License Agreement for Nintendo 64 Video Game System

Confidential Portions Omitted



CONFIDENTIAL LICENSE AGREEMENT

FOR NINTENDO 64 VIDEO GAME SYSTEM

(Western Hemisphere)





THIS AGREEMENT is entered into between NINTENDO OF AMERICA INC., a Washington corporation with an address for notice purposes of 4820 150th Avenue N.E., Redmond, WA 98052 (Fax: 206-882-3585) ("NINTEN DO") and INTERPLAY PRODUCTIONS, a California corporation with an address for notice purposes of 16815 Von Karman Avenue, Irvine, CA 92606 (Fax: (714) 252-0667), Attention: President ("LICENSEE").



NINTENDO and LICENSEE acknowledge and agree as follows:



1. RECITALS

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1.1 NINTENDO markets and sells a high-quality video game system, including hardware, software and an input controller, marketed by NINTENDO under its trademarks "Nintendo 64(R)" and "N64(TM)", for playing video games.



1.2 LICENSEE desires to gain access to and rights to utilize highly proprietary programming specifications, development tools, trademarks and other valuable intellectual property rights in order to develop video game software and to purchase and sell su ch video game software from NINTENDO for play on the Nintendo 64 system, which system was developed by NCL and Silicon Graphics, Inc.



1.3 NINTENDO is willing to grant a license to utilize such proprietary information and intellectual property rights and to sell video game software to LICENSEE upon the terms and conditions set forth in this Agreement.



2. DEFINITIONS

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2.1 "Artwork" shall mean the final art and mechanical formats for the Licensed Product including the Game Cartridge box, user instruction manual with consumer precautions and warranty, Game Cartridge label and inserts.



2.2 "Competing Systems" shall mean hardware platforms, whether marketed now or in the future, designed to play interactive video games, inc luding, but without limitation: Apple/Bandai Pippin or Atmark, Atari Jaguar, Atari Lynx, 3DO Real, Matsushita M2, Phillips CD-I Interactive Player, Sega Master System, Sega Genesis, Sega CD, Sega Game Gear, Sega CD/X, Sega Nomad, Sega 32X, Sega Saturn, Se ga Pico, Sony PSX/Playstation and SNK Neo Geo. IBM-PC and Macintosh personal computer systems are expressly omitted from the definition of "Competing Systems".



2.3 "Effective Date" shall mean the last date in which all parties shall have signed this Agreement.



2.4 "Exclusive Licensed Product" shall mean the audiovisual work to be agreed upon by the parties during the Term, and shipped during the Term.



2.5 "Game Cartridge(s)" shall mean interchangeable plastic cartridges adapted for use with the N64 System, housing the Game embodied in electronic memory devices or comparable medium authorized by NINTENDO for storing and playing Games on the N64 System.



2.6 "Game(s)" shall mean video game software compatible with the N64 System developed under



NINTENDO 64 LICENSE AGREEMENT PAGE 1 this Agreement.



2.7 "Guidelines" shall mean the "Nintendo 64 Packaging Guidelines" and the "Nintendo 64 Development Manual" setting forth trademark, copyright and related artwork standards, as published from time to time by NINTENDO.



2.8 "Independent Contractor" shall mean any third party agent, consultant, contractor or independent programmer, other than LICENSEE.



2.9 "Licensed Copyright(s)" shall mean various copyrights in printed materials, art or logo designs, trade dress, computer software, microcode, electronic circuitry and rights in integrated circuit layout designs employed in the N64 System.



2.10 "Licensed Intellectual Properties" shall mean individually, collectively or in any combination, the Licensed Inventions, Licensed Proprietary Information, Licensed Copyrights and Licensed Trademarks.



2.11 "Licensed Invention(s)" shall mean improvements and inventions concerning the N64 System, including inventions which are or may become the subject matter of various patents or patent applications.



2.12 "Licensed Product(s)" shall mean Game Cartridges (or comparable medium authorized by Nintendo) for employing the Licensed Intellectual Properties and having electronic memory devices storing the Games.



