LICENSE FOR SOFTWARE DEVELOPMENT AND DISTRIBUTION AGREEMENT
LICENSE
FOR SOFTWARE DEVELOPMENT AND DISTRIBUTION AGREEMENT
This
License Agreement for Software Development and Distribution ("Agreement")
is
entered into as of June 30, 2008 (the "Effective
Date")
by and
between Platinum Studios, Inc. ("Platinum"),
a
California corporation, and Brash Entertainment, LLC ("Licensee"),
a
Delaware limited liability company. All capitalized terms used in this Agreement
and the attached Exhibits and Addenda shall be defined terms in the Agreement
or
in the Glossary Addendum attached hereto.
1. PROPERTY
ELEMENTS:
The
elements of the "Property"
licensed
pursuant to the terms and conditions of this Agreement shall consist
collectively of (a)
the
graphic novel “COWBOYS & ALIENS” and all copyrightable elements therein for
which copyright resides with Platinum; and (b) the name
and the
title treatment logo
of the
graphic novel described in subsection (a). Platinum
shall use commercially reasonable efforts to obtain rights to motion picture
elements of the motion picture currently entitled “COWBOYS & ALIENS” (the
“Motion
Picture”),
including, without limitation, access to creative talent, access to the set,
set
blue-prints and designs, costume designs, character voices and likenesses,
music, and other theatrical materials that will assist Licensee in creating
the
Title (as defined below) (collectively, “Motion
Picture Assets”)
for
purposes of inclusion in the Title; provided, however, that a failure to obtain
such rights (notwithstanding commercially reasonable efforts to do so) will
not
result in a breach of this Agreement. To clarify, with respect to character
voices and likenesses, Platinum shall use commercially reasonable efforts to
provide Licensee with the right to use such character voices and likenesses
in
the Title with no further cost to Licensee. To the extent Platinum obtains
any
Motion Picture Assets, such Motion Picture Assets shall be included within
the
definition of Property and the rights granted hereunder, subject to any
contractual restrictions imposed by the motion picture studio producing the
Motion Picture.
2. RIGHTS
GRANTED:
(a) Development
Rights:
Platinum grants to Licensee a non-transferable, exclusive license to develop
and
release video game products derived from the Property on the following
platforms: (i)
Console: Microsoft Xbox 360 ("Xbox
360"),
Sony
Playstation 2 ("PS2"),
Sony
PlayStation 3 ("PS3"),
and
Nintendo Wii ("Wii");
(ii)
Handheld: Sony PSP ("PSP")
and
Nintendo Dual Screen ("DS");
(iii)
all
PC-CD ROM and Mac formats ("PC/Mac");
(iv)
Xbox
Live Arcade
for the video game arena and like platforms from other first party proprietors,
such as Sony HOME, Sony Playstation Network, and Nintendo Wii Storefront
(“First
Party Platforms”);
(v)
online; (vi)
wireless
handheld devices such as mobile telephones, PDAs, iPods, and Zunes;
and (vii)
any
future or successor
platforms to the
platforms named in this sentence to the extent such platforms are commercially
available during the Term (as defined in Paragraph 4 below) (collectively,
the
“Platforms”).
Such
video games shall be referred to as the "Title."
The
right to develop the Title shall include the non-exclusive right to use, copy,
and reproduce certain copyrightable elements from the Property. Licensee may
use
any translations of the name of the Property
within the Territory, but Platinum makes no representation or warranty that
such
translation(s) are available for use as game titles without violation of any
third party copyright or trademark for such purpose. Notwithstanding the
foregoing, Licensee acknowledges that Platinum has previously licensed to the
studio making the motion picture (the “Studio”)
the
right to create free online games based on the Property solely for promotion
of
the motion picture, and that such games do not constitute a violation or breach
of this Agreement. Platinum shall use its best efforts to encourage the Studio
to use such games to promote the Title, as well.
Platinum
shall provide access to or deliver to Licensee any Motion Picture Assets to
which it obtains the rights in a timely manner. Subject
to any limitations or conditions contained herein and/or in any third party
agreements of which Licensee has been notified, Platinum shall use commercially
reasonable efforts to obtain the right for Licensee to use the elements of
the
Motion Picture Assets on the packaging for the Title and in the marketing and
promotion thereof, provided however that no likenesses of any of the actors
from
the Property may be used on the packaging or in the marketing of the
Title
unless
such talent likenesses are used in-game and may only be used as they appear
in-game. These Motion Picture Assets shall be delivered to Licensee on such
date(s) as mutually agreed by the parties.
(b) Mobile
Rights:
In
addition to the rights set forth in Paragraph 2(a), Platinum grants to Licensee
the exclusive license to develop content based solely on unique, game-only
elements of the Title (“Unique Title Assets”) on wireless
handheld devices such as mobile telephones, PDAs, iPods, and Zunes
(“Mobile
Rights”).
Such
Mobile Rights shall include, but are not limited to, the right to develop the
following: games that are derivative of the game set forth in Paragraph 2(a),
casual games, ringtones (including, but not limited to, real tones, “teen buzz”
ringtones, ringback tones, polyphonic ringtones, monophonic ringtones, and
watchtones), a mobile web (consisting of a WAP site with mobile storefront
capabilities), SMS and MMS text messaging, graphics (such as wallpapers), and
video (including, but not limited, to “mobi-sodes,” mobile video content from
the Property, and mobile video content from the Title). To clarify, Mobile
Rights do not include any Motion Picture Assets unless separately granted such
rights by the motion picture studio.
(c) Sequel/Prequel
Rights:
Platinum also grants to Licensee the exclusive right to develop and release
video games derived from any sequels or prequels to the Property on the same
financial terms as set forth in this Agreement. In addition, Licensee shall
have
the exclusive right to develop and release sequel or prequel video games derived
from the Title, regardless of whether a sequel or prequel to the Property is
distributed or exploited, on terms to be negotiated in good faith between the
parties. Furthermore, Licensee shall have the exclusive right to develop and
release non-sequel video games derived from the Property on terms to be
negotiated in good faith between the parties. Any sequels or prequels must
be
released during the Term.
(d) Publishing
Rights:
Platinum further grants to Licensee the exclusive right to manufacture, publish,
distribute, market, advertise, promote and sell the Title, subject to any
limitations or conditions that Platinum may specify in this Agreement,
throughout the Term and Territory (defined below)
(e) Sublicensing
Rights:
Licensee shall have the right to sublicense the rights granted to it under
this
Agreement with respect to development and distribution of the
Title.
(f) Restriction
on Rights:
The
rights
being granted hereunder do
not include
the right to use, copy, simulate or reproduce in the Title or in any marketing
or advertising materials therefor
the
names, likenesses, voices or character voices of any of the actors who perform
in the Property, or
any
film or audio clips from the Property, without
Platinum’s prior written approval and
subject to the obligations and limitations imposed on Platinum by the talents'
agreements for services for the Property and/or the relevant guild
agreements.
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(g) Rights
Reserved:
Platinum
reserves all rights not granted to Licensee hereunder now known or hereafter
created, including, without limitation, DVD
(or
similar home video technology) clip and artwork -based games (using trivia
and
simple puzzles and the like) with or without game boards, arcade game machines,
pachinko/pachisuro/pachislot games, slot machines and other gambling machines,
all of which may be derived from or based upon the Property and Platinum or
its
Affiliates shall be free, without restriction, to exercise such rights during
the Term of this Agreement; provided, however, that any promotion
for the Title shall only be undertaken at the mutual agreement of the parties
with respect to all the terms and elements thereof, and as between Platinum
and
Licensee, Licensee shall bear the expense of any such mutually agreed
promotions.
(h) Credit:
Platinum shall receive credit in the Title in a fashion commensurate with
industry standard, subject to applicable console manufacturer
restrictions.
At a
minimum, Platinum’s credit shall read: “Based on Platinum Studios Comics’
graphic novel created by ▇▇▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇.” This credit shall appear in
the manual, in the game, and on the back of the box (within a legal line).
Platinum
makes no representation or warranty as to the amount of gross sales or profits
Licensee will derive from the rights licensed hereunder or that the Property
will appear or continue to appear in or as part of any program, motion picture
or other work or that any such work will be or continue to be exploited.
Platinum and/or its Affiliates may from time to time, at any time, delay,
discontinue, resume or change any present or future use of the Property;
provided however that any delay in the release of the Property
in
theaters
shall
automatically extend the release obligations of Licensee by an amount of time
equal to the amount of the delay, and the parties shall negotiate in good faith
a reduction of the Guarantee set forth in Paragraph 6. The immediately preceding
sentence shall be subject to the obligations set forth in Paragraph 8.
3. EXCLUSIVITY/
HOLDBACK:
Other
than the rights reserved to Platinum in Paragraph 2(f) and as may be otherwise
limited or excepted in this Agreement, Licensee shall have the exclusive right
to use the elements of the Property in accordance with the terms and conditions
of this Agreement in connection with video game rights for the Property granted
hereunder during the Term. During the Term, Platinum shall not authorize the
Release for sale of video games based on the Property. With respect to any
prequels or sequels authorized pursuant to Paragraph 2(c), the period of
exclusivity shall extend for twelve (12) months from the initial commercial
release of such sequel or prequel, notwithstanding any expiration of the
Term.
4. TERM:
The
term of this Agreement shall commence on the Effective Date and, unless
terminated earlier in accordance with the terms set forth herein, shall expire
four (4) years from the Effective Date (the "Term").
In
addition, commencing on the initial commercial release of the Title and expiring
five (5) years thereafter, there shall exist for the Title an exploitation
period (“Exploitation
Period”)
during
which the rights granted hereunder with respect to the Title shall continue
to
allow Licensee to manufacture, package, distribute, market, promote, advertise,
sell, and otherwise exploit the Title. The Exploitation Period shall be
exclusive during such time as it coincides with the Term, and shall be
non-exclusive thereafter. Any extension of the Term or the Exploitation Period
shall be mutually agreed between the parties.
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5. TERRITORY:
The
territory to be covered by this Agreement is worldwide ("Territory").
6. GUARANTEE:
Licensee
shall pay to Platinum a minimum "Guarantee"
for the
Title in the amount of US$250,000, which
Guarantee shall be paid as follows: (a)
US$125,000 payable upon mutual execution of the Agreement; and (b) US$125,000
payable no later than July 31, 2008. If Licensee fails to pay the US$125,000
payment pursuant to subsection (b) of this Paragraph, then Platinum shall have
the right to terminate this Agreement, provided that it shall have no recourse
against Licensee for the payment of such US$125,000 and the payment pursuant
to
subsection (a) of this Paragraph is non-refundable.
