEE
by NINTENDO.


 


6.3           Security Features. The final
release version of the Game, Game Cards and 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 LICENSEE, (c) promote consumer confidence, and (d) increase
the quality, reliability or operation of the Nintendo DS system.


 


6.4           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 NINTENDO’s prior written consent. Bulk
Goods may be sold or distributed by LICENSEE only when fully assembled in
accordance with the Guidelines.


 


6.5           Sample Printed Materials and Bulk
Goods. Within a reasonable period of time after LICENSEE’s assembly of an
initial order for Bulk Goods title, LICENSEE shall provide NINTENDO with (a) one
(1) sample of the fully assembled, Licensed Product, and (b) five (5) samples
of the LICENSEE-produced Printed Materials for such Licensed Product.


 


6.6           Retention of Sample Licensed
Products by NINTENDO. NINTENDO may, at its own expense, manufacture
reasonable quantities of the Game Cards or the Licensed Products, and make a
reasonable number of copies of the Printed Materials, not to exceed        ****      
copies, to be used for archival purposes, legal proceedings against infringers
of the Intellectual Property Rights, and for other lawful purposes (but not for
resale).


 


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) to
the best of LICENSEE’s knowledge, the guidelines of the PEGI, and (c) all
applicable laws, regulations and official codes of practice in those
jurisdictions in the Territory where they will be used or distributed. All
LICENSEE controlled websites featuring the Games shall adopt a privacy policy
that complies with all applicable local laws, regulations and official
guidelines. To protect NINTENDO’s valuable Intellectual Property Rights, to
prevent the dilution of NINTENDO’s trade marks, and to avoid use of the
licensed Intellectual Property Rights giving rise to any implication of
NINTENDO’s sponsorship, association, approval or endorsement where this is not
the case, prior to actual use or distribution, LICENSEE shall submit to
NINTENDO for review samples of all proposed Marketing Materials. NINTENDO
shall, within ten (10) business days of receipt, approve or disapprove the
quality of such samples. If any of the samples are disapproved, NINTENDO shall
specify the reasons for such disapproval in writing, which may include by
e-mail, and state what corrections and/or improvements are necessary to receive
approval. After making the necessary corrections and/or improvements, LICENSEE
shall submit revised samples for approval by NINTENDO. No Marketing Materials
shall be used or distributed by LICENSEE without NINTENDO’s prior written
approval. NINTENDO 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 avoid use of the licensed Intellectual Property
Rights giving rise to any implication of NINTENDO’s sponsorship, association,
approval or endorsement where this is not the case, LICENSEE shall not, without
NINTENDO’s prior written approval, market or distribute any Licensed Products
that have been bundled with (a) any peripheral designed for use with the
Nintendo DS system that has not been licensed or approved in writing by
NINTENDO, provided that LICENSEE is responsible for ensuring that any such
peripheral shall comply with all applicable laws and regulations in the
Territory, or (b) any other product or service where NINTENDO’s
sponsorship, association, approval or endorsement might be suggested by bundling
the products or services.


 




* Confidential portion omitted and filed separately
with the Securities and Exchange Commission.





 


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CONFIDENTIAL


 


7.3           Warranty and Repair. LICENSEE
shall provide the original consumer with a minimum ninety (90) day (or such
longer minimum period as may be required by applicable law) limited warranty on
all Licensed Products, provided that the exact nature of such warranties and
services shall be determined by LICENSEE in its discretion and further provided
that such warranties and services comply with the requirements of the laws and
regulations applicable in the Territory. 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 law.


 


7.4           Business Facilities. LICENSEE
agrees to develop and maintain sufficient customer service, either directly or
through a third party, to adequately support the Licensed Products.


 


7.5           No Sales Outside the Territory.
LICENSEE represents and warrants that it shall not knowingly 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
NINTENDO’s reasonable judgment, significantly impair the ability of a consumer
to play the Game, NINTENDO may, after consultation with LICENSEE, require the
LICENSEE to recall the Licensed Product and undertake suitable repairs or
replacements.


