Document:

EX-10.56

EXHIBIT 10.56

GLOBAL PLAYSTATION®3 FORMAT

LICENSED PUBLISHER AGREEMENT

					
	 	 	 	 	 
	 
	Sony Computer Entertainment America Inc.	 	 	 	 
	GLPA
	 	REDACTED
	 	CONFIDENTIAL

 

 

TABLE OF CONTENTS

	 	 	 	 	 	 	 
	SECTION:	 	PAGE:
	1.

	 	DEFINITION OF TERMS
	 	 	2	 
	2.

	 	LICENSE
	 	 	4	 
	3.

	 	DEVELOPMENT AND DISTRIBUTION OF LICENSED PRODUCTS
	 	 	5	 
	4.

	 	ONLINE GAMEPLAY
	 	 	7	 
	5.

	 	LIMITATIONS ON LICENSES; RESERVATION OF RIGHTS
	 	 	7	 
	6.

	 	QUALITY STANDARDS FOR LICENSED PRODUCTS
	 	 	7	 
	7.

	 	MANUFACTURE OF DISC PRODUCTS
	 	 	10	 
	8.

	 	MARKETING OF LICENSED PRODUCTS
	 	 	12	 
	9.

	 	PAYMENTS
	 	 	13	 
	10.

	 	REPRESENTATIONS AND WARRANTIES
	 	 	16	 
	11.

	 	INDEMNITIES; LIMITED LIABILITY
	 	 	16	 
	12.

	 	INFRINGEMENT OF SCE INTELLECTUAL PROPERTY RIGHTS BY THIRD
PARTIES
	 	 	18	 
	13.

	 	CONFIDENTIALITY
	 	 	19	 
	14.

	 	TERM RENEWAL AND TERMINATION
	 	 	23	 
	15.

	 	EFFECT OF EXPIRATION OR TERMINATION
	 	 	25	 
	16.

	 	MISCELLANEOUS PROVISIONS
	 	 	26	 

					
	 	 	 	 	 
	 
	Sony Computer Entertainment America Inc.	 	 	 	 
	GLPA
	 	REDACTED
	 	CONFIDENTIAL

 

 

GLOBAL PLAYSTATION® 3 FORMAT

LICENSED PUBLISHER AGREEMENT

This Global PlayStation®3 Format Licensed Publisher Agreement (the “Agreement”) is entered into on
September 26. 2008 by and between SONY COMPUTER ENTERTAINMENT AMERICA INC., with offices at 919
East Hillsdale Boulevard, Foster City, California (“the SCE Company”) and Midway Home
Entertainment, Inc., with offices at 10636 Scripps Summit Court, Suite 100, San Diego, CA 92131
(“Publisher”).

The SCE Company’s parent company, Sony Computer Entertainment Inc. (“SCEI”), has designed and
developed certain core technology of or concerning the System.

The SCE Company has the right to grant non-exclusive licenses to qualified entities regarding
certain intellectual property rights with respect to the System.

Publisher desires to be granted a non-exclusive license to publish, develop, have manufactured,
market, advertise, distribute and sell Licensed Products in accordance with the provisions of this
Agreement and the provisions of the Regional Rider that is attached hereto and incorporated herein
by reference, and the SCE Company is willing, in accordance with the terms and subject to the
conditions of this Agreement and the Regional Rider, to grant Publisher such a license.

In consideration of the representations, warranties and covenants contained herein and in the
Regional Rider, and other good and valuable consideration, Publisher and the SCE Company hereby
agree as follows:

1. Definition of Terms.

     1.1 “Advertising Materials” means any
advertising, marketing, merchandising,
promotional, contest-related, public
relations (including press releases),
display, point of sale or website materials
regarding or relating to the Licensed
Products or depicting any of the Licensed
Trademarks. Advertising Materials include
any advertisements in which the System is
displayed, referred to, or used, including
giving away any unit(s) of the System as
prizes in contests or sweepstakes and the
public display of the System in product
placement opportunities.

     1.2 “Affiliate” means, as applicable,
either Sony Computer Entertainment America
Inc. (“SCEA”), Sony Computer Entertainment
Inc. (“SCEI”), Sony Computer Entertainment
Europe Ltd. (“SCEE”), Sony Computer
Entertainment
Korea (“SCEK”), any subsidiary of the
foregoing, or any other entity as may be
established from time to time and becomes a part
of the Sony Computer Entertainment Group.

     1.3 “Attribution Line” means the legal
attribution line used on Advertising
Materials, which shall be substantially
similar to the following: “Product copyright
and trademarks are the property of the
respective publisher or its licensors.”

     1.4 “Designated Manufacturing Facility”
means a manufacturing facility that is
designated by the SCE Company, in its sole
discretion, to manufacture Disc Products or
any of their component parts.

     1.5 “Development System Agreement”
means an agreement entered into between the
SCE Company and a Licensed Publisher or

	 	 	 	 	 
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other licensee regarding the sale, lease, loan or
license of Development Tools.

     1.6 “Development Tools” means the
PlayStation 3 development tools sold,
leased, loaned or licensed solely for use in
the development of Executable Software.

     1.7 “Disc Products” means the
Executable Software on PS3 Format Discs,
Advertising Materials, Packaging, Printed
Materials and Product Information relating
to any individual title which shall consist
of one application software product per
Unit. Disc Products may, but need not, be
designed to allow Online Gameplay.

     1.8 “Effective Date” is the date
specified in the preamble of this Agreement.

     1.9 “Executable Software” means
software in final object code form that is
designed for use and operation exclusively
on the System which consists of Publisher
Software and any SCE Materials and
constitutes a complete, standalone
videogame.

     1.10 “Guidelines” means any guidelines
or specifications of the SCE Company with
respect to the development, manufacture and
publishing of Licensed Products, including
any requirements regarding the development of
Executable Software, the display of the
Licensed Trademarks in any Licensed Products
and related Advertising Materials, or the
protection of any of the SCE Intellectual
Property Rights, which may be set forth in
the Technical Requirements Checklist,
Corporate Identity Guidelines or in any other
documentation provided to Publisher by the
SCE Company. Guidelines shall be comparable
to the guidelines and specifications applied
by the SCE Company to its own software
products for the System. All Guidelines may
be modified, supplemented or amended by any
Affiliate from time to time upon reasonable
notice to Publisher. Guidelines are
incorporated into and form a part of this
Agreement.

     1.11 “Licensed Developer” means an
entity that has signed a Licensed Developer
Agreement with any Affiliate.

     1.12 “Licensed Developer Agreement” or
“LDA” means a valid and current license
agreement authorizing the development of
software for the System, fully executed
between a Licensed Developer and an
Affiliate.

     1.13 “Licensed Products” means Disc
Products and Online Products, including any
Publisher demonstration discs.

     1.14 “Licensed Publisher” means an
entity that has signed a Licensed Publisher
Agreement with an Affiliate.

     1.15 “Licensed Publisher Agreement” or
“LPA” means a valid and current license
agreement for the publishing, development,
manufacture, marketing, advertising,
distribution and sale of Licensed Products,
fully executed between a Licensed Publisher
and an Affiliate.

     1.16 “Licensed Trademarks” means the
trademarks, service marks, trade dress, logos,
icons and other indicia designated in the
Guidelines or otherwise for use on, in or
otherwise in connection with Licensed
Products. The Licensed Trademarks (or any
part thereof) are subject to change during the
term of this Agreement and may be modified,
supplemented or amended by any Affiliate (as
applicable) from time to time upon reasonable
notice to Publisher.

     1.17 “Master Disc” means a recordable
Blu-Ray disc in the form requested by the SCE
Company containing final pre-production
Executable Software.

     1.18 “Online Gameplay” means the
capability to operate and interact with the
Executable Software associated with a
Licensed Product used on a System that is
connected to the Internet or any other
network and which may allow an end user to
participate in a game or gameplay with
another end user (or other end users) across
the Internet or any other network.

	 	 	 	 	 
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     1.19 “Online Products” means (i)
enhancements, improvements, additions,
patches, and updates, including characters,
artifacts, scripts, levels, modifications,
player statistics and gameplay data, used in
conjunction with a related Disc Product and
distributed electronically to any end users
after sale or distribution of a Unit of the
related Disc Product; and (ii) Executable
Software distributed electronically to
end-users. Online Products may, but need
not, be designed to allow Online Gameplay.

     1.20 “Packaging” means, with respect to
each Disc Product, the carton, containers,
cases, edge labels, wrapping materials,
security seals and other proprietary labels
and trade dress elements and wrapping
materials of or concerning the Disc Products
(and all parts of any of the foregoing) but
specifically excluding Printed Materials and
PlayStation 3 Format Discs.

     1.21 “PlayStation 3 Format Disc” means
the disc media formatted for use with the
System.

     1.22 “Printed Materials” means all
artwork and mechanicals for the disc label
for each PlayStation 3 Format Disc and for
the Packaging relating to any of the Disc
Products, and all instructional manuals,
liners, inserts, and any other materials and
user information within or attached to the
Packaging and distributed as part of the Disc
Products.

     1.23 “Product Information” means any
information owned or licensed by Publisher
relating to any of the Licensed Products,
including demos, videos, hints and tips,
artwork, depictions of Disc Product cover art
and videotaped interviews.

     1.24 “Product Proposal” means a written
proposal prepared by a Licensed Publisher and
submitted to the SCE Company under the
Guidelines regarding the concept and design
for a Licensed Product.

     1.25 “Publisher Software” means any
software including incorporated audio and
visual
material developed by Publisher under this
Agreement or an LDA, and does not include any SCE
Materials.

     1.26 “Publisher Intellectual Property
Rights” means those worldwide intellectual
property rights, current or future, that are
owned and controlled by Publisher, including
rights in or related to patents, inventions,
designs, copyrights, databases, trademarks,
service marks, trade names, trade dress, mask
work rights, utility model rights, trade
secret rights, technical information,
know-how, and the equivalents of the
foregoing under the laws of any jurisdiction
and any other intellectual property rights
recognized in the Territory (including all
registrations, applications to register and
rights to apply for registration of same),
that relate to the Publisher Software,
Packaging, Product Information, Printed
Materials, Advertising
Materials or other materials.

     1.27 “Purchase Order” means a written
purchase order issued by Publisher pursuant
to Section 7.8.1, regarding the purchase of
Disc Products that conform to the Guidelines
and other terms and conditions imposed by the
SCE Company or any Designated Manufacturing
Facility.

     1.28 “Regional Rider” means the
additional set of binding terms and which are
appended to and form part of this Agreement,
and which are applicable to the Territory.

     1.29 “SCE Confidential Information”
means the term as defined in Section 13.1.1.

     1.30 “SCE Intellectual Property Rights”
means those worldwide intellectual property
rights, current or future, including rights
in or related to patents, inventions,
designs, copyrights, databases, trademarks
(including the Licensed Trademarks), service
marks, trade names, trade dress, mask work
rights, utility model rights, trade secret
rights, technical information, know-how, and
the equivalents of the foregoing under the
laws of any jurisdiction, and any other
intellectual property rights recognized in
the Territory

	 	 	 	 	 
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(including all registrations, applications to
register and rights to apply for registration of
the same), for their full term including all
renewals and extensions, that relate to the SCE
Materials, the System, the design and development
of Licensed Products compatible with the System,
and any SCE Confidential Information.

     1.31 “SCE Materials” means any data,
object code, source code, firmware,
documentation (or any part(s) of any of the
foregoing) or information relating to the
System or the development of interactive
entertainment products compatible with the
System, selected in the sole judgment of the
SCE Company, which are directly or indirectly
provided or supplied by any
Affiliate to Publisher. SCE Materials
shall not include any hardware portions of
the Development Tools, but shall include
firmware in such hardware.

     1.32 “System” means the PLAYSTATION®3
computer entertainment system.

     1.33 “Term” means the period from the
Effective Date until March 31, 2012.

     1.34 “Territory” means the term as
defined in the Regional Rider.

     1.35 “Unit” means an individual copy of
a specific Disc Product regardless of the
number of PlayStation 3 Format Discs that are
contained within and are part of such Disc
Product.

2. License.

     2.1 License Grant. The SCE Company
grants to Publisher, for the Term and
throughout the Territory, and in accordance
with the other terms, limitations and
conditions referenced herein, a
non-exclusive, non-transferable license under
the SCE Intellectual Property Rights, without
the right to sublicense (except as
specifically provided herein), to use SCE
Materials as follows: (i) to develop and
publish Licensed Products and to enter into
agreements with Licensed Developers and other
approved third parties, where the SCE Company
requires such approval, subject to Section
3.2, to develop
Licensed Products; (ii) to have Disc Products
manufactured by Designated Manufacturing
Facilities; (iii) to market, advertise, promote,
sell and distribute Disc Products directly to end
users or to third parties for distribution to end
users; (iv) to market, advertise and promote,
and, pursuant to a separate online distribution
agreement(s) with the SCE Company or any
Affiliate, to distribute Online Products to end
users over the PlayStation®Network; (v) to use
the Licensed Trademarks only in connection with
the manufacturing, marketing, packaging,
advertising, promotion, sale and distribution of
the Licensed Products; and (vi) to sublicense
end-user customers the right to use the Licensed
Products for personal, noncommercial purposes in
conjunction with the System only, and not with
other devices or for public performance.

     2.2 Separate PlayStation Agreements. Unless
specifically set forth in this Agreement, all
terms used herein are specific to the System and
the attendant SCE Company licensing program.
Licenses relating to the original PlayStation, PS
One, PlayStation 2 or PlayStation Portable game
consoles are subject to separate agreements with
the SCE Company (or any Affiliate, as applicable),
and any license of rights to Publisher under such
separate agreements shall not confer on Publisher
any rights with respect to the System and vice
versa.

3. Development and Distribution of Licensed
Products.

     3.1 Right to Develop. The SCE Company
grants Publisher the right to purchase, lease or
borrow, as applicable, certain hardware devices
and license certain software tools and utilities
that comprise the Development Tools, as is
appropriate, from the SCE Company or its
designee, pursuant to a separate Development
System Agreement with the SCE Company or a
separate rider to this Agreement, which hardware
and software components may be used by Publisher
only in connection with the development of
Licensed Products pursuant to Section 2.1. In
developing Executable Software (or portions
thereof), Publisher and any third-party Licensed
Developers with whom Publisher contracts shall
fully comply in all respects with

	 	 	 	 	 
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all Guidelines, including technical
specifications. In the event that Publisher uses
any third-party tools to develop Executable
Software or any portion thereof, Publisher shall
be responsible at Publisher’s sole risk and
expense for ensuring that it has obtained all
necessary licenses for any such use.