Production
Fee:
In
addition to the Guarantee, Licensee shall pay to Platinum a “Production
Fee”
for the
Title, which is payable as follows: (a) US$125,000 payable upon the earlier
of
(i) commencement of production of the first Title, or (ii) the
date
on which the motion picture upon which the Title is based is greenlit for
production (as such terms are commonly understood in the film industry) by
a
major motion picture studio with a budget of no less than US$60
million;
and (b)
US$125,000 payable upon the earlier of (i) Platinum’s
approval of the Gold Master version of the first Title; or (ii) the theatrical
release of the motion picture upon which the Title is based. Such Production
Fee
is subject to a further “Production Services Agreement” that shall be entered
into between the parties within thirty (30) days of the Effective
Date.
Licensee
shall have the right, any time during the Term, to seek one or more
third-parties to co-finance the development of the Title provided that such
co-financing arrangements shall not modify the terms of this Agreement.
The
Guarantee and Production Fee shall serve as a non-refundable (except as
otherwise expressly provided herein) advance against and shall be recouped
from
the
Royalties and any Sponsorship Revenue (as defined in Paragraph 10) payable
to
Platinum for the Title. The Guarantee, Production Fee, Royalties, and
Sponsorship Revenue are specific to
this
Agreement,
and may
not be cross-collateralized for recoupment purposes with any other titles that
are the subject of other
agreements between the parties.
7. ROYALTIES:
Licensee shall pay to Platinum and Platinum shall earn a Royalty from the Net
Sales of all formats of the Title as set forth below.
(a) Console
and Handheld Platforms:
License
shall pay to Platinum and Platinum shall earn the following Royalties from
the
Net Sales of all console and handheld formats of the Title in the
Territory:
8%
of Net
Sales on sales of 1 to 600,000 units sold and not returned; and
10%
of
Net Sales on sales of 600,001 + units sold and not
returned.
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(b) First
Party Platforms:
Platinum shall receive 10% of all revenue received by Licensee in connection
therewith, less any unaffiliated third-party costs.
(c) Mobile:
Platinum shall receive 25% of all revenue received by Licensee in connection
therewith, less any unaffiliated third-party costs.
(d) Digital
Distribution:
Platinum shall receive 25% of all revenue received by Licensee in connection
therewith.
As
used
herein, "Net
Sales"
of the
Title (or format thereof) shall mean the gross invoice Wholesale Price of
shipments of all units of the Title to unrelated third parties (including
without limitation shipments made by Licensee, its affiliates and/or
distributors) less (i) fully burdened cost of goods and platform and licensing
fees; (ii) actual price protection and returns provisions; (iii) actual tax,
excise, and duties; (iv) actual trade discounts incurred; (v) royalties to
unaffiliated third parties; and (vi) actual marketing and distribution costs.
Licensee may deduct a reasonable reserve for items (ii) and (iv) not to exceed
20% of Net Sales in the aggregate ("Title
Reserve").
The
Title Reserve shall be used as a holdback to account for the actual returns,
price protection, ▇▇▇▇-down and allowance percentages that are permitted above
per the definition of Net Sales. The Title Reserve shall be liquidated six
(6)
months after the sale of the Title unit, which liquidation shall start six
(6)
months after the first sale of the Title and continue each calendar quarter
thereafter.
Net
Sales
shall be calculated, and the Royalty shall accrue to Platinum, when the Title
is
shipped and/or invoiced, whichever comes first.
"Wholesale
Price"
means
the actual price Licensee charges to those who ultimately sell the Title (i.e.
retailers or third-party distributors) to the public. If Licensee sells
the
Title
directly to consumers, the Wholesale Price shall mean the price charged the
consumer (less shipping and handling fees and sales tax, if any).
Licensee
shall in good faith attempt not to reduce its Wholesale Price for the Title
in
the first four (4) months of Initial Release; provided, however, Licensee
reserves all rights to set its prices (including, but not limited to, wholesale)
for the Title for its customers, which shall include, but is not limited to,
the
right to reduce the Wholesale Prices of the Title as may be commercially
necessary during the first four (4) months of Initial Release. Licensee shall
treat the Title with respect to price reductions in a similar fashion and manner
to other comparable titles published by Licensee.
With
respect to the merchandising of Unique Title Assets, which rights shall be
controlled by Platinum, Platinum acknowledges and agrees that Licensee shall
receive 50% of all revenue received by Platinum with respect to such Unique
Title Assets, less any unaffiliated third-party costs.
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8. RELEASE
OBLIGATIONS:
Licensee
shall Release the
Title on
all
platforms in
the
United
States concurrent
with the theatrical release of the Property
in the United States (currently scheduled for release in Summer
2010).
Platinum
shall apprise Licensee of the theatrical release date and the DVD release date
of the Property
as soon
as is reasonably practicable. Licensee acknowledges that the intent of this
Agreement is to have the Release of the Title on all
platforms
coincide
with the theatrical release of the Property.
As
such, should the theatrical release
date of the Property
be
changed to a date later than that which shall be identified initially and
notified to Licensee, Licensee shall be timely informed in writing by Platinum
of such change and
Licensee
shall adjust its release of the Title
to
coincide with the revised theatrical release
date.
Notwithstanding
the foregoing, in the event that the theatrical
release
of the Property is delayed more than 90 days from the currently-anticipated
release date, then Platinum and Licensee shall negotiate in good faith a
potential reduction in the Guarantee to off-set resulting development and
marketing costs. If
Licensee
fails to release all
formats
of the Title by the date
that
is
three
(3)
months
after the date described
above (subject to further extension for any intervening force majeure events),
Platinum at
its
election may either
terminate
this Agreement with respect to only that format of the Title
not
Released by such dates or terminate this Agreement pursuant to Paragraph
23.
9. DISTRIBUTION
OBLIGATIONS:
Licensee
shall have the right to distribute the Title
in all
customary and standard channels of distribution, including, but not limited
to,
trade, retail, rental outlets, online, digitally, and mobile (“on” and “off”
deck).
Should
Licensee
enter into
a
bundle/OEM arrangement or non-traditional distribution deal for the
Title
for which Licensee receives financial remuneration, Platinum
shall receive 8%
of net
licensing fees received by, accruing or credited to Licensee for Bundles, and
8%
net
licensing fees received by, accruing or credited to Licensee for OEMs. "Net
licensing fees" shall mean gross revenue from any such transaction less only
refunds Licensee is required to make to its licensee but in no event will
Licensee deduct any administration or agency fees.
In
connection with Licensee's distribution rights, it shall comply with the
following:
(a) Concept
Approval:
Licensee
shall be responsible for and shall obtain from the appropriate console and
handheld manufacturing entities concept and manufacturing approval for the
Title.
(b)
Duplication:
Licensee shall be responsible for having the Title manufactured and duplicated
and for all costs thereof. Licensee shall supply to the console and handheld
manufacturers or their licensed manufacturers the master(s), samples of the
Title, the documentation and manuals for the Title, and all other collateral
material as have been approved by Platinum that are reasonably required to
manufacture, or have manufactured the Title.
(c)
Manufacturing Royalties:
As
between Platinum and Licensee, Licensee shall be solely responsible for the
payment of any fees and/or manufacturing royalties due to the appropriate
manufacturing entities for the manufacture and/or sale of the
Title.
(d)
ESRB and First Party Platforms Compliance/Authorized Publisher:
Licensee shall submit to the ESRB and its foreign ratings board equivalents
the
Title and all other materials required to be submitted for ratings compliance,
the costs for which Licensee shall bear, and Licensee shall comply with all
rules and regulations established by the ESRB and its foreign equivalents
regarding the distribution of video game products. In addition, Licensee shall
submit to the first parties the title and all other materials required to be
submitted for compliance with the ratings system of First Party Platforms,
the
costs for which Licensee shall bear, and Licensee shall comply with all rules
and regulations established by the first parties regarding the distribution
of
video game products. Licensee shall be an authorized publisher with any or
all
of Sony, Microsoft, or Nintendo for all formats of the Title specified in
Paragraph 2(a) in time to secure all necessary concept approvals of the
Title.
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(e)
Product Support:
Licensee shall provide all customer product support, including technical
support, for the Title in the Territory in the same manner as it provides such
support for any other title that it distributes and/or publishes.
(f)
Solicitation of Sales:
So long
as the Agreement has not been terminated or otherwise expired, Licensee shall
use all reasonable commercial efforts as are standard within the video game
industry to solicit Sales Transactions throughout the Territory during the
Term
of this Agreement.
(g)
No
Preferential Treatment:
Platinum acknowledges and understands that Licensee is under no obligation
to
treat Platinum's products preferentially to any other software products which
Licensee has the right to sell or license. Notwithstanding the foregoing,
Licensee warrants, represents and agrees that it will cause the Title to be
manufactured and distributed in a first class manner.
(h)
Shipping:
As
between Platinum and Licensee, Licensee shall be responsible for providing
the
Title to its Customers (including all appropriate shipping and insurance
costs).
(i)
Modifications:
Licensee shall not modify the Title, including for customization purposes,
without the prior written approval of Platinum.
(j)
Compliance with all Laws:
Licensee shall comply with all laws, rules, treaties, and regulations governing
the development, manufacture, promotion, marketing and distribution of the
Title
throughout the Territory and in the collection of any consumer information
via
the Internet or otherwise.
(k)
Localization:
Licensee shall localize
the English language version of the Title, both audio and text, and the
packaging of the Title into the following languages: French, German, Italian,
and Spanish. Licensee shall determine any additional
foreign
territories in which it will cause the Title to be distributed, and will further
determine, in its professional judgment, the extent to which the English
language version of the Title, both audio and text, and the packaging of the
Title will be translated and dubbed into the
foreign
languages,
or
subtitled into the local language. Licensee shall submit all localized versions
of the Title and marketing materials therefor to Platinum for its approval
in
accordance with Paragraph 11 below. Licensee shall bear all costs of localizing
the Title and materials therefor, including the costs of any foreign language
voice talent.
