XBOX 360 PUBLISHER LICENSE AGREEMENT
This Xbox 360 Publisher License Agreement ("Agreement") is entered
into
and effective as of the later of the two signature dates below (the
"Effective
Date") by and between Microsoft Licensing, GP, a Nevada general
partnership
("Microsoft"), and Majesco Entertainment Company, a Delaware
corporation
("Publisher").
RECITALS
A. Microsoft and its affiliated companies develop and license a
computer game system known as the Xbox 360 game system and a
proprietary online
service accessible via the Xbox 360 game system known as Xbox Live.
B. Publisher wishes to develop and/or publish one or more software
products running on the Xbox 360 game system, which software
products may also
be made available to subscribers of Xbox Live, and to license
proprietary
materials from Microsoft on the terms and conditions set forth
herein.
Accordingly, for and in consideration of the mutual covenants and
conditions contained herein, and for other good and valuable
consideration,
receipt of which each party hereby acknowledges, Microsoft and
Publisher agree
as follows:
1.
EXHIBITS
The following exhibits are hereby incorporated to this Agreement
(some require
completion and/or execution by one or both parties):
Exhibit 1:
Payments
Exhibit 2:
Xbox 360 Royalty Tier Selection Form
Exhibit 3:
Xbox 360 Publisher Enrollment Form
Exhibit 4:
Authorized Subsidiaries
Exhibit 5:
Non-Disclosure Agreement
Exhibit 6:
Japan/Asian Royalty Incentive Program
Exhibit 7:
Xbox Live Incentive Program
2.
DEFINITIONS
As further described in this Agreement and the Xbox 360 Publisher
Guide (defined
below), the following terms have the following respective meanings:
2.1 "ASIAN MANUFACTURING REGION" means the region for manufacturing
comprising Taiwan, Hong Kong, Singapore, Korea, Japan and any other
countries
that are included by Microsoft from time to time as set forth in
the Xbox 360
Publisher Guide.
2.2 "ASIAN SALES TERRITORY" means the territory for sales
distribution
comprising Taiwan, Hong Kong, Singapore, Korea, and any other
countries that are
included by Microsoft from time to time as set forth in the Xbox
360 Publisher
Guide. The Asian Sales Territory does not include Japan.
2.3 "AUTHORIZED REPLICATOR" means a software replicator certified
and
approved by Microsoft for replication of FPUs (defined below) that
run on the
Xbox 360.
2.4 "BRANDING SPECIFICATIONS" means the specifications as provided
by
Microsoft from time to time for using the Licensed Trademarks in
connection with
a Software Title and/or Online Content and on Marketing Materials
as set forth
in the Xbox 360 Publisher Guide.
2.5 "BTS" means a Microsoft designed break-the-seal sticker that
will
be issued to the Authorized Replicator for placement on the
Packaging Materials
(defined below) as specified in the Xbox 360 Publisher Guide.
2.6 "CERTIFICATION" means the final stage of the approval process
by
which Microsoft approves or disapproves of a Software Title or
Online Content
for manufacture and/or distribution. Certification is further
defined in this
Agreement and the Xbox 360 Publisher Guide.
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2.7 "COMMERCIAL RELEASE" with respect to a Software Title means the
first commercial distribution of an FPU that is not designated as a
Demo
Version. With respect to Online Content, Commercial Release means
its first
availability via Xbox Live to Xbox Live Users.
2.8 "CONCEPT" means the detailed description of Publisher's
proposed
Software Title and/or Online Content in each case including such
information as
may be requested by Microsoft.
2.9 "DEMO VERSIONS" means a small portion of an applicable Software
Title that is provided to end users to advertise or promote a
Software Title.
2.10 "EUROPEAN SALES TERRITORY" means the territory for sales
distribution comprising the United Kingdom, France, Germany, Spain,
Italy,
Netherlands, Belgium, Sweden, Denmark, Norway, Finland, Austria,
Switzerland,
Ireland, Portugal, Greece, Australia, New Zealand and any other
countries that
are included by Microsoft from time to time as set forth in the
Xbox 360
Publisher Guide
2.11 "EUROPEAN MANUFACTURING REGION" means the region for
manufacturing
comprising the United Kingdom, France, Germany, Spain, Italy,
Netherlands,
Belgium, Sweden, Denmark, Norway, Finland, Austria, Switzerland,
Ireland,
Portugal, Greece, Australia, New Zealand and any other countries
that are
included by Microsoft from time to time as set forth in the Xbox
360 Publisher
Guide.
