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 Scott Mitchell Rosenberg." 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, mark-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 an ...