 


7.7           NINTENDO Promotional Materials,
Publications and Events. With a view to improving the competitiveness of
the video game products consisting of Nintendo video game systems and services
and compatible software published by LICENSEE and others, at its option and
expense, NINTENDO may (a) insert in the Printed Materials for the Licensed
Products promotional materials concerning publications and promotions for such
video game products, provided that LICENSEE shall not be required to include
any such materials where the purpose of such materials is to promote a product(s) directly
competitive with LICENSEE’s products; (b) utilize screen shots, Artwork
and information regarding the Licensed Products in all NINTENDO-published or
officially licensed magazines, official NINTENDO-sponsored web-sites, or other
advertising, promotional or marketing media that promotes such video game
products, services or programs, and (c) exercise public performance rights
in the Games and use related trademarks and Artwork in connection with
NINTENDO-sponsored contests, tours, conventions, trade shows, press briefings
and similar events that promote such video game products subject to the
prior written approval of LICENSEE.


 


7.8           Nintendo Gateway System. To
promote and increase demand for games on Nintendo video game systems, NINTENDO
licenses a system (the “Nintendo Gateway System”) 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
systems. If NINTENDO identifies a Game for possible license on the Nintendo
Gateway System, the parties agree to conduct good faith negotiations toward
including the Game in the Nintendo Gateway System.


 


8.             CONFIDENTIAL INFORMATION


 


8.1           Definition. “Confidential
Information” means information provided to LICENSEE by NINTENDO or any third
party working with NINTENDO or NOA relating to the hardware and software for
the Nintendo DS system or the Development Tools, including, but not limited to,
(a) all current or future information, know-how, techniques, methods,
tools, emulator hardware or software, software development specifications,
proprietary manufacturing processes and/or trade secrets, (b) any
information on inventions, 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 that were in the public domain prior to LICENSEE’s receipt of
the same hereunder, or that subsequently becomes part of the public domain by
publication or otherwise, except by the wrongful act or omission of LICENSEE or
any third party, (ii) data and information that LICENSEE can demonstrate,
through written records kept in the ordinary course of business, were in


 


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CONFIDENTIAL


 


its possession without
restriction on use or disclosure, prior to its receipt of the same hereunder
and were not acquired directly or indirectly from NINTENDO or NOA under an
obligation of confidentiality that is still in force, and (iii) data and
information that LICENSEE can show were received by it from a third party who
did not acquire the same directly or indirectly from NINTENDO or NOA 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 NINTENDO at least ten (10) days prior
to such disclosure, or such lesser period as may be needed to comply with such
requirement. LICENSEE shall use its best commercial efforts to limit the
disclosure to the greatest extent possible, consistent with LICENSEE’s legal
obligations, and if required by NINTENDO, shall cooperate in the preparation
and entry of appropriate court orders limiting the persons to whom Confidential
Information may be disclosed and the extent of disclosure of such Confidential
Information.


 


8.3           Disclosure and Use. NINTENDO
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 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 to 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 have access
to Confidential Information shall not disclose or make any unauthorized use of
the Confidential Information.


 


8.4           No Disclosure to Independent
Contractors. LICENSEE shall not disclose the Confidential Information,
including without limitation the Guidelines and Intellectual Property Rights,
to any Independent Contractor, nor permit any Independent Contractor to perform
or assist in development work for a Game that requires use of the Confidential
Information, without the prior written consent of NINTENDO. Any Independent
Contractor seeking access to Confidential Information shall be required to
enter into a written non-disclosure agreement with NINTENDO or NOA that is no
less restrictive than the terms of this Section 8, prior to receiving any
access to or disclosure of the Confidential Information from either LICENSEE or
NINTENDO.


 


At
LICENSEE’s option, the written non-disclosure agreement may be with LICENSEE
rather than NINTENDO or NOA, in which case the form and substance of the non-disclosure
agreement must be acceptable to NINTENDO. Upon NINTENDO or NOA’s reasonable
written request, LICENSEE shall provide to NINTENDO a listing of all
Independent Contractors who have received or been granted access to
Confidential Information along with copies of the applicable written
nondisclosure agreements. In addition, LICENSEE shall take all reasonable
measures to ensure that its Independent Contractors fulfill the requirements of
the applicable written non-disclosure agreements.


 


LICENSEE shall use its
best commercial efforts to ensure that its employees working with or otherwise
having access to Confidential Information shall not disclose or make
unauthorised use of the Confidential Information._**** _____________________


____________________________________________________________________________________________________________


_____________________________


 


8.5           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 NINTENDO’s prior written
approval, such approval not to be unreasonably delayed or withheld. 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 government agencies in the Territory and the United States
that regulate publicly-traded securities, provided that all Confidential


 




* Confidential portion omitted and filed separately
with the Securities and Exchange Commission.