2.12 "FPU" or "FINISHED PRODUCT UNIT" means a copy of a Software
Title
in object code form that has passed Certification, has been affixed
to a DVD
disk and approved by Microsoft for release and manufacturing. Once
the Packaging
Materials have been added, and the BTS has been assigned or affixed
to the FPU
or its packaging, the FPU also includes its accompanying BTS and
Packaging
Materials.
2.13 "JAPAN SALES TERRITORY" means the territory for sales
distribution
comprising the country of Japan.
2.14 "LICENSED TRADEMARKS" means the Microsoft trademarks
identified in
the Xbox 360 Publisher Guide.
2.15 "MARKETING MATERIALS" collectively means the Packaging
Materials
and all press releases, marketing, advertising or promotional
materials related
to the Software Title, FPUs and/or Online Content (including
without limitation
Web advertising and Publisher's Web pages to the extent they refer
to the
Software Title(s), FPU(s) and/or Online Content) that will be used
and
distributed by Publisher in the marketing of the Software Title(s),
FPU(s)
and/or Online Content.
2.16 "MANUFACTURING REGION" means the Asian Manufacturing Region,
European Manufacturing Region, and/or North American Manufacturing
Region.
2.17 "NORTH AMERICAN SALES TERRITORY" means the territory for sales
distribution comprising the United States, Canada, Mexico, Colombia
and any
other countries that may be included by Microsoft from time to time
as set forth
in the Xbox 360 Publisher Guide
2.18 "NORTH AMERICAN MANUFACTURING REGION" means the region for
manufacturing comprising the United States, Canada, Mexico,
Colombia and any
other countries that may be included by Microsoft from time to time
as set forth
in the Xbox 360 Publisher Guide
2.19 "ONLINE CONTENT" means any content, feature, or access to
software
or online service that is distributed by Microsoft pursuant to this
Agreement.
Online Content includes, but is not limited to, Online Game
Features, Title
Updates, Demo Versions, trailers, "themes," "gamer pictures" or any
other
category of online content or service approved by Microsoft from
time to time.
Trailers, "themes," "gamer pictures" and any other approved Online
Content will
be further described in the Xbox 360 Publisher Guide.
2.20 "ONLINE GAME FEATURES" means a Software Title's content,
features
and/or services that are available to Xbox Live Users via Xbox
Live, whether
included in the Software Title's FPU or otherwise distributed via
Xbox Live.
2.21 "PACKAGING MATERIALS" means art and mechanical formats for a
Software Title including the retail packaging, end user instruction
manual with
end user license agreement and warranties, end user warnings, FPU
media label,
and any promotional inserts and other materials that are to be
included in the
retail packaging.
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2.22 "PRE-CERTIFICATION" means the first stage of the approval
process
wherein Microsoft tests to provide feedback and/or identify any
issues that may
prevent the Software Title from being approved during the
Certification phase.
Pre-Certification is further described in this Agreement and the
Xbox 360
Publisher Guide.
2.23 "SALES TERRITORY" means the Asian Sales Territory, European
Sales
Territory, Japan Sales Territory, and/or North American Sales
Territory.
2.24 "SOFTWARE TITLE" means the single software product as approved
by
Microsoft for use on Xbox 360, including any Title Updates thereto
(if and to
the extent approved by Microsoft) and all Online Game Features for
such Software
Title. If Microsoft approves one or more additional single software
product(s)
proposed by Publisher to run on Xbox 360, this Agreement, and the
term "Software
Title," will be broadened automatically to cover the respective new
software
product(s) as additional Software Title(s) under this Agreement.
2.25 "SUBSCRIBER" means an Xbox Live User that establishes an
account
with Xbox Live.
2.26 "SUB-PUBLISHER" means an entity that has a valid Xbox 360
publisher license agreement with Microsoft or a Microsoft affiliate
and with
whom Publisher has entered an agreement to allow such entity to
publish a
Software Title or Online Content in specific Sales Territories.
2.27 "SUGGESTED RETAIL PRICE" means the highest per unit price that
Publisher or its agent recommends the FPU be made commercially
available to
end-users in a particular Sales Territory. If the Suggested Retail
Price of a
particular Software Title varies among the countries in a single
Sales
Territory, then the highest Suggested Retail Price established for
any of the
countries will be used to determine the appropriate royalty fees
for the entire
Sales Territory.