     3.2 Subcontractors. Publisher may retain
subcontractors who provide services which do not
require access to SCE Materials or SCE
Confidential Information without prior approval.
Otherwise, Publisher may retain subcontractor(s)
to assist with the development, publication and
marketing of Licensed Products (or portions
thereof) which have signed (i) an LPA or LDA with
the SCE Company (the “PlayStation 3 Agreement”) in
full force and effect throughout the term of such
development, publishing and marketing services or
(ii) if required by the SCE Company, an SCE
Company-approved subcontractor agreement
(“Subcontractor Agreement”), and the SCE Company
has approved such subcontractor in writing (which
approval shall be in the SCE Company’s sole
discretion). Publisher shall not disclose to any
subcontractor any of the SCE Confidential
Information, including any SCE Materials, unless
and until either a PlayStation 3 Agreement or any
required Subcontractor Agreement has been executed
and approved by the SCE Company. Publisher shall
be solely responsible for verifying that all third
parties that contribute to the development of any
Licensed Product, or component thereof, satisfy
the requirements of clause (i) or (ii) of this
Section 3.2. Notwithstanding any consent which
may be granted by the SCE Company for Publisher to
employ any such permitted subcontractor(s), or any
such separate agreement(s) that may be entered
into by Publisher with any such permitted
subcontractor, Publisher shall remain fully liable
for its compliance with all of the provisions of
this Agreement and for the compliance of any and
all permitted subcontractors with the provisions
of any agreements entered into by such
subcontractors in accordance with this Section.
Publisher shall use best efforts to cause all
subcontractors that it retains in furtherance of
this Agreement to comply in all respects with the
terms and conditions of this Agreement, and
hereby unconditionally guarantees all obligations
of its subcontractors. The SCE Company may
subcontract any of its rights or obligations
hereunder.

     3.3 Form of Distribution. Executable Software
distributed physically to end users and
demonstration discs shall be in the form of
PlayStation 3 Format Discs only. Publisher shall
not, directly or indirectly, incorporate more than
one Disc Product in a single Unit, or package or
bundle Units of any Disc Product with any other
goods or services, without the SCE Company’s prior
written consent. Online Products, Online Gameplay
and any services associated with Online Gameplay,
including subscriptions, shall be distributed or
made available electronically, including by
wireless distribution, to end users over the
PlayStation®Network only, unless the SCE Company
gives express written consent to another manner of
distribution on SCE Company standard terms or
otherwise as agreed. Notwithstanding this
limitation, Publisher may electronically transmit
Executable Software from site to site, or from
machine to machine over a computer network, for
the sole purposes of facilitating development and
for testing to be carried out under Section 6;
provided that no right of retransmission shall
attach to any such transmission, and provided
further that Publisher shall use reasonable
security measures customary within the high
technology industry to reduce the risk of
unauthorized interception or retransmission of
such transmissions.

	 	 	 	 	 
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     3.4 Distribution Channels for Disc Products.
Publisher may use such distribution channels to
distribute Disc Products as Publisher deems
appropriate, including the use of third-party
distributors, resellers, dealers and sales
representatives. In the event that the SCE
Company permits Publisher to have any of its Disc
Products published by another Licensed Publisher,
Publisher must, in addition to complying with
Section 3.2, provide the SCE Company with advance
written notice of such arrangement, including the
name of the Licensed
Publisher and any additional information
requested by the SCE Company regarding the nature
of the distribution services that would be
provided by such third-party Licensed Publisher
prior to manufacture of the Disc Product.

4. Online Gameplay.

     4.1 Access to and Maintenance of Online
Gameplay. Publisher shall maintain servers
hosting Online Gameplay for the periods specified
in the Guidelines. Publisher, or, at SCEE’s
option, SCEE or its Affiliate shall provide
notice to consumers in a clear and conspicuous
manner via one of the methods listed in Section
4.3 any permanent shutdown to a server hosting or
supporting Online Gameplay no later than [*********] prior to any shutdown.

     4.2 Publisher Online Designee. Publisher
shall appoint a dedicated contact person for its
Licensed Products designed to allow Online
Gameplay, who shall act as a liaison between the
SCE Company and Publisher for all online matters
relating to Licensed Products designed to allow
Online Gameplay. Publisher’s designee shall also
be responsible for ensuring that all terms and
conditions relating to the online elements of the
Licensed Products are complied with. Publisher
shall give the SCE Company [*********] written
notice prior to any change in designee.

     4.3 Online Legal Compliance. Licensed
Products designed for Online Gameplay must
include a legal disclosure enumerating end user,
privacy and moderation policies and age rating
(collectively, “Online Terms”) prior to allowing
any end users to engage in Online Gameplay for
the first time for a particular user or as
otherwise required by law. The SCE Company
reserves the right to review Publisher’s Online
Terms, but shall have no liability for content of
Publisher’s Online Terms. Online Terms shall
either be coded into the applicable Licensed
Product or available on the server hosting Online
Gameplay in such a way that an end user must
agree to it prior to accessing and engaging in
Online Gameplay. Online Terms must
comply with the Guidelines. Publisher must
inform all end users engaging in or accessing
Online Gameplay if any personally identifying
information will be collected, how it will be
collected, and how it will be used.

     4.4 Publisher Liability for Online
Gameplay. Publisher shall bear exclusively all
responsibility
and liability for any features or capability of
Licensed Products related to Online Gameplay,
including Online Gameplay between territories
using different television standards, whether
PAL, NTSC or otherwise.

5. Limitations on Licenses; Reservation of
Rights.

     5.1 Application of Council Directive
91/250/EEC. If Publisher has executed the
Regional Rider in a Territory governed by Council
Directive 91/250/EEC, the limitations set forth
in Section 5 shall be subject to Council
Directive 91/250/EEC.

     5.2 Reverse Engineering Prohibited.
Publisher shall not directly or indirectly
disassemble, decrypt, electronically scan, peel
semiconductor components, decompile, or otherwise
reverse engineer in any manner or attempt to
reverse engineer or otherwise derive any source
code from, all or any portion of the SCE
Materials, or permit, assist or encourage any
third party to do so.

     5.3 Limitation on Creation of Derivative
Works. Publisher shall not use, modify,
reproduce, sublicense, distribute, create
derivative works from, or otherwise provide to
third parties, the SCE Materials, in whole or in
part, other than as expressly set forth herein
without the SCE Company’s prior written consent.

     5.4 Limitation on Examination and Study of
Tools. Publisher may study the performance,
design and operation of the Development Tools
solely for the limited purposes of developing and
testing Publisher Software, or to develop tools
to assist Publisher with the development and
testing of Publisher Software. Any tools

 

* Information
has been omitted from this document and filed separately with the SEC
under a request for confidential treatment pursuant to Rule 24b-2
under the Securities Exchange Act of 1934, as amended.

	 	 	 	 	 
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developed or derived by Publisher as a result of
studying the performance, design or operation of
the Development Tools shall be considered
derivative works of the SCE Materials and shall
be owned by the SCE Company, but may be treated
as trade secrets of Publisher. This section
shall govern any conflict with a similar
provision in any separate agreement.

     5.5 Limitations Regarding Content of Licensed
Products. No rights are granted under this
Agreement with respect to non-game products or
products which contain significant elements of, or
are a hybrid with, audio or video profile
products. No rights are granted under this
Agreement with respect to serving or providing
in-game dynamic advertisements. Licensed Products
may contain in-game static advertisements, subject
to the Guidelines.

     5.6 Reservation of SCE Company’s Rights.

     5.6.1 Limitations on Use of SCE Materials and
SCE Intellectual Property Rights. This Agreement
does not grant any right or license under, and
Publisher shall not use, any SCE Confidential
Information, the SCE Materials, or any of the SCE
Intellectual Property Rights except as expressly
authorized hereunder and in strict compliance with
the terms and conditions of this Agreement. No
other right or license is to be implied by or
inferred from any provision of this Agreement or
the conduct of the parties. In particular,
Publisher shall not use the Executable Software,
SCE Materials or SCE Confidential Information (or
any portion of any of the foregoing) in connection
with the development of any software for any
emulator or other computer hardware or software
system. In no event shall Publisher patent any
tools, methods, or applications, created,
developed or derived from SCE Materials.
Publisher shall not make available to any third
party any tools developed or derived from the
study of the Development Tools without the SCE
Company’s express written permission. Use of such
tools shall be strictly limited to the creation or
testing of Licensed Products and any other use,
direct or indirect, of such tools is strictly
prohibited.
Moreover, Publisher shall bear all risks arising
from incompatibility of its Licensed Product and
the System resulting from use of
Publisher-created tools. The burden of proof
under this Section shall be on Publisher, and the
SCE Company reserves the right to require
Publisher to furnish evidence satisfactory to the
SCE
Company that Publisher has complied with this
Section.

     5.6.2 Ownership and Protection of SCE
Materials and SCE Intellectual Property Rights.
All rights with respect to the SCE Materials and
the System, including all of the SCE Intellectual
Property Rights, are the exclusive property of the
SCE Company or its Affiliates. Publisher shall
not do or cause to be done any act or thing in any
way impairing or tending to impair any of the SCE
Company’s rights, title or interests in or to the
SCE Materials or the SCE Intellectual Property
Rights. Publisher shall take all steps as the SCE
Company may reasonably require for the protection
and maintenance of the SCE Intellectual Property
Rights, including executing licenses or obtaining
registrations. Publisher shall not register any
trademark in its own name or in any other person’s
name, or use, or obtain rights to use Internet
domain names or addresses, which are identical or
similar to, or are likely to be confused with any
of the Licensed Trademarks or any other trademarks
of the SCE Company. All goodwill associated with
the Licensed Trademarks, including any goodwill
generated or arising by or through

	 	 	 	 	 
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Publisher’s or
its sub-licensees’ activities under this
Agreement, accrues to the benefit of and belongs
exclusively to the SCE Company. Nothing contained
in this Agreement shall be deemed to grant
Publisher the right to use the trademark “SONY” in
any manner or for any purpose.

     5.6.3 Authentication. The SCE Company
reserves the right to require Publisher to
utilize an authentication or authorization system
to be provided, licensed or designated by the SCE
Company to authenticate and verify all Licensed
Products and units of the System. The SCE
Company reserves the right to insert serial numbers on all PlayStation 3 Format Discs for
security or authentication purposes.

     5.7 Acknowledgment of Publisher’s Ownership
Rights. Separate and apart from the
SCE Materials and other rights licensed to
Publisher by the SCE Company hereunder, as
between Publisher and the SCE Company, Publisher
retains all rights, title and interest in and to
the Publisher Software, the Product Proposals,
and related Product Information, including
Publisher Intellectual Property Rights therein,
as well as Publisher’s rights in any source code
and other underlying material such as artwork and
music (but specifically excluding the SCE
Materials and any software provided directly or
indirectly by the SCE Company) and any names used
as titles for Licensed Products and other
trademarks used by Publisher. Nothing in this
Agreement shall restrict the right of Publisher
to develop, distribute or transmit products
incorporating the Publisher Software and
underlying material, which do not contain or were
not developed through use of the SCE Materials or
the SCE Intellectual Property Rights, for any
hardware platform or service other than the
System, or to use Printed Materials or
Advertising Materials approved by the SCE Company
(excepting Printed Materials or Advertising
Materials that contain any Licensed Trademarks)
as Publisher determines for such other platforms.

     5.8 Guidelines Requirement. The licenses
granted to Publisher are expressly conditioned on
Publisher’s compliance with all provisions of the
SCE Company’s Guidelines, as and when published or
within a commercially reasonable time following
its receipt of a publication expressly referencing
such provisions, and any and all such provisions
are incorporated herein by this reference. To the
extent that the Guidelines change with respect to
any Licensed Product materials that Publisher
submits to the SCE Company under Section 6.1,
Publisher shall only be required to implement any
such revised Guidelines in subsequent orders of
corresponding Disc Product or subsequent
publications of corresponding Online Product.
Publisher shall not be required to recall or
destroy previously manufactured Disc Products,
unless such Disc Products do not comply with the
original standards, requirements and conditions
set forth in the Guidelines or unless explicitly
required to do so in writing by the SCE
Company.

     6. Quality Standards for Licensed Products.

     6.1 Product Assessment, Format Quality
Assurance and Printed and Advertising Materials.
Publisher shall comply with the process and
requirements for assessment and format quality
assurance of Licensed Products and Advertising
Materials, on a product-by-product basis as
specified in the Guidelines. The SCE Company
will not approve Licensed Products that are
outside the PlayStation®3 format specifications
in the Guidelines.

     6.2 Rating Requirements. No Licensed Product
may be published, sold, distributed, marketed,
advertised or promoted unless each Licensed
Product bears a consumer advisory age rating,
consisting of a rating code and product
descriptors, either as required by local law or
as issued by, and following the rating display
requirements of, a consumer 

	 	 	 	 	 
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advisory ratings
system designated by the SCE Company. Any and
all costs and expenses incurred in connection
with obtaining such rating shall be borne solely
by Publisher. No Licensed Product, Printed
Materials or Advertising Materials may bear more
than one consumer advisory rating code. Any
Online Product that can be used with a Disc
Product must bear a rating that is the same as or
lower than the rating issued to the Disc Product,
unless the SCE Company gives express written
consent.

     6.3 Compatibility of Licensed Products with
Peripherals. Publisher shall be solely
responsible for functionality and operational
compatibility of its Licensed Products with any
third-party peripherals (e.g., controllers,
memory storage devices, etc.). The SCE Company
shall have no responsibility to test or otherwise
evaluate the compatibility of Publisher’s
Licensed Products with any third-party
peripherals. The SCE Company shall not be held
responsible for any actual, incidental or
consequential damages that may result from any
use or inability to use any third-party
peripherals
with any Licensed Products or the System. If the
SCE Company elects, at its sole discretion, to
test or otherwise evaluate the compatibility of
Publisher’s Licensed Products with any
third-party peripheral device then, (i) any such
testing or evaluation shall not obligate the SCE
Company to test or evaluate any other third-party
peripherals; (ii) any such testing or evaluation
shall not shift to the SCE Company any
responsibility to ensure or assess the
functionality or compatibility of any third-party
peripheral or require the SCE Company to report
any third-party peripheral incompatibilities; and
(iii) Publisher shall provide the SCE Company,
upon request and at no additional cost or expense
to the SCE Company, with a reasonable number of
samples of any such third-party peripheral
products for testing and review in a timely
manner. In the event that any Licensed Product
fails to perform to the SCE Company’s
satisfaction with any third-party peripheral that
it is intended to support, the SCE Company shall
have the right to require that Publisher modify
or remove such portions of the Executable
Software as are intended to support the affected
third-party peripheral.