(l)
Bug Testing:
Each
Deliverable shall be thoroughly tested by Licensee prior to delivery to Platinum
for its written approval. Licensee shall be responsible for the appropriate
testing of each Deliverable of the Title to ensure (i)
the
functionality and quality assurance of the Deliverable, (ii)
the
operation of the software on the designated hardware system and other platforms,
and (iii)
the
final Deliverables delivered to Platinum are free of material Bugs which affect
in any manner the functionality of the Title or their
operation on the intended hardware system or other platforms. To the extent
that
a material Bug is discovered in the Title, Licensee will promptly investigate
it
and correct all such Bugs, whether discovered by Licensee, Platinum or a console
or handheld manufacturer. Licensee shall correct all Bugs identified by the
console or handheld manufacturer to be fixed. All costs of performing the
foregoing obligations shall be borne solely by Licensee. Delivery of the
Deliverables to Platinum shall constitute a certification of Licensee's good
faith belief that the delivered item meets the applicable acceptance criteria
under this Agreement. The Title, on any format, may not be released until such
time that Platinum has approved in writing the final Deliverable, i.e., that
which is to be used to manufacture the Title.
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(m)
Legal Copy / Logos:
Platinum shall designate and approve all copyright and trademark notices for
Platinum and
its
licensors
that
shall appear on the packaging and advertising for the Title. Licensee shall
approve all copyright and trademark notices for itself and any other entity
that
shall appear on the packaging and advertising for the Title, except that the
copyright and/or trademark of any entity competitive to Platinum or the motion
picture studio shall not appear on the packaging and advertising of the Title.
Licensee shall be responsible for all other third party copyrights. Platinum
understands that all legal copy and the placement of logos shall be subject
to
the appropriate console and/or handheld manufacturer's rules and regulations.
At
the very least, a Platinum logo designated by Platinum must
appear in equal size and placement on the back of the packaging for the Title
and in equal size, placement and prominence to that of Licensee on all materials
for the Title, including, but not limited to, manual, advertising and all other
collateral materials. Licensee shall use commercially reasonable efforts to
place Platinum’s logo on the front of the packaging, subject only to the
aforementioned first party rules and regulations. Licensee shall have the right
to include the logo of its
developer for
the
Title on the back of the packaging for the Title, the size
and
placement of
which
shall be subject
to the mutual approval of Platinum and Licensee. In no event, however, shall
the
size of the developer's logo be greater than fifty percent (50%) of the
designated Platinum
logo. To the extent allowed by the console manufacturers, a Platinum logo (the
specific logo to be designated by Platinum) shall appear immediately after
Licensee's logo and prior to the logo of any developer in-game at the opening
of
the Title. Platinum shall determine in its discretion whether such opening
screen logo shall be animated or a static image and provide the same to
Licensee. Platinum
shall have the right to approve in its discretion the inclusion of any
additional third party logos on the Title, its packaging and any collateral
materials.
(n)
Copies to Platinum:
On or
before selling or distributing the Title, Licensee shall furnish and ship to
Platinum, at no cost, 40
units of
the Title, including all packaging material, and six (6) samples of all
Distribution Materials. In addition, Licensee shall provide to Platinum, at
no
cost, 40 “free downloads” of the Title on First Party Platforms, the method of
providing such downloads to Platinum to be determined in good faith by the
parties. Licensee shall permit Platinum to purchase units of the Title in
quantities designated by Platinum at Licensee's cost of goods plus the amount
of
Royalty that would have been payable to Platinum should Licensee have sold
such
unit at Licensee's current wholesale rate, for resale by Platinum on various
Platinum-dedicated or Property-specific web-sites. On any such sale by Licensee
to Platinum, such sale will be calculated as part of Licensee's Net Sales of
the
Title and Licensee will account for and pay to Platinum the Royalty on such
sale
which would have been payable by Licensee to Platinum on sales of the same
units
of the Title to third party/ies at their best wholesale price.
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(o) Free
Units/Playable Demos:
Licensee shall have the right to distribute for free for promotional or internal
purposes up to 1,000 units of the Title across all formats, on which no
Royalties shall be payable to Platinum. Further, Licensee shall be entitled
to
create and distribute free
consumer
and trade demos for the Title in any media (including on-line) on which no
Royalties shall be payable to Platinum. Any such demo shall be subject to the
approval rights of Platinum as set forth in Paragraph 11. Should
Licensee desire to offer a demo for sale to consumers, any such arrangement
shall be subject to Platinum's prior approval, which approval Platinum may
withhold in its reasonable discretion. If Platinum shall consent to such demo
sale, Licensee shall pay Royalties to Platinum in respect of such
sale.
10. MARKETING
AND PROMOTION:
Licensee shall use all commercially reasonable efforts to market, advertise
and
promote the Title throughout the Territory and Term, and shall market, advertise
and promote the Title with the standards comparable to those as when it markets,
advertises and promotes its own products. All marketing materials and plans
for
the Title shall be subject to Platinum's approval, not to be unreasonably
withheld, as follows:
(a) Marketing
Efforts/Obligation:
Provided the Title is
fully
developed and this Agreement has not been terminated or otherwise expired,
Licensee shall be fully responsible for producing the packaging, advertising,
sales, distribution, marketing, consumer and trade publicity and promotional
materials for the Title (and the costs therefor.
Any
marketing plans, including, but not limited to, the media used and the amount
spent to market the Title, shall be subject in all respects to Platinum's prior
written approval;
provided, however, that as long as Licensee’s marketing budget is a minimum of
10% of good faith revenue projections and is allocated in accordance with
industry standard, then Platinum’s approval is not required. To
the
extent that the development cycle for the Title permits, Licensee shall
prominently display a playable demo for the Title at major trade shows in the
United States, Europe and Japan prior to the Title's Release to the extent
that
Licensee exhibits at such trade shows.
(b) Marketing
Particulars:
In no
way limiting the previous paragraph, Platinum shall have prior approval over
Licensee's marketing plans for distribution of the Title, such approval not
to
be unreasonably withheld, with separate plans due for the U.S. and European
markets for the
Title.
Licensee's marketing plans for the Title shall be delivered to Platinum at
least
three (3) months before Release of the Title. Platinum shall approve or
disapprove the marketing plans in writing within ten
(10)
business
days of receiving the plan(s) from Licensee.
(c) Packaging,
Collateral Materials and Advertising:
The
quality and style of the packaging, collateral and advertising materials for
the
Title shall be subject in all respects to Platinum's prior written approval,
which shall not be unreasonably withheld. Licensee's submissions of sample
packaging, collateral and advertising materials to Platinum shall permit
Platinum ten
(10)
business days for
review before production, display or other use and in any case, such submissions
shall not be made less than ten (10) business days before production deadlines.
Only after Platinum has approved the packaging, collateral and advertising
materials may Licensee proceed with production thereof, with no alterations
from
the approved packaging, collateral and advertising materials; provided, however,
Licensee may make immaterial changes to the materials, only if such changes
do
not change the artwork and/or graphics contained in the materials approved
by
Platinum and do not affect Platinum's Property elements as contained in the
above-mentioned materials. Examples of immaterial changes are translated
versions of the materials into foreign languages and the addition of a local
rating to the materials, which examples are not meant to be an exhaustive list
of immaterial changes. Platinum's approval rights with respect to all such
marketing related materials shall be rendered in accordance with provisions
of
▇▇▇▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇
-▇-
(▇) Media
Cooperation and Integration:
Platinum shall make commercially
reasonable
efforts
to
facilitate cross-promotional opportunities and cross-media integration with
Platinum marketing teams and the motion picture studio for the Property to
provide cooperation in motion picture and Title marketing efforts. Such
commercially reasonable efforts shall include, but are not limited to, inclusion
of the in theatrical and DVD marketing media, one sheets, trailers, radio and
television spots, and outdoor, print, and online advertisements; shared
in-theater presence (such as standees, mobile, and concession merchandising);
inclusion in third-party promotions; website integration of Title features;
retail (such as the Title trailer on the DVD and inclusion in the DVD sell
sheet
and posters); packaging and manual placements; and access to theatrical,
promotional, and licensing materials ten (10) months prior to Title release.
At
Platinum's discretion, and provided Platinum provides marketing plans and
materials in sufficient time, Licensee shall
cause
the marketing plans and strategy for the Title be
tied
to, complement and be coordinated with the marketing plans and strategy of
Platinum and the major motion picture studio.
(e) Sponsorships:
Licensee is granted the right to integrate product placements, advertising,
or
sponsorships (collectively, “Sponsorships”)
into
the Title; however, Licensee shall not engage in any such Sponsorships with
respect to the Title without the prior written approval of Platinum,
which
approval
may not be unreasonably withheld. Should
Platinum approve a proposed Sponsorship for the Title for which financial
remuneration is to be received by Licensee, then as a condition of Platinum's
approval, Platinum
shall receive a 50% share of the net
revenue
received
by
Licensee for
such
Sponsorship, less only unaffiliated third-party fees (“Sponsorship
Revenue”).
(f) Strategy
Guides:
Licensee is granted the right to create strategy guides for the Title. Platinum
shall receive 15% of the revenue received by Licensee with respect to such
strategy guides.
11. PLATINUM
APPROVALS:
Licensee
shall deliver to Platinum for its review and written approval all the
Deliverables, the Title and materials created, developed and/or to be used
in
the Title and in connection with the distribution, marketing and promotion
thereof. Notwithstanding
anything to the contrary contained in this Agreement, Platinum's approval of
any
of the Deliverables, the Title and materials to be approved pursuant to this
Agreement shall not be unreasonably withheld or delayed.
Licensee acknowledges that Platinum's approval shall include the approval of
any
third party who has approval rights over the Property.
For the
sake of clarity, with respect to any dispute that may arise between Platinum
and
Licensee regarding the Titles’ developer, budget, production, distribution, or
marketing, the decision of Licensee shall prevail.
(a) Development
Company Approval:
Licensee
shall consult
with Platinum in good faith as to each developer Licensee proposes to hire
for
the Title (the “Developer”)
and
the parties shall mutually agree as to such selection. Licensee shall obligate
Developer to maintain those members identified as key in the development process
to remain involved in the Title's development throughout the entire development
cycle or to be replaced promptly with members of comparable skill and ability.
Licensee
shall submit to Platinum the following information and materials about and
from
the development companies Licensee
proposes to hire to develop the Title:
developer
name,
location and contact information, biographies
of senior management of developer(s), names, titles duties, and curricula vitae
of key team members who will work on the Title, a
complete listing of all titles
developer(s)
have
developed and samples of titles developer(s)
have
developed, in multiple formats.
-10-
(b) Concept
/ Treatment:
Licensee first will deliver to Platinum a concept / treatment for the Title,
which will outline the story line or plot for the Title as well as the other
creative aspects of the Title, including but not limited to, the number of
levels to be in the game and the purpose or plot (the mission) of such levels
and the genre(s) of video game into which the Title will fall. The Title concept
shall be derived from the Property storyline. The concept / treatment for the
Title shall be subject to Platinum's approval (except that Platinum shall not
have approval over the number of levels to be in the game). In this regard,
Licensee shall have the right to submit a concept / treatment to Platinum for
approval
three
times. Once the concept / treatment is approved by Platinum, Licensee shall
seek
concept approval from the console manufacturer in each of the relevant
territories.