2.28 "TITLE UPDATE" means an update, upgrade, or technical fix to a
Software Title that Xbox Live Users can automatically download to
the Xbox Live
User's Xbox 360.
2.29 "WHOLESALE PRICE" means the highest per unit price that
Publisher
charges retailers and/or distributors in bona fide third party
transactions for
the right to distribute and sell the Software Title within a Sales
Territory, it
being agreed that (i) any transactions involving affiliates of
Publisher
(entities controlling, controlled by or under common control of,
Publisher) are
not to be considered in determining the Wholesale Price; (ii) if
Publisher
enters into an agreement with a third party (such as a
Sub-Publisher) providing
the third party with the exclusive right to distribute the Software
Title in a
Sales Territory, the Wholesale Price is governed by the price
charged by the
third party rather than the terms of the exclusive distribution
agreement
between Publisher and such third party; and (iii) if the Wholesale
Price varies
among countries in a single Sales Territory, the highest Wholesale
Price used in
the Sales Territory will be used to determine the appropriate
royalty fees for
the entire Sales Territory.
2.30 "XBOX 360" means the second version of Microsoft's proprietary
game system, successor to the Xbox game system, including operating
system
software and hardware design specifications.
2.31 "XBOX 360 PUBLISHER GUIDE" means a document (in physical,
electronic or Web site form) created by Microsoft that supplements
this
Agreement and provides detailed requirements regarding the
Pre-Certification and
Certification approval process, Branding Specifications,
replication
requirements, royalty payment process, marketing guidelines,
technical
specifications and certification requirements, Demo Version
requirements,
packaging requirements and other operational aspects of the Xbox
360 and Xbox
Live. Microsoft may supplement, revise or update the Xbox 360
Publisher Guide
from time to time in its reasonable discretion as set forth in this
Agreement.
2.32 "XBOX LIVE" means the proprietary online service offered by
Microsoft to Xbox Live Users.
2.33 "XBOX LIVE USER" means any individual that accesses and uses
Xbox
Live.
2.34 OTHER TERMS. All other capitalized terms have the definitions
set
forth with the first use of such term as described in this
Agreement.
3.
XBOX 360 DEVELOPMENT KIT LICENSE
Publisher shall enter into one or more development kit license(s)
for the
applicable territory(ies) to which Xbox 360 game development kits
will be
shipped for use by Publisher (each an "XDK License") pursuant to
which Microsoft
or its affiliate may license to Publisher software development
tools and
hardware to assist Publisher in the development and testing of
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Software Titles, including redistributable code that Publisher must
incorporate
into Software Titles pursuant to the terms and conditions contained
in the XDK
License.
4.
APPROVAL PROCESS
4.1 STANDARD APPROVAL PROCESS. The standard approval process for a
Software
Title is divided into four phases comprised of Concept approval,
Pre-Certification, Certification, and Marketing Materials approval.
Unless
Publisher elects the EU Approval Option for a European FPU
(described below),
Publisher is required to submit its Software Title to Microsoft for
evaluation
at all four phases. Each phase is identified below and further
described in the
Xbox 360 Publisher Guide. Additional or alternate approval
processes for Online
Content may be further described in the Xbox 360 Publisher Guide
4.1.1 CONCEPT. For each Software Title, Publisher shall deliver to
Microsoft a completed Concept submission form (in the form provided
by Microsoft
to Publisher) that describes the Software Title. In the event that
Publisher
desires to host or have a third party host or provide to Xbox Live
Users any of
Publisher's Online Game Features, Publisher shall so indicate on
the Concept
submission form and must execute an addendum to this Agreement,
which addendum
is available upon request and will be incorporated into this
Agreement upon
execution. Following evaluation of Publisher's Concept submission,
Microsoft
will notify Publisher of whether the Concept is approved or
rejected. If
approved, the Concept submission form, in the form submitted and
approved by
Microsoft, is incorporated herein by reference and adherence to its
terms is a
requirement for Certification. Publisher may propose Online Content
at any time
after a Concept has been approved, in which case Publisher shall
deliver to
Microsoft a separate Concept submission for each proposed piece of
Online
Content.