     6.4 Publisher’s Additional Quality Assurance
Obligations. If at any time or times subsequent
to the approval of any part of a Licensed
Product, the SCE Company identifies any material
defects (such materiality to be determined by the
SCE Company in its sole discretion) with respect
to the Licensed Product, or in the event that the
SCE Company identifies any improper use of its
Licensed Trademarks or the SCE Materials, or any
material defects or improper use are brought to
the attention of the SCE Company, Publisher
shall, at no cost to the SCE Company, promptly
correct any such material defects, or improper
use, to the SCE Company’s commercially reasonable
satisfaction, which may include, in the SCE
Company’s judgment, the recall and re-release of
Units of the affected Disc Product or publication
of an update, upgrade or technical fix to an
Online Product. In the event any Licensed
Products create any risk of loss or
damage to any property or injury to any person,
Publisher shall immediately take effective steps,
at Publisher’s sole liability and expense, to
recall
and remove such Licensed Products from any
affected channels of distribution; provided,
however, that if Publisher is not acting as the
distributor or seller for the Licensed Products,
its obligation shall be to use its best efforts to
arrange removal of all affected Licensed Products
from the relevant distribution channels.
Publisher shall provide all end-user support for
Licensed Products. Publisher and the SCE Group
Company may enter into a separate agreement to
have Publisher provide all end-user support for
Online Gameplay of Publisher’s Licensed Products
that is provided through the PlayStation®Network.
The SCE Company expressly disclaims any
obligations or liability to provide end-user
support with respect to Licensed Products.

7. Manufacture of Disc Products.

     7.1 Manufacture of Units. Upon approval of
Executable Software and associated Printed
Materials pursuant to Section 6, and subject to
Sections 7.4 — 7.7, the Designated Manufacturing
Facility will, in accordance with the terms and
conditions set forth in this Section 7, and at
Publisher’s request and sole expense (a)
manufacture PlayStation 3 Format Discs for
Publisher; 

	 	 	 	 	 
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(b) manufacture Publisher’s Packaging
and Printed Materials; and (c) assemble the
PlayStation 3 Format Discs with the related
Printed Materials and Packaging. Publisher shall
comply with all Guidelines relating to the
production of Units of Disc Products. The SCE
Company reserves the right to insert or require
Publisher to make arrangements for the insertion
of certain Printed Materials relating to the
System into each Unit.

     7.2 Designated Manufacturing Facilities. To
insure compatibility of PlayStation 3 Format Discs
with the System, consistent quality of the Disc
Products and incorporation of anti-piracy security
measures, the SCE Company shall designate and
license a Designated Manufacturing Facility or
Facilities to reproduce PlayStation 3 Format
Discs. Publisher shall purchase [*********] for
PlayStation 3 Format
Discs, including demonstration discs, from such
Designated Manufacturing Facility. Any
Designated Manufacturing Facility shall be
entitled to enforce the terms of this Agreement.

     7.3 Creation of Master PlayStation 3 Format
Disc. Using one of the fully approved Master
Discs provided by Publisher under the Guidelines,
the SCE Company or the Designated Manufacturing
Facility shall create an encrypted, reproducible
master of the Executable Software (formatted as a
PlayStation
3 Format Disc) from which all other copies of the
Executable Software for the corresponding Disc
Product are to be replicated. Publisher shall be
responsible for the costs, as determined by the
SCE Company or the Designated Manufacturing
Facility, of producing the reproducible masters
of any and all Executable Software.

     7.4 Manufacture of Printed Materials by
Designated Manufacturing Facility. If Publisher
elects to order Printed Materials from a
Designated Manufacturing Facility, Publisher
shall deliver all SCE Company-approved Printed
Materials to that Designated Manufacturing
Facility, at Publisher’s sole risk and expense,
and the Designated Manufacturing Facility will
manufacture such Printed Materials in accordance
with this Section 7. In order to insure against
loss or damage to the copies of the Printed
Materials furnished to the SCE Company, Publisher
shall retain duplicates of all Printed Materials,
and neither the SCE Company nor any Designated
Manufacturing Facility shall be liable for any
loss of or damage to any Printed Materials.

     7.5 Manufacture of Printed Materials by
Alternate Source. Subject to the Guidelines,
Publisher may elect to be responsible for
manufacturing its own Printed Materials (other
than artwork which is to be reproduced or
otherwise displayed on any PlayStation 3 Format
Discs, which Publisher will supply to the
Designated Manufacturing Facility for
incorporation within the Disc Products), at
Publisher’s sole risk and expense. The SCE
Company shall have the right to disapprove any
Printed Materials that do not comply with the
applicable Guidelines. If Publisher elects to
supply its own Printed Materials, neither the SCE
Company nor any Designated Manufacturing Facility
shall be responsible for any delays arising from
use of Publisher’s own Printed Materials.

     7.6 Manufacture of Packaging by Designated
Manufacturing Facility. To ensure consistent
quality of the Disc Products, the SCE Company may
designate and license a Designated Manufacturing
Facility to reproduce all or part of the
proprietary Packaging for the Disc Products. If
so, then Publisher shall purchase [*********]
for such Packaging from a Designated
Manufacturing Facility during the Term.

     7.7 Assembly Services. Publisher may either
procure assembly services from a Designated
Manufacturing Facility or, with the SCE Company’s
prior written consent, from an alternate source.
If Publisher elects to be responsible for
assembling the Disc Products, then the Designated
Manufacturing Facility shall ship the component
parts of the Disc Product to a destination
designated by Publisher, at Publisher’s sole risk
and expense. The SCE Company shall have the right to

 

* Information
has been omitted from this document and filed separately with the SEC
under a request for confidential treatment pursuant to Rule 24b-2
under the Securities Exchange Act of 1934, as amended.

	 	 	 	 	 
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inspect any assembly facilities that Publisher
proposes to use in order to determine if the
component parts of the Disc Products are being
assembled in accordance with the SCE Company’s
quality standards. The SCE Company may require
Publisher to recall any Units of any Disc Products
that fail to comply with the Guidelines. If
Publisher elects to use alternate assembly
facilities, neither the SCE Company nor any
Designated Manufacturing Facility shall be
responsible for any delays or other production
issues, including missing component parts, arising
from use of alternate assembly facilities.
Publisher shall comply with all applicable labor
laws and, in accordance with the provisions of
Section 16.8, shall not employ child labor, slave
labor or forced labor in connection with the
assembly of the Licensed Products.

     7.8 Orders and Delivery.

          7.8.1 Orders. Publisher shall issue Purchase
Order(s) to a Designated Manufacturing Facility in
the form set forth and containing the information
required in the Guidelines, with a copy to the SCE
Company. No Purchase Orders will be processed for
any Disc Product unless that Disc Product is fully
compliant with the Guidelines. All Purchase
Orders shall be subject to approval by the SCE
Company not to be unreasonably withheld and to
acceptance by the Designated Manufacturing
Facility pursuant to the Guidelines. Purchase
Orders issued by Publisher to a Designated
Manufacturing Facility for each Licensed Product
approved by the SCE Company shall be
non-cancelable and are subject to the order
requirements of the Designated Manufacturing
Facility.

          7.8.2 General Terms. Neither the SCE
Company nor any Designated Manufacturing Facility
shall be responsible for shortage or breakage
with respect to any order if component parts or
assembly services are obtained from alternate
sources.

     7.9 Delivery of Disc Products. The
Designated Manufacturing Facility will deliver
Disc Products to Publisher at Publisher’s sole
expense, except where otherwise provided under
this Agreement. Publisher shall have no right to
have completed Units of Disc Products stored
after manufacture.

     7.10 Ownership of Original Master Discs.
Due to the proprietary and confidential nature of
the mastering and encryption process, neither the
SCE Company nor any Designated Manufacturing
Facility shall under any circumstances release any
original Master Discs, reproducible masters
created under section 7.3 or other in-process
materials to Publisher. All such materials shall
be and remain the sole property of the SCE Company
or the Designated Manufacturing Facility (as
applicable). Notwithstanding the foregoing, the
Publisher Intellectual Property Rights contained
in the Publisher Software that is contained in any
such in-process materials is, as between the SCE
Company and Publisher, the sole and exclusive
property of Publisher or its licensors.

8. Marketing of Licensed Products.

     8.1 Marketing Generally. At no expense to
the SCE Company, Publisher shall, and shall
direct its distributors to, diligently market,
sell and distribute the Licensed Products, and
shall use commercially reasonable efforts to
stimulate demand for such Licensed Products
throughout the Territory and to supply any
resulting demand. Publisher shall use reasonable
efforts to protect the Licensed Products from and
against illegal reproduction or copying by end
users or by any other persons.

     8.2 Samples. Publisher shall provide sample
Units of each Disc Product to the SCE Company in
the quantities and per the terms specified in the
Guidelines. In the event that Publisher
assembles any Disc Product using an alternate
source, Publisher shall be responsible for
shipping such sample Units to the SCE Company, at
Publisher’s cost and expense, promptly following
the commercial release of such Disc Product.
Units shall not be shipped to the SCE Company
prior to the commercial release of such Disc
Product. The SCE

	 	 	 	 	 
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Company assumes no liability
for release of samples prior to commercial
release. The SCE Company shall not directly or
indirectly resell any such sample Units of the
Disc Products without Publisher’s prior written
consent. The SCE Company may distribute sample
Units to its employees, provided that it uses its
reasonable efforts to ensure that such Units are
not sold into the retail market. In addition,
subject to availability, Publisher shall sell to
the SCE Company additional Units at cost.

     8.3 Marketing Programs. From time to time,
Company may invite Publisher to
participate in promotional or advertising
opportunities that may feature one or more
Licensed Products from one or more Licensed
Publishers. Participation shall be voluntary and
subject to terms to be determined at the time of
the opportunity. In the event Publisher elects
to participate, all materials submitted by
Publisher to the SCE Company shall be submitted
subject to the Guidelines and delivery of such
materials to the SCE Company shall constitute
acceptance
by Publisher of the terms of the offer. Each
Affiliate shall be entitled to display and
otherwise use the Attribution Line on its
multi-product marketing materials, unless
otherwise agreed in writing.

     8.4 PlayStation Website. Publisher shall
provide the SCE Company with Product Information
for a web page for each of its Licensed Products
for display on the PlayStation promotional
website, or other website(s) operated by the SCE
Company from time to time in connection with the
promotion of the PlayStation brand.
Specifications for Product Information for such
web pages shall be as provided in the Guidelines.
Publisher shall provide the SCE Company with
such Product Information for each Licensed
Product upon submission of Printed Materials to
the SCE Company for approval pursuant to the
Guidelines. Publisher shall also provide updates
for any such web page in a timely manner as may
be required in the Guidelines.

     8.5 Demonstration Disc Programs. The SCE
Company may, from time to time, provide
opportunities for Publisher to contribute
Licensed Product content for distribution as part
of a demonstration disc published by any
Affiliate, or permit Publisher to publish its own
demonstration disc pursuant to a third party
demonstration disc program. The specifications
with respect to the approval, creation,
manufacture, marketing, distribution and sale of
any such demo disc programs shall be set forth in
the Guidelines. The SCE Company reserves the
right to choose from products submitted from
other Licensed Publishers and first party
products to determine the specific products that
will be included in any SCE Company demonstration
discs, and Publisher’s Licensed Products will not
be guaranteed prominence or preferential
treatment on any SCE demonstration disc. The SCE
Company has no obligation to publish, advertise
or promote any demonstration disc.

     8.6 Contests and Sweepstakes of Publisher.
Publisher may conduct contests, sweepstakes,
competitions and promotions, as permitted by law
(collectively, “Contest” or “Contests”), to
promote Licensed Products. The
SCE Company shall permit Publisher to include
Contest materials in Printed Materials and
Advertising Materials, subject to compliance with
the provisions of Sections 10.2 and 11.2, and
subject to the Guidelines.

9. Payments.

     9.1 Payments for Licensed Products.
Publisher shall pay the SCE Company either
directly or through its designee, for Licensed
Products, including Licensed Products in any
“Greatest Hits,” “Platinum” or any other program,
and demonstration discs, at the rates and in the
manner specified in the Regional Riders and the
terms of this Section 9. Publisher shall be
required in all cases to make payments to the SCE
Company, in accordance with this Section 9 and the
Regional Rider, with respect to any and all of
Publisher’s products that are developed utilizing
any SCE Materials or SCE Intellectual Property
Rights or any derivative works based on or
otherwise derived from the same. The burden of
proof under this 

	 	 	 	 	 
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Section shall be on Publisher.
The SCE Company reserves the right to require
Publisher to furnish evidence satisfactory to the
SCE Company that Publisher has complied with any
or all of its obligations pursuant to this
Section. Payment terms are subject to change in
the SCE Company’s discretion upon reasonable
notice to Publisher.

     9.2 Payment for Units of Disc Products.
Payments shall be made to the SCE Company through
its Designated Manufacturing Facility concurrent
with the placement of any Purchase Order for Units
of any Disc Product in accordance with the terms
and conditions set forth in this Agreement unless
otherwise agreed in writing with the SCE Company.
Payment shall be made prior to manufacture unless
the SCE Company has agreed in writing to extend
credit terms to Publisher under Section 9.3.

     9.3 Credit Terms. The SCE Company is not
required to extend any credit terms to Publisher,
but may do so in the SCE Company’s sole
discretion. Credit terms and limits shall be
subject to revocation or extension at the SCE
Company’s sole discretion. If credit terms are
extended to Publisher, Purchase Orders will be
invoiced upon shipment of Disc Products and each
invoice will be payable within [*********] of the
date of the invoice. Publisher shall be
additionally liable for all costs and expenses of
collection, including without limitation,
reasonable fees for lawyers and court costs.

     9.4 Charges and Deductions. The amounts
that Publisher must pay under this Agreement are
exclusive of all taxes, duties, charges or
assessments which the SCE Company or the
Designated Manufacturing Facility may have to
collect or pay and for which Publisher is solely
responsible. No costs incurred in the
development, manufacture, marketing, sale or
distribution of any Licensed Products shall be
deducted from any amounts payable under this
Agreement. Similarly, there shall be no deduction
from any amounts owed hereunder as a result of any
uncollectible accounts owed to Publisher, or for
any credits, discounts, allowances or returns
which Publisher may credit or otherwise grant to
any third-party customer of any Licensed Products,
or for any taxes, fees, assessments or expenses of
any kind which may be incurred by Publisher in
connection with its sale or distribution of any
Licensed Products or arising with respect to the
payment of royalties. Publisher may not assert
any credit, set-off or counterclaim to justify
withholding payment under this Agreement.
Publisher shall be solely responsible for and bear
any costs relating to any withholding taxes or
other such assessments which may be imposed by any
governmental authority with respect to the
payments to the SCE Company. Publisher shall
provide the SCE Company with official tax receipts
or other such documentary evidence issued by the
applicable tax authorities sufficient to
substantiate that any such taxes or assessments
have in fact been timely paid. Deductions may
only be made after issuance of an approved credit
memo from the
SCE Company or a Designated Manufacturing
Facility.