2.13 "Licensed Proprietary Information" shall mean any of the following information relating to the N64 System: (a) all current o r future information, know-how, techniques, methods, information, tools, emulator boards, software development specifications, and/or trade secrets, (b) any patents or patent applications, (c) any business, marketing or sales data information, and (d) any other information or data relating to development, design, operation, manufacturing, marketing or sales. "Licensed Proprietary Information" shall include information disclosed to LICENSEE by NINTENDO, NINTENDO's affiliated companies, SGI, and/or other th i rd parties working with NINTENDO. Such Licensed Proprietary Information shall include all confidential information disclosed, whether in writing, orally, visually, or in the form of drawings, technical specifications, software, samples, pictures, models, recordings, or other tangible items which contain or manifest, in any form, the Licensed Proprietary Information. Licensed Proprietary Information shall not include: (a) data and information which was in the public domain prior to LICENSEE's receipt of t h e same hereunder, or which subsequently becomes part of the public domain by publication or otherwise, except by LICENSEE's wrongful act or omission, (b) data and information which LICENSEE can demonstrate, through written records kept in the ordinary cou r se of business, was in its possession without restriction on use or disclosure, prior to its receipt of the same hereunder and was not acquired directly or indirectly from NINTENDO under an obligation of confidentiality which is still in force, (c) data a n d information which LICENSEE can show was received by it from a third party who did not acquire the same directly or indirectly from NINTENDO and to whom LICENSEE has no obligation of confidentiality, and (d) data and information which is required to be d isclosed by an authorized governmental or judicial entity, provided that LICENSEE shall notify NINTENDO at least thirty (30) days prior to such disclosure.



2.14 "Licensed Trademarks" shall mean registered and unregistered trademarks and trademark appl ications used in connection with the N64 System, including "Nintendo(R)", "Nintendo 64 (R)", "N64(TM)," "Official Nintendo Seal of Quality(R)" and trade dress in the N64 System.



2.15 "Marketing Materials" shall mean marketing, advertising or promotional materials which incorporate the Licensed Intellectual Properties which are developed by or for LICENSEE to promote the sale of the Licensed Products.



NINTENDO 64 LICENSE AGREEMENT PAGE 2

2.16 "NCL" shall mean NINTENDO's parent company, Nintendo Co., Ltd. of Kyoto, Japan.



2.17 "Nintendo 64 System" and "N64 System" shall mean the 64-bit Nintendo 64 video game system, including the hardware, software and input controller marketed by NINTENDO and Nintendo Co., Ltd.



2.18 "Other Agreements" shall mean that certain Product Developer Non- Disclosure Agreement for Nintendo 64 entered into between NINTENDO and LICENSEE with an effective date of 4/23/96.



2.19 "Product Proposal" shall mean a written proposal which provides a detailed explanation of the Game.



2.20 "Schedule 1" shall mean the "Nintendo of America Inc. Price Sheet N64 Licensed Game Paks" attached to this Agreement and incorporated by reference into this Agreement.



2.21 "SGI" shall mean Silicon Graphics, Inc. and/or MIPS Technologies, Inc.



2.22 "Term" shall mean three (3) years from the Effective Date.



2.23 "Territory" shall mean all countries within the Western Hemisphere, including the United States, Canada, South America, Central America, Mexico and all applicable territories and possessions.



3. GRANT OF LICENSE; RESERVATION OF RIGHTS BY NINTENDO

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3.1 Grant. For the Term and in the Territory, NINTENDO hereby grants to

----- LICENSEE, and LICENSEE hereby accepts under the terms and conditions set forth in this Agreement, a nonexclusive license to employ the Licensed Intellectual Properties sol ely to develop and sell video games incorporated into Game Cartridges for play on the N64 System. Except as may be permitted under a separate written authorization from NINTENDO or Nintendo Co., Ltd., LICENSEE shall not use the Licensed Intellectual Prop erties for any other purpose.



3.2 Reservation of Rights in the Licensed Intellectual Properties.

------------------------------------------------------------- LICENSEE acknowledges NINTENDO and Nintendo Co., Ltd.'s right, title, and intere st in and to the Licensed Intellectual Properties and the goodwill associated with the Licensed Trademarks. LICENSEE will not at any time do or cause to be done any act or thing which in any way impairs or is intended to impair any part of such right, ti tle, interest or goodwill. LICENSEE shall not represent that it has any ownership in the Licensed Intellectual Properties. Use of the Licensed Intellectual Properties shall not create any right, title or interest therein in LICENSEE's favor.



