exv10w1






Exhibit 10.1



NOTE: CERTAIN MATERIAL HAS BEEN OMMITTED FROM THIS AGREEMENT PURSUANT TO A REQUEST FOR CONFIDENTIAL
TREATMENT UNDER RULE 24b-2. THE LOCATIONS OF THESE OMISSIONS ARE INDICATED THROUGHOUT THE AGREEMENT
BY THE FOLLOWING MARKINGS: [***].




XBOX 360 ACCESSORY LICENSE AGREEMENT



This Xbox 360 Accessory License Agreement (the “Agreement”) is made and entered into as of the
later of the two signature dates below (the “Effective Date”) by and between Mad Catz, Inc.
(“Company”), a Delaware corporation with its principal place of business at 7480 Mission Valley
Road, Suite 101, San Diego, California 92108, and Microsoft Corporation, a Washington, U.S.A.
corporation with its principal place of business at One Microsoft Way, Redmond, Washington 98052
(“Microsoft”).




1. Definitions.




     1.1 “Approved Subcontractor” means a Company subcontractor that is identified on Exhibit
H and provides manufacturing services for the Licensed Product(s).



     1.2 “Approved Vendor” means a Microsoft-approved supplier of Xbox 360 Chips that is identified
in Exhibit F.



     1.3 “Baseband Chip” means an application specific integrated circuit that instantiates the
Baseband Firmware and is made by an Approved Vendor.



     1.4 “Baseband Firmware” means the proprietary Microsoft firmware instantiated on a silicon
baseband chip and designed to allow the chip to operate within the Xbox 360 console platform.



     1.5 “Branding Specifications” means the specifications in Exhibit B-2 for using the
Xbox 360 Logos, as such specifications may be updated or supplanted by Microsoft from time to time.



     1.6 “Certification Specifications” means the then-current Xbox 360 accessory and interface
specifications used by Microsoft or the Certification Testing Center to verify the compatibility of
Proposed Products with the Xbox 360 console.



     1.7 “Certification Testing Center” means an entity identified on Exhibit D, as may be
updated by Microsoft from time to time, to verify the compatibility of Proposed Products with the
Xbox 360 console in accordance with the Certification Specifications.



     1.8 “Firmware” means (a) the Security Firmware, (b) the Wireless Firmware, and (c) the
Baseband Firmware, if Company licenses the Baseband Firmware as described in Section 3.2.



     1.9 “Licensed Product” means a Proposed Product that meets the Xbox 360 Certification
Specifications, has passed the Xbox 360 certification process described in Section 6, and meets the
Quality Standards and Microsoft Standards.



     1.10 “Licensed for Xbox 360 Logo” means the “Licensed for Xbox 360 Logo” as provided by
Microsoft to Company and identified in Exhibit B-1 for use on the Product Package and
related promotional materials, advertising and documentation for Licensed Product(s) in accordance
with the terms of this Agreement.



     1.11 “Microsoft Materials” means the Technical Documentation, Firmware and Necessary Claims.



     1.12 “Microsoft Standards” means Microsoft’s restricted substances specifications (including
without limitation any lead-free product requirements), Vendor Code of Conduct and



Microsoft
Confidential




Page 1 of 28









 







Microsoft’s social and environmental compliance specification as released to Company prior to
execution and delivery of this Agreement and as updated by Microsoft from time to time.




     1.13 “Necessary Claims” means claims (a) of a patent or patent application that Microsoft now
or hereafter owns or otherwise has the right to license to Company, without the payment of any
royalty or other amounts to any unaffiliated third party, that (b) are necessarily infringed by
implementation of the Security Feature or the Wireless Feature. For purposes of the foregoing, a
claim is a “Necessary Claim” only when it is not possible to avoid infringement, because there is
no technically reasonable, non-infringing alternative implementation. Further, notwithstanding the
foregoing, “Necessary Claims” do not include any claims: (1) other than those set forth above,
even if contained in the same patent or patent application as Necessary Claims; (2) to any enabling
technologies that may be necessary to make or use any product (or a portion thereof) or combination
that implements the Security Feature or the Wireless Feature (such as hardware, semiconductor
manufacturing, compiler, object-oriented, operating system, protocol, programming interface or
networking technologies); (3) covering the implementation of other published specifications that
may be referenced in the Microsoft Materials; or (4) to the extent such claim covers any product
(or portion thereof) or combination, the purpose or function of which is not included in the
Security Feature or the Wireless Feature.



     1.14 “Product Package” means the retail package containing the Licensed Product and other
materials that are included with the Licensed Product.



     1.15 “Proposed Product” means a pre-release version of Company’s proposed accessory device
that Company submits to Microsoft or its Certification Testing Center to verify the device’s
compatibility with the Xbox 360 console in accordance with the Certification Specifications.



     1.16 “Quality Standards” means the standards of workmanship, overall quality, and performance
generally accepted in the video game console accessory industry.



     1.17 “Radio Device” means either (a) the application specific integrated circuit that
instantiates the Wireless Feature and is made by an Approved Vendor (i.e. the chip known by the
Microsoft internal code name “Adams”) or (b) the module that instantiates the Wireless Feature and
is made by an Approved Vendor (i.e. the module known by the Microsoft internal code name
“McAdams”).



     1.18 “Security Chip” means the application specific integrated circuit that instantiates the
Security Feature and is made by an Approved Vendor.



     1.19 “Security Feature” means Microsoft’s proprietary protocol used to validate authentic
devices on the Xbox 360 platform.



     1.20 “Security Firmware” means that proprietary Microsoft firmware that implements the
Security Feature and is instantiated on a Security Chip.



     1.21 “Technical Documentation” means the specifications, reference code and other technical
documentation listed in the attached Exhibit A or otherwise delivered by Microsoft for
Company’s use under this Agreement.



     1.22 “Term” means the term of the Agreement set forth in Section 15.1.



     1.23 “Territory” means those countries or regions identified in Exhibit E.



     1.24 “Wireless Feature” means Microsoft’s proprietary protocol used to enable wireless
communication between devices on the Xbox 360 platform.



     1.25 “Wireless Firmware” means that proprietary Microsoft firmware that implements the
Wireless Feature and is instantiated on a Radio Device.



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     1.26 “Wireless Licensed Product” means a Licensed Product that includes the Wireless Feature,
but only if Microsoft has approved the inclusion of the Wireless Feature in such Licensed Product
during the Product Review and Certification process described in Section 6.



     1.27 “Xbox 360 Chip(s)” means (a) the Security Chip, (b) the Radio Device, and (c) the
Baseband Chip, if Company elects to license the Baseband Firmware in accordance with Section 3.2.



     1.28 “Xbox 360 Logos” means the Licensed for Xbox 360 Logo and the Xbox 360 Product Jewel
Logo, collectively.



     1.29 “Xbox 360 Product Jewel Logo” means the stylized Xbox 360 “X” logo as provided by
Microsoft to Company and identified in Exhibit B-1 for use on Licensed Product(s) in
accordance with the terms of this Agreement.


All other initially capitalized terms will have the meanings hereinafter assigned to them.




2. Xbox 360 Development Kit (Peripherals) License.



Prior to submitting any Proposed Product for verification, Company must sign Microsoft’s Xbox 360
Development Kit (Peripherals) (“PXDK”) license agreement for third party accessory manufacturers.
If Company will use an Approved Subcontractor to manufacture Licensed Products or provide
development services related to the Licensed Products, then prior to submitting any corresponding
Proposed Product, Company must require that Approved Subcontractor to sign Microsoft’s PXDK license
agreement.




