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 ______ , a
______corporation (“Publisher”).
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:
The following
exhibits are hereby incorporated to this Agreement (some require
completion and/or execution by one or both parties):
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Payments
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Xbox 360
Royalty Tier Selection Form
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Xbox 360
Publisher Enrollment Form
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Authorized
Subsidiaries
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Non-Disclosure
Agreement
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Japan/Asian
Royalty Incentive Program
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Xbox Live
Incentive Program
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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.
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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.
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
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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.
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
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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 Software Titles,
including redistributable code that Publisher must incorporate into
Software Titles pursuant to the terms and conditions contained in
the XDK License.
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
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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 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 (****) 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).
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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.
4.7.1
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 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 (****) following
the respective Commercial Release of the FPUs of the Software Title
in each Sales Territory
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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 (****) after
discontinuation. Following the Minimum Commitment period, Publisher
may terminate Microsoft’s license associated with such Online
Game Feature upon (****) prior written notice to Microsoft; and/or
Microsoft may discontinue the availability of any or all such
Online Game Feature via Xbox Live (****) upon 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 (****) 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 (****)
thereafter.
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
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.
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7.4 Samples
. For each Software Title sku, at Publisher’s cost, Publisher
shall provide Microsoft with (****) 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 (****) 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
(****) which will be effective starting the following (****).
Currently, the MOQs are as follows:
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7.5.2
For the purposes of this section, a “Disc” shall mean
an FPU that is signed for use on a certain defined range of Xbox
360 hardware, regardless of the number of languages or product skus
contained thereon. The MOQs per Software Title are cumulative per
Sales Territory. For example, if an FPU is released in both the
North American Sales Territory and the European Sales Territory,
the cumulative MOQ per Software Title would be (****). The MOQ per
Software Title and the MOQ per Disc, however, are not cumulative.
For example, a single Disc FPU released only in the North America
Sales Territory will have a total minimum order quantity of (****),
which would cover the (****) MOQ per Software Title and the (****)
MOQ per Disc (rather than (****) which would have been the total
minimum order quantity if the MOQ per Software Title and the MOQ
per Disc had been cumulative).
7.5.3
If Publisher fails to place orders to meet any applicable minimum
order quantity within (****) of Release to Manufacture, Publisher
shall immediately pay Microsoft the applicable royalty fee for the
number of FPUs represented by the difference between the applicable
MOQ and the number of FPUs of the Software Title actually ordered
by Publisher.
7.6
Manufacturing Reports . For purposes of assisting in the
scheduling of manufacturing resources, on a (****) basis, or as
otherwise requested by Microsoft in its reasonable discretion,
Publisher shall provide Microsoft with forecasts showing
manufacturing projections by Sales Territory (****) out for each
Software Title. Publisher will use commercially reasonable efforts
to cause the Authorized Replicator to deliver to Microsoft true and
accurate (****) statements of FPUs manufactured in each (****), on
a Software Title-by-Software Title basis and in sufficient detail
to satisfy Microsoft, within (****). Microsoft will have reasonable
audit rights to examine the records of the Authorized Replicator
regarding the number of FPUs manufactured.
7.7 New
Authorized Replicator . If Publisher requests that Microsoft
certify and approve a third party replicator that is not then an
Authorized Replicator, Microsoft will consider such request in good
faith. Publisher acknowledges and agrees that Microsoft may
condition certification and approval of such third party on the
execution of an agreement in a form satisfactory to Microsoft
pursuant to which such third party agrees to strict quality
standards, non-disclosure requirements, license fees for use of
Microsoft intellectual property and trade secrets, and procedures
to protect Microsoft’s intellectual property and trade
secrets. Notwithstanding anything contained herein, Publisher
acknowledges that Microsoft is not required to certify, maintain
the certification or approve any particular third party as an
Authorized Replicator, and that the certification and approval
process may be time-consuming.
7.8 Alternate
Manufacturing in Europe . Publisher may, solely with respect to
FPUs manufactured for distribution in the European Sales Territory,
utilize a different process or company for the combination of a FPU
with Packaging Materials provided that such packaging process
incorporates the BTS and otherwise complies with the Xbox 360
Publisher Guide. Publisher shall notify Microsoft regarding its use
of such process or company so that the parties may properly
coordinate their activities and approvals. To the extent that
Microsoft is unable to accommodate such processes or company,
Publisher shall modify its operations to comply with
Microsoft’s requirements.
8
7.9
Security . Microsoft has the right to add to the final
release version of the Software Title delivered by Publisher to
Microsoft, and to all FPUs, such digital signature technology and
other security technology and copyright management information
(collectively, “Security Technology”) as Microsoft may
determine to be necessary, and/or Microsoft may modify the
signature included in any Security Technology included in the
Software Title by Publisher at Microsoft’s discretion.
Additionally, Microsoft may add Security Technology that prohibits
the play of Software Titles on Xbox 360 units manufactured in a
region or country different from the location of manufacture of the
respective FPUs or that have been modified in any manner not
authorized by Microsoft.