4.1.2 PRE-CERTIFICATION. If the Concept is approved, Publisher
shall
deliver to Microsoft a code-complete version of the Software Title
or Online
Content that includes all current features of the Software Title
and such other
content as may be required under the Xbox 360 Publisher Guide. Upon
receipt,
Microsoft shall conduct technical screen and/or other testing of
the Software
Title or Online Content consistent with the Xbox 360 Publisher
Guide and will
subsequently provide Publisher with advisory feedback regarding
such testing.
4.1.3 CERTIFICATION. Following Pre-Certification, Publisher shall
deliver to Microsoft the proposed final release version of the
applicable
Software Title that is complete, ready for access via Xbox Live (if
applicable),
release, manufacture, and commercial distribution. Such version
must include the
final content rating certification required by Section 4.4, have
identified
program errors corrected, and have any and all changes previously
required by
Microsoft implemented. Microsoft shall conduct compliance,
compatibility,
functional and other testing consistent with the Xbox 360 Publisher
Guide
("Certification Testing") and shall subsequently provide Publisher
with the
results of such testing, including any required fixes required
prior to
achieving Certification. Release from Certification for a Software
Title (and
for Online Content as applicable) is based on (1) passing the
Certification
Testing; (2) conformance with the approved Concept and any required
submission
materials as stated in the Xbox 360 Publisher Guide; (3) Packaging
Materials
approval; (4) consistency with the goals and objectives of the Xbox
360 console
platform and Xbox Live; and (5) continuing and ongoing compliance
with all
Certification requirements and other requirements as set forth in
the Xbox 360
Publisher Guide and this Agreement.
4.1.4 MARKETING MATERIALS APPROVAL. Publisher shall submit all
Marketing Materials to Microsoft and shall not distribute such
Marketing
Materials unless and until Microsoft has approved them in writing.
Prior to use
or publication of any Marketing Materials, Publisher agrees to
incorporate all
changes relating to use of the Licensed Trademarks that Microsoft
may request
and will use its commercially reasonable efforts to incorporate
other changes
reasonably suggested by Microsoft (provided, however, that in any
event
Publisher shall at all times comply with the Branding
Specifications).
4.2 EU APPROVAL OPTION. For a Software Title that Publisher intends
to
distribute solely in the European Sales Territory (a "European
FPU"), Publisher
may choose to forego Concept approval (Section 4.1.1),
Pre-Certification
(Section 4.1.2) and/or Marketing Materials approval (Section 4.1.4)
and submit
such Software Title to Microsoft only for Certification approval.
This option is
referred to herein as the "EU Approval Option." The EU Approval
Option applies
solely to distribution of European FPUs, and is not available for
Online Content
intended to be available in the European Sales Territory. If
Publisher chooses
the EU Approval Option, Publisher shall not use the Licensed
Trademarks on the
European FPU and the license grant set forth in Section 12.1 is
withdrawn as to
such European FPU. In addition, Publisher shall make no statements
in
advertising, marketing materials, packaging, Web sites or otherwise
that the
European FPU is approved or otherwise sanctioned by Microsoft or is
an official
Xbox 360 Software Title. The European FPU may not be distributed
outside the
European Sales Territory without complying with all terms of this
Agreement
concerning approvals and the release of the FPU as deemed relevant
by Microsoft.
Microsoft may provide additional information in the Xbox 360
4
Publisher Guide regarding the European Approval Option.
Notwithstanding
Publisher's choice of the EU Approval Option, all other portions of
this
Agreement other than those specifically identified above shall
remain in effect.
4.3 RESUBMISSIONS AND ADDITIONAL REVIEW. If a Software Title or
Online
Content fails Certification, and if Publisher has made good faith
efforts to
address any issues raised by Microsoft, Microsoft will give
Publisher the
opportunity to resubmit such Software Title or Online Content for
Certification.
Microsoft may charge Publisher a reasonable fee designed to offset
the costs
associated with testing upon resubmission. Publisher may request
the ability to
submit versions of the Software Title or Online Content at stages
of development
other than as identified above for review and feedback by
Microsoft. Such review
is within the discretion of Microsoft and may require the payment
of reasonable
fees by Publisher to offset the costs associated with the review of
such
Software Titles or Online Content.
4.4 CONTENT RATING. For those Sales Territories that utilize a
content
rating system, Microsoft will not accept submission of a Software
Title for
Certification approval unless and until Publisher has obtained, at
Publisher's
sole cost, a rating not higher than "Mature (17+)" or its
equivalent from the
appropriate rating bodies and/or any and all other independent
content rating
authority/authorities for the applicable Sales Territory(ies)
reasonably
designated by Microsoft (such as ESRB, ELSPA, CERO, etc.).