(c) Design
Document:
If the
concept /treatment for the Title is approved by Platinum, Licensee then shall
submit to Platinum a game design document ("Design
Document")
which
shall include a Milestone Schedule for the Title and will lay out all creative
and technical aspects for the Title, including how Licensee intends to use
the
Property elements in the Title. The Design Document shall be subject to
Platinum's written approval. In this regard, Licensee shall have the right
to
submit a Design Document to Platinum for approval
three
times.
(d) Milestone
Deliverables:
Licensee shall deliver to Platinum the following Milestone Deliverables for
Platinum's written approval (subject to Paragraphs 11(b) and (c)):
concept/treatment, design document, technical document, character models,
material game builds and revisions, first playable version, Alpha, Beta and
Gold
Master candidate. Licensee shall also deliver to Platinum a Milestone Schedule
in which descriptions for each Milestone Deliverable and the delivery dates
for
such Deliverables are set out, which Milestone Schedule shall mirror that which
Licensee accepts from its Developer(s). With regard to the delivery dates for
the final Deliverables of the Title, Licensee shall deliver the final
Deliverables to Platinum in accordance with the Milestone Schedule. If Licensee
fails to deliver the final Deliverables within three (3) months of the dates
set
out in the Milestone Schedule approved by Platinum, Platinum shall be
entitled to terminate this Agreement in accordance with Paragraph 23. By way
of
clarification, Licensee shall have the opportunity to cure such non-delivery
of
the final Deliverable prior to any attempted termination provided that such
later
delivery of the final Deliverable permits the
Title
to
be
commercially released as provided herein.
(e) Distribution
Materials:
All
"Distribution
Materials",
i.e.,
all packaging, marketing, sales, advertising and promotional materials related
to the Title, shall be subject to Platinum's written approval prior to the
use
thereof by Licensee.
Licensee
shall deliver to Platinum all
Distribution Materials for
Platinum's prior written approval.
The
quality and style of the packaging, collateral and advertising materials for
the
Title shall be subject in all respects to Platinum's prior written approval.
Licensee shall submit to Platinum samples of the packaging, collateral and
advertising materials before production, display or other use. Once Platinum
has
approved the packaging, collateral and advertising materials, Licensee may
proceed with production thereof, provided there are no alterations
from the approved packaging, collateral and advertising materials
other
than language localizations.
-11-
(f) Approval
Process:
(i) Evaluation:
Platinum shall approve or reject in writing all Milestone Deliverables and
Distribution Materials submitted to it for its approval.
(ii) Rejection:
If
Platinum rejects any Deliverable, Platinum shall provide to Licensee, in
writing, the reasons for its rejection of the Deliverable. Licensee shall then
make the changes to the Deliverable and resubmit it to Platinum for Platinum's
reconsideration and approval. If the
Deliverable is rejected more than three times based on a reason previously
notified to Licensee by Platinum, then Platinum may either terminate this
Agreement in accordance with Paragraph 23 or allow Licensee to resubmit the
Deliverable.
(iii) Collaborative
Process:
With
regard to Platinum's approval rights, Platinum
(which,
as stated above, shall include any third party who has approval rights over
the
use of the Property)
shall
have input into all creative aspects of the Title. The development of the Title
shall be a collaborative effort between Platinum and Licensee, such that
Platinum shall have input and approval over all aspects of the Title, including,
but not limited to, the look and feel of the Title, art direction, as well
as
the use of all elements of the Property in the Title and in the advertising,
promotion and marketing thereof in accordance with this Agreement. Licensee
understands and agrees that approval of any two-dimensional and static artwork
does not constitute approval of the implementation of the artwork in the Title
in three dimensional form and that Platinum has approval of the animated artwork
and the specifications set forth in the Design Document as implemented in the
Title and as set forth herein. Licensee also understands, agrees and
acknowledges that Platinum has approval over the advertising, promotion and
marketing of the Title, subject to the terms set forth herein.
(iv) Except
as
otherwise provided herein, Platinum shall approve or reject in writing all
Deliverables and all Distribution Materials submitted to it for its approval
within ten
(10)
days of
Platinum's receipt thereof, except for the marketing plans, which shall be
approved or disapproved as set forth in Paragraph 10(b). A rejection of any
such
submission shall include the reason(s) for such rejection.
If
Platinum does not approve or reject in writing a Deliverable and any
Distribution Materials submitted within ten
(10)
days of
its receipt and causes a significant delay in the development or in the
marketing or sales of the Title, or if Platinum does not approve or disapprove
the marketing plans as set forth in Paragraph 10(b), then Platinum and Licensee
shall mutually and in good faith discuss and agree to any adjustments in the
Milestone Schedule and/or Release Date which are necessary due to such delay.
If
through no fault or action of Platinum, Licensee fails to deliver the
Deliverables for the Title on or before the dates agreed to by the parties,
as
shall be set forth in the Milestone Schedule as stated above
but
which in no event shall extend three (3) months beyond the Release Date
(subject
to extension for any intervening force majeure events), and it becomes
reasonably apparent to Platinum that such delays by Licensee will result in
the
Title not being ready for Release within
three (3) months of the applicable Release
Date
(subject
to extension for any intervening force majeure events), then Platinum shall
be
entitled to terminate this Agreement in accordance with Paragraph 23 and the
rights granted
herein shall automatically revert back to Platinum and the full Guarantee shall
be due and payable to Platinum. If, through no fault or action of
Platinum,
Licensee
fails to Release the Title by the date(s) set forth in Paragraph 8, Platinum
shall be entitled to terminate this Agreement in
accordance with Paragraph 23
and the
rights to such format granted herein shall automatically revert back to Platinum
and the full Guarantee shall be due and payable to Platinum.
-12-
Whenever
a party has an obligation to pay a portion of or remainder of the Guarantee,
as
set forth in this Paragraph 11, then that party shall make such payment within
thirty (30) days of the date of written notice from the other party regarding
the event or condition triggering the repayment obligation.
12. OBLIGATIONS
OF PLATINUM:
(a) Required
Licenses:
Platinum will obtain any and all necessary approvals to use the elements of
the
Property in the Title for which Platinum has granted Licensee the
rights.
(b) Third
Party Participation Fees:
Platinum shall be solely responsible for paying any and all merchandising
participation fees and royalties that Platinum may be obligated to pay with
respect to having such rights in and to the Property which may arise from
Licensee's exploitation of the rights granted it under this Agreement. Licensee
shall be responsible for the payment of any and all fees, costs, expenses and
royalties of any kind arising from any services rendered by Property talent
(including acting, writing and directing talent), if any, for and in connection
with the Title or any reuse fees or third party licenses as may be authorized
hereunder.
13. INTELLECTUAL
PROPERTY RIGHTS:
(a) Ownership:
(i) Platinum:
Platinum
or its assigns own, and Licensee or its assigns will not claim any right, title
or interest in and to, and expressly acknowledge that they do and will not
own,
all Intellectual Property Rights in and to the Property, including storylines,
characters, names, symbols, titles and logos based on the Property. Licensee
shall cause Platinum to own the aforesaid rights and shall set forth in its
agreement with its developer(s) and any other third parties rendering services
in connection with the production of the Title that Platinum shall be the
exclusive owner of these rights as a party commissioning a work made for hire,
or acquiring by assignment rights in a work made for hire (such as elements
created by Licensee’s employees). Platinum's Intellectual Property Rights shall
be indefeasible and irrevocable and shall not be subject to reversion under
any
circumstances, including cancellation, termination, expiration, or breach of
this Agreement.
All
materials created hereunder shall be prepared by an employee-for-hire of
Licensee under Licensee's sole supervision, responsibility and monetary
obligation. If third parties who are not employees of Licensee contribute to
the
creation of the materials, Licensee shall obtain from such third parties, prior
to commencement of work, a full written assignment of rights so that all right,
title and interest in the materials, throughout the universe, in perpetuity,
shall vest in Platinum.
-13-
(ii) Licensee:
Licensee and its assigns shall own, and Platinum or its assigns will not claim
any right, title or interest in and to, and expressly acknowledge that they
do
and will not own, the artwork of the Title (the “Licensee
Created Artwork”)
and any
pre-existing software tools and/or any game engines (pre-existing or developed
for the Title) owned or controlled by Licensee or its developers and used in
the
Title and such tools and engines shall not be deemed to be part of Platinum's
Intellectual Property. Licensee’s ownership in the Licensee Created Artwork
shall not extend to any elements of Platinum’s Intellectual Property that are
included within the Licensee Created Artwork, and Licensee shall have no right
to exploit or use Licensee Created Artwork outside the parameters of this
Agreement unless Licensee is able to remove all aspects of and/or references
to
the Platinum Intellectual Property included in such Licensee Created Artwork.
Licensee shall own all Intellectual Property Rights in and to the Source
Materials developed for the Title, as limited by any ownership interest the
console manufacturing entity(ies) may have in the Source Materials with respect
to its Intellectual Property for its/their respective platform(s).
(b) Moral
Rights:
(i) Licensee:
Licensee hereby does expressly assign to Platinum any and all rights of
paternity or integrity, rights to claim authorship, to object to any distortion,
mutilation or other modification of, or other derogatory actions in relation
to,
any of Platinum's Intellectual Property Rights in and to the Property and Title,
whether or not such would be prejudicial to Platinum's honor or reputation,
and
any similar right, existing under judicial or statutory law of any country
in
the world, or under any treaty ("Moral
Rights"),
regardless of whether such right is denominated or generally referred to as
a
moral right. Licensee hereby does irrevocably transfer and assign to Platinum
any and all Moral Rights that Licensee may have in Platinum's Intellectual
Property Rights in and to the Property and Title and shall cause Licensee's
employees and contractors, including Licensee's developers of the Title, to
do
likewise. Licensee hereby does forever waive and agree never to assert any
and
all Moral Rights it may have in Platinum's Intellectual Property Rights in
and
to the Property and Title and shall cause its employees and contractors
(including the developers) to do likewise.
(ii) Platinum:
Platinum hereby does expressly assign to Licensee any and all rights of
paternity or integrity, rights to claim authorship, to object to any distortion,
mutilation or other modification of, or other derogatory actions in relation
to,
any of Licensee's Intellectual Property Rights in and to the Title, whether
or
not such would be prejudicial to either of their respective honors or
reputations, and any similar right, existing under judicial or statutory law
of
any country in the world, or under any treaty regardless of whether such right
is denominated or generally referred to as a moral right. Platinum hereby does
irrevocably transfer and assign to Licensee any and all Moral Rights that
Platinum may have in Licensee's Intellectual Property Rights in and to the
Title
and shall cause Platinum employees and contractors, if any, to do likewise.