     9.5 General Terms. Each shipment to
Publisher shall constitute a separate sale,
whether said shipment constitutes the whole or
partial fulfillment of any Purchase Order. Title
to Units shall pass to Publisher only upon
payment in full of the amounts due under this
Agreement for those Units. The receipt and
deposit by the SCE Company of any moneys payable
under this Agreement shall be without prejudice
to any rights or remedies the SCE Company has and
shall not restrict or prevent the SCE Company
from challenging the basis for calculation or
payment accuracy. Nothing in this Agreement
shall excuse or be construed as a waiver of
Publisher’s obligation to timely provide any and
all payments owed to the SCE Company or any
Designated Manufacturing Facility.

10. Representations and Warranties.

     10.1 Representations and Warranties of SCE
Company. The SCE Company represents and warrants
solely for the benefit of Publisher that the SCE
Company has the right, power and authority to
enter into this 

 

* Information
has been omitted from this document and filed separately with the SEC
under a request for confidential treatment pursuant to Rule 24b-2
under the Securities Exchange Act of 1934, as amended.

	 	 	 	 	 
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Agreement and to fully perform
its obligations hereunder.

     10.2 Representations and Warranties of
Publisher. Publisher represents and warrants
that:

     (i) There is no threatened or pending
action, suit, claim or proceeding alleging that
the use or possession by Publisher or its
affiliates of all or any part of the Publisher
Software, Product Proposals, Product Information,
Printed Materials, Advertising Materials,
Packaging not provided by the Designated
Manufacturing Facility, or any underlying work or
content embodied in any of the foregoing,
including any name, designation or trademark used
in conjunction with any of the Licensed Products,
infringes or otherwise violates any intellectual
property right or other right or interest of any
kind whatsoever anywhere in the world of any
third party, or otherwise contesting any right,
title or interest of Publisher in or to the
Publisher
Software, Product Proposals, Product Information,
Printed Materials, Advertising Materials,
Packaging not provided by the Designated
Manufacturing Facility, or any underlying work or
content embodied in any of the foregoing,
including any name, designation
or trademark used in conjunction with any of the
Licensed Products;

     (ii) The Publisher Software, Product
Proposals, Product Information, Printed Materials,
Advertising Materials, Packaging not provided by
the Designated Manufacturing Facility, and their
contemplated disclosure or use under this
Agreement do not and shall not infringe any
person’s rights including patents, copyrights
(including rights in a joint work), trademarks,
trade dress, trade secret, rights of publicity,
privacy, performance, moral rights, literary
rights or any other right or interest anywhere in
the world of any third party. Publisher has
obtained the consent of all holders of
intellectual property rights necessary for the SCE
Company’s or its Affiliates’ use of any Publisher
Software, Product Proposals, Product Information,
Printed Materials, Advertising Materials and
Packaging not provided by the Designated
Manufacturing Facility provided by Publisher,
which may be reproduced, published, publicly
displayed, publicly performed, marketed, sold and
otherwise distributed by the SCE Company and any
Affiliates in accordance with this Agreement.
Publisher has made all payments required to any
person having any legal rights arising from such
disclosure or use so that the SCE Company will not
incur any obligation to pay any royalty, residual,
union, guild or other fees or expenses;

     (iii) Publisher has the right, power and
authority to enter into this Agreement, to grant
the SCE Company the rights granted hereunder and
to fully perform its obligations hereunder;

     (iv)The making of this Agreement by
Publisher does not violate any separate
agreement, rights or obligations existing between
Publisher and any other person, and, throughout
the Term, Publisher shall not make any separate
agreement
with any third party that is inconsistent with
any of the provisions of this Agreement;

     (v) Publisher has not previously taken any
action that could be interpreted as having sold,
assigned, leased, licensed or in any other way
disposed of or encumbered any of the rights
granted to Publisher hereunder. Publisher will
not sell, assign, lease, license or in any other
way dispose of or encumber any of such rights
except as expressly consented to by the SCE
Company in writing;

     (vii) Neither Publisher nor its affiliates
shall make any representation or give any
warranty to any person or entity expressly or on
the SCE Company’s behalf, or to the effect that
the Licensed Products are connected in any way
with the SCE Company other than that the
Executable Software and Licensed Products have
been developed, marketed, sold and distributed
under license from the SCE Company;

     (viii) In the event that any Executable
Software is delivered by Publisher to any other
Licensed Publishers or Licensed Developers in

	 	 	 	 	 
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source code form, Publisher will take all
precautions consistent with the protection of
valuable trade secrets by companies in high
technology industries to ensure that such third
parties protect and maintain the confidentiality
of such source code;

     (ix) The Executable Software, excepting any
SCE Materials, and any Product Information shall
be in a commercially acceptable form, free of
significant bugs, defects, time bombs or viruses
or unauthorized content that is inconsistent with
the age rating applicable to the corresponding
Licensed Product, which could disrupt, delay, or
destroy the Executable Software or System, or
render any of such items less than fully useful,
or that could cause the SCE Company to suffer
public disrepute, contempt, scandal or ridicule,
or which insults or offends the community or any
substantial organized group thereof or which
could tend to adversely affect the SCE Company’s
name, reputation or goodwill associated with the
System, and shall be fully compatible with the
System and all peripherals listed on the Printed
Materials as
compatible with the Licensed Product;

     (x) Each of the Licensed Products shall be
developed, marketed, sold and distributed by or
at the direction of Publisher in an ethical
manner and in a responsible manner with respect to the
protection of children in the online environment,
and in full compliance with all applicable laws,
including federal, state, provincial, local and
foreign laws, and any rules, regulations and
standards promulgated thereunder, including
lottery laws and labor laws, and will not contain
content that violates applicable laws, including
those relating to privacy or any obscene or
defamatory matter;

     (xi) Publisher’s policies and practices with
respect to the development, marketing, sale, and
distribution of the Licensed Products shall in no
manner reflect adversely upon the name,
reputation or goodwill of the SCE Company or any
Affiliate;

     (xii) To the extent Publisher wishes to
utilize a Licensed Developer to assist in
development of Licensed Products, Publisher has
contracted, or will contract, with a Licensed
Developer for the technical expertise and
resources necessary to fulfill its obligations
under this Agreement; and

     (xiii)Publisher shall make no false,
misleading or inconsistent representations or
claims with respect to the System, any
Licensed Products, or the SCE Company or any
Affiliate.

11. Indemnities; Limited Liability.

11.1 Indemnification by SCE
Company. The SCE Company shall indemnify and
hold Publisher harmless from and against any and
all third-party claims, demands, losses,
liabilities, damages, expenses and costs,
including reasonable fees for lawyers, expert
witnesses and litigation costs, and costs
incurred in the settlement or avoidance of any
such claim, in connection with or which result
from a breach of any of the SCE Company’s
representations or warranties set forth in
Section 10.1 (collectively,
“SCE-Indemnified Claim(s)”); provided that: (i)
Publisher shall give prompt written notice to the
SCE Company of the assertion of any
SCE-Indemnified Claim; (ii) the SCE Company shall
have the right to select counsel and control the
defense and settlement of any SCE-Indemnified
Claim and Publisher shall not agree to the
settlement of any SCE-Indemnified Claim without
the SCE Company’s prior written consent; and
(iii) Publisher shall provide the SCE Company
reasonable assistance and cooperation concerning
any SCE-Indemnified Claim, except that Publisher
need not incur any out-of-pocket costs in
rendering such assistance and cooperation. The
SCE Company shall have the exclusive right, at
its discretion, to commence and prosecute at its
own expense any lawsuit or to take such other
action with respect to SCE-Indemnified Claims as
shall be deemed appropriate by the SCE Company.

11.2 Indemnification By Publisher.
Publisher shall indemnify and hold the 

	 	 	 	 	 
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SCE
Company harmless from and against any and all
claims, demands, losses, liabilities, damages,
expenses and costs, including reasonable fees for
lawyers, expert witnesses and litigation costs,
and costs incurred in the settlement or avoidance
of any such claim, in connection with or which
result from (i) a breach of any of the provisions
of this Agreement; (ii) any claim of infringement
of a third party’s intellectual property rights
or any consumer claim, with respect to
Publisher’s Licensed Products, including claims
related to Publisher’s support of unauthorized or
unlicensed peripherals or software that are not
part of the PlayStation 3 format specifications
as set forth in the Guidelines; (iii) any claim
related to any Licensed Product features or
capability related to cross-regional Online
Gameplay; (iv) any claims of or in connection
with any personal or bodily injury (including
death or disability) or property damage arising
out of, in whole or in part, the development,
marketing, advertising, sale, distribution or use
of any of the Licensed Products (or portions
thereof) unless due directly and solely to the
breach of the SCE Company in performing any of
the specific duties or providing any of the
specific services required of it hereunder; or
(v) any federal, state or foreign
civil or criminal investigations or actions
relating to the development, marketing,
advertising, sale or distribution of Licensed
Products (all subsections collectively,
“Publisher-Indemnified Claim(s)”), provided that
(a) the SCE Company shall give prompt written
notice to Publisher of the assertion of
any Publisher-Indemnified Claim; (b) Publisher
shall have the right to select counsel and control
the defense and settlement of any
Publisher-Indemnified Claim, except that with
respect to any Publisher-Indemnified Claims made
by a third party against the SCE Company, the SCE
Company shall have the right to select counsel for
the SCE Company and reasonably control the defense
and settlement of the Publisher-Indemnified Claim
against the SCE Company; and (c) the SCE Company
shall provide Publisher with reasonable assistance
and cooperation concerning any
Publisher-Indemnified Claim, except that the SCE
Company need not incur any out-of-pocket costs in
rendering such assistance and cooperation.
Subject to the foregoing, Publisher shall have the
exclusive right, at its discretion, to commence
and prosecute at its own expense any lawsuit or to
take such other action with respect to
Publisher-Indemnified Claims as shall be deemed
appropriate by Publisher.

     11.3 LIMITATIONS OF
LIABILITY.

          11.3.1 SCE Limitation of Liability for
Financial Losses. In no event shall the SCE
Company or any Affiliates, or the officers,
directors, employees, agents, licensors or
suppliers of any of such entities, be liable for
loss of revenue, loss of actual or prospective
profits, loss of contracts, loss of anticipated
savings, loss of business opportunity, reputation
or goodwill or loss of, damage to or corruption
of data (whether such loss or damages are direct,
indirect, special, incidental or consequential)
arising out of, relating to, or in connection
with this Agreement or any collateral contract
(including the breach of this Agreement by the
SCE Group Company), whether known, foreseen
or foreseeable and whether in contract, tort
(including negligence), product liability, under
indemnity, or otherwise.

          11.3.2 SCE Limitation of Liability for
Other Consequential Losses. In no event shall
the SCE Company, its Affiliates or the officers,
directors, employees, agents, licensors or
suppliers of any of such entities, be liable for
any indirect, special, incidental or
consequential
loss or damage of any kind arising out of or in
connection with this Agreement or any collateral
contract (including the breach of this Agreement
by the SCE Group Company), whether known,
foreseen or foreseeable and whether in contract,
tort (including negligence), product liability,
under an indemnity or otherwise.

          11.3.3 SCE Limitation of Liability for
Representations. Publisher shall have no remedy
with respect to any representation made to it upon
which it relied in entering into this Agreement
and the SCE Company and its 

	 	 	 	 	 
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Affiliates and the
officers, directors, employees, agents, licensors
or suppliers of any of such entities shall have no
liability to Publisher other than under the
express terms of this Agreement. In this Section
11.3.3, “representation” means any undertaking,
promise, assurance, statement, representation,
warranty or understanding, whether in writing or
otherwise, of any person (whether a party to this
Agreement or not), relating to the subject matter
of this Agreement.

          11.3.4 SCE Limitation of Liability for SCE
Materials and Publisher’s Materials.
Except as expressly set forth herein, neither the
SCE Company, nor its Affiliates, nor the
officers, directors, employees, agents, licensors
or suppliers of any of such entities, shall bear
any risk, or have any responsibility or liability
of any kind to Publisher or to any third parties
with respect to the quality, functionality,
operation or performance of, or the use or
inability to use, all or any part of the SCE
Materials, the System, the Licensed Products or
Units of Disc Products, or for any software
errors or “bugs” in Product Information included
on SCE Company demonstration discs.

          11.3.5 SCE Limitation of Financial
Liability.
In no event shall the SCE Company’s liability
arising under, relating to, or in connection with
this Agreement, or any collateral contract,
exceed the total amount paid by Publisher under
Section 9 within the [*********] period immediately
prior to the date of the first occurrence of the
event or circumstances giving rise to the claimed
liability.

          11.3.6 Publisher Limitation of Liability.
In no event shall Publisher, its officers,
directors, employees, agents, licensors or
suppliers be liable to the SCE Company for loss of
revenue, loss of actual or prospective profits,
loss of contracts, loss of anticipated savings,
loss of business opportunity, reputation or
goodwill or loss of, damage to or corruption of
data (whether such loss or damage is direct,
indirect, special, incidental or consequential),
arising out of or in connection with this
Agreement or any collateral contract (including
the breach of this Agreement by Publisher)
provided that such limitations shall not apply to
damages resulting from Publisher’s breach of
Sections 2, 3, 5, 11.2, or 13 of this Agreement,
or to any amounts which Publisher may be required
to pay pursuant to Sections 11.2 or 16.10.

          11.3.7 Disclaimer of Warranty. Except as
expressly provided in Section 10.1, neither the
SCE Company, nor any of its officers, directors,
employees, agents or suppliers, make, nor does
Publisher receive, any warranties (express,
implied or statutory) regarding all or part of
the SCE Materials, the SCE Confidential
Information, the SCE Intellectual Property
Rights, the System, Units manufactured hereunder
or Product Information included on demonstration
discs. Without limiting the generality of the
foregoing, the SCE Company disclaims any
warranties, conditions or other terms implied by
any law (including as to merchantability,
satisfactory quality or fitness for a particular
purpose and warranties against infringement, and
the equivalents thereof under the laws of any
jurisdiction) to the fullest extent permitted by
applicable law.

          11.3.8 Law Applicable to Liabilities.
Nothing in this Agreement shall exclude or limit
any liability of either party which may not be
excluded or limited under applicable law.

12. Infringement of SCE Intellectual Property
Rights By Third Parties.

In the event that Publisher discovers or
otherwise becomes aware that any of the SCE
Intellectual Property Rights have been or are
being infringed by any third party, Publisher
shall promptly notify the SCE Company. The SCE
Company shall have the sole right, in its
discretion, to institute and prosecute lawsuits
against third parties regarding infringement of
SCE Intellectual Property Rights. Any lawsuit
shall be prosecuted solely at the cost and
expense of the SCE Company and all sums recovered
in any such lawsuits, whether by judgment,
settlement or otherwise, shall belong solely to
the SCE Company. 