3. Licenses.




     3.1 Xbox 360 Security Feature and Wireless Feature. Subject to Company paying all applicable
fees and royalties set forth in this Agreement, Microsoft, on behalf of itself and its affiliates,
grants to Company a personal, nonexclusive, nontransferable, royalty-bearing, nonsublicensable
license to: (a) make and use a reasonable number of copies of the Technical Documentation, but only
as necessary for the development of Licensed Products that conform to the specifications included
in the Technical Documentation; (b) make derivative works based on source code that may be supplied
in the Technical Documentation (“Derivatives”), but only for incorporation into Licensed Products;
(c) incorporate (i) object code supplied in the Technical Documentation and (ii) Derivatives into
the Licensed Product; (d) use and distribute Security Firmware in the Territory, but only as
incorporated in Security Chips made by and purchased from Approved Vendors and included in Licensed
Products; (e) use and distribute Wireless Firmware in the Territory, but only as incorporated in
Radio Devices made by and purchased from Approved Vendors and included in Wireless Licensed
Products; and (f) only in the Territory, directly or indirectly sell, offer for sale, import and
distribute Licensed Products that implement (i) the Security Feature alone, or (ii) the Security
Feature and the Wireless Feature, but only if the Licensed Product is a Microsoft-approved
Wireless Licensed Product. Except as specifically provided in (b), (c) and (d) of this Section
3.1, the license grant above does not include any right to disclose or incorporate into any
product, including without limitation Licensed any copy of, or derivative work based upon, any
Technical Documentation or Firmware.



     3.2 Baseband Firmware. Company may elect to license the Baseband Firmware from Microsoft by
notifying Microsoft in writing and paying the Baseband Firmware Fee set forth in Exhibit C.
Upon Microsoft’s receipt of the Baseband Firmware Fee, Microsoft, on behalf of itself and its
affiliates, grants to Company a personal, nonexclusive, nontransferable, royalty-bearing,
nonsublicensable license to: use and distribute the Baseband Firmware only in the Territory and
only as incorporated in Baseband Chips made by and purchased from Approved Vendors and included in
Licensed Products. The license grant above does not include any right to disclose or incorporate
into any product, including without limitation Licensed Products, any copy of, or derivative work
based upon, any Technical Documentation or Firmware.



Page 3 of 28









 





     3.3 Xbox 360 Chip(s). The license granted in Section 3.1 includes the right for Company to
purchase Security Chips (at a minimum purchase order quantity of 25,000 units) from an Approved
Vendor for use with the Licensed Products, upon such pricing and other terms to be agreed upon
between Company and the Approved Vendor. If the Licensed Product is a Wireless Licensed Product,
then the license granted in Section 3.1 includes the right for Company to purchase Radio Devices
(at a minimum purchase order quantity of 25,000 units) from an Approved Vendor for use with the
Licensed Products, upon such pricing and other terms to be agreed upon between Company and the
Approved Vendor. If Company elects to license the Baseband Firmware, the license granted in
Section 3.2 includes the right for Company to purchase the Baseband Chips (at a minimum purchase
order quantity of 25,000 units) from an Approved Vendor for use with the Licensed Products, upon
such pricing and other terms to be agreed upon between Company and the Approved Vendor. Microsoft
reserves the right to require additional design or other specifications relating to the Xbox 360
Chips and/or to add or decrease security requirements, including, without limitation,
implementation of the Security Feature without using the Security Chip.



     3.4 Restrictions.



     (a) No Reverse Engineering. Company shall not reverse engineer, decompile, disassemble, or
otherwise access the source code for any portion of the Security Feature, Wireless Feature, or
Firmware except (i) as permitted by applicable law which cannot be waived by this subsection, or
(ii) as authorized by separate agreement by Microsoft or a Microsoft affiliate. Company shall use
commercially reasonable efforts to design Licensed Products to prevent third parties from reverse
engineering, decompiling or disassembling any portion of the Security Feature, Wireless Feature,
and/or Firmware and to prevent end users from discovering the source code of any component of the
underlying Security Feature, Wireless Feature, and/or Firmware.



     (b) No Foundry Products. The license grants above do not include any rights to make, use,
sell, offer for sale, import or distribute Licensed Product designed by or for a third party
without substantial input from Company, and manufactured, reproduced, sold, leased, licensed or
otherwise transferred from Company to that third party (or to customers of, or as directed by, that
third party) on essentially an exclusive basis.



     (c) Restricted Software. Company will not use any software subject to an Excluded License to
make any derivative of any Microsoft Materials or offer, sublicense or distribute any code supplied
in the Microsoft Materials or derivative of any such code in conjunction with any software subject
to an Excluded License. “Excluded License” means any license that requires that any (a) Microsoft
Materials or component or portion thereof, (b) other software, technology, product, service or
documentation incorporating or using any Microsoft Materials, or (c) other software, technology,
product, service or documentation combined and/or distributed with any Microsoft Materials be: (x)
disclosed or distributed in source code form; (y) licensed for the purpose of making derivative
works; or (z) redistributable at no charge.



     3.5 Reservation of Rights. All rights not expressly granted in this Agreement are reserved.
No additional rights whatsoever (including, without limitation, any implied licenses) are granted
by implication, estoppel or otherwise. Microsoft retains ownership of all right title and interest
in the Microsoft Materials.



4. Xbox 360 Logos.




     4.1 Licensed for Xbox 360 Logo. Microsoft will provide Company with the required Licensed for
Xbox 360 Logo artwork. Upon approval of the Licensed Product under Section 6.3 and subject to
payment of the license fees and royalties set forth in Section 5, Microsoft grants to Company a
non-exclusive, fully paid-up, non-transferable, revocable, personal license to use the Licensed for
Xbox 360 Logo during the Term only on Company’s Product Package and related promotional materials,
advertising, and documentation in connection with the marketing, sales and distribution of the
Licensed Product in the Territory, according to the Branding Specifications and the other terms and
conditions set forth herein. Company is not authorized or licensed to include the Licensed for
Xbox 360 Logo on the



Page 4 of 28









 







Licensed Product itself or on any labels affixed to the Licensed Product or as part of any
warranties made by the Company.



     4.2 Xbox 360 Product Jewel Logo. In addition to the license granted in 4.1, Microsoft grants
to Company a non-exclusive, fully paid-up, non-transferable, revocable, personal license during the
Term to place the Xbox 360 Product Jewel Logo only on Licensed Product(s) intended for sale in the
Territory, according to the Branding Specifications and the other terms and conditions set forth
herein. Company is not authorized or licensed to include the Xbox 360 Product Jewel Logo on any
promotional materials or advertising in connection with the marketing, sales and distribution of
the Licensed Product(s), or as part of any warranties made by the Company. The Xbox 360 Product
Jewel Logo is licensed to Company solely for placement on the Licensed Products as set forth
herein.



     4.3 Logo Usage Approval.



     (a) Company Submission. Company will deliver to Microsoft the Product Package and any other
materials that use or refer to the Xbox 360 Logos or any other Microsoft name (“Submitted
Materials”). Microsoft will review the Submitted Materials to confirm that the use of the Xbox
360 Logos in the Submitted Materials complies with the Branding Specifications. Company must
receive Microsoft’s approval of Submitted Materials prior to any manufacture, distribution or
publication of the same. All requests for approval hereunder will be submitted to:


Scott Loomis, Xbox Accessories Program Manager

Microsoft Corporation, One Microsoft Way, Redmond, WA 98052, USA

e-mail: xe3pp@xbox.com




     (b) Microsoft Response. Microsoft will respond to Company’s request for approval of Submitted
Materials within a commercially reasonable period of time. Microsoft’s approval or rejection of
the request from Company will be delivered via U.S. Mail or e-mail to:



	 	 	 
	Company Contact:

	 	Simon Bell
	Address:

	 	Mad Catz, Inc.
	 

	 	4 West Point Row, Great Park Road
	 

	 	Almondsbury, Bristol
	 

	 	BS324QG
	 

	 	United Kingdom
	e-mail:

	 	sbell@madcatz.com






	 	 	 
	Company Packaging Contact:

	 	Johnny Schmidt
	Address:

	 	Mad Catz, Inc.
	 

	 	7480 Mission Valley Road, Suite 101
	 

	 	San Diego, California 92108 USA
	e-mail:

	 	Jschmidt@madcatz.com





If requested, Company agrees to incorporate Microsoft’s comments or edits prior to publication,
manufacture or distribution of any Submitted Materials.




     (c) Use of Approved Materials. After Microsoft has approved Submitted Materials, Company will
manufacture, assemble, publish, and distribute the Submitted Materials only as approved by
Microsoft and will make no changes to the Submitted Materials without first obtaining Microsoft’s
written approval of such change.



     4.4 Logo Usage Requirements and Restrictions.



     (a) Branding Specifications. Company’s use of the Xbox 360 Logos will comply with the
Branding Specifications and will conform in all respects to the Submitted Materials finally
approved by Microsoft as required hereunder.