Platinum hereby does forever waive and agree never to assert any and all Moral
Rights it may have in Licensee's Intellectual Property Rights in and to the
Title and shall cause its employees and contractors to do likewise.
-14-
(c) Assignment
and Cooperation:
(i) Licensee:
Promptly upon the written request of Platinum, Licensee agrees to execute and
deliver, and cause its employees and contractors (if any) and such contractors'
employees to execute and deliver, to Platinum or to such third party as Platinum
reasonably may direct, without further compensation, any and all powers of
attorney, assignments, applications (whether original, continuation, divisional,
reissue, extension or renewal) and other papers which may be necessary or
desirable fully to secure to and perfect in Platinum (or such party as Platinum
may designate) the rights in the Intellectual Property addressed in Paragraphs
13(a)(i) and 13(b)(i) hereof, in the United States and in any foreign country.
As reasonably necessary, Licensee agrees to assist Platinum and to cause its
employees and contractors (if any) hereunder and such contractors' employees
to
assist Platinum in every proper way (including, without limitation, appearing
as
a witness to provide testimony), entirely at Platinum's expense and for
Platinum's benefit, in connection with prosecuting, securing, maintaining,
enforcing and defending any such Platinum Intellectual Property.
(ii) Platinum:
Promptly upon the written request of Licensee, Platinum agrees to execute and
deliver, and cause its employees and contractors (if any) and such contractors'
employees to execute and deliver, to Licensee or to such third party as Licensee
may reasonably direct, without further compensation, any and all powers of
attorney, assignments, applications (whether original, continuation, divisional,
reissue, extension or renewal) and other papers which may be reasonably
necessary to secure to and perfect in Licensee (or such party as Licensee may
designate) the rights in Licensee's Intellectual Property addressed in
Paragraphs 13(a)(ii) and 13(b)(ii) hereof, in the United States and in any
foreign country. Platinum agrees to assist Licensee, and to cause its employees
and contractors (if any) hereunder and such contractors' employees to assist
Licensee in every proper way (including, without limitation, appearing as a
witness to provide testimony), entirely at Licensee's expense and for Licensee's
benefit, in connection with prosecuting, securing, maintaining, enforcing and
defending any such Intellectual Property.
14. DEVELOPMENT
COSTS / RESPONSIBILITY FOR EXPENSES:
As
between Platinum and Licensee, and except as provided in Paragraph 12(b) above,
Licensee shall be solely responsible for and shall pay all development costs
for
the Title. Licensee also shall be solely responsible for any and all other
costs
associated with the distribution of the Title, including packaging, advertising,
promotional, manufacturing and all other such related costs.
15. PRODUCT
LIABILITY INSURANCE:
Licensee shall obtain and maintain at its own expense product liability
insurance from a qualified insurance carrier, in the amount of $5,000,000 for
bodily injury and $100,000 for property damage. Platinum shall be added as
a
named insured to the policy, and the policy shall be non-cancelable except
after
10 calendar days' prior written notice to Platinum. Licensee shall furnish
Platinum with a copy of
such
policy within 30 calendar days after signature of this Agreement by
Platinum.
-15-
16. ROYALTY
ACCOUNTING AND PAYMENT:
Licensee shall compute payments of Platinum's Royalties on an annual calendar
quarterly basis. Within sixty (60)
days
after the last day of each calendar quarter, Licensee shall deliver to Platinum
a statement showing, to the full extent provided Licensee by the Distributor,
the number of unit sales delineated by format and by country of sale, any and
all allowable deductions the amount of Royalties earned based on such unit
sales, the amount to be recouped from such unit sales, if any, and application
information with respect to mobile revenue. These quarterly statements are
to be
delivered to Platinum whether Royalties are payable to Platinum or not. Licensee
will pay to Platinum the Royalties due, if any, simultaneously with delivery
of
the statement. Neither the acceptance of any payment or Royalty statement nor
the deposit of any check shall preclude Platinum from questioning the
correctness of such payment or Royalty statement at any time.
Notwithstanding the foregoing, Platinum agrees to assist Licensee in
coordinating with Distributor(s) the start of the first reporting and payment
period to prevent inadvertent breach or frustration of the purposes hereof.
To
the
extent necessary to comply with the laws, rules and regulations of the United
States, and any treaties between the United States and any foreign countries
which are in the Territory, and for the sake of this Agreement Canada is
acknowledged to be outside the United States, on the Royalties payable to
Platinum hereunder, Licensee shall be entitled to withhold from any Royalties
due Platinum foreign withholding taxes at the applicable rate set forth in
such
treaties which are payable by Platinum (on the Royalties payable to Platinum)
to
such foreign countries; provided, however, that within one hundred and eighty
(180) days after the date of any payment of such foreign withholding tax
withheld by Licensee in respect of any payment herein, Licensee shall furnish
to
Platinum the original or a certified copy of a receipt evidencing payment
thereof in a form acceptable to the government of the foreign country or other
relevant local tax authority, certifying the fact that such tax has been duly
paid and account to Platinum for its pro-rata share of such tax credit, if
any.
Notwithstanding
the foregoing, Platinum agrees to work with Licensee and its Distributor in
good
faith in order to detail the various systems and processes with respect to
the
reporting obligations contained herein. Nothing contained in the immediately
preceding sentence shall be deemed to amend or alter Licensee’s obligations
contained herein.
17. BOOKS
AND RECORDS:
Licensee shall keep, maintain and preserve at its principal place of business,
for at least two (2) years following termination or expiration of the Term
of
this Agreement, complete and accurate records of accounts, including, without
limitation, invoices, correspondence, banking, financial and other records,
pertaining to the subject matter and terms of this Agreement. Such records
shall
be maintained as confidential, except Platinum may make copies of such records
regarding the subject matter of this Agreement, in whole or in part, if it
exercises its right to inspect Licensee's books and records, provided that
it
may only use such records to enforce its rights under this Agreement. During
the
Term and for two (2) years following any expiration or termination of the
Agreement, these records shall be available for inspection and audit by an
independent certified public accountant at any time as follows: (a)
not
more than once per year, (b)
during reasonable business hours, and (c)
upon
reasonable notice. Licensee agrees not to cause or to permit any interference
with the independent certified public accountant in the performance of its
duties of inspection and audit and the independent certified public accountant
shall have access to any and all pertinent books and records regardless of
the
location where the same may be maintained by Licensee. Platinum shall pay the
fees and expenses of the auditor for the examination; except that if any
examination discloses a shortfall in the payments due to Platinum hereunder
for
the period being audited of ten percent (10%) or more, Licensee shall together
with such shortfall payment and applicable interest thereon calculated from
the
date first owed, pay the reasonable outside fees and expenses of the auditor
for
that examination within thirty (30) days of notice that such fees are due.
In
the event such a shortfall is uncovered in an audit, Platinum thereafter shall
be entitled to audit twice per year for the remainder of the Term.
-16-
18. PUBLICITY
AND PROMOTION:
Neither
party shall publicize, advertise or otherwise make public the relationship
between the parties or the development of the Title until such time as both
parties have mutually agreed upon all aspects for such announcement(s), such
as
but not limited to the vehicle for such announcement(s) and the wording
thereof.
19. REPRESENTATIONS
AND WARRANTIES:
(a) By
Licensee:
As an
inducement to Platinum entering into and consummating this Agreement, Licensee
represents, warrants and covenants as follows:
(i) Organization
Representations; Enforceability:
Licensee is duly organized, validly existing and in good standing in the
jurisdiction as stated above. The execution and delivery of this Agreement
by
Licensee and the transactions contemplated hereby have been duly and validly
authorized by all necessary action on the part of Licensee. This Agreement
constitutes a valid and binding obligation of Licensee, enforceable in
accordance with its terms.
(ii) No
Conflict:
The
entering into and performance of this Agreement by Licensee does not and will
not violate, conflict with or result in a material default under any other
contract, agreement, indenture, decree, judgment, undertaking, conveyance,
lien
or encumbrance to which Licensee or any of its Affiliates is a party or by
which
it or any of its property is or may become subject or bound.
(iii) Right
to Make Full Grant:
Licensee has and shall have all requisite ownership, rights and licenses to
perform its obligations under this Agreement fully as contemplated hereby and
to
grant to Platinum all rights to be granted in this Agreement, free and clear
of
any and all agreements, liens, adverse claims, encumbrances and interests of
any
Person or party.
(iv) Authorized
Publisher:
Licensee represents and warrants it is an authorized and licensed publisher
for
all of the various console and handheld platforms contemplated for exploitation
under this Agreement and Licensee is in good standing with all such platform
proprietors, and that Licensee shall comply with all the terms of its publisher
license agreements with such console manufacturer.
(v) Developer's
Agreement:
Licensee shall enter into a written agreement with all developers of the Title.
Such developers shall be and remain throughout development authorized developers
for the particular proprietary platforms for which the Title is
developed.
-17-
(vi) Non-Infringement:
With
respect to any material supplied by Licensee, its developers or other vendors
in
connection with the Title, such materials do not and will not infringe upon
or
misappropriate any copyright, trademark,
patent, trade secret or other proprietary right of any third party.
(vii) No
Pending or Current Litigation:
Licensee is not involved in current litigation, arbitration or any other claim
and knows of no pending litigation, arbitration, other claim, or fact which
may
be the basis of any claim which would prevent Licensee from making the
representations set forth in Paragraph 19(a)(ii) and 19(a)(vi)
above.
(viii) No
Harmful Content/Acts:
The
Title
does not and will not contain any matter which is injurious to end-users or
their property, and will not contain any matter which is scandalous, libelous,
obscene, an invasion of privacy or otherwise unlawful or tortious. Further,
Licensee warrants and represents that all aspects of its obligations hereunder
with respect to the Title (including development, distribution, manufacturing,
advertising and promotion thereof) shall be of such quality as to reasonably
maintain or enhance the Title and the Intellectual Property Rights contained
therein and the goodwill pertaining thereto. Licensee recognizes the goodwill
of
Platinum in and to the Property and the name and logos of Platinum. Licensee
represents and warrants that it shall not do anything (whether by taking action
or failing to take action) that would attack or harm the goodwill of the
Property and/or the name and logos of Platinum and/or the Intellectual Property
Rights contained therein.