 

* Information
has been omitted from this document and filed separately with the SEC
under a request for confidential treatment pursuant to Rule 24b-2
under the Securities Exchange Act of 1934, as amended.

	 	 	 	 	 
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Upon the SCE Company’s request,
Publisher shall execute all papers, testify on
all matters and otherwise cooperate in every way
necessary or desirable for the prosecution of any
such lawsuit. The SCE Company shall reimburse
Publisher for the reasonable expenses incurred as
a result of such cooperation, but unless
authorized by other provisions of this Agreement,
not costs and expenses attributable to any
cross-claim, counterclaim or third party action.

13. Confidentiality.

     13.1 SCE Confidential Information.

          13.1.1 Definition of SCE Confidential Information. “SCE Confidential
Information” shall mean:

          (i) the SCE Materials, the Development
Tools, the Guidelines, the Regional Riders and
this Agreement, including all exhibits and
schedules attached to any of the foregoing and
all information related to these items;

          (ii) other information, documents and
materials developed, owned, licensed or under the
control of the SCE Company or any Affiliate,
including all processes, data, hardware,
software, inventions, trade secrets, ideas,
creations, improvements, designs, discoveries,
developments, research and know-how, including
SCE Intellectual Property Rights relating to the
SCE Materials and the Development Tools; and

          (iii) information, documents and other
materials regarding the SCE Company’s or any
Affiliate’s finances, business and business
methods, marketing and technical plans, and
development and production plans; and

          (iv) third-party information and documents
licensed to or under the control of the SCE
Company or any Affiliate.

The SCE Confidential Information consists of
information in any medium, whether oral, printed,
in machine-readable form or otherwise, provided
to Publisher before or during the Term, including
information subsequently reduced to tangible or
written form. In addition, the existence of a
relationship between Publisher and the SCE
Company shall be deemed to be the SCE
Confidential Information unless otherwise agreed
to in writing by the parties or until publicly
announced by the SCE Company or any Affiliate.

          13.1.2 Term of Protection of the SCE
Confidential Information. The term for the
protection of the SCE Confidential Information
shall commence on the Effective Date and shall
continue in full force and effect for as long as
any of the SCE Confidential Information continues
to be maintained as confidential and proprietary
by the SCE Company or any Affiliate.

          13.1.3 Preservation of SCE
Confidential Information. Publisher shall, with
respect to the SCE Confidential Information:

          (i) not disclose SCE Confidential
Information to any person, other than those
employees, directors or officers of the Publisher
or subcontractors expressly approved under
Section 3.2, whose duties justify a
“need-to-know” and who have executed a
confidentiality agreement in which such
employees, directors, officers or subcontractors
have agreed not to disclose and to protect and
maintain the confidentiality of all confidential
information and materials inclusive of those of
third parties which may be disclosed to them or
to which they may have access during the course
of their duties. At the SCE Company’s request,
Publisher shall provide the SCE Company with
a copy of such confidentiality agreement between
Publisher and its employees, directors, officers,
or subcontractors and shall also provide the SCE
Company with a list of employee, director,
officer, and subcontractor signatories. Publisher
shall not disclose any of the SCE Confidential Information
to third parties, other than expressly approved
subcontractors under section 3.2, including to
consultants or agents 

	 	 	 	 	 
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without the SCE Company’s
prior written consent. Any employees, directors,
officers, subcontractors, authorized consultants
and agents who obtain access to or copies of the
SCE Confidential Information shall be advised by
Publisher of the confidential or proprietary
nature of the SCE Confidential Information, and
Publisher shall be responsible for any breach of
this Agreement by all such persons.

          (ii) hold all of the SCE Confidential
Information in confidence and take all measures
necessary to preserve the confidentiality of the
SCE Confidential Information in order to avoid
disclosure, publication, or dissemination, using
as high a degree of care and scrutiny, but at
least reasonable care, as is consistent with the
protection of valuable trade secrets by companies
in high technology industries.

          (iii) ensure that all written materials
relating to or containing the SCE Confidential
Information be maintained in a restricted access
area and plainly marked to indicate the
proprietary and confidential nature thereof.

          (iv) at the SCE Company’s request, return
promptly to the SCE Company any and all portions
of the SCE Confidential Information, together
with all copies thereof.

          (v) not use, copy, reproduce, modify, create
derivative works from, sublicense, distribute, or
otherwise disseminate the SCE Confidential
Information, or any portion thereof, except as
expressly authorized, nor shall Publisher remove
any proprietary legend set forth on or contained
within any of the SCE Confidential Information.

          13.1.4 Exceptions. The foregoing
restrictions shall not apply to any portion of
the SCE Confidential Information which:

          (i) was previously known by Publisher
without restriction on disclosure or use, as
proven by
written documentation of Publisher;

          (ii) is or legitimately becomes part of the
public domain through no fault of Publisher or
any of its employees, directors, officers,
consultants or agents;

          (iii) is independently developed by
Publisher’s employees or consultants who have not
had access to or otherwise used the SCE
Confidential Information (or any portion
thereof), as proven by written documentation of
Publisher;

          (iv) is required to be disclosed by court,
administrative or governmental order; provided
that Publisher must use all reasonable efforts
prior to issuance of any such order to maintain
the confidentiality of the SCE Confidential
Information, including asserting in any action or
investigation the restrictions set forth in this
Agreement, and, immediately after receiving
notice of any such action, investigation, or
threatened action or investigation, Publisher
must notify the SCE Company of such action,
investigation, or threatened action or
investigation, unless Publisher is ordered by a
court not to so notify; or

          (v) is approved for release by written
authorization of the SCE Company.

          13.1.5 No Obligation to License.
Disclosure of the SCE Confidential Information to
Publisher shall not (i) constitute any option,
grant or license from the SCE Company to
Publisher under any SCE Intellectual Property
Rights now or after owned or controlled by the
SCE Company; (ii) result in any obligation on
the part of the SCE Company to approve any
materials of Publisher; (iii) give Publisher any
right to, directly or indirectly, develop,
manufacture, sell or otherwise distribute any
product derived from or which uses or was
developed with the use of the SCE Confidential
Information (or any portion thereof), other than
as expressly set forth in this Agreement.

          13.1.6 Publisher’s Obligations Upon
Unauthorized Disclosure. If at any time Publisher
becomes aware of any unauthorized 

	 	 	 	 	 
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duplication,
access, use, possession or knowledge
of any of the SCE Confidential Information, it
shall notify the SCE Company as soon as reasonably
practicable, and shall promptly act to recover any
such information and prevent further breach of the
confidentiality obligations herein. Publisher
shall provide any and all reasonable assistance to
the SCE Company to protect the SCE Company’s
proprietary rights in any of the SCE Confidential
Information that Publisher or its employees,
directors, officers, or permitted subcontractors,
consultants, or agents may have directly or
indirectly disclosed or made available, and that
may be duplicated, accessed, used, possessed or
known in any manner or for any purpose not
expressly authorized by this Agreement, including
enforcement of confidentiality agreements,
commencement and prosecution in good faith (alone
or with the SCE Company) of legal action, and
reimbursement for all reasonable lawyers’ fees,
costs and expenses incurred by the SCE Company to
protect the SCE Company’s proprietary rights in
the SCE Confidential Information. Publisher shall
take all steps requested by the SCE Company to
prevent the recurrence of any unauthorized
duplication, access, use, possession or knowledge
of the SCE Confidential Information.

     13.2 Publisher’s Confidential Information.

          13.2.1 Definition of Publisher’s
Confidential Information. “Publisher’s
Confidential Information” shall mean:

          (i) any Publisher Software provided to the
SCE Company pursuant to this Agreement and all
documentation and information relating thereto,
including Product Proposals, Printed Materials
and Advertising Materials (other than
documentation and information intended for
release to and use by end users, the general
public or the trade);

          (ii) other documents and materials
developed, owned, licensed or under the control
of Publisher, including all processes, data,
hardware, software, inventions, trade secrets,
ideas, creations, improvements, designs,
discoveries,
developments, research and knowhow; and

          (iii) information and documents regarding
Publisher’s finances, business, marketing and
technical plans, business methods and production
plans.

Publisher’s Confidential Information may consist
of information in any medium, whether oral,
printed, in machine-readable form or otherwise,
provided to the SCE Company before or during the
Term, including information subsequently reduced
to tangible or written form.

          13.2.2 Term of Protection of Publisher’s
Confidential Information. The term for the
protection of Publisher’s Confidential
Information shall commence on the Effective Date
and shall continue in full force and effect for
as long as any of Publisher’s Confidential
Information continues to be maintained as
confidential and proprietary by Publisher.

          13.2.3 Preservation of Confidential
Information of Publisher. The SCE Company shall,
with respect to Publisher’s Confidential
Information:

          (i) hold all Publisher’s Confidential
Information in confidence and take all reasonable
steps to preserve the confidentiality of
Publisher’s Confidential Information, and to
prevent it from falling into the public domain or
into the possession of persons other than those
persons to whom disclosure is authorized
hereunder.

          (ii) not disclose Publisher’s Confidential
Information to any person other than the SCE Company’s or a Designated
Manufacturing Facility’s employees, directors,
agents, consultants and subcontractors who need
to know or have access to Publisher’s

	 	 	 	 	 
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Confidential Information for the purposes of this
Agreement, and only to the extent necessary for
such purposes.

          (iii) ensure that all written materials
relating to or containing Publisher’s
Confidential Information be maintained in a
secure area and plainly marked to indicate the
proprietary and confidential nature thereof.

          (iv) at Publisher’s request, return promptly
to Publisher any and all portions of Publisher’s
Confidential Information, together with all
copies thereof.

          (v) not use Publisher’s Confidential
Information, or any portion thereof, except as
provided herein, nor shall the SCE Company remove
any proprietary legend set forth on or contained
within any of Publisher’s Confidential
Information.

          13.2.4 Exceptions. The foregoing
restrictions shall not apply to any portion of
Publisher’s Confidential Information which:

          (i) was previously known by the SCE Company
without restriction on disclosure or use, as
proven by written documentation of the SCE
Company;

          (ii) comes into the possession of the SCE
Company from a third party which is not under any
obligation to maintain the confidentiality of
such information;

          (iii) is or legitimately becomes part of
information in the public domain through no fault
of the SCE Company, or any of its employees,
directors, agents, consultants or subcontractors;

          (iv) is independently developed by the SCE
Company’s employees, consultants or
subcontractors who have not had access to or
otherwise used Publisher’s Confidential
Information (or any portion thereof), as proven
by written documentation of the SCE Company;

          (v) is required to be disclosed by court,
administrative, or governmental order; provided
that the SCE Company attempts, prior to the
issuance of any such order, to maintain the
confidentiality of Publisher’s Confidential
Information, including asserting in any action or
investigation the restrictions set forth in this
Agreement, and immediately after receiving notice
of any such action, investigation, or threatened
action or investigation, notifies Publisher of
such action, investigation, or threatened action
or investigation, unless the SCE Company is
ordered by a court not to so notify; or

          (vi) is approved for release by written
authorization of Publisher.

          13.2.5 SCE Company’s Obligations Upon
Unauthorized Disclosure. If at any time the SCE
Company becomes aware of any unauthorized
duplication, access, use, possession or knowledge
of Publisher’s Confidential Information, it shall
notify Publisher as soon as is reasonably
practicable. The SCE Company shall provide any
and all reasonable assistance to Publisher to
protect Publisher’s proprietary rights in any of
Publisher’s Confidential Information that it or
its employees or permitted subcontractors may
have directly or indirectly disclosed or made
available and that may be duplicated, accessed,
used, possessed or known in a manner or for a
purpose not expressly authorized by this
Agreement, including enforcement of
confidentiality agreements, commencement and
prosecution in good faith (alone or with
Publisher) of legal action, and reimbursement for
all reasonable lawyers’ fees, costs and expenses
incurred by Publisher to protect Publisher’s
proprietary rights in Publisher’s Confidential
Information. The SCE Company shall take all
reasonable steps requested by Publisher to
prevent the recurrence of any unauthorized
duplication, access, use, possession or knowledge
of Publisher’s Confidential Information.

	 	 	 	 	 
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     13.3 Confidentiality of Agreement.
While the terms of this Agreement and the
Regional Rider shall be treated as SCE
Confidential Information, Publisher may disclose
their terms and conditions:

     (i) to legal counsel;

     (ii) in confidence, to accountants, banks
and financing sources and their advisors;

     (iii) in confidence, in connection with the
enforcement of this Agreement or rights arising
under or relating to this Agreement; and

     (iv) if required, in the opinion of its
counsel, to file publicly or otherwise disclose
the terms of this Agreement under applicable
securities or other laws, Publisher shall
promptly notify the SCE
Company of such obligation so that the SCE
Company has a reasonable opportunity to contest
or limit the scope of such required disclosure,
and Publisher shall request, and shall use best
efforts to obtain, confidential treatment for
such sections of this Agreement as the SCE
Company may designate.

14. Term Renewal and Termination.

     14.1 Term Renewal. The Term shall be
automatically extended for additional one-year
terms, unless either party provides the other
with written notice of its election not to extend
on or before January 31 of the year in which the
Term would renew. Notwithstanding the foregoing,
the term for the protection of SCE Confidential
Information and Publisher’s Confidential
Information shall be as set forth in Sections
13.1.2 and 13.2.2 respectively.

     14.2 Termination by SCE Company. The SCE Company shall have the right to terminate
the Agreement immediately, on written notice to
Publisher, upon the occurrence of any of the
following:

     (i) If Publisher is in material breach of
any of its obligations under the Agreement or
under any other agreement entered into between
the SCE Company or any Affiliate, on the one
hand, and Publisher on the other hand;

     (ii) A statement of intent by Publisher to
no longer exercise any of the rights granted by
the SCE Company to Publisher hereunder or
Publisher failing to submit materials under
section 6.1 or failing to issue any Purchase
Orders during any period of twelve consecutive
calendar months;

     (iii) If Publisher (a) is unable to pay its
debts when due; (b) makes an assignment for the
benefit of any of its creditors; (c) files or has
filed against it a petition, or an order of
bankruptcy or insolvency is made, under the
bankruptcy or insolvency laws of any jurisdiction
(and such petition is not discharged within [*********] or becomes or is adjudicated bankrupt or
insolvent;
(d) is the subject of an order for, or applies
for or notices its intent to apply for, the
appointment of an administrator, receiver,
administrative receiver, manager, liquidator,
trustee or similar officer to be appointed over
any of its business or property; (e) ceases to do
business or enters into liquidation; or (f) takes
or suffers any similar or analogous action in any
jurisdiction as a consequence of debt;

     (iv) If a controlling interest in
Publisher or in an entity which directly or
indirectly has a controlling interest in
Publisher is transferred to a party that (a)
is in breach of any agreement with the SCE
Company or any Affiliate; (b) directly or
indirectly holds or acquires a controlling
interest in a third party which designs,
develops any of the core components for an
interactive device or product which is
directly or indirectly competitive with the
System, or itself develops any product that
is directly or indirectly competitive with
the System; or (c) is in litigation or in an
adversarial administrative proceeding with
the SCE Company or any Affiliate concerning
the SCE Confidential Information or any SCE
Intellectual Property Rights, including
challenging validity of any SCE Intellectual
Property Rights;

     (v) If Publisher or any entity that directly
or indirectly has a controlling interest in
Publisher (a) enters into a business relationship
with a third 

 

* Information
has been omitted from this document and filed separately with the SEC
under a request for confidential treatment pursuant to Rule 24b-2
under the Securities Exchange Act of 1934, as amended.