Page 5 of 28









 





     (b) No Third Party Usage; No Merchandising. Company is granted no right to permit any third
party to use the Xbox 360 Logos in any manner without Microsoft’s prior written consent and any
attempt to do so will be void. Company’s license to use the Xbox 360 Logos in association with
Licensed Products will not extend to the merchandising or sale of related or promotional products
under such Xbox 360 Logos.



     (c) No Co-Branding. Company will not use the Xbox 360 Logos in association with any third
party trademarks in a manner that might suggest co-branding or otherwise create potential confusion
as to source or sponsorship of the Licensed Products or ownership of the Xbox 360 Logos without
written consent (including via email).



     (d) Other Prohibited Uses. Company will not use Xbox 360 Logos in connection with any activity
that (i) disparages Microsoft or its products or services; (ii) violates or infringes any
intellectual property of Microsoft; or (iii) violates any local, state, federal, country, or
international regulation or law.



     (e) Remedy of Non-Conformance. Upon notice or other discovery of any non-conformance with the
requirements or prohibitions of this Section 4, Company will promptly remedy such non-conformance
and notify Microsoft of the non-conformance and remedial steps taken.



     4.5 Assistance in Protecting Logos. Company will assist Microsoft in protecting and
maintaining Microsoft’s rights in the Xbox 360 Logos worldwide, including preparation and execution
of documents necessary to register the Xbox 360 Logos at Microsoft’s expense and giving immediate
notice to Microsoft of potential infringement of the Xbox 360 Logos in any country. Microsoft will
have the sole right to and in its sole discretion may commence, prosecute or defend, and control
any action concerning the Xbox 360 Logos. Company will not contest the validity of, or by act or
omission jeopardize, or take any action inconsistent with, Microsoft’s rights or goodwill in the
Xbox 360 Logos in any country, including attempted registration of the Xbox 360 Logos or use or
attempted registration of any mark confusingly similar thereto.



     4.6 Logo Ownership. Company acknowledges Microsoft’s sole ownership of the Xbox 360 Logos
worldwide and all associated goodwill. Nothing in this Agreement or in the performance thereof, or
that might otherwise be implied by law, will operate to grant Company any right, title, or interest
in or to the Xbox 360 Logos other than as specified in the limited license granted in this
Agreement. Company’s use of the Xbox 360 Logos will inure solely to the benefit of Microsoft.
Company hereby assigns and will assign in the future to Microsoft all rights it may acquire by
operation of law or otherwise in the Xbox 360 Logos, including all applications or registrations
therefore, along with the goodwill associated therewith.



5. Payments.




     5.1 License Fees.



     (a) Security Feature Fee. Company will pay Microsoft the fees set forth on Exhibit C
for the license of the Security Feature (the “Security Feature Fee”). The Security Feature Fee is
above and beyond the actual cost of the Security Chip that Company (or Approved Purchasers) will
purchase from the Approved Vendor. In the event that Company purchases any Security Chips prior to
the Effective Date, Company will pay the Security Feature Fee corresponding to such Security Chips
within thirty (30) days after the Effective Date.



     (b) Wireless Feature Fee. For Wireless Licensed Products, Company will also pay Microsoft the
fees set forth on Exhibit C for the license of the Wireless Feature (the “Wireless Feature
Fee”). The Wireless Feature Fee is above and beyond the actual cost of the Radio Device that
Company (or Approved Purchasers) will purchase from the Approved Vendor. In the event that Company
purchases any Radio Devices prior to the Effective Date, Company will pay the Wireless Feature Fee
corresponding to such Radio Devices within thirty (30) days after the Effective Date.



Page 6 of 28









 





     (c) Setup and Firmware Fees. Company will also pay Microsoft the applicable Setup and
Firmware Fees identified in Exhibit C.



     5.2 Logo Royalties.



     (a) Logo Royalties. In consideration of the Xbox 360 Logo license rights granted Company for
the Licensed Products, Company will pay to Microsoft the Xbox 360 Logo Royalties set forth on
Exhibit C. The royalty obligation is triggered on the shipment of Licensed Product(s) to
customers.



     (b) Royalty Reports and Payments. Company will make quarterly royalty reports to Microsoft
within (i) forty-five (45) days after the end of each calendar quarter during the Term; (ii)
fifteen (15) days after termination of this Agreement in the event there is no “Sell Off Period” as
referenced in Section 15.3; or (iii) in the event there is a “Sell Off Period” as referenced in
Section 15.4, within fifteen (15) days after the end of each calendar month during the Sell Off
Period and a final report and payment within fifteen (15) days of the end of the Sell Off Period.
The royalty report will include monthly sales information and be in a reasonable form as defined by
Microsoft. For each calendar quarter, Company will remit payment(s) in accordance with Section 5.3
in United States Dollars at the same time as submission of the royalty report.



     5.3 Place of Payment. Microsoft will address invoices for fee and royalty payments owed by
Company to:



	 	 	 
	Company Contact:

	 	Michael Guerrero
	Address:

	 	Mad Catz, Inc.
	 

	 	7480 Mission Valley Road, Suite 101
	 

	 	San Diego, California 92108 USA
	e-mail:

	 	mguerrero@madcatz.com





The statements required pursuant to this Section will be delivered by Company to:




	 	 	 
	Reports:

	 	Quarterly royalty reports should be sent via email to:
	 

	 	Microsoft Licensing, GP (MLGP)
	 

	 	Xbox 360 Accessories Accounting Services
	 

	 	Email: mslipubx@microsoft.com
	 

	 	Fax: (1) 775/826-0531
	 

	 	Fax (alternative): 1-775-826-0506





Payments will be sent via wire transfer in U. S. Dollars only to:




	 	 	 
	 

	 	Bank of America
	 

	 	901 Main Street
	 

	 	Dallas, TX 75202
	 

	 	USA
	 

	 	Wire / EFT ABA # 0260-0959-3
	 

	 	ACH ABA # 111000012
	 

	 	SWIFT# BOFAUS3N
	 

	 	Microsoft Licensing, GP
	 
	 	 
	 

	 	or such other address of account as Microsoft may specify from time to time.






     5.4 Audit. During the Term and for a period of at least three (3) years thereafter, Company
shall keep and maintain complete and accurate books and records relating to its performance (and
any of its manufacturer’s performance) under this Agreement. Upon not less than fourteen (14) days
advance written notice from Microsoft, Company shall make such books and records available for
audit by Microsoft’s internal audit team or an independent certified public accounting firm
(together with independent technical



Page 7 of 28









 







personnel if and as reasonably required for such accountant to perform the audit) designated
by Microsoft and approved by Company, which approval shall not be unreasonably withheld. Unless
otherwise agreed by Microsoft and Company, any such audit shall be conducted during regular
business hours, at Company’s principal place of business, not more frequently than once in any
period of twelve (12) consecutive months and in a manner that does not unreasonably interfere with
Company’s normal course of business. If any audit reveals an overpayment, then Company will
receive a credit, in the amount of such overpayment, that will be applied only against future
royalties payable under Section 5.2. If any audit reveals an underpayment, then Company will pay
Microsoft the amount of the underpayment, together with interest as provided for in Section 5.5,
within forty-five (45) days after the date of the auditor’s report. Further, if any audit reveals
an underpayment of more than five percent (5%) of the royalties owed for the royalty periods
subject to the audit, then Company will promptly reimburse Microsoft, upon request, for all costs
and expenses reasonably incurred by Microsoft to conduct the audit.



     5.5 Delinquent Payment. Any license fee, royalty or other amount not paid when due and
otherwise in accordance with this Section 5 shall bear interest at the rate of one percent (1%) per
month or the highest rate permitted by applicable usury law, whichever is less, calculated on a
daily basis and compounded on the first day of each calendar month, from the date due until the
date received by Microsoft in accordance with Section 5.3. This Section 5.5 does not authorize
late payments, and the payment of interest hereunder shall not be lieu of or prejudice any other
right or remedy that Microsoft may have on account of Company’s failure to make any payment in
accordance with this Section 5.