(ix) Inspection
and Testing of Milestones:
Licensee shall have inspected and tested the Milestones and Title before
delivery to Platinum to ensure they contain no material Bugs, including computer
viruses, booby traps, time bombs or other programming designed to interfere
with
the normal functioning of the Title.
(b) By
Platinum:
As an
inducement to Licensee entering into and consummating this Agreement, Platinum
represents and warrants as follows:
(i) Enforceability:
Platinum Studios,
Inc. is
duly
organized, validly existing and in good standing in the jurisdiction as stated
above. The execution and delivery of this Agreement by Platinum and the
transactions contemplated hereby have been duly and validly authorized by all
necessary action on the part of Platinum. This Agreement constitutes a valid
and
binding obligation of Platinum, enforceable in accordance with its
terms.
(ii) Right
to Make Full Grant:
Platinum has and shall have all requisite rights and licenses to perform its
obligations under this Agreement fully as contemplated hereby and will obtain
all necessary licenses, clearances and permissions in respect of the Property
to
be used in the Title only as such obligations have been expressly assumed by
Platinum hereunder.
-18-
(iii) Non-Infringement:
The
Property (and any portion thereof) and Licensee's use of the Property do not
and
will not infringe upon or misappropriate any copyright, trademark, patent,
trade
secret or other intellectual property or proprietary right of any third party
or
violate any applicable law or regulation, and will
not
contain any matter which is scandalous, libelous, obscene, an invasion of
privacy or otherwise unlawful or tortious.
The
matter contained therein will be consistent with matter given a "T" rating
by
the Motion Picture Association of America.
(iv) No
Conflict:
The
making and entering of this Agreement by Platinum does not violate any agreement
existing between Platinum and any other person or entity.
20. INDEMNIFICATION:
(a) By
Licensee:
Licensee hereby indemnifies Platinum, its parent companies, affiliates,
officers, directors, employees, and agents, and agrees to defend and hold them
harmless from and against any and all liability, damage, costs, loss or expense
(including reasonable attorney's fees and costs) arising from, out of or in
connection with any third party claim, demand, action or proceeding based upon
the breach or
alleged breach of
any of
Licensee's representations or warranties set forth in this Agreement and any
third party claim, demand, action or proceeding arising out of the development,
manufacturing, marketing, sales, distribution and exploitation of the Title
by
Licensee and those third parties acting under the authority of Licensee in
the
development, manufacturing, marketing, sales, distribution and exploitation
of
the Title (all except to the extent covered by Platinum’s indemnity below);
provided, however, Platinum shall give prompt notice to Licensee of the
assertion of any such claims and provided further that Licensee shall have
the
right to select counsel (with Platinum's approval of such counsel) and control
the defense thereof, subject to the right of Platinum to participate therein
at
Platinum's own expense. Licensee shall not settle any such claim without the
prior written approval of Platinum.
(b) By
Platinum:
Platinum hereby indemnifies Licensee, its parent companies and affiliates,
officers, directors, agents and employees, and agrees to defend and hold them
harmless from and against any and all liability, damage, costs, loss or expense
(including reasonable attorney's fees and costs) arising from, out of or in
connection with any third party claim, demand, action or proceeding based upon
the breach or alleged breach of any of Platinum's representations or warranties
set forth in this Agreement; provided, however, Licensee shall give prompt
notice to Platinum of the assertion of any such claims and Platinum shall have
the right to select counsel (with
Licensee’s approval of such counsel) and control the defense thereof, subject to
the right of Licensee to participate therein at Licensee's own expense.
Platinum
shall not settle any such claim without the prior written approval of
Licensee.
21. PIRACY/THIRD-PARTY
INFRINGEMENT:
Platinum shall have the sole right to pursue any piracy or infringement of
its
Intellectual Property Rights in and to the Property as used in the Title and
all
collateral materials therefore in such manner as Platinum in its sole discretion
deems appropriate, including bringing an action for piracy or infringement
on
behalf of itself (and Licensee, if necessary,
subject
to Licensee’s right to approve counsel).
Licensee
shall cooperate fully with Platinum in any such action at Platinum's
expense.
-19-
Licensee
shall have the right to pursue any piracy or infringement of its Intellectual
Property Rights in and to the Title in such manner as Licensee in its sole
discretion deems appropriate, including bringing an action for piracy or
infringement on behalf of itself (and Platinum, if necessary, subject to
Platinum's right to approve counsel). Platinum shall cooperate fully with
Licensee in any such action at Licensee's expense.
22. CONFIDENTIALITY:
(a) Preservation
of Confidentiality:
Each
party ("Receiving
Party")
agrees
that it will hold all Confidential Information of the other party ("Disclosing
Party")
in
trust for the sole benefit of the Disclosing Party and for the exercise of
the
limited rights expressly granted to the Receiving Party under this Agreement.
The Receiving Party shall take all steps reasonably necessary to preserve the
confidentiality of the Confidential Information of the Disclosing
Party,
including, but not limited to, those steps that the Receiving Party takes to
protect the confidentiality of its own most highly confidential
information.
Except
as
may be expressly authorized by the Disclosing Party in writing, the Receiving
Party shall not at any time either before or after termination or expiration
of
this Agreement, directly or indirectly: (i)
disclose any Confidential Information to any Person other than an employee
or
subcontractor (including Licensee’s Developer(s) and Distributor(s)) of the
Receiving Party who needs to know or have access to such Confidential
Information for the purposes of this Agreement, and only to the extent necessary
for such purposes; (ii)
except as otherwise provided in this Agreement, duplicate the Confidential
Information for any purpose whatsoever; or (iii)
use
the Confidential Information for any reason or purpose other than as expressly
permitted in this Agreement. A Receiving Party may disclose Confidential
Information to its owners, officers and employees, and those of its parent
companies and Affiliates, on a need to know basis. Except
as
otherwise approved by Platinum, nothing
in this
Paragraph authorizes Licensee to provide or disclose Property-related
Confidential Information to its Distributors, including, without limitation,
marketing plans and scripts.
The
Receiving Party shall notify each of its employees and subcontractors (including
Licensee’s Developer(s) and Distributor(s)) to whom it discloses or provides
access to Confidential Information, that such disclosure or access is made
in
confidence and, prior to such disclosure or provision of access, the Receiving
Party shall obtain such employee's or subcontractor's (including Licensee’s
Developer’s and Distributor’s) written agreement to protect the confidentiality
of the Confidential Information.
Notwithstanding
the foregoing, the Receiving Party may disclose the following information to
prospective employees in form and content approved in writing by the Disclosing
Party, if reasonably necessary to obtain qualified employees: (i) the Disclosing
Party's general business purpose; (ii) the general business relationship between
the parties; and (iii) the Disclosing Party's general business plans with
respect to the general business relationship between the parties. Prior to
the
disclosure of any of the foregoing to any prospective employee or Developer,
the
Receiving Party shall first require the prospective employee or Developer to
sign a confidentiality agreement under which the prospective employee or
Developer agrees to keep the foregoing information
confidential.
-20-
(b) Obligations
Upon Unauthorized Disclosure:
If at
any time the Receiving Party becomes aware of any unauthorized duplication,
access, use, possession or knowledge of any Confidential Information, the
Receiving Party shall immediately notify the Disclosing Party. The Receiving
Party shall provide any and all reasonable assistance to the Disclosing Party
to
protect the Disclosing Party's proprietary rights in any Confidential
Information that the Receiving Party or its employees or 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, but not limited to enforcement of
confidentiality agreements, commencement and prosecution in good faith of legal
action (alone or with the Disclosing Party), and reimbursement for all
reasonable attorneys' fees (and all related costs), costs and expenses incurred
by the Disclosing Party to protect its proprietary rights in the Confidential
Information. The Receiving Party shall take all reasonable steps requested
by
the Disclosing Party to prevent the recurrence of any unauthorized duplication,
access, use, possession or knowledge of the Confidential Information. An
unauthorized disclosure of Confidential Information by a Receiving Party's
subcontractors (including Licensee's Developer(s) and Distributor(s)) shall
be
deemed a breach of this Agreement by the Receiving Party under Paragraph
23.
(c) Exceptions:
The
foregoing restrictions will not apply to information to the extent that the
Receiving Party can demonstrate such information (i)
was
known to the Receiving Party at the time of disclosure to the Receiving Party
by
the Disclosing Party as shown by the files of the Receiving Party in existence
at the time of disclosure; (ii)
has
become publicly known through no wrongful act of the Receiving Party;
(iii)
has
been rightfully received from a third party authorized by the Disclosing Party
to make such disclosure without restriction; (iv)
has
been approved for release by written authorization of the Disclosing Party;
or
(v)
has
been disclosed by court order or as otherwise required by law, provided that
the
Receiving Party has notified the Disclosing Party immediately upon learning
of
the possibility of any such court order or legal requirement and has given
the
Disclosing Party a reasonable opportunity (and cooperated with the Disclosing
Party) to contest or limit the scope of such required disclosure (including
without limitation application for a protective order).
(d) Confidentiality
of Agreement:
Notwithstanding Paragraph 23(a), each party may disclose the terms and
conditions of this Agreement (i)
as
required by any court or other governmental body or as otherwise required by
law, provided that such party has notified the other party immediately upon
learning of the possibility of any such requirement and has given the other
party a reasonable opportunity (and cooperated with the other party) to contest
or limit the scope of such required disclosure (including without limitation
application for a protective order); (ii)
to
legal counsel; (iii)
in
confidence to accountants, banks, and financing sources and their advisors;
and
(iv)
in
confidence in connection with the enforcement of this Agreement or rights under
this Agreement.
(e) Return
of Confidential Materials:
Upon
any expiration or termination of this Agreement or the completion of Licensee's
services hereunder, or at any time that either party may request, each party
shall promptly return to the other all Confidential Information in tangible
form
which is then in the possession or control of such party.
-21-
23. TERMINATION:
(a) Termination
by Platinum:
In
addition to Platinum’s right to terminate this Agreement pursuant to Paragraph
6, Platinum shall have the right to terminate in its discretion this Agreement
for breach (i)
if
Licensee fails to seek or obtain Platinum's approval of any materials to be
approved by Platinum hereunder and uses such materials or obtains Platinum's
disapproval of such materials and uses such materials despite such
disapproval
in each
case subject to a ten
(10)
day
cure period where such failure to obtain Platinum’s approval does not result in
any publicly-released or disseminated usage of such materials; (ii)
upon
Licensee's insolvency or liquidation as a result of which Licensee ceases to
do
business for a continuous
period of one
(1)
month;
(iii)
in the event of a sale
or
transfer of all or substantially all of Licensee's assets to a direct competitor
of Platinum or a Change
of
Control in Licensee, to which Platinum does not consent; (iv) if Licensee fails
to continue to exploit the Title in a commercially reasonable manner as provided
in this Agreement; or (v) in the case of any other breach
which Licensee fails to cure within twenty (20) Business Days (or
ten
(10)
days to
cure in the event of any breach of any financial obligation of Licensee under
this Agreement, unless
otherwise specified in this Agreement) following
written notice from Platinum specifying such breach. There
shall be no cure period afforded Licensee in the event the breach by Licensee
is
of the type described in subsection (ii) above. In
the
event of such a termination by Platinum, and
without limiting in any manner Platinum's rights and remedies, Platinum
shall have no further liability or obligation with respect to this Agreement
or
to Licensee or to any of its contractors, and Platinum shall retain all
Guarantee payments paid to it to date.