 


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CONFIDENTIAL


 


Information shall be
edited from such disclosures to the maximum extent allowed by such government
agencies, (d) in response to lawful process, subject to court order limiting
the persons to whom Confidential Information may be disclosed and the extent of
disclosure of such Confidential Information, approved in advance by NINTENDO,
and (e) to a third party proposing to enter into a business transaction
with LICENSEE or with NINTENDO, but only to the extent reasonably necessary for
carrying out the proposed transaction and only under terms of mutual
confidentiality.


 


8.6           Notification Obligations.
LICENSEE shall promptly notify NINTENDO of the unauthorized use or disclosure
of any Confidential Information of which LICENSEE becomes aware, 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
NINTENDO under this Agreement or applicable law.


 


8.7           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 used in association with 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 or an agent or
licensee of a third party such as a collecting society, by LICENSEE, as are
necessary for the development, advertising, marketing or sale of the Licensed
Products and the Marketing Materials under this Agreement.


 


9.2           NINTENDO’s Representations and
Warranties. NINTENDO 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 NINTENDO does not
conflict with any agreement or understanding to which NINTENDO may be bound.


 


9.3           INTELLECTUAL PROPERTY RIGHTS
DISCLAIMER BY NINTENDO. NINTENDO (ON ITS OWN BEHALF AND ON BEHALF OF ITS
AFFILIATES, SUBSIDIARIES, LICENSORS, SUPPLIERS AND SUBCONTRACTORS), EXPRESSLY
DISCLAIMS ALL REPRESENTATIONS AND WARRANTIES CONCERNING THE SCOPE OR VALIDITY
OF THE INTELLECTUAL PROPERTY RIGHTS. NINTENDO (ON ITS OWN BEHALF AND ON BEHALF
OF ITS AFFILIATES, SUBSIDIARIES, LICENSORS, SUPPLIERS AND SUBCONTRACTORS),
EXPRESSLY DISCLAIMS 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. TO THE MAXIMUM EXTENT
LEGALLY PERMISSIBLE, ANY WARRANTY, CONDITION OR TERM THAT MAY BE PROVIDED
IN ANY APPLICABLE PROVISION OF ANY LAW OR REGULATION IN THE TERRITORY GOVERNING


 


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CONFIDENTIAL


 


COMMERCIAL ACTIVITY, OR
ANY OTHER COMPARABLE LAW OR REGULATION IS EXPRESSLY DISCLAIMED. LICENSEE HEREBY
ASSUMES THE RISK OF INFRINGEMENT.


 


9.4           GENERAL DISCLAIMER BY NINTENDO.
NINTENDO (ON ITS OWN BEHALF AND ON BEHALF OF ITS AFFILIATES, SUBSIDIARIES,
LICENSORS, SUPPLIERS AND SUBCONTRACTORS) EXPRESSLY DISCLAIMS ANY AND ALL
WARRANTIES WITH RESPECT TO THE LICENSED PRODUCTS, INCLUDING, WITHOUT
LIMITATION, THE SECURITY TECHNOLOGY. LICENSEE PURCHASES AND ACCEPTS ALL LICENSED
PRODUCTS ON AN “AS IS” AND “WHERE IS” BASIS. NINTENDO (ON ITS OWN BEHALF AND ON
BEHALF OF ITS AFFILIATES, SUBSIDIARIES, LICENSORS, SUPPLIERS AND
SUBCONTRACTORS) EXPRESSLY DISCLAIMS ALL WARRANTIES, CONDITIONS OR OTHER TERMS
OF ANY KIND 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 NINTENDO NOR ITS SUBSIDIARIES,
AFFILIATES, LICENSORS, SUBCONTRACTORS OR SUPPLIERS 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 NINTENDO, THE
MANUFACTURE OF THE LICENSED PRODUCTS OR THE USE OF THE LICENSED PRODUCTS 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 actual costs, and any actual 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 national,
subnational, or multinational law or regulation, or the rules of any
self-regulatory body (e.g., PEGI).


 


10.2         LICENSEE’s Indemnification.            LICENSEE shall indemnify and hold
harmless NINTENDO (and any of its 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 material 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 or the Marketing
Materials, by LICENSEE or on behalf of LICENSEE, excluding claims based solely
upon the Intellectual Property Rights,


 


(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 or the Marketing
Materials.