     5.6 Taxes. Company shall be responsible for the billing, collecting and remitting of sales,
use, value added, and other comparable taxes due with respect to the exercise of the licenses
granted in this Agreement and any other activities of Company and its subsidiaries under this
Agreement (including, without limitation, the collection of revenues). Microsoft is not liable for
any taxes (including, without limitation, any penalties or interest thereon) that Company or any of
its subsidiaries is legally obligated to pay in connection with this Agreement, the exercise of any
licenses granted in this Agreement or any other activities of Company and its subsidiaries under
this Agreement. Company is not liable for any income taxes that Microsoft is legally obligated to
pay with respect to any amounts paid to Microsoft by Company under this Agreement.



     All royalties and fees exclude any taxes, duties, levies, fees, excises or tariffs imposed on
any of Company’s activities in connection with this Agreement. Company shall pay to Microsoft any
applicable taxes that are owed by Company solely as a result of entering into this Agreement and
which are permitted to be collected from Company by Microsoft under applicable law, except to the
extent that Company provides to Microsoft a valid exemption certificate for such taxes. Company
agrees to indemnify, defend and hold Microsoft harmless from any taxes (including, without
limitation, sales or use taxes paid by Company to Microsoft) or claims, causes of action, costs
(including, without limitation, reasonable attorneys’ fees) and any other liabilities of any nature
whatsoever related to such taxes.



     If, after a determination by foreign tax authorities, any taxes are required to be withheld on
payments made by Company to Microsoft, Company may deduct such taxes from the amount owed Microsoft
and pay them to the appropriate taxing authority; provided, however, that Company shall promptly
secure and deliver to Microsoft an official receipt for any such taxes withheld or other documents
necessary to enable Microsoft to claim a U.S. Foreign Tax Credit. Company will make certain that
any taxes withheld are minimized to the extent possible under applicable law.



     This tax section shall govern the treatment of all taxes arising as a result of or in
connection with this Agreement notwithstanding any other section of this Agreement.



6. Product Review and Certification.




     6.1 Review of Proposed Product. Company will identify a single contact person for all
business development activity relating to Proposed Products. Company will submit its plans for
Proposed Products to Microsoft for review against Xbox 360 hardware and software game categories.
Feedback



Page 8 of 28









 







regarding the category fit of any Proposed Product may be provided by Microsoft in its sole
discretion to maintain consistent and compatible Xbox 360 accessory products. Company’s plan for
Proposed Products will be in writing, and will include at least (to the extent applicable): (a)
detailed description of the design, technical and marketing suitability of the Proposed Product,
(b) expected suggested retail pricing of the Proposed Product, (c) whether the Proposed Product is
intended to result in a Wireless Licensed Product; and (d) estimated annual sales volumes by world
region of the Proposed Product(s) based upon assumptions provided by Company.



     6.2 Authorization of Security Feature, Wireless Feature and Xbox 360 Chip(s). Upon
Microsoft’s approval of the plan for each Proposed Product, Company may request sample Security
Chips, Radio Devices (if the Proposed Product approved by Microsoft is intended to result in a
Wireless Licensed Product), and Baseband Chips from the applicable Approved Vendor in quantities
approved by Microsoft. Company will use the sample Xbox 360 Chips solely for Proposed Product
development and certification testing per Microsoft’s Technical Documentation and Certification
Specifications. Upon such approval, Company may also initiate discussions with the Approved Vendor
to reach agreement on supply of the Xbox 360 Chips including price, schedule and other purchase
order requirements. Such agreement will include an authorization from Company for Approved Vendor
to release information to Microsoft about the number of Xbox 360 Chips purchased.



     6.3 Certification of Proposed Product.



     (a) Requirements for Certification. Microsoft will at all times control requirements for Xbox
360 certification testing. Modifications to the Certification Specifications and Branding
Specifications may be implemented by Microsoft at any time during the Term, but will not be
retroactive to any Licensed Product already certified by Microsoft or its Certification Testing
Center.



     (b) Proposed Product Submission. Company will, at its sole cost and expense, deliver to
Microsoft or Microsoft’s Certification Testing Center a minimum of seven (7) units of the Proposed
Product for certification. Company represents and warrants that: (i) all Proposed Products units
submitted are representative of product ready for release for general distribution; (ii) Company
has adequately and extensively tested the Proposed Products using the PXDK test equipment required
by Microsoft; (iii) there are no errors in the Proposed Products. If requested by Microsoft,
Company will also provide Microsoft or the Certification Testing Center with copies of all End User
installation and technical reference manuals for the Proposed Product, as well as any other
documentation reasonably requested by Microsoft for operating the Proposed Product and/or
conducting the certification activities.



     (c) Proposed Product Review. The Proposed Product units will be reviewed for compliance with
the Certification Specifications in effect at the time of review. Company will be responsible for
supplying any necessary documentation to operate the Proposed Product for verification purposes and
for designating a single contact person for technical assistance. If the certification is provided
by a Certification Testing Center, Company will pay all verification fees required by the
Certification Testing Center and will execute any additional contracts required by the
Certification Testing Center. Microsoft is not liable for any damage to the Proposed Product units
while in transit to and on Microsoft’s premises or that of the Certification Testing Center.



     (d) Testing Schedule; Reports. Company will schedule all certification testing at least three
(3) weeks in advance or shorter time as agreed to by Microsoft or the Certification Testing Center.
Certification will be performed by Microsoft or the Certification Testing Center subject to the
availability of its resources and staff. Microsoft will report to Company on status of testing
within two weeks of Company’s submission, but nothing in this Section will require Microsoft to
complete testing within such time.



     (e) Failure to Pass Certification. If a Proposed Product fails to meet the Certification
Specifications, Microsoft or the Certification Testing Center will provide Company with a written
report indicating the reasons for such failure but will not provide recommendations for
improvements to the



Page 9 of 28









 







Proposed Product. Company will promptly replace, repair, or withdraw the Proposed Product from
further certification testing. Microsoft will not refund any advance license fees paid for a
Proposed Product that does not pass certification testing.



     (f) Additional Product Requirements. In addition to meeting the Certification Specifications
and passing the Xbox 360 certification testing, all Proposed Products will be of a quality at least
commensurate with the quality of products distributed by Company before the Effective Date and will
meet or exceed the Quality Standards and Microsoft Standards. On an annual basis, a Company
officer will certify compliance with the Microsoft Standards in writing in a form substantially
similar to that attached in Exhibit G as updated from time to time by notice from
Microsoft. In the event Microsoft rejects the Proposed Product for failure to comply with the
Quality Standards or Microsoft Standards, Company will correct and then resubmit the Proposed
Product to Microsoft, or withdraw the Proposed Product from any further certification testing.
Microsoft will not refund any advance license fees paid for a Proposed Product that does not pass
certification testing or meet the Quality Standards or Microsoft Standards.



     6.4 Approval to Deliver Xbox 360 Chip(s). Upon final approval of each Licensed Product,
Microsoft will inform the applicable Approved Vendor of such approval and authorize the Approved
Vendor to sell the applicable Xbox 360 Chips to Company for use in the Licensed Product.



     6.5 Control of Xbox 360 Chip(s). Company must provide to Microsoft a detailed plan for
secure handling, storage, and scrap of Security Chips by Company ninety (90) days prior to their
first receipt of Xbox 360 Chips. The detailed plan must include full material handling, storage
and scrap procedures in place at all Company’s manufacturing facilities where Xbox 360 Chips are
delivered, stored, and utilized in Licensed Products. Microsoft has the right to require
additional handling, storage and scrap procedures to ensure adequate controls of Xbox 360 Chips.



     6.6 Final Retail Product Samples. Upon final approval, Company will provide at no cost to
Microsoft twenty (20) final retail packaged Licensed Products for use in its test and game
certification laboratories. These units will be used for compliance testing on current and future
products.



     6.7 Prohibition on Unauthorized Manufacture or Distribution. Unless otherwise approved by
Microsoft in writing, in no event will Company manufacture or distribute a Proposed Product or any
other product utilizing the Security Feature without such product being a Licensed Product under
the terms of this Agreement.



     6.8 Private Label Products. As a convenience to Company, Company may from time to time submit
to Microsoft proposals for products that Company would, if approved by Microsoft, make for sale
exclusively to a specifically identified customer of Company for sale by such customer under its
brand, trademark, and/or logo (“Company Customer Products”). Microsoft may approve or reject such
proposals in its sole discretion. For each such proposal Microsoft approves, the parties will set
forth the details in Exhibit I and upon the execution of such Exhibit I, the approved Company
Customer Product will be deemed a Licensed Product under this Agreement. Company agrees that,
regardless of any agreement or arrangement between Company and any Company customer, or between
Microsoft and any Company customer, Company remains fully responsible to Microsoft for all Company
obligations under this Agreement, and Company will be responsible for, and indemnify Microsoft
against, any act or omission of any Company customer and/or any claim in connection with any
Company Customer Product.