	 	 	 	 	 
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party related to the design or
development of any core components for an interactive device
or product which is directly or indirectly
competitive with the System; or (b) acquires an
interest in or otherwise forms a strategic
business relationship with any third party which
has developed or owns or acquires intellectual
property rights in any such device or product;

     (vi) If Publisher or any of its affiliates
initiates any legal or administrative action
against the SCE Company or any Affiliate or
challenges the validity of any SCE Intellectual
Property Rights;

     (vii) If Publisher fails to pay any sums
owed to the SCE Company on the date due and
such default is not fully corrected or cured within [*********] of
the date on which such payment was originally
due; or

     (viii) If Publisher or any of its
officers or employees engage in “hacking” of
any software for any PlayStation format or in
activities which facilitate the same by any
third party.

As used hereinabove, “controlling interest”
means, with respect to any form of entity,
sufficient power to control the decisions of such
entity. Publisher shall immediately notify the
SCE Company in writing in the event that any of
the events or circumstances specified in this
Section 14.2 occur. In the event of termination
under 14.2(viii), the SCE Company shall have the
right to terminate any other agreements entered
into between the SCE Company and Publisher.

     14.3 Product-by-Product Termination.
In addition to the events of termination
described in Section 14.2, the SCE Company, at
its option, shall be entitled to terminate, with
respect to a particular Licensed Product, the
licenses and related rights herein granted to
Publisher on written notice to
Publisher, in the event that (a) [*********] (b) Publisher uses a third party that
fails to comply with the requirements of Section
3.2 in connection with the development of any
Licensed Product; (c) any third party with whom
Publisher has contracted for the development of
Licensed Products breaches any of its material
obligations to the SCE Company pursuant to such
third party’s agreement with the SCE Company with
respect to any such Licensed Product; (d)
Publisher cancels a Licensed Product or fails to
provide the SCE Company, in accordance with the
provisions of Section 6 and the relevant
Guidelines, with the final version of the
Executable Software for any Licensed Product
within three months of the scheduled release date
(as referenced in the Product Proposal or as
otherwise mutually agreed by the parties in
writing), fails to provide work in progress to
the SCE Company in strict compliance with the
review process set forth in the Guidelines, fails
to provide fully tested final Executable Software
in strict conformance with the Guidelines; or (e)
Publisher otherwise fails materially to conform
to the Guidelines with respect to any particular
Licensed Product.

     14.4 Options in Lieu of Termination. As
alternatives to terminating the Agreement or all
licensed rights with respect to a particular
Licensed Product as set forth in Sections 14.2
and 14.3, the SCE Company may, at its option and
upon written notice to Publisher, suspend this
Agreement, entirely or with respect to a
particular Licensed Product or program, for a set
period of time which shall be specified in
writing to Publisher upon the occurrence of any
breach of this Agreement. Election of suspension
shall not constitute a waiver of or compromise
with respect to any of the SCE Company’s rights
under this Agreement and the SCE Company may
elect to terminate this Agreement with respect to
any breach.

 

* Information
has been omitted from this document and filed separately with the SEC
under a request for confidential treatment pursuant to Rule 24b-2
under the Securities Exchange Act of 1934, as amended.

	 	 	 	 	 
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     14.5 No Refunds. In the event that this
Agreement expires or is terminated under any of
Sections 14.2 through 14.4, no portion of any
payments of any kind whatsoever previously
provided hereunder shall be owed or be repayable
or refunded to Publisher.

15. Effect of Expiration or Termination.

     15.1 Inventory Statement. Within [*********] of
the date of expiration or the effective date of
termination with respect to any or all Licensed
Products or this Agreement, Publisher shall
provide the SCE Company with an itemized
statement, certified to be accurate by an officer
of Publisher, specifying the number of unsold
Units of the Licensed Products as to which such
termination applies, on a title-by-title basis,
which remain in its inventory or under its
control at the time of expiration or the
effective date of termination. The SCE Company
shall be entitled to conduct at its expense a
physical inspection of Publisher’s inventory and work in process upon
reasonable written notice during normal business
hours in order to ascertain or verify such
inventory and inventory statement.

     15.2 Reversion of Rights. Upon expiration
or termination and subject to Section 15.3, the licenses and related rights herein
granted to Publisher shall immediately revert to
the SCE Company, and Publisher shall cease from
any further use of the SCE Confidential
Information, Licensed Trademarks and the SCE
Materials and any SCE Intellectual Property Rights
therein, and, subject to the provisions of Section
15.3, Publisher shall have no further right to
continue the development, publication,
manufacture, marketing, advertising, sale or other
distribution of any Licensed Products, or to
continue to use any Licensed Trademarks; provided,
however, that for a period of one year after the
effective date of termination, and subject to all
the terms of Section 13, and provided this
Agreement is not terminated due to any breach or
default by Publisher, Publisher may retain such
portions of the SCE Materials and the SCE
Confidential Information as the SCE Company in its
sole discretion agrees are required to support end
users who possess Licensed Products but must
return all these materials at the end of such one
year period. Upon expiration or termination, the
licenses and related rights herein granted to the
SCE Company by Publisher shall immediately revert
to Publisher, and the SCE Company shall cease from
any further use of Product Information and
any Publisher Intellectual Property Rights
therein; provided that the SCE Company may
continue the manufacture, marketing, advertising,
sale and other such distribution of any SCE
Company demonstration discs containing
Publisher’s Product Information which Publisher
had previously approved.

     15.3 Disposal of Unsold Units Upon
Termination. In the event of termination of this
Agreement under sections 14.2(ii), (iv), or (v),
Publisher may sell off existing inventories of
Units of the Disc Products, on a non-exclusive
basis, and strictly in accordance with this
Agreement, for a period of [*********] from the date
of expiration or effective date of termination of
this Agreement, and provided such inventories
have not been manufactured solely or principally
for sale during such period. Subsequent to the
expiration of such [*********] period, or in the event
this Agreement is terminated under Sections
14.2(i), (iii), (vi), (vii), or (viii), any and
all Units of the Disc Products remaining in
Publisher’s inventory or otherwise under its
control shall be destroyed by Publisher within
[*********] business days of such expiration or
termination date. Within [*********] business days
after such destruction, Publisher shall provide
the SCE Company with an itemized statement,
certified to be accurate by an officer of
Publisher, indicating the number of Units of the
Licensed Products which have been destroyed (on a
title-by-title basis), the location and date of
such destruction, and the disposition of the
remains of such destroyed materials.

     15.4 Disposal of Unsold Units Upon
Non-Renewal. In the event that the Term expires
and this Agreement is not renewed, Publisher may
continue to publish those Licensed Products
containing Executable Software whose development
was completed before or during the 

 

* Information
has been omitted from this document and filed separately with the SEC
under a request for confidential treatment pursuant to Rule 24b-2
under the Securities Exchange Act of 1934, as amended.

	 	 	 	 	 
	Sony Computer Entertainment America
	 	 	 	 
	PLAYSTATION 3 GLPA

	 	REDACTED

{Page}
	 	CONFIDENTIAL

 

 

Term, and to
use the Licensed Trademarks strictly, only and
directly in connection with such publication,
until the Term expires or, if later, until the
[*********] anniversary of the [*********] next
following such completion. Upon expiration of
the Term or, the extended period for publishing
Licensed Products, Publisher may sell off
existing inventories of such Licensed Products on a non-exclusive basis for a period of
180 days from the applicable expiration date;
provided that such inventory is not manufactured
solely or principally for sale within such
sell-off period.

     15.5 Return of the SCE Materials and the SCE
Confidential Information. Upon the expiration or
earlier termination of this Agreement or
following either the [*********] period or the [*********]
period referenced in Sections 15.4 and 15.3 and
subject to Section 15.2, Publisher shall immediately deliver to the
SCE Company, or if and to the extent requested by
the SCE Company, destroy, all SCE Materials and
any and all copies thereof, and Publisher and the
SCE Company shall, upon the request of the other
party, immediately deliver to the other party, or
to the extent requested by such party destroy, all
Confidential Information of the other party,
including any and all copies thereof, which the
other party previously furnished to it in
furtherance of this Agreement. Within [*********] after any such destruction, Publisher
or the SCE Company, as appropriate, shall provide
the other party with a certificate of destruction
and an itemized statement, each certified to be
accurate by an officer of Publisher, indicating
the number of copies or units of the SCE Materials
or SCE Confidential Information which have been
destroyed, the location and date of such
destruction and the disposition of the remains of
such destroyed materials. In the event that
Publisher fails to return or certify the
destruction of the SCE Materials or SCE
Confidential Information and the SCE Company must
resort to legal means (including any use of
lawyers) to recover the SCE Materials or SCE
Confidential Information or the value thereof, all
costs, including the SCE Company’s reasonable
lawyers’ fees, shall be borne by Publisher, and
the SCE Company may, in addition to the SCE
Company’s other remedies, withhold such amounts
from any payment otherwise due from the SCE
Company to Publisher under any agreement between
the SCE Company and Publisher.

     15.6 Extension of this Agreement;
Termination Without Prejudice. The SCE Company
shall be under no obligation to extend this
Agreement notwithstanding any actions taken by
either of the parties prior to the expiration of
this Agreement. Upon the expiration of this
Agreement, neither party shall be liable to the
other for any damages (whether direct, indirect,
consequential or incidental, and including any
expenditures, loss of profits or prospective
profits) sustained or arising out of or alleged
to have been sustained or to have arisen out of
such expiration. The expiration or termination
of this
Agreement shall be without prejudice to any
rights or remedies which one party may otherwise
have against the other party, and shall not
excuse either party from liability with respect
to any events occurring prior to expiration or
the effective date of termination.

16. Miscellaneous Provisions.

     16.1 Notices. All notices or other
communications required or desired to be sent to
either of the parties shall be in writing and
shall be sent by registered or certified mail,
postage prepaid, or sent by recognized
international courier service, or facsimile, with
charges prepaid. The address for all notices or
other communications required to be sent to the
SCE Company or Publisher, respectively, shall be
the mailing address stated in the preamble
hereof, or such other address as may be provided
by written notice from one party to the other on
at least [*********] prior written notice.
Any such notice shall be effective upon the date
of actual receipt, as confirmed by the receiving
party.

     16.2 Audit Provisions. Publisher shall keep
full, complete, and accurate books of accounts
and records covering all

 

* Information
has been omitted from this document and filed separately with the SEC
under a request for confidential treatment pursuant to Rule 24b-2
under the Securities Exchange Act of 1934, as amended.

	 	 	 	 	 
	Sony Computer Entertainment America
	 	 	 	 
	PLAYSTATION 3 GLPA

	 	REDACTED

{Page}
	 	CONFIDENTIAL

 

 

 transactions relating to
this Agreement. Publisher shall preserve such
books of accounts, records, documents, and
materials for a period of [*********] after the
expiration or earlier termination of this
Agreement. Acceptance by the SCE Company of any
accounting statement, purchase order, or payment
hereunder will not preclude the SCE Company from
challenging or questioning the accuracy thereof at a later time.
In the event that the SCE Company reasonably
believes that the pricing information provided by
Publisher with respect to any Licensed Product is
not accurate, the SCE Company shall be entitled to
request additional documentation from Publisher to
support the pricing information provided for such
Licensed Product. In addition, during the Term
and for a period of [*********] thereafter and
upon the giving of reasonable prior written notice
to Publisher, at the SCE Company’s expense,
representatives of the SCE Company shall be given
access to, and the right to inspect, audit, and
make copies and summaries of and take extracts
from, such portions of all books and
records of Publisher, and Publisher’s affiliates
and branch offices, as pertain to the Licensed
Products and any payments due or credits received
hereunder. Any such audit shall take place during
normal business hours and shall, at the SCE
Company’s sole election, be conducted either by an
independent certified accountant or by an
appropriately professionally qualified SCE Company
employee. In the event that such inspection
reveals any under-reporting of any payment due to
the SCE Company, Publisher shall immediately pay
the SCE Company such amount. In the event that
any audit conducted by the SCE Company reveals
that Publisher has under-reported any payment due
to the SCE Company hereunder by [ ******* ] or
more for the relevant audit period, then in
addition to the payment of the appropriate amount
due to the SCE Company, Publisher shall reimburse
the SCE Company for all reasonable audit costs for
that audit and any and all collection costs to
recover any unpaid amounts.

     16.3 Force Majeure. Neither the SCE
Company nor Publisher shall be liable for any
loss or damage or be deemed to be in breach of
this Agreement if its failure to perform or
failure to cure any of its obligations under this
Agreement results from any event or circumstance
beyond its reasonable control, including any
natural disaster, fire, flood, earthquake or
other Act of God; shortage of equipment,
materials, supplies or transportation facilities;
strike or other industrial dispute; war
or rebellion; shutdown or delay in power,
telephone or other essential service due to the
failure of computer or communications equipment or
otherwise; provided, however, that the party
interfered with gives the other party written
notice thereof promptly, and, in any event, within [*********] of discovery of any
such Force Majeure condition. If notice of the
existence of any Force Majeure condition is
provided within such period, the time for
performance or cure shall be extended for a period
equal to the duration of the Force Majeure event
or circumstance described in such notice, except
that any such
cause shall not excuse the payment of any sums
owed to the SCE Company prior to, during or after
the occurrence of any such Force Majeure
condition. In the event that the Force Majeure
condition continues for more than [*********], the SCE
Company may terminate this Agreement for cause by
providing written notice to Publisher to such
effect.