 


NINTENDO
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 such Claim, LICENSEE, as indemnitor, shall have the right to select
counsel and to control the defense and/or settlement thereof. NINTENDO 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) NINTENDO
has been named as a party, or (ii) Intellectual Property Rights have been
asserted


 


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CONFIDENTIAL


 


without NINTENDO’s prior
written consent, which shall not be unreasonably withheld. NINTENDO 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 or a
comparable rating by another recognized insurance rating organization. Such
policy of insurance shall be in an amount of not less than the equivalent of ___________****_________
on a per-occurrence basis and shall provide for adequate protection against any
Claims. Such policy shall name NINTENDO as an additional insured and shall
specify that it may not be canceled without thirty (30) days’ prior written
Notice to NINTENDO. A Certificate of Insurance shall be provided to NINTENDO
not later than the date of the initial order of Licensed Products under this
Agreement or within thirty (30) days of the Effective Date of this Agreement,
whatever date occurs later. If LICENSEE fails to provide NINTENDO 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 and fails to cure
within thirty (30) days of written notice, NINTENDO, in its sole discretion
may: (a) terminate this Agreement in accordance with Section 13.2
herein; and/or (b) secure comparable insurance, at LICENSEE’s expense, for
the sole benefit and protection of NINTENDO.


 


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


 


11.          PROTECTION OF PROPRIETARY RIGHTS


 


11.1         Joint Actions Against Infringers.
LICENSEE and NINTENDO 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 NINTENDO for their respective reasonable attorneys’ fees and costs, pro
rata, and any remaining recovery shall be distributed to LICENSEE and NINTENDO,
pro rata, based upon the fees and costs incurred in bringing such action.


 


11.2         Actions by LICENSEE. LICENSEE,
without the consent of NINTENDO and to the extent permitted by law, 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 NINTENDO 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 NINTENDO. NINTENDO,
without the consent of LICENSEE, may bring any action or proceeding relating to
an infringement or potential infringement of NINTENDO’s Intellectual Property Rights
in the Licensed Products. NINTENDO shall, in a timely manner, make reasonable
good-faith efforts to inform LICENSEE of such actions likely to affect LICENSEE’s
rights. NINTENDO 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


 




* Confidential portion omitted and filed separately
with the Securities and Exchange Commission.





 


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CONFIDENTIAL


 


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
NINTENDO’s prior written consent, which consent may be withheld by NINTENDO for
any reason whatsoever in its sole discretion. In the event of an attempted
Assignment in violation of this provision, NINTENDO shall have the right at any
time, at its sole option, to immediately terminate this Agreement. Upon such
termination, NINTENDO shall have no further obligation under this Agreement to
LICENSEE or to LICENSEE’s intended or purported assignee.


 


12.3:        Sale or Transfer of LICENSEE’s
Business. Notwithstanding the rights of NINTENDO specified in Clauses 12.1
and 12.2, NINTENDO will not unreasonably withhold its consent of LICENSEE’s
assignment of the present Agreement in conjunction with the sale or transfer of
LICENSEE’s business related to this Agreement, provided that the
purchaser/transferee does not manufacture, or have manufactured for it, a Competitive
Game System. Such Competitive Game Systems include, but without limitation:
Apple/Bandai Pippin or Atmark, Atari Jaguar, Atari Lynx, 3DO Real, Matsushita
M2, Microsoft Xbox, Microsoft Xbox 360, Phillips CD-I Interactive Player, Sega
Master System, Sega Genesis, Sega CD, Sega Game Gear, Sega CD/X, Sega Katana,
Sega Nomad, Sega 32X, Sega Saturn, Sega Pico, Sony PSX/Playstation, Sony PSX2,
Sony PSP, Sony Personal Digital Assistant, and SNK Neo Geo.


 


Further,
with respect to Related Parties, this Agreement may be sold, assigned,
delegated, or sublicensed upon thirty (30) days’ prior notice to NINTENDO, provided
that any such sale, assignment, delegation or sublicense will require that the
Related Party purchaser, assignor, delegate, or sublicensee, affirmatively
assume all of LICENSEE’s duties, responsibilities, and obligations under this
Agreement. The term “Related Party(ies)” shall mean any person or entity that
directly or indirectly controls, is controlled by, or is under common control
with LICENSEE. For purposes of this definition, “control” (or any variation
thereof) means beneficial ownership of more than fifty percent (50%) of the
equity or other interests entitled to vote for the election of directors or
equivalent governing body of a person or entity. The term “Related Party(ies)”
shall not include any person or entity that directly or indirectly
manufactures, or has manufactured for it, a Competitive Game System.