7. No Restriction on Independent Development.




     Nothing in this Agreement will be construed as restricting Microsoft’s ability to acquire, license,
develop, manufacture or distribute for itself, or have others acquire, license, develop,
manufacture or distribute any software, firmware, or hardware with the same or similar
functionality as the Proposed Product(s) or Licensed Product(s), or to market and distribute such
other technology and products.




Page 10 of 28












 





8. Product Manufacturing.



Company is solely responsible for manufacturing, designing, testing, labeling (including all
warnings, use instructions and regulatory compliance), warehousing, distributing, promoting,
selling and if necessary recalling the Licensed Products. Company is also responsible for
ensuring that all commercially released versions of the Licensed Products are free of defects in
material, manufacture and design, and comply with all applicable domestic and international
regulations, standards and other laws and standards governing restricted substances, product safety
and consumer protections. In no event will Microsoft be deemed to have any such responsibilities
with regard to the Licensed Products. In particular, under any recycling, collection, recovery,
reuse, disposal and/or waste management legislation, Company agrees that it is solely responsible
for all Licensed Products as a producer and that Microsoft has no responsibility therefor. Company
hereby indemnifies Microsoft in the event that its failure to comply with its responsibilities as a
producer or any of its acts or omissions leads to a claim or action being made against Microsoft
for Licensed Products under such legislation. Company will provide Microsoft with the name and
address of the manufacturers of the Licensed Products and the location of their manufacturing
facilities, and will provide Microsoft with no less than thirty (30) days prior written notice in
the event of any changes of such manufacturer. Company will institute manufacturing processes and
tests so as to ensure that all units of the Licensed Products manufactured by or for Company meet
the Quality Standards and Microsoft Standards, comply with all applicable regulations, standards
and other laws and are in compliance with the version of the Proposed Product approved by Microsoft
under Section 6 of this Agreement. Company agrees to provide Microsoft with samples of the
Licensed Product(s) from time to time for purposes of verifying that they continue to meet the
Certification Specifications and Quality Standards. Upon notice or other discovery of any
non-conformance of the Licensed Product or Product Package with the Quality Standards, Microsoft
Standards or Certification Specifications (including receipt of any bona fide end user claims or
complaints pertaining to consumer product safety matters), Company will promptly notify Microsoft
and remedy such non-conformance in all such Licensed Product units or Product Packages regardless
of where such are in the chain of distribution, and Company will notify Microsoft of the remedial
steps taken.




9. Permission to Demonstrate.



Company hereby grants permission to Microsoft to use and display Licensed Products at conventions,
events, trade shows, press briefings, and the like, and to use, depict, broadcast, and otherwise
display the Licensed Products in advertising and promotional material relating to Xbox 360 and
related Microsoft products and services, as Microsoft may reasonably deem appropriate.




10. Confidentiality; Press Announcements; Product Listing.




     10.1 Non-Disclosure Agreement. Microsoft and Company agree that the terms of the
Non-Disclosure Agreement (“NDA”) executed by the parties on August 31, 2000 are incorporated herein
by this reference. Further, the parties agree that all terms and conditions of this Agreement will
be deemed Microsoft Confidential Information as defined in the NDA. In the event that any
independent contractor of Company will require access to Microsoft Confidential Information for the
purposes of fulfilling Company’s obligations under this Agreement, Company will enter into written
confidentiality agreements with such independent contractors which are at least as protective of
the Microsoft Confidential Information as is the NDA.



     10.2 Press Releases. Microsoft and Company agree that Company’s initial press release or
communication to the press and/or public regarding this Agreement, and any subsequent press
releases to be published by Company which refer to Microsoft or Xbox 360, will be mutually agreed
upon prior to Company’s release to the public. Company’s requests for approval and Microsoft’s
reply thereto will be sent to:


Scott Loomis, Xbox Accessories Program Manager

Microsoft Corporation, One Microsoft Way, Redmond, WA 98052, USA

e-mail: xe3pp@xbox.com.




Page 11 of 28









 








     10.3 Mandated Disclosure of this Agreement. Notwithstanding Sections 10.1 and 10.2, the
parties acknowledge that this Agreement, or portions thereof, may be required under applicable law
to be disclosed as part of or an exhibit to either party’s required public disclosure documents.
If either party is advised by its legal counsel that such disclosure is required, it will notify
the other in writing and the parties will jointly seek confidential treatment of this Agreement to
the maximum extent reasonably possible, in documents approved by both parties and filed with the
applicable governmental or regulatory authorities, and/or Microsoft will prepare a redacted version
of this Agreement for such filing.



     10.4 Access to Xbox 360 Game Publishers. Microsoft agrees that Company may work with
publishers and developers of Xbox 360 platform game products, under terms and conditions to be
agreed upon by Company and such publisher/developer, for Company’s potential creation of Proposed
Products that will maximize such publishers’/developers’ Xbox 360 game products. Nothing in this
Agreement will prohibit Company from distributing Company’s Licensed Products as a packaged set
together with any third party’s Xbox 360-compatible game products.



     10.5 Product Listing. Microsoft may, but is not obligated to, post information regarding the
Licensed Products on applicable Microsoft websites provided that Company has not requested that
Microsoft exclude the Licensed Products from such posting.



11. End User Warranties.



Company will be solely responsible for the distribution, marketing, sales, maintenance, and End
User warranties of the Licensed Products, and for providing technical and all other support to
distributors and End Users of the Licensed Products. Company will provide all distributors and End
Users of the Licensed Products with Company’s contact information (including without limitation
Company’s street address and telephone number, and the applicable individual/group responsible for
customer support. Such distributor and End User support will be consistent with the
then-applicable video game accessory industry standards. Company acknowledges and agrees that
Microsoft will have no responsibilities whatsoever for any of the foregoing and that Company will
be solely responsible for any and all End User warranty claims.




12. Company Warranties to Microsoft. Company warrants and represents that:




     12.1 It has the full power and authority to enter into this Agreement.



     12.2 The Licensed Products and Product Package comply with all relevant domestic and
international regulations, standards, and other laws, including without limitation those pertaining
to environmental, restricted substances, recycling, disposal, reuse, waste management, labor,
worker safety, product safety and consumer protections applicable to the Licensed Products and
Product Packaging, and Company expressly acknowledges that Microsoft has not undertaken and has no
duty to test, verify or otherwise ensure that the Licensed Products, or Product Package complies
with such regulations, standards, and laws.



     12.3 The Licensed Products comply with the Quality Standards, Microsoft Standards, and the
Certification Specifications and the Licensed Products, Product Package, and all marketing
materials comply with the Branding Specifications.



     12.4 Company has and will maintain throughout the Term and for at least two (2) years
thereafter, a comprehensive general liability insurance policy with respect to the Licensed
Product(s) in an amount not less than U.S.$2,000,000.00 per occurrence. Microsoft will be a named
insured on said policy and Company will provide to Microsoft a Certificate of Insurance evidencing
Microsoft’s status as an additional insured within 30 days of execution of this Agreement and only
at Microsoft’s request a copy of said policy. Company will provide Microsoft with thirty (30) days
prior written notice in the event of any policy cancellation or a material change in the terms or
provisions of such policy.



Page 12 of 28









 





     12.5 Notwithstanding anything to the contrary contained in this Agreement, in the event
Microsoft learns of a material variance in the Licensed Products’ compliance with the Quality
Standards, Microsoft Standards or Certification Specifications or Company’s warranty in Section
12.2, Microsoft may terminate this Agreement in accordance with Section 15.2(a).



13. Microsoft Warranties to Company; Disclaimer of Warranties; Exclusion of Damages; Limitation
of Liability.




     13.1 Warranties. Microsoft warrants and represents that: (a) it has the full power to enter
into this Agreement; and (b) it has not previously and will not grant any rights to any third party
that are inconsistent with the rights granted to Company herein.