     16.4 No Agency, Partnership or Joint
Venture. The relationship between the SCE
Company and Publisher, respectively, is that of
licensor and licensee. Both parties are
independent contractors and neither party is the
legal representative, agent, joint venturer,
partner or employee of the other party for any
purpose whatsoever. Neither party has any right
or authority to assume or create any obligations
of any kind or to make any representation or
warranty on behalf of the other party, whether
express or implied, or to bind the other party in
any respect whatsoever.

     16.5 Assignment. The SCE Company has
entered into this Agreement based upon the
particular reputation, capabilities and
experience of Publisher and its officers,
directors and employees.

 

* Information
has been omitted from this document and filed separately with the SEC
under a request for confidential treatment pursuant to Rule 24b-2
under the Securities Exchange Act of 1934, as amended.

	 	 	 	 	 
	Sony Computer Entertainment America
	 	 	 	 
	PLAYSTATION 3 GLPA

	 	REDACTED

{Page}
	 	CONFIDENTIAL

 

 

 Except as provided in
this Agreement, Publisher may not assign,
sublicense, subcontract, encumber or otherwise
transfer this Agreement or any of its rights
hereunder, nor delegate or otherwise transfer any
of its obligations hereunder, to any third party
unless the prior written consent of the SCE
Company shall first be obtained. Any attempted
or purported assignment, delegation or other such
transfer, directly or indirectly, without the
required consent of the SCE Company shall be void
and a material breach of this Agreement. Subject
to the foregoing, this Agreement shall inure to
the benefit of the parties and their respective
successors and permitted assigns (other than in
connection with any of the events referenced in
Section 14.2(iv).) The SCE Company shall have the
right to assign any and all of its rights and
obligations hereunder to any Affiliate(s) or to
any company in the Sony family group of companies.

     16.6 Non-solicitation. Neither Publisher
nor any of its affiliates, by itself, its
officers, employees or agents, or indirectly,
shall during the Term, induce or seek to induce, on an
individually targeted basis, the employment or
the engagement of the services of, any employee
of the SCE Company or any of its Affiliates,
whose services are (a) specifically engaged in
product development or directly related functions
or (b) otherwise reasonably deemed by his or her
employer to be of material importance to the
protection of its legitimate business interests,
and (c) with whom Publisher or any of its
affiliates shall have had contact or dealings
during the Term. The foregoing provisions shall
continue to apply for a period of [*********] after
this Agreement expires or is terminated.

     16.7 Compliance with Applicable Laws. The parties shall at all times comply with all
applicable laws and regulations and all
conventions and treaties to which their countries
are a party or relating to or in any way
affecting this Agreement and the performance by
the parties of this Agreement, including the US
Children’s Online Privacy Protection Act and all
other laws and regulations relating to the
gathering, handling and dissemination of all data
from or concerning end users of Online Products.
Each party, at its own expense, shall negotiate
and obtain any approval, license or permit
required in the performance of its obligations,
and shall declare, record or take such steps to
render this Agreement binding, including the
recording of this Agreement with any appropriate
governmental authorities (if required).

     16.8 Legal Costs and Expenses. In the event
it is necessary for either party to retain the
services of a lawyer to enforce the provisions of
this Agreement or to file or defend any action
arising out of this Agreement, then the
prevailing party in any such action shall be
entitled, in addition to any other rights and
remedies available to it at law or in equity, to
recover from the other party its reasonable fees
for lawyers and expert witnesses, plus such court
costs and expenses as may be fixed by any court
of competent jurisdiction. The term “prevailing
party” for the purposes of this Section shall
include a defendant who has by motion, judgment,
verdict or dismissal by the court, successfully defended against any claim
that has been asserted against it.

     16.9 Remedies. Unless expressly set forth
to the contrary, either party’s election of any
remedies provided for in this Agreement shall not
be exclusive of any other remedies at law or
equity, and all such remedies shall be deemed to
be cumulative. Any breach of Sections 2, 3, 5,
6, 7.1 — 7.7, 13 or 15 of this Agreement would
cause significant and irreparable harm to the SCE
Company, the extent of which would be difficult
to ascertain and for which damages might not be
an adequate remedy. Accordingly, in addition to
any other remedies, including damages to which
the SCE Company may be entitled, in the event of
a breach or threatened breach by Publisher, or
any of its directors, officers, employees, agents
or permitted consultants or subcontractors, of
any such Section or Sections of this Agreement,
the SCE Company shall be entitled to the
immediate 

 

* Information
has been omitted from this document and filed separately with the SEC
under a request for confidential treatment pursuant to Rule 24b-2
under the Securities Exchange Act of 1934, as amended.

	 	 	 	 	 
	Sony Computer Entertainment America
	 	 	 	 
	PLAYSTATION 3 GLPA

	 	REDACTED

{Page}
	 	CONFIDENTIAL

 

 

issuance without bond or other
security, of ex parte equitable relief, including
injunctive relief, or, if a bond is required
under applicable law, on the posting of a bond in
an amount not to exceed USD [    *******],
enjoining any breach or threatened breach of any
or all of such provisions. In addition, if
Publisher fails to comply with any of its
obligations as set forth herein, the SCE Company
shall be entitled to an accounting and repayment
of all forms of compensation, commissions,
remuneration or benefits which Publisher directly
or indirectly realizes as a result of or arising
in connection with any such failure to comply. Such remedy
shall be in addition to and not in limitation of
any injunctive relief or other remedies to which
the SCE Company may be entitled under this
Agreement or otherwise at law or in equity.

     16.10 Severability. In the event that any
provision of this Agreement or portion thereof is
determined by a court of competent jurisdiction
to be invalid or otherwise unenforceable, such
provision or portion shall be enforced to the
extent possible consistent with the stated
intention of the parties, or, if incapable of
such enforcement, shall be deemed to be deleted
from this Agreement, while the remainder of this
Agreement shall continue in full force and remain
in effect according to its stated terms and conditions.

     16.11 Sections Surviving Expiration or
Termination. The following Sections shall
survive the expiration or earlier termination of
this Agreement for any reason: 5, 6.2, 6.3, 6.4,
7.10, 9, 10, 11, 13, 14.5, 15 and 16 and any
terms in any Regional Rider that are expressly
designated as surviving termination.

     16.12 Waiver. No failure or delay by either
party in exercising any right, power or remedy
under this Agreement shall operate as a waiver of
any such right, power or remedy. No waiver of any
provision of this Agreement shall be effective
unless in writing and signed by the party against
whom such waiver is sought to be enforced. Any
waiver by either party of any provision of this
Agreement shall not be construed as a waiver of
any other provision of this Agreement, nor shall
such waiver operate or be construed as a waiver
of such provision respecting any future event or
circumstance.

     16.13 Modification and Amendment. The SCE
Company reserves the right, at any time upon
reasonable notice to Publisher, to amend the
relevant provisions of this Agreement or the
Guidelines, to take account of or in response to
any decision, order, or objection of any court or
governmental or other competition authority of
competent jurisdiction, or any statutory or
similar measures that give effect to any such
decision (from which this Agreement and the
Guidelines are not exempt) or to reflect any
undertaking by the SCE Company to any such
authority. Any such amendment shall be of
prospective application only and shall not be
applied to any Licensed Products submitted to the
SCE Company pursuant to Section 6 prior to the
date of the SCE Company’s notice of amendment.
In the event that Publisher is unwilling to
accept any such amendment, then Publisher shall
have the right to terminate this Agreement by
providing written notice to the SCE Company no
more than [*********] following the date of the SCE
Company’s notice of amendment. The provisions of
Section 15.3 shall come into effect upon any such
termination by Publisher. Subject to the
remainder of this Section 16.14 and except as
otherwise provided in this Agreement, no
modification or amendment of any provision of
this Agreement shall be effective unless in
writing and signed by both of the parties.

     16.14 Interpretation. The section headings
used in this Agreement are intended primarily for
reference and shall not by themselves determine
the construction or interpretation of this
Agreement or any portion hereof. Any reference
to section numbers are to the sections of this
Agreement. Any reference to persons includes
natural persons as well as organizations,
including firms, partnerships, companies and corporations. Any phrase
introduced by the terms “including,” “include,”
“in particular,” or any similar expression shall
be construed as illustrative and shall not limit
the category preceding those terms.

     16.15 Integration. This Agreement, together
with the Guidelines, constitutes the entire
agreement between the SCE Company 

 

	*	 	Information has been omitted from this document and filed separately with the SEC under a
request for confidential treatment pursuant to Rule 24b-2 under the Securities Exchange
Act of 1934, as amended.

	 	 	 	 	 
	Sony Computer Entertainment America
	 	 	 	 
	PLAYSTATION 3 GLPA

	 	REDACTED

{Page}
	 	CONFIDENTIAL

 

 

and Publisher
and supersedes all prior or contemporaneous
agreements, proposals, representations,
understandings and communications between the SCE
Company and Publisher, whether oral or written,
with respect to the subject matter hereof,
including any PlayStation 3 Confidentiality and
Nondisclosure Agreement between the SCE Company
and Publisher. Publisher is not relying upon any
statement, representation, warranty or
understanding, whether negligently or innocently
made, of any person other than as expressly set
out in this Agreement.

     16.16 Counterparts. This Agreement may be
executed in counterparts, each of which shall be
deemed an original, and together shall constitute
one and the same instrument.

     16.17 Construction. This Agreement shall be
fairly interpreted in accordance with its terms
and without any strict construction in favor of
or against either of the parties.

THIS AGREEMENT HAS BEEN ENTERED INTO ON THE DATE STATED AT THE
BEGINNING OF IT.

	 	 	 	 	 	 	 	 	 
	SONY COMPUTER ENTERTAINMENT

AMERICA INC.

 	 	 	 	MIDWAY HOME ENTERTAINMENT INC.
	By:

	 	/s/ Jack Tretton
	 	 	 	By:
	 	/s/ Miguel Iribarren
	 

	 	 
	 	 	 	 	 	 

	 	 	 	 	 	 	 	 	 
	Print Name:

	 	Jack Tretton
	 	 
	 	Print Name:
	 	Miguel Iribarren
	 

	 	 
	 	 	 	 	 	 

	 	 	 	 	 	 	 	 	 
	Title:

	 	President and CEO
	 	 	 	Title:
	 	SVP-Publishing
	 

	 	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 	 	 
	Date:

	 	10/17/08
	 	 	 	Date:
	 	October 3, 2008
	 

	 	 
	 	 	 	 	 	 

NOT AN AGREEMENT UNTIL

EXECUTED BY BOTH PARTIES

	 	 	 	 	 
	Sony Computer Entertainment America
	 	 	 	 
	PLAYSTATION 3 GLPA

	 	REDACTED

{Page}
	 	CONFIDENTIAL

 

 

SONY COMPUTER ENTERTAINMENT AMERICA INC.

FIRST AMENDED NORTH AMERICAN TERRITORY RIDER TO THE GLOBAL

PLAYSTATION3 FORMAT LICENSED PUBLISHER AGREEMENT

This
First Amended North American Territory Rider to the Global PlayStation® 3
Format Licensed Publisher Agreement (the “Rider” or
“1st Amended North American
Rider”) is entered into and rendered effective as of this 26th day of September,
2008 (the “Effective Date.

1. Incorporation

     The Rider’s terms and conditions are incorporated into and read in
conjunction with the terms and conditions of the Global PlayStation 3 Format
Licensed Publisher’s Agreement signed by Publisher (“PS3 LPA”).

2. Definitions

     All capitalized words and phrases referenced in the Rider that are not expressly defined
herein shall have the meanings set forth in the Definitions section of the PS3 LPA.

     2.1
[*********] to determine the initial wholesale price for the purpose of calculating royalties.

3. Territory

     A. The Territory pursuant to the Rider and the PS3 LPA is expressly limited to
the following countries and territories:

	 	(1)	 	The United States of America and its territories and possessions;
	 
	 	(2)	 	Canada: and
	 
	 	(3)	 	Mexico.

     B. SCEA shall be entitled to modify and amend the Territory from time to time
during the Term by providing written notice of any such changes to Publisher. In the event
a country is deleted from the Territory, SCEA shall deliver to Publisher a written notice stating the
number of days within which Publisher must cease distributing Licensed Products and must retrieve any
Development Tools located in any deleted country.

     C. Publisher shall not, directly or indirectly, solicit orders for or sell any
Units of Disc Products in any situation where Publisher knows or reasonably should know that
any of such Disc Products may be exported or resold outside of the Territory.

4. Royalties Applicable to Licensed Products

	 	A.	 	Disc Products.

     (i)
Initial Orders. In accordance with Section 9 of the PS3 LPA, Publisher
shall pay SCEA, either directly or through its designee, a royalty in United States dollars
for each Unit of the Disc products manufactured, as follows:

 

	*	 	Information has been omitted from this document and filed separately with the SEC under a
request for confidential treatment Pursuant to Rule 24b-2 under the Securities Exchange
Act of 1934, as amended.

 

          For product distributed on a 25GB BD: [*********]

          For product distributed on a 50GB BD: [*********]

          To
insure quality, royalty payments include manufacturing of the BluRay
disc and Packaging,
excluding Printed Materials and inserts. In the future and at its sole discretion, SCEA may allow
Publisher to use alternative packaging facilities provided that Publisher can prove that it can
meet all of SCEA’s quality assurance criteria set forth in the Guidelines. At that time, SCEA may
restructure royalties to account for costs related to Packaging.

          In the absence of satisfactory evidence to support the WSP, the royalty rate that shall apply
will be [*********] for a BluRay 25 disc and [*********] for a BluRay 50 disc, per Unit. Upon receipt
of any notice of change in royalties under Section 9.1 of the PS3 LPA, Publisher shall have the
option to terminate this Agreement upon written notice to SCEA and discontinue all production,
publishing, marketing, advertising, sale, distribution and other exploitation of Licensed Products,
rather than having such revised royalty structure go into effect.

          (ii) Reorders and Other Programs. Royalties on additional orders for Disc Products shall be
the royalty determined by the initial Wholesale Price as originally reported by Publisher for that
Disc Product, regardless of the wholesale price of the Disc Product at the time of reorder, except:
(a) in the event that the Wholesale Price increases for such Disc Product, in which case the
royalty shall be adjusted upwards to reflect the higher Wholesale Price; or (b) the product
qualifies for an alternative royalty program offered by SCEA. Disc Products qualifying for SCEA’s
“Greatest Hits” programs or other SCEA alternative royalty programs shall be subject to the royalty
rates applicable for such programs as set forth in the Guidelines.

          (iii) Third Party Publisher Demo Disc Program Royalties. Publisher shall be able to produce
demonstration discs in accordance with the Guidelines published by SCEA for demonstration discs in
the Territory. The quantity of Units ordered shall comply with the terms of such SCEA Established
Third Party Demo Disc Program.