 


12.4         Proposed Assignment. Prior to
any proposed Assignment of this Agreement, LICENSEE shall give NINTENDO 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
proposed Assignment and the nature and extent of the rights and obligations
that LICENSEE proposes to assign. NINTENDO may, in its sole discretion, approve
or disapprove such proposed Assignment. Unless written consent is given by
NINTENDO to a proposed Assignment, any attempted or purported Assignment shall
be deemed disapproved and NINTENDO shall have the unqualified right, in its
sole discretion, to terminate this Agreement at any time. Upon termination,
NINTENDO shall have no further obligation under this Agreement to LICENSEE or
to LICENSEE’s intended or purported assignee.


 


12.5         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 NINTENDO 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.


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13.2         Default or Breach. In the event that either party is in
default or commits a material 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 NINTENDO’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 (a) the expiration of this
Agreement, (b) its termination other than by LICENSEE’s breach, or
(c) termination of this Agreement by NINTENDO after one hundred twenty
days (120) Notice to LICENSEE in the event NINTENDO reasonably believes that
LICENSEE has developed, marketed, or sold a product that infringes any intellectual
property rights of NINTENDO anywhere in the world (provided that if the parties
are able to resolve such alleged infringement within such 120-day period, such
termination shall not take effect), _****_____________________________________ 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
proof of such destruction (certified by an officer of LICENSEE) shall be
provided to NINTENDO.


 


13.5         Termination by LICENSEE’s Breach. If this Agreement is terminated by NINTENDO
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 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 NINTENDO.


 


13.6         Breach of NDA or Other NINTENDO License
Agreements. At NINTENDO’s
option, any material breach by LICENSEE of (a) the NDA, or (b) any
other license agreement between NINTENDO 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,
(and which shall give NINTENDO reasonable cause to believe that it needs to
terminate this Agreement so as to protect its legitimate business interests),
shall be considered a material breach of this Agreement, entitling NINTENDO 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 NINTENDO all Development Tools provided to LICENSEE by
NINTENDO, and (b) return to NINTENDO or destroy any and all 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 NINTENDO.


 


13.8         Termination by NINTENDO’s Breach. If this Agreement is terminated by LICENSEE
as a result of a breach of its terms or conditions by NINTENDO, LICENSEE may at
its sole option 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         Compliance with Applicable Laws and
Regulations. LICENSEE shall
at all times comply with applicable laws, regulations and orders in the
countries of the Territory relating to or in any way affecting this Agreement
and LICENSEE’s performance under this Agreement, including, without limitation,
the export laws and regulations of any country with jurisdiction over the
Intellectual Property Rights, Licensed Products, Development Tools and/or
either party. LICENSEE shall not


 




* Confidential
portion omitted and filed separatlely with the Securities and Exchange
Commission.





 


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CONFIDENTIAL


 


market,
distribute, or sell the Game and/or Game Cards in any country in the Territory
in which such marketing, distribution or sale would violate any applicable
laws, regulations or orders of such country.


 


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, terrorism, 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 that 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
Licensed Products, NINTENDO 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 (at least 15 days), NINTENDO may, at its expense and subject to a
confidentiality agreement, arrange for a third party audit of LICENSEE’s
records, reports and other information solely related to LICENSEE’s compliance
with this Agreement; provided, however, that NINTENDO 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, 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 fulfilment or discharge.


 


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


 


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


 


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         Expansion of Rights. NINTENDO may expand the rights granted to
LICENSEE under this Agreement by providing written notice of such expansion of
rights to LICENSEE and without having to enter into a written addendum to the
present Agreement with LICENSEE.