     13.2 DISCLAIMER. EXCEPT AS EXPRESSLY STATED IN SECTION 13, MICROSOFT PROVIDES ALL MATERIALS,
LICENSES AND SERVICES HEREUNDER ON AN “AS IS” BASIS, AND MICROSOFT DISCLAIMS ALL OTHER EXPRESS OR
IMPLIED WARRANTIES UNDER THE APPLICABLE LAWS OF ANY COUNTRY REGARDING THE MATERIALS, LICENSES AND
SERVICES, INCLUDING ANY IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR
WARRANTY OF NON-INFRINGEMENT OR WITH REGARD TO THE SCOPE, COVERAGE, VALIDITY OR ENFORCEABILITY OF
ANY NECESSARY CLAIMS OR THAT ANY NECESSARY CLAIMS OR OTHER INTELLECTUAL PROPERTY RIGHTS APPLY
WORLDWIDE. THE ENTIRE RISK AS TO THE QUALITY, USE, OR PERFORMANCE OF ANY MATERIALS PROVIDED BY
MICROSOFT HEREUNDER REMAINS WITH COMPANY.



     13.3 EXCLUSION OF INCIDENTAL, CONSEQUENTIAL AND CERTAIN OTHER DAMAGES. To the maximum extent
permitted by applicable law, in no event will Microsoft, its affiliates, subsidiaries, licensors or
its suppliers be liable for any special, incidental, indirect, or consequential damages whatsoever
under this Agreement (including, but not limited to, damages for loss of profits or confidential or
other information, for business interruption, for personal injury, for failure to warn, for failure
to meet any duty including of good faith or of reasonable care, for negligence, and for any other
pecuniary or other loss whatsoever) even if Microsoft has been apprised of the likelihood of such
damages.



     13.4 Limitation of Liability and Remedies. Notwithstanding any damages that Company might
incur for any reason whatsoever (including, without limitation, all damages referenced above and
all direct or general damages), the entire liability of Microsoft, its affiliates, licensors and
any of its suppliers under any provision of this Agreement and Company’s exclusive remedy for all
of the foregoing, will be limited to the cumulative sum of all license fees and royalty payments
received by Microsoft from Company under this Agreement. The foregoing limitations, exclusions and
disclaimers will apply to the maximum extent permitted by applicable law, even if any remedy fails
its essential purpose.



14. Indemnity.




     14.1 Company’s Indemnity of Microsoft. Company will defend, indemnify and hold harmless
Microsoft and Microsoft’s affiliates and subsidiaries, and their respective directors, officers,
employees, agents, customers and distributors of each of the foregoing from and against any and all
claims, actions, demands, legal proceedings, liabilities, damages, losses, judgment, authorized
settlements, costs and expenses, including without limitation actions by private parties or
governmental agencies and reasonable attorney’s fees, arising out of or in connection with any
actual or alleged:



     (a) claim that, if assumed to be true, would constitute a breach of a Company warranty,
representation or covenant set forth in this Agreement; and/or



     (b) claim relating to the Proposed Product(s), Licensed Product(s), Product Package or the
marketing thereof (except to the extent that Microsoft is obligated to indemnify Company for
trademark infringement claims under14.3), including without limitation: (A) claims of actual or
alleged infringement



Page 13 of 28









 




by Company, a Proposed Product, a Licensed Product, and/or Product Package, of any patent,
copyright, trade secret, mask work right, trademark or other proprietary right of any third party
except to the extent that such infringement arises from the Xbox 360 Logos, the Firmware, the
Security Feature, or the Wireless Feature; (B) claims by any third party that a Proposed Product,
Licensed Product, and/or Product Package has caused any injury or bodily harm (including death) or
has damaged real property or personal property or the environment; (C) claims based on a violation
by Company of, or failure of Proposed Product, Licensed Product, and/or Product Package to comply
with, any applicable law or regulation; (D) claims by or on behalf of any subcontractor, supplier,
employee or agent of Company; and/or (E) claims related to Company’s use of the Xbox 360 Logos in a
manner not authorized under this Agreement.




     14.2 Indemnity Procedures. In the event Microsoft becomes aware of any such claim, Microsoft
shall: (a) reasonably promptly notify Company thereof; and (b) provide Company with reasonable
cooperation in the defense thereof. Unless such claim or the defense thereof could give rise to
criminal liability or could have a material effect on Microsoft’s business in the jurisdiction of
such proceeding, Microsoft will not settle any such claim without Company’s consent, which will not
be unreasonably withheld. Microsoft will have the right to approve the counsel selected by Company
to defend any such claim (such approval not to be unreasonably withheld) and will also have the
right to have its own counsel participate in the defense of any such claim at Microsoft’s own
expense. Notwithstanding the foregoing, and without prejudice to Company’s indemnification
obligations or Microsoft’s other rights hereunder, Microsoft will be entitled (using its own
counsel and without the consent of Company) to control the defense of, and settle, any claim if
Company does not, upon Microsoft’s demand, acknowledge in writing Company’s full responsibility to
indemnify therefor.



     14.3 Microsoft’s Indemnity of Company. Microsoft will defend, indemnify and hold Company and
Company’s affiliates, directors, officers, employees, licensees, agents and independent contractors
harmless from and against any costs, damages and fees reasonably incurred by Company, including but
not limited to fees of attorneys and other professionals, that are attributable to any third-party
claim that the Xbox 360 Logos infringe the trademark of such third party in those countries in
which Microsoft distributes the Xbox 360 video game consoles. Company will provide Microsoft
reasonably prompt notice in writing of any such claims and provide Microsoft with reasonable
information and assistance, at Microsoft’s expense, to help Microsoft to defend such claims.



15. Term and Termination.




     15.1 Term. The term of this Agreement will commence on the Effective Date and unless
terminated earlier as provided in Section 15.2, will continue until two (2) years after the
Effective Date. Thereafter the Term will automatically renew for successive one-year periods until
the last year Microsoft distributes the Xbox 360 version console unless either party gives written
notice of its intent not to renew no less than ninety (90) days prior to the expiration of the
initial or any subsequent renewal term.



     15.2 Termination for Cause.



     (a) By Microsoft. Upon thirty (30) days written notice to Company without any further right to
cure, Microsoft may terminate this Agreement for cause in the event that the PXDK license between
Microsoft and Company is terminated or in the event of any breach by Company of the license
provisions in Section 3 or 4. Microsoft may immediately terminate this Agreement for cause in the
event of any of the following: (i) if Company is in material breach or default of any
representation, warranty, covenant or agreement hereunder or fails to continue to perform its
obligations hereunder, which breach or default is not cured within thirty (30) days of written
notice from Microsoft; (ii) if Company becomes insolvent, or (iii) if Company becomes the subject
of any proceeding under any bankruptcy, insolvency or liquidation law, whether domestic or foreign
and whether voluntary or involuntary, which is not resolved favorably to Company within sixty (60)
days of commencement thereof; or (iv) if Company becomes subject to property attachment, court
injunction or court order which has a material adverse effect on its operations.



Page 14 of 28









 





     (b) By Company. Company may terminate this Agreement upon thirty (30) days’ written notice to
Microsoft if Microsoft becomes the subject of any proceeding under any bankruptcy, insolvency or
liquidation law, whether domestic or foreign and whether voluntary or involuntary, which is not
resolved favorably to Microsoft within sixty (60) days of commencement thereof.



     15.3 Effect of Termination; Sell-off Rights. In the event of any termination of this
Agreement and subject to any Sell-off Period, Company will immediately (a) cease manufacture and
distribution of the Licensed Product (b) cease all use of the Xbox 360 Logos and Microsoft
Materials, (c) cancel all purchase orders for Xbox 360 Chips, (d) destroy all tooling that contains
Xbox 360 Logos, (e) dispose of Product Packages at Company’s expense as directed by Microsoft in
its sole discretion, and (f) return all unused Xbox 360 Chips. Notwithstanding the foregoing, upon
the expiration or termination of this Agreement pursuant to a notice of non-renewal under Section
15.1 or under Section 15.2 above, or in the event this Agreement is terminated by Company under
Section 15.2(b), Company will have the right to continue to sell or otherwise dispose of Licensed
Product which is in Company’s inventory on the date of such termination or expiration, such right
to continue for six (6) months after such expiration or termination (the “Sell-off Period”),
provided that Company will not manufacture amounts of Licensed Product in anticipation of such
termination or expiration which is in excess of orders expected to be received prior to the
termination or expiration date. Company will immediately destroy any inventory units of Licensed
Product remaining after the Sell-off Period, unless the parties agree otherwise in writing. Any
and all sales or other dispositions of the Licensed Product made under the provisions of this
Section 15.3, including such during any Sell-Off Period, will be subject to all of the provisions
of this Agreement. Sales by Company to end users and distributors prior to any termination or
expiration of this Agreement will not be abridged or diminished by any expiration or termination of
this Agreement.