3.3 Reservation of Rights of Distribution Outside the Territory.

----------------------------------------------------------- LICENSEE shall market and sell the Licensed Products only in the Territory. LICENSEE shall not directly or indirectly export an y Licensed Products from the Territory nor shall LICENSEE knowingly permit or assist any third party in doing so.



3.4 Reservation of Rights to Reverse Engineer. LICENSEE may utilize and

----------------------------------------- study the design, performance and operation of the N64 System and the Licensed Proprietary Information solely for the purpose of developing software which is compatible with the N64 System for license under this Agreement. LICENSEE shall n ot, directly or indirectly, reverse engineer or aid or assist in the reverse engineering of all or any part of the N64 System, including the hardware, software, input controller and/or tools. For purposes of this Agreement, "reverse engineering" shall me a n: (a) the x-ray electronic scanning and/or physical or chemical stripping of semiconductor components; (b) the disassembly, decompilation, decryption, simulation, debugging or code tracing of microcode; and/or (c) the disassembly, decompilation, decrypti on, simulation, debugging or code tracing of object code or executable code, specifically including, but not limited to, any NINTENDO supplied or developed libraries or microcode. The limitations set forth in this Section 3.4 shall not preclude



NINTENDO 64 LICENSE AGREEMENT PAGE 3 LICENSEE from engaging in reverse engineering of any Game code which was developed solely by LICENSEE and related only to the Game and was not supplied by nor derived from any code supplied by NINTENDO.



3.5 Reservation of Rights of Electronic Transmission. LICENSEE shall not

------------------------------------------------ directly or indirectly duplicate, distribute or transmit Games via electronic means or any other means now known or hereafter devised, including without limitation, wireless, cable, fiber optic means, telephone lines, satellite transmission, microwave or radio waves or over a network of interconnected computers or other devices. Notwithstanding this limitation, LICENSEE shall not be prohibited from the electronic transmission of Games during the development process for the sole purpose of facilitating development; provided, however, that no right of retransmission shall attach to any such transmissio n, and, provided further, that LICENSEE shall use reasonable security measures, customary within the industry, to reduce the risk of unauthorized interception or retransmission of such transmissions.



3.6 Notification Obligations. LICENSEE shall promptly notify NINTENDO of

------------------------ the loss or unauthorized use or disclosure of any Licensed Proprietary Information and shall promptly act to recover any such information and/or prevent further breach of the confidentiality obligations herein.



4. CONFIDENTIALITY

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4.1 Disclosure of Proprietary Information. NINTENDO has and shall during

------------------------------------- the Term provide LICENSEE with highly proprietary development information, development tools, emulation systems, programming specifications and related resources and information constituting and incorporating the Licensed Proprietary Information to enable LICENSEE to develop video games for use with the N64 System.



4.2 Confidentiality of Licensed Proprietary Information. LICENSEE shall

--------------------------------------------------- maintain all Licensed Proprieta ry Information as strictly confidential and will use such Licensed Proprietary Information only in accordance with this Agreement. LICENSEE shall limit access to the Licensed Proprietary Information to LICENSEE's employees having a strict need to know an d shall advise such employees of their obligation of confidentiality as provided herein. LICENSEE shall require each such employee to retain in confidence the Licensed Proprietary Information pursuant to a written non-disclosure agreement between LICENSEE and such employee. LICENSEE shall use its best efforts to ensure that its employees working with or otherwise having access to Licensed Proprietary Information shall not disclose or make unauthorized use of the Licensed Proprietary Information.



4.3 Agent/Consultant Confidentiality. LICENSEE shall not disclose the

-------------------------------- Licensed Proprietary Information to any Independent Contractor without NINTENDO's prior written approval. Each a pproved Independent Contractor shall be required to enter into a written non-disclosure agreement with NINTENDO prior to receiving any access to or disclosure of the Licensed Proprietary Information.



4.4 SGI as a Third-Party Beneficiary. LICENSEE hereby acknowledges and

--------------------------------- agrees that SGI shall be a third-party beneficiary of LICENSEE's confidentiality obligations as set forth in this Section 4.



5. DEVELOPMENT; QUALITY STANDARDS; ARTWORK; MANUFACTURING

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5.1 Development and Sale of the N64 System Programs. During the Term,

----------------------------------------------- LICENSEE may develop Games and/or sell Licensed Products for the N64 System in accordance with this Agreement.



5.2 Exclusivity; Exclusive Licensed Product. For the Exclusive Licensed

--------------------------------------- Produ ...