Publisher shall
include the applicable rating(s) prominently on FPUs and Marketing
Materials, in
accordance with the applicable rating body guidelines, and shall
include the
applicable rating in a header file of the Software Title and in
Online Content,
as described in the Xbox 360 Publisher Guide. For those Sales
Territories that
do not utilize a content rating system, Microsoft will not approve
any Software
Title or Online Content that, in its opinion, contains excessive
sexual content
or violence, inappropriate language or other elements deemed
unsuitable for the
Xbox 360 platform. If, after Commercial Release, a Software Title
is determined
as suitable for adults only or otherwise as indecent, obscene or
otherwise
prohibited by law, the Publisher shall at its own costs recall all
FPUs.
Publisher hereby represents and warrants that any Online Game
Features and other
game-related Online Content not included in the initial Software
Title FPU will
not be inconsistent with the content rating (or, in those countries
that do not
utilize a content rating system, with the overall nature of the
content) of the
underlying Software Title. Content rating information and
requirements may be
further described in the Xbox 360 Publisher Guide.
4.5 PUBLISHER TESTING. Publisher shall perform its own testing of
the
Software Title and FPUs and shall keep written or electronic
records of such
testing during the term of this Agreement and for no less than
[INFORMATION
OMITTED AND FILED SEPARATELY WITH THE COMMISSION UNDER RULE 24B-2]
thereafter
("Test Records"). Upon Microsoft's request, Publisher shall provide
Microsoft
with copies of, or reasonable access to inspect, the Test Records,
FPUs and
Software Title (either in pre-Commercial Release or Commercial
Release versions,
as Microsoft may request).
4.6 MUTUAL APPROVAL REQUIRED. Publisher shall not distribute the
Software
Title, nor manufacture any FPU intended for distribution, unless
and until
Microsoft has given its final approval and release from
Certification version of
the Software Title and both parties have approved the FPU in
writing.
4.7 TITLE UPDATES
4.7.1 All Title Updates for Software Titles are subject to approval
by
Microsoft. Publisher may release one Title Update per Software
Title free of
charge. Any additional Title Updates proposed by Publisher may be
subject to a
reasonable charge.
4.7.2 Microsoft may require Publisher to develop and provide a
Title
Update if (a) a Software Title or Online Content adversely affects
Xbox Live,
(b) if a change to the Xbox 360 Publisher Guide requires a Title
Update, (c) if
Certification is revoked for Online Content, or (d) for any other
reason at
Microsoft's reasonable discretion. Microsoft will not charge
Publisher for the
Certification, hosting, and distribution of Title Updates to Xbox
Live Users for
the first Title Update (if any) per Software Title or Online
Content required by
a specific change in the Xbox 360 Publisher Guide or for any other
reason at
Microsoft's reasonable discretion. Microsoft reserves the right to
charge
Publisher a reasonable fee to offset the costs associated with the
Certification, hosting, and distribution of Title Updates to Xbox
Live Users
that are required because of revocation of Certification or a
Software Title or
Online Content adversely affecting Xbox Live.
5. XBOX 360 PUBLISHER GUIDE
Publisher acknowledges that the Xbox 360 Publisher Guide is an
evolving document
and subject to change during the term of this Agreement. Publisher
agrees to be
bound by all provisions contained in the then-applicable version of
the Xbox 360
Publisher Guide. Publisher agrees that upon Publisher's receipt of
notice of
availability of the applicable supplement, revision, or updated
version of the
Xbox 360 Publisher Guide (which may be via a publisher newsletter
or other
electronic
5
notification), Publisher automatically is bound by all provisions
of the Xbox
360 Publisher Guide as supplemented, revised, or updated.
Publisher's continued
distribution of FPUs after a notice of supplement, revision or
update is
included in the Xbox 360 Publisher Guide or made available to
Publisher
constitutes Publisher's agreement to the then-current Xbox 360
Publisher Guide
as supplemented, revised or updated. Microsoft will specify in each
such
supplement, revision or update a reasonable effective date of each
change if
such change is not required to be effective immediately. Only with
respect to a
Software Title that has passed Pre-Certification prior to the
applicable
revision or update, Publisher will not be obligated to comply with
any changes
made to the technical or content requirements for Software Titles
in the Xbox
360 Publisher Guide, except in circumstances where such change is
deemed by
Microsoft to be vitally important to the success of the Xbox 360
platform (e.g.