B. Online Products.

          Publisher must require all end-users to sign in with the end-user’s unique PLAYSTATION Network
identifier (“PSN Online ID”) when accessing Online Gameplay. On a site that allows end-users access
to Online Gameplay, for revenue, income, or other monetary value (“Consumer Value”) that is earned,
recognized, or otherwise derived by Publisher, including revenue recognized through distribution of
Licensed Products or services provided free of charge to end-users, Publisher shall pay SCEA,
either directly or through its designee, a [*********] royalty in United States dollars on all
Consumer Value.

     Prior to distributing a Licensed Product to consumers without cost or other consideration,
Publisher shall confer with SCEA to determine the deemed Consumer Value of the Licensed Product.

C. Advertising. Content or services that are supported by advertising shall be
subject to a separate agreement or rider to the PS3 LPA and to SCEA’s advertising policies and procedures. No
advertisements shall be placed in Online Products nor shall advertisements be placed or served
dynamically in Licensed Products without a separate express license from SCEA. SCEA reserves the
right to charge an additional or different royalty for third-party advertising in-game, whether
dynamic or static.

5.
Accounting.

 

	*	 	Information has been omitted from this document and filed separately with the SEC under a
request for confidential treatment Pursuant to Rule 24b-2 under the Securities Exchange
Act of 1934, as amended.

 

          Publisher shall provide SCEA with monthly reports of the gross Consumer Value revenues
actually received by Publisher (or otherwise credited to its benefit). Such monthly reports shall be
delivered on a per title basis to SCEA no later than [*********] after the end of each month,
beginning with the month in which Publisher launches a title-specific site that allows end-users
access to Online Gameplay of that title. SCEA shall have the right to adopt and implement online
royalty accounting verification mechanisms at its sole discretion.

          Additional Regional Terms.

          6.1 Payment Terms. In addition to the remedies and requirements set forth in the PS3 LPA, any
overdue sums shall bear interest at the rate of [*********] per [*********] or such lower rate as
may be the maximum rate permitted under applicable law, from the date when payment first became due
through and including the date of payment.

          6.2 Subpublishing Prohibited. Publisher’s license to publish Licensed Products in the
Territory under the PS3 LPA does not extend to Licensed Products previously published for the
PlayStation 3 computer entertainment system by another Licensed Publisher.

          6.3 Liquidated Damages. As an additional option in lieu of termination under Section 14.4 of
the PS3 LPA, SCEA may require Publisher to pay liquidated` damages of [*********] for certain
breaches of the Agreement, including violations of SCEA’s trademark rights under Section 6.8.2 of
the PS3 LPA. Liquidated damages may be invoiced separately or on Publisher’s next invoice for Disc
Products. Election of liquidated damages shall not constitute a waiver of or compromise with
respect to any of SCEA’s rights under this Rider or the PS3 LPA and SCEA may elect to terminate the
PS3 LPA with respect to any breach.

          6.4 Additional Ground for Termination. If Publisher fails to pay any sums owed to SCEA
(Including liquidated damages pursuant to Section 6.3 of this Rider) on the date due and such
default is not fully corrected or cured within [*********] of the date on which such payment was
originally due, SCEA shall be entitled to terminate under Section 14.2 of the PS3 LPA.

          6.5 Subcontractors. SCEA requires that Publisher enter into a Subcontractor Agreement for use
of subcontractors under Sections 2.1(i), 3.2 and 16.7 of the PS3 LPA. Each Subcontractor Agreement
shall provide that SCEA has the full right to bring any actions against the signing subcontractor,
to require the subcontractor to comply with all the terms and conditions of the PS3 LPA or the
Subcontractor Agreement. Publisher shall provide a copy of any proposed Subcontractor Agreement to
SCEA prior to, and a fully-executed copy promptly following, execution of the Subcontractor
Agreement. Publisher shall give SCEA written notice of the identity of any prospective
subcontractor no less than [*********] prior to entering into an agreement or other arrangement
with the prospective subcontractor.

7.      Notices.

          Any notices required under this Rider or the PS3 LPA shall be delivered addressed to the
following persons:

	 	 	 
	For Publisher:

	 	ATTN: President
	 

	 	Midway Home Entertaiment Inc.
	 

	 	c/o Midway Amsement Games, LLC.
	 

	 	2704 West Roscoe Street
	 

	 	Chicago, IL 60618
	 
	 	 
	with a copy to:

	 	ATTN: SVP, General Counsel
	 

	 	Midway Games Inc.

 

			
	*	 	Information has been omitted
from this document and filed separately with the SEC under a request
for confidential treatment pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as
amended.

 

	 	 	 	 	 
	 

	 	 	 	2704 West Roscoe Street
	 
	 	 	 	 
	 

	 	 	 	Chicago, IL 60618
	 
	 	 	 	 
	 

	 	For SCEA:
	 	ATTN: General Counsel
	 

	 	 	 	Sony Computer Entertainment America
Inc.
	 

	 	 	 	919 East Hillsdale Boulevard
	 

	 	 	 	Foster City, CA 94404

8. Governing Law

     The Agreement and this Rider shall be governed by and interpreted in accordance
with the laws of the State of California, excluding that body of law related to
choice of laws, and of the United States of America.

9. Dispute Resolution

     The Parties shall attempt in good faith to resolve through informal discussions or
negotiations any dispute, controversy or claim of any kind or nature arising under or in
connection with this Agreement, including breach, termination or validity thereof (a
“Dispute”). Any Dispute that the Parties are unable to resolve through informal
discussions or negotiations after [*********] will be submitted to binding arbitration
conducted in accordance with and subject to the Commercial Arbitration Rules of the
American Arbitration Association (“AAA”) except to the extent otherwise required under
this dispute resolution clause. One arbitrator will be selected by the Parties’ mutual
agreement or, failing that, by the AAA. The arbitrator must have substantial experience
in disputes involving technology licensing agreements. The arbitrator will allow such
discovery as is appropriate, and impose such restrictions as are appropriate, consistent
with the purposes of arbitration in accomplishing fair, speedy and cost-effective
resolution of disputes, except that (i) no requests for admissions will be permitted;
(ii) interrogatories will be limited to (a) identifying persons with knowledge of
relevant facts and b) identifying expert witnesses and obtaining their opinions and the
bases therefor; and (iii) each party will be limited to five (5) depositions. Judgment
upon the award rendered in any such arbitration may be entered in any court having
jurisdiction thereof. Any arbitration conducted pursuant to this section will take place
in San Francisco, California. Each Party will bear its own costs. The Parties will share
equally in paying the expenses and fees of the arbitrator. The arbitrator may not alter
the foregoing allocation of the parties’ costs, nor of the arbitrator’s fees and
expenses. Other than those matters involving injunctive relief or any action necessary
to enforce the award of the arbitrator, the Parties agree that the provisions of this
section are a complete defense to any suit, action or other proceeding instituted in any
court or before any administrative tribunal with respect to any Dispute. Notwithstanding
the foregoing. SCEA may apply to any court of competent jurisdiction within the Licensed
Territory seeking a temporary restraining order, preliminary injunction, or other
interim or conservatory relief, with respect to the protection of any intellectual
property rights or Confidential Information of or concerning the SCE Group Companies or
the System, including, without limitation, the SCE Materials and Licensed Trademarks.

ACCEPTED AND AGREED:

	 	 	 	 	 	 	 	 	 
	Sony Computer Entertainment America Inc.	 	 	 	Midway Home Entertainment Inc.
	 
	 	 	 	 	 	 	 	 
	By:

Name:

	 	/s/ Jack Tretton
 

Jack Tretton
	 	 
	 	By:

Name:
	 	/s/ Miguel Iribarren
 
 Miguel
Iribarren
	Title:

	 	President & CEO
	 	 	 	Title:
	 	 SVP-Publishing
	Date:

	 	10/17/08
	 	 	 	Date:
	 	October 3, 2008

 

			
	*	 	Information has been omitted
from this document and filed separately with the SEC under a request
for confidential treatment pursuant to Rule 24b-2 under the Securities Exchange Act of 1934, as
amended.EX-10.57

EXHIBIT 10.57

EXECUTION COPY

AMENDMENT NO. 1 to LOAN AND SECURITY AGREEMENT

          THIS AMENDMENT NO. 1 to LOAN AND SECURITY AGREEMENT (this “Amendment”) is being
executed and delivered as of August 19, 2008, by and among MIDWAY HOME ENTERTAINMENT INC., a
Delaware corporation (“Midway”), as Administrative Borrower on behalf of the “Companies”
(as defined in the Credit Agreement referred to below), and NATIONAL AMUSEMENTS, INC., a Maryland
corporation, as Lender (the “Lender”). All capitalized terms used herein without
definition shall have the same meanings as set forth in the hereinafter identified and defined
Credit Agreement.

WITNESSETH:

          WHEREAS, the Lender, Midway, Midway Amusement Games, LLC, a Delaware limited liability
company, Midway Games Inc., a Delaware corporation, Midway Games West Inc., a California
corporation, Midway Interactive Inc., a Delaware corporation, Midway Sales Company, LLC, a Delaware
limited liability company, Midway Home Studios Inc., a Delaware corporation, Surreal Software Inc.,
a Washington corporation, Midway Studios — Austin Inc., a Texas corporation, and Midway Studios —
Los Angeles Inc., a California corporation, have entered into that certain Loan and Security
Agreement, dated as of February 29, 2008 (as amended, restated, supplemented or otherwise modified
from time to time, the “Credit Agreement”); and

          WHEREAS, Midway, on behalf of the Companies, has requested that the Lender agree to amend the
Credit Agreement, as set forth herein, and the Lender has agreed to so amend the Credit Agreement
on the terms and conditions of this Amendment;

          NOW, THEREFORE, in consideration of the foregoing premises, the terms and conditions stated
herein, the representations and warranties of Midway in Section 2 hereof, and other valuable
consideration, the receipt and sufficiency of which are hereby acknowledged by Midway and the
Lender, such parties hereby agree as follows:

     1. Amendments. As of the date hereof, the Credit Agreement is hereby amended as
follows:

     (a) The definition of “Permitted Investments” appearing in Section 1.1 of the Credit
Agreement is hereby amended (i) to insert the additional clauses, “(o) Investments
constituting loans made by any Foreign Company to the Parent or any other Subsidiary of the
Parent,” and “(p) Loans from any Company to any Foreign Company which re-evidence
Investments made prior to the Closing Date (so long the proceeds of any such Loan are used
at the time of such Loan to repay such prior Investments),” immediately after clause (n)
therein and (ii) to renumber the final clause in such definition from “(o)” to “(q)”.

     (b) The definition of “LIBOR Rate” appearing in Section 1.1 of the Credit Agreement is
hereby amended to insert the words “(or such other independent source as
the Administrative Borrower and the Lender may agree upon from time to time)”
immediately after the words “Bank of America, N.A.” appearing therein.

 

 

     (c) The definition of “Maximum Revolver Amount” appearing in Section 1.1 of the Credit
Agreement is hereby amended to delete the number “$1,047,619” appearing therein and to
replace such figure with the following language: “the aggregate face amount as of any date
of determination of (i) that Letter of Credit issued by Wells Fargo Bank, N.A. on January 5,
2006, initially in favor of RREEF Domain, LP, with an initial face amount of $833,333, and
(ii) that Letter of Credit issued by Wells Fargo Bank, N.A. on November 6, 2006, initially
in favor of Crystal Pier Partners, LP, San Diego, CA, with an initial face amount of
$214,285.75, in each case, together with any Letter of Credit as may renew, refinance,
restructure, replace, or extend either such Letter of Credit, and in each case, as the same
may be amended, restated, supplemented or otherwise modified and in effect”.

     (d) Section 1.1 of the Credit Agreement is hereby amended to insert the following new
definition in proper alphabetical order:

     “German Intercompany Loan” means, collectively, one or more
loans in an aggregate principal amount of up to €2,137,100 made on or after
August 19, 2008 by the German Company to the Parent and evidenced by that
certain Agreement dated as of August 19, 2008, as amended, restated,
supplemented or otherwise modified, as such loan or loans may be refinanced,
renewed or extended.

     (e) The definition of “Permitted Lien” appearing in Section 1.1 of the Credit Agreement
is hereby amended (i) to insert the additional clause “(n) Liens granted in favor of the
German Company and securing the obligations of the Parent under the German Intercompany
Loan” immediately after clause (m) therein and (ii) to renumber the final clause in such
definition from “(n)” to “(o)”.

     (f) Article VIII of the Credit Agreement is hereby amended to insert the following
Section 8.14 immediately following Section 8.13 appearing therein, and to renumber Sections
8.14 and 8.15 as Sections “8.15” and “8.16”, respectively:

     8.14 The German Company shall sell, assign, pledge, or otherwise transfer its
interest in the German Intercompany Loan without the prior consent of the Lender or
the German Company’s security interest in the collateral pledged by the Parent in
connection with such German Intercompany Loan shall be enforced or foreclosed upon.

     2. Representations and Warranties. Midway hereby represents and warrants that after
giving effect to the terms of this Amendment (i) no Default or Event of Default has occurred and is
continuing and (ii) the representations and warranties contained in the Credit Agreement and the
other Loan Documents shall be true and correct in all material respects on and as of the date
hereof, as though made on and as of such date (except to the extent that such representations and
warranties relate solely to an earlier date).

     3. Counterparts. This Amendment may be executed in any number of counterparts and by
different parties hereto in separate counterparts, each of which when so executed and

2

 

delivered
shall be deemed to constitute one and the same instrument. A signature page sent to the Lender or
its counsel by facsimile or other electronic means (including in portable document format (.pdf))
shall be effective as an original counterpart signature.

     4. Section Titles. The section titles contained in this Amendment are and shall be
without substance, meaning or content of any kind whatsoever and are not a part of the agreement
between the parties hereto.

     5. Governing Law. The validity of this Amendment, the construction, interpretation,
and enforcement hereof, and the rights of the parties hereto with respect to all matters arising
hereunder or related hereto shall be determined under, governed by, and construed in accordance
with the laws of the State of Illinois.

[Signature Pages Follow]

3

 

               IN WITNESS WHEREOF, this Amendment has been duly executed as of the day and year first above
written.

	 	 	 	 	 
	 	MIDWAY HOME ENTERTAINMENT INC.,

as Administrative Borrower

 	 
	 	By  	/s/ Matthew V. Booty
 	 
	 	 	Title   Interim President and Chief Executive Officer 	 
	 	 	 	 

Signature Page to

Amendment No. 1

to Loan and Security Agreement

 

	 	 	 	 	 
	 	NATIONAL AMUSEMENTS, INC.,

a Maryland corporation, as Lender

 	 
	 	By:  	/s/ Richard J. Sherman
 	 
	 	 	Title:  Vice President 	 
	 	 	 	 

Signature Page to

Amendment No. 1

to Loan and Security Agreement

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