 


PAGE 16 OF 20













 


CONFIDENTIAL


 


14.10       Delegation of Duties.
NINTENDO, at its option, may delegate its duties under the present Agreement to
a wholly owned subsidiary. To the extent necessary for the parties to carry out
their duties under this Agreement, NINTENDO shall provide notice to LICENSEE of
any such delegation, including to whom at NINTENDO’s wholly owned subsidiary
communications from LICENSEE under this Agreement may be directed. Also in the
event of a delegation by NINTENDO, the provisions of this Agreement shall
continue to govern the relationship between NINTENDO and LICENSEE and shall
govern the relationship between NINTENDO’s subsidiary and LICENSEE, subject to
any amendments or modifications to this Agreement which such subsidiary and
LICENSEE may agree to in their relationship. NINTENDO shall remain obligated
under the present Agreement for the performance of NINTENDO’s duties by
NINTENDO’s subsidiary.


 


14.11       Counterparts and Signature by Facsimile. This Agreement may be signed in counterparts,
which shall together constitute a complete Agreement. A signature transmitted
by facsimile or electronically via computer network 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.


 


	
  NCL:

  	
   

  	
  LICENSEE:

  
	
   

  	
   

  	
   

  
	
  NINTENDO
  CO., LTD.

  	
   

  	
  THQ INC.

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Printed:

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  
	
  Date:

  	
   

  	
   

  	
  Date:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  THQ
  INTERNATIONAL GmbH (Switzerland)

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Printed:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Date:

  	
   

  
											



 


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CONFIDENTIAL


 


	
   

  	
  THQ (UK)
  LIMITED

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  
	
   

  	
  Printed:

  	
   

  
	
   

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
  Date:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  THQ
  ENTERTAINMENT GmbH (Germany)

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  
	
   

  	
  Printed:

  	
   

  
	
   

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
  Date:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  THQ
  FRANCE SARL

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  
	
   

  	
  Printed:

  	
   

  
	
   

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
  Date:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  THQ ASIA
  PACIFIC PTY (LTD)

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  
	
   

  	
  Printed:

  	
   

  
	
   

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
  Date:

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  THQ
  NORDIC ApS

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  
	
   

  	
  Printed:

  	
   

  
	
   

  	
   

  
	
   

  	
  Title:

  	
   

  
	
   

  	
   

  
	
   

  	
  Date:

  	
   

  
													



 


PAGE 18 OF 20













 


CONFIDENTIAL


 


	
   

  	
  THQ
  INTERACTIVE ENTERTAINMENT ESPAÑA, SL

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Printed:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Date:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  THQ ITALY
  SRL

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
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  Date:

  	
   

  
								



 


Enclosure:


Annex A - Guidelines on
Ethical Content


 


PAGE 19 OF 20













 


CONFIDENTIAL


 


Annex A


 


Guidelines on Ethical Content


 


The
following Guidelines on Ethical Content are presented for assistance in the
development of Games by defining the types of the theme inconsistent with
NINTENDO’s corporate philosophy. Exceptions may be made when necessary to
maintain the integrity of the Game or the Game’s theme. Games shall not:


 


	
   

  	
  (a)

  	
  contain
  sexually explicit content including but not limited to nudity, rape, sexual
  intercourse and sexual touching; for instance, NINTENDO does not allow
  bare-breasted women in Games, however, mild displays of affection such as
  kissing or hugging are acceptable;

  
	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  contain
  language or depictions which specifically denigrate members of any race,
  gender, ethnicity, religion or political group;

  
	
   

  	
   

  	
   

  
	
   

  	
  (c)

  	
  depict
  gratuitous or excessive blood or violence. NINTENDO does not permit
  depictions of animal cruelty or torture;

  
	
   

  	
   

  	
   

  
	
   

  	
  (d)

  	
  depict
  verbal or physical spousal or child abuse;

  
	
   

  	
   

  	
   

  
	
   

  	
  (e)

  	
  permit
  racial, gender, ethnic, religious or political stereotypes; for example,
  religious symbols such as crosses will be acceptable when fitting into the
  theme of the Game and not promoting a specific religious denomination;

  
	
   

  	
   

  	
   

  
	
   

  	
  (f)

  	
  use
  profanity, obscenity or incorporate language or gestures that are offensive
  by prevailing public standards and tastes; and

  
	
   

  	
   

  	
   

  
	
   

  	
  (g)

  	
  promote
  the use of illegal drugs, smoking materials, tobacco and/or alcohol; for
  example NINTENDO does not allow gratuitous beer or cigarette advertisement
  anywhere in a Game; however, Sherlock Holmes smoking a pipe would be
  acceptable as it fits the theme of the Game.

  



 


JEN:hjd


 


PAGE 20 OF 20