Further, except as may be otherwise specified in this Agreement, in the event
of
termination by Platinum of this Agreement pursuant to this provision, any
uncontested installments of the Guarantee unpaid at the time of termination
of
this Agreement shall be immediately due and payable by Licensee.
In
the
event Platinum terminates this Agreement, Licensee shall have no right to
exploit, copy, make, reproduce, manufacture, market, publish, sell or
distribute, or license such activities to others, the Title or any portions
thereof, or Platinum's Intellectual Property, including the Property and that
derived from the Property. In no event may Licensee develop, publish or
distribute, or cause a third party to develop, publish or distribute the Title.
Licensee shall retain all rights to its Intellectual Property, so long as it
is
not derivative of Platinum's Intellectual Property, as set forth in Paragraph
13.
Licensee
shall take all necessary steps in its developer agreements to allow Platinum
or
its designee or licensee to continue the development of the Title directly
with
such Developer in the event of termination of this Agreement due to a Change
of
Control of Licensee or the sale or transfer of all or substantially all of
Licensee's assets to a third party for which Platinum has not given its consent.
Solely in the event of such termination, and if Platinum elects to continue
development of the Title, Platinum shall reimburse Licensee for any costs
incurred by Licensee pursuant to its developer agreements. Upon termination,
in
no event is Platinum limited from developing and publishing video game titles
based on the Property for any and all Platform(s) or having third parties
perform such activities, whether using the Platinum Intellectual Property
created pursuant to this Agreement or not. Licensee shall retain all rights
to
the Licensee Intellectual Property in the Title, as set forth in Paragraph
13.
In the event of termination pursuant to this paragraph or pursuant to any other
provision entitling Licensee to terminate this Agreement, Licensee promptly
shall deliver to Platinum any and all Platinum Intellectual Property for the
Title,
whether
Released or in process at the time of termination,
including without limitation, all visual displays, scripts, literary treatments,
characters, backgrounds, environments, and other elements visible to the Title's
users; all sounds, sound effects, dialogue and voice recordings, soundtracks
and
other elements audible to the user; and all methods in which the user interacts
with the characters, backgrounds, environments or other elements of the
Milestone deliverables and Title and Platinum promptly shall deliver to Licensee
any materials in Platinum's possession that contain Licensee Intellectual
Property.
-22-
Subject
to any sell-off rights Licensee may have under Paragraph 25 below, Licensee
shall have no right to continue to develop, manufacture, distribute or otherwise
exploit the elements of the Title that contain any Platinum Intellectual
Property, but Licensee shall be free to exploit any and all of the Licensee
Intellectual Property Rights in and to the Title that are not derivative of
the
Platinum Intellectual Property Rights.
In
the
event of Licensee's breach, the foregoing in no way limits any rights and
remedies Platinum may have and Platinum may pursue any and all other rights
and
remedies at law and in equity it may have against Licensee.
(b) Termination
by Licensee:
Licensee may terminate this Agreement upon written notice to Platinum
(i)
as
set forth in this Agreement, or (ii)
for
any breach of this Agreement by Platinum which Platinum fails to cure within
twenty (20) Business Days following written notice from Licensee to Platinum
specifying such breach.
In
the
event Licensee terminates this Agreement, Platinum shall have no right to
exploit, copy, make, reproduce, manufacture, market, publish, sell or
distribute, or license such activities to others, the Title or portions thereof;
provided, however, Platinum shall be free to exploit any and all rights to
the
Property if any, created by Licensee or its developers or any other person
during the development and/or exploitation of the Title, and Platinum shall
be
free to exploit the Platinum Intellectual Property developed pursuant to this
Agreement. However, this right does not include the right to use Licensee's
Intellectual Property as described in Paragraph 13(a)(ii). Unless termination
is
specific to a particular format, upon termination, in no event is Platinum
limited from developing and publishing video game titles based on the Property
for any and all Platform(s), or having third parties perform such activities.
Licensee shall retain all rights to its Intellectual Property in the Title,
as
set forth in Paragraph 13.
Subject
to any sell-off rights Licensee may have under Paragraph 25 below, Licensee
shall have no right to continue to develop, manufacture, distribute or otherwise
exploit the elements of the Title that are Platinum's Intellectual Property,
but
Licensee shall be free to exploit any and all of its Intellectual Property
Rights to the Title that are separable from Platinum's Intellectual Property
Rights.
24. SURVIVAL:
The
respective rights, obligations, representations and warranties of the parties
under Paragraphs 2(a)(i), 2(h), 6, 7, 13,
14,
15, 17, 19, 20, 21, 22, 23, and 27 through 36 shall survive any termination
or
expiration of this Agreement (and any applicable sell-off period).
25. SELL-OFF
RIGHTS:
Only
in
the case
of termination of this Agreement by Licensee due
to
Platinum's
breach
or upon expiration of the Term of this Agreement, Licensee shall have the right
to sell-off such existing units for a period of one
hundred and eighty (180) days
from
the date of Licensee's termination or expiration of this Agreement, whichever
is
sooner, on which Royalties shall be reported and paid to Platinum (including
those royalties due under Paragraphs 2(a)(i)). After expiration of the
sell-off
period, Licensee shall destroy all units of the Title that have not been sold,
at Licensee's expense, and certify to Platinum in writing that such units have
been destroyed.
-23-
26. FORCE
MAJEURE:
Neither
party shall be deemed in default of this Agreement to the extent that
performance of their obligations or attempts to cure any breach are delayed
or
prevented by reason of any act of God, fire, natural disaster, accident, act
of
government, sabotage of material or supplies or any other cause beyond the
control of such party ("Force
Majeure"),
provided that such party gives the other party written notice thereof promptly
and, in any event, within fifteen (15) calendar days of discovery thereof.
In
the event of such a Force Majeure, the time for performance or cure shall be
extended for a period equal to the duration of the Force Majeure but not in
excess of ninety (90) days,
after
which
ninety
(90) day
period,
this Agreement may be cancelled by the party the performance of whose
obligations is not affected by the Force Majeure, in that party's sole
discretion.
If
cancellation of this Agreement due to a Force Majeure event, Platinum shall
be
entitled to keep all Guarantee, Production Fee and Royalty (if any) payments
made to it as of such date.
Notwithstanding anything to the contrary herein, if such force majeure event
does not affect the Licensee and/or the Distributor(s), Licensee shall be
entitled to distribute and sell the Title throughout the remainder of the Term
of this Agreement. Licensee shall continue to account for and pay Royalties
to
Platinum for such sales.
27. ASSIGNMENT:
This
Agreement shall be binding upon, and inure to the benefit of, the parties hereto
and their respective successors and assigns; provided, however, Licensee may
not
assign, license or otherwise transfer this Agreement, in whole or in part,
without the prior written approval of Platinum (which Platinum may grant or
withhold in its reasonable discretion). Any such attempted assignment by
Licensee shall be void and declared without effect. Notwithstanding the
foregoing, the use of approved developers or Distributors shall not be deemed
to
be an assignment of this Agreement by Licensee, and Platinum approves the
assignment of this Agreement to Vanguard Games, LLC or its related
entities.
A
Change
of Control of Licensee shall be deemed an assignment requiring Platinum's
consent hereunder as shall a sale or transfer of substantially all of the assets
of Licensee to a third party direct competitor of Platinum, except that the
following shall not be deemed to be a Change of Control and shall not require
Platinum’s consent hereunder: (i) an Initial Public Offering ("IPO") by
Licensee; (ii) an
investment in Licensee from a private equity fund or similarly situated
institutional investor; or (iii) a sale or transfer of all or substantially
all
of the assets of Licensee to a third party, non-competitor of Platinum.
28. NOTICES:
All
notices hereunder shall be in writing and shall be effective upon receipt.
Notices may be sent by any reasonable means which allows confirmation of
receipt, including facsimile. The parties shall notify each other of their
respective facsimile numbers or any changes thereto or of their addresses for
notice. Unless notice is given to the contrary, the parties' addresses and
facsimile numbers for notice shall be that shown below the signature
lines.
29. INDEPENDENT
CONTRACTOR:
Licensee shall be deemed to have the status of an independent contractor, and
nothing in this Agreement shall be deemed to place the parties in the
relationship of employer-employee, principal-agent, partners or joint venturers.
Neither party shall hold itself out contrary to the terms of this provision
by
advertising or otherwise.
-24-
30. GOVERNING
LAW AND CONSENT TO JURISDICTION, VENUE AND SERVICE OF
PROCESS:
This
Agreement, its validity, construction and effect, shall be governed by and
construed under the laws of the State of California, without giving effect
to
its conflict of laws principles. Platinum and Licensee agree (a)
to
submit to the jurisdiction of any State and/or Federal Court situated within
the
County of Los Angeles in the State of California for any action brought arising
under this Agreement; and (b)
to
waive any objection they may have now or hereafter to the venue of any suit
brought pursuant to clause (a) above.
31. WAIVER/
REMEDIES:
Any
terms or conditions of this Agreement may be waived or qualified at any time
by
a party entitled to the benefit thereof by a written instrument executed by
the
party entitled to such benefit. No omission, delay or failure on the part of
either party in exercising any rights hereunder, and no partial or single
exercise thereof, will constitute a waiver of such rights or of any other rights
hereunder. All remedies provided for in this Agreement are intended to be
cumulative and not exclusive or in limitation of any other remedies, whether
provided in other provisions of this Agreement or otherwise available under
applicable law.
32. NUMBER
AND GENDER:
Except
as otherwise specified, singular and plural forms, and gender forms, of pronouns
and other words and terms herein shall be deemed interchangeable as required
by
the context and the identity of the parties.
33. ILLEGAL
ACTS:
In no
event shall this Agreement be construed as requiring Platinum or Licensee to
commit any unlawful act or acts whatsoever.