7.10 Demo
Versions . If Publisher wishes to distribute a Demo Version in
FPU format, Publisher must obtain Microsoft’s prior written
approval and Microsoft may charge a reasonable fee to offset costs
of the Certification. Subject to the terms of the Xbox 360
Publisher Guide, such Demo Version(s) may be placed on a single
disc, either as a stand-alone or with other Demo Versions and the
price of such units must be (****) or its equivalent in local
currency. Unless separately addressed in the Xbox 360 Publisher
Guide, all rights, obligations and approvals set forth in this
Agreement as applying to Software Titles shall separately apply to
any Demo Version. (****) If Publishers wishes to distribute a Demo
Versions in an online downloadable format, such downloadable Demo
Version shall be distributed via by Microsoft Xbox Live in
accordance with Section 10.3, and such downloadable Demo
Version will be subject to all other terms and policies applicable
to Online Content set forth herein and in the Xbox 360 Publisher
Guide.
The Parties
shall make payments to each other under the terms of
Exhibit 1 .
9.
Marketing, Sales and Support
9.1 Publisher
Responsible . As between Microsoft and Publisher, Publisher is
solely responsible for the marketing and sales of the Software
Title. Publisher is also solely responsible for providing technical
and all other support relating to the FPUs (including for Xbox Live
Users of Online Content). Publisher shall provide all appropriate
contact information (including without limitation Publisher’s
address and telephone number, and the applicable individual/group
responsible for customer support), and shall also provide all such
information to Microsoft for posting on http://www.xbox.com, or
such successor or related Web site identified by Microsoft or in
Xbox Live. Customer support shall at all times conform to the
Customer Service Requirements set forth in the Xbox 360 Publisher
Guide and industry standards in the console game
industry.
9.2
Warranty. Publisher shall provide the original end user of
any FPU a minimum warranty in accordance with local laws and
industry practices. For example, in the United States, Publisher
shall, as of the Effective Date, provide a minimum (****) limited
warranty that the FPU will perform in accordance with its user
documentation or Publisher will refund the purchase price or
provide a replacement FPU at no charge. Publisher may offer
additional warranty coverage consistent with the traditions and
practices of video game console game publishers within the
applicable Sales Territory or as otherwise required by local
law.
9.3 Recall.
Notwithstanding anything to the contrary contained in this
Agreement, if there is a material defect in a Software Title and/or
any FPUs, which defect in the reasonable judgment of Microsoft
would significantly impair the ability of an end user to play such
Software Title or FPU or would adversely affect the gameplay of the
Xbox 360 or Xbox Live, Microsoft may require Publisher to recall
FPUs and undertake prompt repair or replacement of such Software
Title and/or FPUs.
9.4 No Bundling
with Unapproved Peripherals, Products or Software . Except as
expressly stated in this section, Publisher shall not market or
distribute a FPU bundled with any other product or service, nor
shall Publisher knowingly permit or assist any third party in such
bundling, without Microsoft’s prior written consent.
Publisher may market or distribute (i) FPU bundled with a
Software Title(s) that has been previously certified and released
by Microsoft for manufacturing; or (ii) FPU bundled with a
peripheral product (e.g. game pads) that has been previously
licensed as an “Xbox 360 Licensed Peripheral” by
Microsoft, without obtaining the written permission of Microsoft.
Publisher shall contact Microsoft in advance to confirm that the
peripheral or Software Title to be bundled has previously been
approved by Microsoft pursuant to a valid license.
9
9.5 Software
Title License . Publisher grants Microsoft a fully-paid,
royalty-free, worldwide, non-exclusive license (i) to publicly
perform the Software Titles at conventions, events, trade shows,
press briefings, public interactive displays and the like;
(ii) to use the title of the Software Title, and screen shots
from the Software Title, in advertising and promotional material
relating to Xbox 360 and related Microsoft products and services,
as Microsoft may reasonably deem appropriate; (iii) distribute
Demo Versions with the Official Xbox Magazine , as a
standalone product with other demo software; and
(iv) distribute Software Title trailers via xbox.com.
Publisher may also select Online Content for inclusion in public
interactive displays and/or compilation demo discs published by
Microsoft, in which case Publisher grants Microsoft a fully-paid,
royalty-free, worldwide, transferable, sublicenseable license to
broadcast, transmit, distribute, host, publicly display, reproduce
and manufacture such selected Online Content as part of public
interactive displays and compilation demo discs, and to distribute
and permit end users to download and store (and, at
Publisher’s discretion, to make further copies) such Online
Content via public interactive displays, The rights granted in the
preceding sentence are in addition to any rights that Microsoft may
have for uses of Publisher Software Titles under the applicable
law, such as uses that are “referential,” “fair
use” or “reasonable use.”
10. Grant of
Distribution License, Limitations
10.1
Distribution License . Upon Certification of the Software
Title, approval of the Marketing Materials and the FPU test version
of the Software Title by Microsoft, and subject to the terms and
conditions contained within this Agreement, Microsoft grants
Publisher a non-exclusive, non-transferable, license to distribute
FPUs containing Redistributable and Sample Code (as defined in the
XDK License) and Security Technology (as defined above) within the
Sales Territories approved in the Software Title’s Concept in
FPU form to third parties for distribution to end users and/or
directly to end users. The license to distribute the FPUs is
personal to Publisher and except for transfers of FPU through
normal channels of distribution (e.g. wholesalers, retailers),
absent the written approval of Microsoft, Publisher may not
sublicense or assign its rights under this license to other
parties. For t
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