changes due to piracy, technical failure) or will not add
significant expense to
the Software Title's development. In addition, changes made in
Branding
Specifications or other Marketing Materials requirements will be
effective as to
a Software Title that has passed Certification only on a "going
forward" basis
(i.e., only to such Marketing Materials and/or FPUs as are
manufactured after
Microsoft notifies Publisher of the change). Notwithstanding the
foregoing,
Publisher shall comply with such changes to the Xbox 360 Publisher
Guide related
to Branding Specifications or other Marketing Materials
requirements
retroactively if Microsoft agrees to pay for Publisher's direct,
out-of-pocket
expenses necessarily incurred as a result of its retrospective
compliance with
the change.
6.
POST-RELEASE COMPLIANCE
6.1 CORRECTION OF BUGS OR ERRORS. Notwithstanding Microsoft's
Certification, all Software Titles must remain in compliance with
all
Certification requirements and requirements set forth in the Xbox
360 Publisher
Guide on a continuing and ongoing basis. Publisher must correct any
material
program bugs or errors in conformance with the Xbox 360 Publisher
Guide whenever
discovered and Publisher agrees to correct such material bugs and
errors as soon
as possible after discovery. With respect to bugs or errors
discovered after
Commercial Release of the applicable Software Title, Publisher
will, at
Microsoft's request or allowance, correct the bug or error in all
FPUs
manufactured after discovery and Microsoft may charge a reasonable
amount to
cover the costs of Certifying the Software Title again.
6.2 ONLINE CONTENT; MINIMUM COMMITMENT
6.2.1 Publisher agrees that each Online Game Feature of a Software
Title will be made available via Xbox Live for at least
[INFORMATION OMITTED AND
FILED SEPARATELY WITH THE COMMISSION UNDER RULE 24B-2] following
the respective
Commercial Release of the FPUs of the Software Title in each Sales
Territory in
which Xbox Live is available (the "Minimum Commitment"). Publisher
is obligated
to provide all necessary support for such Online Game Feature
during its
availability and for [INFORMATION OMITTED AND FILED SEPARATELY WITH
THE
COMMISSION UNDER RULE 24B-2] after discontinuation . Following the
Minimum
Commitment period, Publisher may terminate Microsoft's license
associated with
such Online Game Feature upon [INFORMATION OMITTED AND FILED
SEPARATELY WITH THE
COMMISSION UNDER RULE 24B-2] prior written notice to Microsoft;
and/or Microsoft
may discontinue the availability of any or all such Online Game
Feature via Xbox
Live upon [INFORMATION OMITTED AND FILED SEPARATELY WITH THE
COMMISSION UNDER
RULE 24B-2] prior written notice to Publisher. Publisher is
responsible for
communicating the duration of Online Game Feature availability to
Xbox Live
Users, and for providing reasonable advance notice to Xbox Live
Users of any
discontinuation of such Online Game Feature.
6.2.2 Subject to Section 10.3, Publisher agrees that Microsoft has
the
right to make Online Content other than Online Games Features
submitted by
Publisher available to Xbox Live Users for the Term of this
Agreement. Publisher
agrees to provide all necessary support for such Online Content as
long as such
Online Content is made available to Xbox Live Users and for
[INFORMATION OMITTED
AND FILED SEPARATELY WITH THE COMMISSION UNDER RULE 24B-2]
thereafter.
6.2.3 ARCHIVE COPIES. Publisher agrees to maintain, and to possess
the
ability to support, copies in object code, source code and symbol
format, of all
Online Content available to Xbox Live Users during the term of this
Agreement
and for no less than [INFORMATION OMITTED AND FILED SEPARATELY WITH
THE
COMMISSION UNDER RULE 24B-2] thereafter.
7.