     15.4 Return of Materials. Upon the expiration or termination of this Agreement, each party
will promptly return to the other all Confidential Information and other materials of the other
that were held by each under the terms of this Agreement.



     15.5 Survival. The provisions of Sections 1, 4.6, 5.3, 7, 8, 10, 11, 12, 13, 14, 15.5, and 16
will survive any termination or expiration of this Agreement.



16. Miscellaneous.




     16.1 Governing Law; Attorneys’ Fees.



     (a) Governing Law. This Agreement will be construed and controlled by the laws of the State of
Washington, and Company further consents to jurisdiction by the state and federal courts sitting in
the State of Washington. The parties agree that the U. N. Convention on Contracts for the
International Sale of Goods does not apply to this Agreement. Process may be served on either
party by U.S. Mail, postage prepaid, certified or registered, return receipt requested, or by such
other method as is authorized by the Washington Long Arm Statute. This Section 16 does not prevent
Microsoft from seeking injunctive relief with respect to a violation of intellectual property
rights or confidentiality obligations in any appropriate jurisdiction.



     (b) Attorneys’ Fees. If either Microsoft or Company employs attorneys to enforce any rights
arising out of or relating to this Agreement, the prevailing party will be entitled to recover
reasonable attorneys’ fees.



     16.2 Notices and Requests. All notices and requests in connection with this Agreement will be
deemed given as of the day they are received either by messenger, delivery service, or in the U.S.
mail, postage prepaid, certified or registered, return receipt requested, and addressed as follows:



Page 15 of 28









 





	 	 	 
	Company: 


	 	MAD CATZ, INC.

7480 Mission Valley Road, Suite 101

San Diego, California 92108 USA

	Attention:

	 	President & CEO
	 
	 	 
	Phone: 

Fax:

	 	(619) 683-9830 x3600

(619) 683-9839
	 
	 	 
	with a cc to: 

Attention:

	 	Whitney E. Peterson

General Counsel
	 
	 	 
	Microsoft:

	 	MICROSOFT CORPORATION

One Microsoft Way

Redmond, WA 98052-6399 USA


	Attention:

	 	
Scott Loomis
	 
	 	 
	with a cc to: 


	 	MICROSOFT CORPORATION

One Microsoft Way

Redmond, WA 98052-6399 USA

	
Attention:

	 	
Law & Corporate Affairs — Xbox Hardware
	 
	 	 
	Phone: 

Fax:

	 	(425) 882-8080

(425) 936-7329





or to such other address as the party to receive the notice or request so designates by written
notice to the other.




     16.3 Assignment. Except as provided below, this Agreement, and any rights or obligations
hereunder will not be assignable by Company by contract or by operation of law without first
obtaining Microsoft’s written consent, which consent shall not be unreasonably withheld. An
assignment will be deemed to include without limitation (a) a merger of Company with another party,
whether or not Company is the surviving entity, (b) the acquisition of more than twenty percent
(20%) of any class of Company’s voting stock by another party, or (d) the sale or other transfer of
more than fifty percent (50%) of Company’s assets (whether in a single transaction or series of
transactions) any of which results in the assumption of management control by another corporation
or its nominees. Notwithstanding the foregoing, Company may assign this Agreement to the following
entities: Mad Catz Interactive, Inc., Mad Catz Interactive Asia Limited, Mad Catz Europe Limited or
Mad Catz Canada, provided such companies remain affiliates of or under common ownership with
Company. Subject to the limitations of this Section 16, this Agreement will inure to the benefit of
and be binding upon the parties, their successors, administrators, heirs, and permitted assigns.
Any attempted transfer or assignment in violation of this Section will be void; and, in the event
of any such assignment or attempted assignment by Company, Microsoft shall have the right to
immediately terminate the Agreement.



     16.4 Independent Contractors. This Agreement is intended solely as a license agreement, and
no partnership, joint venture, agency, or other form of agreement or relationship is intended.




     16.5 Enforceability/Waiver. If any provision of this Agreement will be held by a court of
competent jurisdiction to be illegal, invalid or unenforceable, the remaining provisions will
remain in full force and effect. No waiver of any breach of any provision of this Agreement will
constitute a waiver of any other breach of the same or any other provision hereof, and no waiver
will be effective unless made in writing and signed by an authorized representative of the waiving
party.



Page 16 of 28









 





     16.6 Government Approvals. Company shall, at its own expense, obtain and arrange for the
maintenance in full force and effect of all foreign and domestic governmental and regulatory
approvals, consents, licenses, authorizations, declarations, filings, and registrations as may be
necessary or advisable for the performance of all of the terms and conditions of the Agreement
including, but not limited to, foreign exchange approvals, import and offer agent licenses, fair
trade approvals and all approvals which may be required to realize the purposes of the
Agreement. 



     16.7 Injunctive Relief. The parties agree that Company’s threatened or actual unauthorized
use of the Xbox 360 Logos or Microsoft Materials, whether in whole or in part, will result in
immediate and irreparable damage to Microsoft for which there is no adequate remedy at law, and in
such event Microsoft will be entitled to appropriate injunctive relief, without the necessity of
posting bond or other security. 



     16.8 Entire Agreement/Modification. The parties hereto acknowledge that they have
read this entire Agreement and understand it, and they agree to be bound by all its terms and
conditions. They further agree that this Agreement, the NDA and all exhibits hereto constitute a
single, integrated written contract expressing the entire agreement between the parties with
respect to the subject matter hereof and all prior and contemporaneous communications and
negotiations, whether written or oral, have been and are merged and integrated into, and are
superseded by, this integrated written agreement. No covenants, agreements, representations or
warranties of any kind whatsoever have been made by any party hereto, except as specifically set
forth in this integrated written contract. This Agreement will not be modified except by a written
agreement of even date herewith or subsequent hereto signed on behalf of Company and Microsoft by
their duly-authorized representatives. 



IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the dates
indicated below.



	 	 	 	 	 
	MICROSOFT CORPORATION

	 	MAD CATZ, INC.
	 	 
	 
	 	 	 	 
	/s/ Todd Holmdahl

	 	/s/ Darren Richardson	 	 
	 

	 	 	 	 
	By (signature)

	 	By (signature)	 	 
	 
	 	 	 	 
	Todd Holmdahl

	 	Darren Richardson	 	 
	 

	 	 	 	 
	Name (print)

	 	Darren Richardson	 	 
	 
	 	 	 	 
	Corp VP

	 	President & CEO	 	 
	Title

	 	Title	 	 
	 
	 	 	 	 
	3/23/2009

	 	3/9/2009	 	 
	Date

	 	Date	 	 






Page 17 of 28









 






EXHIBIT A




Microsoft Materials




Technical Documentation:





	 	1.	 	Xbox 360 Controller Requirements
	 
	 	2.	 	Xbox 360 Wireless Controller Requirements
	 
	 	3.	 	Xbox 360 Controller XUSB Specification
	 
	 	4.	 	Xbox 360 Controller Certification Requirements
	 
	 	5.	 	XNA common controller WindowsXP driver [in object code only]
	 
	 	6.	 	Xbox 360 Controller Security Interface Specification




Page 18 of 28









 











EXHIBIT B-1




Licensed Logos




Xbox 360 Product Jewel Logo









Licensed for Xbox 360 Logo









Page 19 of 28









 





EXHIBIT B-2




Branding Specifications




[***]



 




			
	[***]	 	INDICATES MATERIAL THAT HAS BEEN OMMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION
PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.






Page 20 of 28









 








EXHIBIT C




Royalties and Fees




[***]




 




			
	[***]	 	INDICATES MATERIAL THAT HAS BEEN OMMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN
REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION
PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.