34. ENTIRE
AGREEMENT:
This
instrument constitutes the entire agreement between the parties pertaining
to
the subject matter hereof and supersedes all prior and contemporaneous
agreements, negotiations and understandings, oral or written. This Agreement
may
be modified only by an instrument in writing duly executed by both parties.
This
Agreement, including the attached Glossary Addendum, states the entire terms
and
conditions agreed to by the parties with regard to the subject matter addressed
in this Agreement.
-25-
COUNTERPARTS:
This
Agreement may be executed in one or more counterparts, each of which shall
be
deemed an original and all of which when taken together shall constitute one
and
the same instrument.
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BRASH
ENTERTAINMENT, LLC ("Licensee")
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PLATINUM
ANIMATION, LLC ("Platinum")
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By
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By
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Its
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Its
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Date
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Date
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Brash
Entertainment, LLC
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||||
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Attention:
General Counsel
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Attention:
General Counsel
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Telephone:
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Facsimile:
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[FACSIMILE]
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"Affiliate",
an
"Affiliate"
of or a
Person "Affiliated
with"
a
specified Person shall mean another Person that, directly or indirectly,
controls, is controlled by or is under common control with, the Person specified
(other than independent contractors and leased employees), provided that the
officers having management responsibility and the directors of the Person
specified shall be deemed to be Affiliates of such Person. For purposes of
the
foregoing, "control" means 25% or more direct or indirect equity ownership
or
voting control.
"Alpha"
shall
mean the Milestone where the major development work of the Title has been
completed, and from this Milestone onwards the production activities shift
from
creating the Title to finishing the Title. The Title shall be delivered running
on the final platforms and delivery media (e.g. CD or DVD) and it shall be
possible to play through the entire Title from start to finish. This Deliverable
shall contain all of the final Title content with the only exception being
non-playable items such as full motion video or music, for which placeholders
will be provided. The Title shall be fully localized to ensure that languages
can be fully tested. The Title shall provide access to parameters which allow
the Title's elements to be adjusted and balanced. A test plan including the
full
structure of the Title as well as estimates of how much time is required to
fully test the Title shall be included.
"Beta"
shall
mean a post-Alpha Milestone of the Title meeting all Alpha requirements and
in
substantial conformance with the design document, with all features and
functions implemented, which effectively addresses all comments theretofore
received in reviews of any prior Milestone submissions and in which all
interface, memory allocation and code size issues are effectively addressed.
This submission must pass established testing procedures and have no known
Bugs.
"Bug(s)"
shall
mean a repeatable phenomenon of unintended events or actions during the running
of the software under normal conditions that results in (i) the software being
rendered not functional, (ii) a failure of the software to conform to the
Specifications contained in the TDD, (iii) a detriment to the functionality
of
the software, or (iv) a detriment to the visual representation or sound of
the
software. Bug(s) shall not include artistic decisions or subjective design
features and effects, including visual art and/or sound, (all of which shall
be
otherwise subject to Platinum approval as provided in this Agreement). Only
if
the technical delivery and display of such art, visual and/or sound as a
function or lack of function is materially distorted shall it be deemed to
fall
within the definition of Bug.
"Bundle"
shall
mean the Title is combined with one (1) or more console hardware products of
a
third party in a single package for sale in the Territory.
"Bundling
Transaction"
shall
mean the sale or license of the Title for the purpose of sale and distribution
of such Title in a Bundle in the Territory.
"Business
or Working Days"
shall
mean those days of the week during which businesses are generally open, i.e.,
Monday through Friday, with the exception of U.S. Federal Holidays.
-27-
"Change
of Control"
shall
mean a change of ownership or control of Licensee or of its business performing
the work that is the subject matter of the Agreement, such that (i) a single
Person having direct or indirect majority ownership or control of Licensee
ceases to have such ownership or control, or (ii) there is a change of more
than
fifty percent (50%) in the composition of any group of Persons having direct
or
indirect majority ownership or control of Licensee, but not including changes
which merely substitute a Person with another Person under common ownership
or
control with the Person removed, or (iii) Licensee sells substantially all
of
its business or that portion of its business, or substantially all of the assets
of such business, associated with the subject matter of the Agreement to a
Person unaffiliated with Licensee.
"Confidential
Information"
shall
mean all information relating to the Milestones and the Title or to the business
of Licensee, Platinum and their Affiliates, including without limitation
Platinum's involvement with the Title, the terms of this Agreement or any
contract, subcontract or other agreement, relationship or arrangement relating
to services or materials of any nature to be provided with respect to the Title,
the identities of the Persons providing such services and materials and the
terms under which such services or materials are provided or to be provided,
the
identity of customers and prospects of Licensee, Platinum or its Affiliates,
development or marketing plans for the Title or for any other product of
Licensee, Platinum or its Affiliates, cost information, specifications, computer
programs and related Source Code and Design Documentation, engineering
notebooks, drawings, patent disclosures and applications and their status,
presentations regarding the Milestones and Title, market studies, sales
information, non-public financial information, and any other information
designated in writing or identified in this Agreement as
confidential.
"Customer(s)"
shall
mean third parties, including, but not limited to, licensed manufacturers,
licensees, retailers, distributors and commercial service providers (e.g.,
software customization companies) whom Licensee solicits, with whom Licensee
negotiates, and/or with whom Licensee enters into an agreement for a Sale
Transaction.
"Derivative
Work"
shall
mean a work which is based upon one or more preexisting works, such as, but
not
limited to a revision, enhancement, modification, translation, abridgment,
condensation, expansion, transfer to another medium, or any other form in which
such preexisting works may be recast, transformed or adapted, and which, if
prepared without authorization of the owner of the copyright in such preexisting
works, would constitute a copyright infringement. For purposes hereof,
Derivative Work shall include any compilation that incorporates such a
preexisting work.
"Design
Documentation"
shall
mean the Title's design and all technical documentation in connection with
the
Milestones or the Title, including without limitation, Specifications, designs,
descriptions, flow charts, Source Code, Object Code, data dictionaries, data
structure descriptions, file layouts, schematic diagrams, timing diagrams,
circuit layouts, chip plots, chip masks, drawings and blueprints.
"Development
Aids"
shall
mean any device, programming, programming techniques, trade secrets,
documentation, media or other materials, including compilers, workbenches,
programming tools, higher-level or proprietary languages and/or routing systems
used by the developer for the development, maintenance and implementation of
the
Deliverable(s) and the Title.
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"Platinum
Representative"
shall
mean Platinum or such other individual or individuals who may be appointed
from
time to time in writing to Licensee by Platinum to coordinate with Licensee
or
the developer on behalf of Platinum with respect to this Agreement. The Platinum
Representative shall be separate and apart from the creative director Platinum
has a right to appoint pursuant to Paragraph 11(f)(iii) of the
Agreement.
"Initial
Release"
aka
"Release"
in
connection with a specified subject matter shall mean the first commercial
shipment of manufactured units of the Title sold to the trade for ultimate
resale to consumers.
"Instructional
Materials"
shall
mean the printed materials intended for customer or end-user, as may be
described if included in the Milestones, including without limitation user's
manuals and instructions for using the Milestones or Title.
"Intellectual
Property"
in
connection with a specified subject matter shall mean all U.S. and foreign
patents, trade secrets, Technology, trademarks, trade names, copyrights, Moral
Rights, designs, rights of publicity, mask work rights, utility models, and
other industrial or intangible property rights of a similar nature; all grants
and registrations worldwide in connection with the foregoing and all other
rights with respect thereto existing other than pursuant to grant or
registration; all applications for any such grant or registration, all rights
of
priority under international conventions to make such applications and the
right
to control their prosecution, and all amendments, constitutions, divisions
and
continuations-in-art of such applications; and all corrections, reissues,
patents of addition, extensions and renewals of any such grant, registration
or
right
"Intellectual
Property Right"
shall
mean the right to exclude others from access to or use of Intellectual
Property.
"Milestone(s),
Milestone Deliverable(s), and/or Deliverable(s)"
shall
mean all the materials to be delivered to Platinum by Licensee, as set forth
in
the Milestone Schedule and/or the Design Document.
"Milestone
Schedule"
shall
mean the schedule of development for the Title and the date of delivery of
each
segment of development of the Title, i.e., each Milestone as set forth in the
Milestone Schedule as shall be set forth in the Design Document.
"Object
Code"
shall
mean computer instructions, expressed substantially or entirely in binary form,
which are directly executable by a computer after suitable processing but
without intervening steps of compilation or assembly.
“OEM”
shall
mean the Title is combined with one (1) or more PC hardware products of a third
party in a single package for sale in the Territory.
"Person"
shall
mean a natural person, a corporation, a partnership (general or limited), a
joint venture, an association, a trust or any other organization or entity
including a government or political subdivision or any agency or instrumentality
thereof.
"Port"
means a
substantially similar version of a Title for use on another computer or video
game system.
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"Sales
Transaction(s)"
shall
mean the sale and license of the Title (either directly by Licensee or its
Distributors, or indirectly through Customer(s), including software aggregators)
for the purpose of sale and distribution of such Title in the Territory during
the Term.
"Source
Code"
shall
mean computer programming code, other than Object Code, and related
documentation and comments which may be printed out or displayed in a form
readable and understandable by a programmer of ordinary skill.
"Source
Materials"
shall
mean all Source Code, Object Code, Design Documentation and Development Aids
created or used by Licensee or required by Licensee for the development,
maintenance or implementation of any Milestones or the Title.
"Specifications"
shall
mean the product specifications for the Title (both creative and technical)
to
be set forth by the developer in detail in the Design Document, which shall
be
subject in all respects to the prior written approval of Platinum and
Licensee.
"TDD"
shall
refer to the technical design review document which is a document prepared
by
Licensee or the Developer and submitted to Platinum by Licensee. The TDD shall
describe how each of the key games features of the Title within the Design
Document shall be implemented from a technical perspective. It shall identify
each of the major technical challenges for the Title, clearly describe the
nature of each problem and then proceed to specify and appropriate technical
solution. It shall cover all areas of the game design and production including
programming, art, audio and level design.
"Technology"
shall
mean all discoveries, inventions, trade secrets, writing, know-how, designs,
techniques, methods, formulae, algorithms, procedures and all knowledge or
other
information, whether or not the subject matter thereof is patentable,
copyrightable or eligible for mask work protection, which are incorporated
in or
used in designing, developing or modifying the Milestones or the Title or any
hardware or software component thereof, or are known or become known to Licensee
and are useful in connection therewith, excluding subject matter in the public
domain as of the date hereof or which hereafter enters the public domain through
no fault of the developer.
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