MANUFACTURING
7.1 AUTHORIZED REPLICATORS. Publisher will use only an Authorized
Replicator to produce FPUs. Prior to placing an order with a
replicator for
FPUs, Publisher shall confirm with Microsoft that such entity is an
Authorized
Replicator. Microsoft will endeavor to keep an up-to-date list of
Authorized
Replicators in the Xbox 360 Publisher Guide. Publisher will notify
Microsoft in
writing of the identity of the applicable Authorized Replicator and
the
agreement for such
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replication services shall be as negotiated by Publisher and the
applicable
Authorized Replicator, subject to the requirements in this
Agreement. Publisher
acknowledges that Microsoft may charge the Authorized Replicator
fees for
rights, services or products associated with the manufacture of
FPUs and that
the agreement with the Authorized Replicator grants Microsoft the
right to
instruct the Authorized Replicator to cease the manufacture or FPU
and/or
prohibit the release of FPU to Publisher or its agents in the event
Publisher is
in breach of this Agreement or any credit arrangement entered into
by Microsoft
and Publisher or Publisher affiliates. Microsoft does not guarantee
any level of
performance by the Authorized Replicators, and Microsoft will have
no liability
to Publisher for any Authorized Replicator's failure to perform its
obligations
under any applicable agreement between Microsoft and such
Authorized Replicator
and/or between Publisher and such Authorized Replicator. Microsoft
has no
responsibility for ensuring that FPUs are free of all defects.
7.2 SUBMISSIONS TO THE AUTHORIZED REPLICATOR. Microsoft, and not
Publisher,
will provide to the applicable Authorized Replicator the final
release version
of the Software Title and all specifications required by Microsoft
for the
manufacture of the FPUs including, without limitation, the Security
Technology
(as defined in Section 7.9 below). Publisher is responsible for
preparing and
delivering to the Authorized Replicator all other items required
for
manufacturing FPUs including approved Packaging Materials
associated with the
FPUs. Subject to the approval of Publisher (which approval shall
not be
unreasonably withheld), Microsoft has the right to have included in
the
packaging of FPUs such promotional materials for Xbox, Xbox 360,
Xbox Live,
and/or other Xbox or Xbox 360 products or services as Microsoft may
determine in
its reasonable discretion. Microsoft will be responsible for
delivering to the
Authorized Replicator all such promotional materials as it desires
to include
with FPUs, and, unless otherwise agreed by the parties, any
incremental
insertion costs relating to such marketing materials will be borne
by Microsoft.
7.3 VERIFICATION VERSIONS. Publisher shall cause the Authorized
Replicator
to create several test versions of each FPU ("Verification
Version(s)") that
will be provided to both Microsoft and Publisher for evaluation.
Prior to full
manufacture of a FPU by the Authorized Replicator, both Publisher
and Microsoft
must approve the applicable Verification Version. Throughout the
manufacturing
process and upon the request of Microsoft, Publisher shall cause
the Authorized
Replicator to provide additional Verification Versions of the FPU
for evaluation
by Microsoft. Microsoft's approval is a condition precedent to
manufacture,
however Publisher shall grant the final approval and shall work
directly with
the Authorized Replicator regarding the production run. Publisher
agrees that
all FPUs must be replicated in conformity with all of the quality
standards and
manufacturing specifications, policies and procedures that
Microsoft requires of
its Authorized Replicators, and that all Packaging Materials must
be approved by
Microsoft prior to packaging. Publisher shall cause the Authorized
Replicator to
include the BTS on each FPU.
7.4 SAMPLES. For each Software Title sku, at Publisher's cost,
Publisher
shall provide Microsoft with [INFORMATION OMITTED AND FILED
SEPARATELY WITH THE
COMMISSION UNDER RULE 24B-2] FPUs and accompanying Marketing
Materials per Sales
Territory in which the FPU will be released. Such units may be used
in
marketing, as product samples, for customer support, testing and
for archival
purposes. Publisher will not have to pay a royalty fee for such
samples nor will
such samples count towards the Unit Discounts under Exhibit 1.
7.5 MINIMUM ORDER QUANTITIES
7.5.1 Within [INFORMATION OMITTED AND FILED SEPARATELY WITH THE
COMMISSION UNDER RULE 24B-2] after the date on which both Microsoft
and
Publisher have authorized the Authorized Replicator to begin
replication of FPUs
for distribution to a specified Sales Territory, (receipt of both
approvals is
referred to as "Release to Manufacture"), Publisher must place
orders to
manufacture the minimum order quantities ("MOQs") as described in
the Xbox 360
Publisher Guide. Microsoft may update and revise the
MOQs[INFORMATION OMITTED
AND FILED SEPARATELY WITH THE COMMISSION UNDER RULE 24B-2] which
will be
effective starting the following [INFORMATION OMITTED AND FILED
SEPARATELY WITH
THE COMMISSION UNDER RULE 24B-2]. Curren