Page 21 of 28









 








EXHIBIT D




Certification Testing Centers




[To be supplied at a later date]




Page 22 of 28









 





EXHIBIT E




Territory




Check all that apply:



þ     North America



þ     Japan



þ     Europe and Rest of World




Page 23 of 28









 








EXHIBIT F




Approved Vendors




[to be supplied at a later date]





Page 24 of 28











 





EXHIBIT G




Certificate of Compliance (CoC)




Supplier Information




	 	 	 
	Company Name:

	 	Address:
	SRSM (Supplier Restricted Substance Mngr) :

	 	Title:
	SRSM Phone:

	 	Email:






Reportable Substances



Use the following section to disclose all Section B substances listed in Microsoft Specification
Restricted Substances for Hardware Products (H00594). If Section B substances are used in the
product or component, specify the chemical name, Chemical Abstracts Service (CAS) number, and where
the substance is used in the product or component.

If none of the above substances are present, specify “NOT USED” on line 1 below. Use additional
sheet if necessary.




	 	 	 	 	 
	H00594 Section B SUBSTANCE NAME	 	CAS NUMBER	 	WHERE USED in PRODUCT
	1.

	 	 
	 	 
	2.

	 	 
	 	 
	3.

	 	 
	 	 
	4.

	 	 
	 	 
	5.

	 	 
	 	 
	6.

	 	 
	 	 






Product Information




	 	 	 
	Product Names & Number:	 	Device (ex. Gamepad, Steering wheel):
	PNs/EIPNs/SKUs:

	 	Time Period (maximum 12 months):
	 
	 	 
	 

	 	From:                    To:






Does this component contain a RoHS exempt application? No: o          Yes: o

If yes:





	 	1.	 	Cite the RoHS exemption(s) being claimed. Select exemption from drop down menu,
Select exemption from drop down menu, Select exemption from drop down menu, Select
exemption from drop down menu, Select exemption from drop down menu
	 
	 	 	 	Refer to Annex 1 at the end of this form for the complete list of RoHS exemptions.
	 
	 	2.	 	Identify the homogeneous material(s) in the component(s) containing the RoHS
substance (e.g. glass, metal, alloy, ceramic, etc.):




I certify that the supplied product (see above) conforms fully to the requirements of the Microsoft
“Restricted Substances for Hardware Products (H00594)” specification and that no banned
Ozone Depleting Chemicals (per the Montreal Protocol) are used in the manufacture of Microsoft
products.




Supplier Electronic Signature




	 	 	 
	SRSM:	 	Date:
	 
	 	 






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Annex 1: Applications of lead, mercury, cadmium and hexavalent chromium exempted from RoHS as of
October 2006



The following is a list of exemptions under RoHS which MS suppliers may find relevant. Suppliers
are responsible for maintaining current information and are encouraged to consult the full text of
RoHS for other exemptions and for the latest updates to RoHS.





	1.	 	Mercury in compact fluorescent lamps not exceeding 5 mg per lamp.
	 
	2.	 	Mercury in straight fluorescent lamps for general purposes not exceeding:— halophosphate 10
mg; — triphosphate with normal lifetime 5 mg; — triphosphate with long lifetime 8 mg.
	 
	3.	 	Mercury in straight fluorescent lamps for special purposes.
	 
	4.	 	Mercury in other lamps not specifically mentioned in this Annex.
	 
	5.	 	Lead in glass of cathode ray tubes, electronic components and fluorescent tubes.
	 
	6.	 	a.        Lead as an alloying element in steel containing up to 0.35 % lead by weight






	 	b.	 	Lead as an alloying element in aluminum containing up to 0.4 % lead by weight

	 
	 	c.	 	Lead as an alloying element copper alloys containing up to 4 % lead by weight.






	7.	 	a.        Lead in high melting temperature type solders (i.e. lead based alloys containing 85 % by
weight or more lead)






	 	b.	 	Lead in solders for servers, storage and storage array systems, network infrastructure
equipment for switching, signaling, transmission as well as network management for
telecommunications
	 
	 	c.	 	Lead in electronic ceramic parts (e.g. piezoelectronic devices).






	8.	 	Cadmium in electrical contacts and cadmium plating except for applications banned under
Directive 91/338/EEC (1) amending Directive 76/769/EEC (2) relating to restrictions on the
marketing and use of certain dangerous substances and preparations.
	 
	9.	 	Hexavalent chromium as an anti-corrosion of the carbon steel cooling system in absorption
refrigerators.
	 
	10.	 	Not Applicable per H00594. Deca BDE is banned in Microsoft products.
	 
	11.	 	Lead used in compliant pin connector systems.
	 
	12.	 	Lead as a coating material for the thermal conduction module c-ring.
	 
	13.	 	Lead and cadmium in optical and filter glass.
	 
	14.	 	Lead in solders consisting of more than two elements for the connection between the pins and
the package of microprocessors with a lead content of more than 80% and less than 85% by
weight.
	 
	15.	 	Lead in solders to complete a viable electrical connection between semiconductor die and
carrier within integrated circuit Flip Chip packages.
	 
	16.	 	Lead in linear incandescent lamps with silicate coated tubes.
	 
	17.	 	Lead halide as radiant agent in High Density Discharge (HID) lamps used for professional
reprography applications.
	 
	18.	 	Lead as activator in the fluorescent powder (1 % lead by weight or less) of discharge lamps
when used as sun tanning lamps containing phosphors such as BSP (BaSi2O5:Pb) as well as when
used as speciality lamps for diazo-printing reprography, lithography, insect traps,
photochemical and curing processes containing phosphors such as SMS ((Sr,Ba)2MgSi2O7:Pb).
	 
	19.	 	Lead with PbBiSn-Hg and PbInSn-Hg in specific compositions as main amalgam and with PbSn-Hg
as auxiliary amalgam in very compact Energy Saving Lamps (ESL).
	 
	21.	 	Lead oxide in glass used for bonding front and rear substrates of flat fluorescent lamps used
for Liquid Crystal Displays (LCD).Lead and cadmium in printing inks for the application
enamels on borosilicate glass
	 
	22.	 	Lead in finishes of fine pitch components other than connectors with a pitch of 0.65mm or
less with Ni Fe lead frames and lead in finishes of fine pitch components other than
connectors with a pitch of 0.65mm or less with copper lead-frames
	 
	23.	 	Lead in solders for the soldering to machined through hole discoidal and planar array ceramic
multilayer capacitors
	 
	24.	 	Lead oxide in plasma display panels (PDP) and surface conduction electron emitter displays
(SED) used in structural elements; notably in the front and rear glass dielectric layer, the
bus electrode, the black stripe, the address electrode, the barrier ribs, the seal frit and
frit ring as well as in print pastes
	 
	25.	 	Lead oxide in the glass envelope of Black Light Blue (BLB) lamps
	 
	26.	 	Lead alloys as solder for transducers used in high-powered (designated to operate for several
hours at acoustic power levels of 125dB SPL and above) loudspeakers
	 
	27.	 	Hexavalent chromium in corrosive preventive coatings of unpainted metal sheetings and
fasteners used for corrosion protection and Electromagnetic Interference Shielding in
equipment falling under category three of Directive 2002/96/EC (IT and telecommunications
equipment). Exemption granted until 1 July 2007
	 
	28.	 	Lead bound in crystal glass as defined in Annex I (Categories 1, 2, 3, and 4) of Council
Directive 69/493/EEC OJ L 326, 29.12.1969, p. 36. Directive as last amended by 2003 Act of
Accession




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EXHIBIT H




Approved Subcontractors




[to be supplied at a later date]




	 	 	 
	Subcontractor	 	Contact Information
	 
	 	 





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EXHIBIT I




Company Customer Products




     This
[first] Exhibit I is dated ___ ___, 200___and made part of the Xbox 360 Accessory License
Agreement between Microsoft Corporation and Mad Catz, Inc. dated ___, 2009.



	 	 	 	 	 	 	 	 	 
	 	 	 	 	Contact Person	 	 	 	Brand,
	Company	 	 	 	(Name, phone and	 	 	 	Trademark
	Customer	 	Address	 	email)	 	Licensed Product	 	and/or Logo
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 





	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	MICROSOFT CORPORATION	 	 	 	MAD CATZ, INC.	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	 	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	 	 	 	 	 	 	Name:	 	 	 	 
	 

	 	Title:
	 	 	 	 	 	 	 	Title:	 	 	 	 







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