EXHIBIT 10.1
DISTRIBUTION AGREEMENT
This Distribution Agreement (this "AGREEMENT") is made as of August 23,
2001 (the "EFFECTIVE DATE") by and between Vivendi Universal Interactive
Publishing North America ("UNIVERSAL"), a Delaware corporation with offices at
6080 Center Drive, Los Angeles, California, 90045 , and INTERPLAY ENTERTAINMENT
CORP. ("INTERPLAY"), a Delaware corporation with offices at16815 Von Karman
Avenue, Irvine, California 92606.
RECITALS
A. Universal and Interplay are both in the business of creating,
publishing, manufacturing, marketing and distributing interactive entertainment
software for a variety of hardware platforms.
B. Interplay desires to deliver to UNIVERSAL, and UNIVERSAL desires to
receive from Interplay on a consignment basis, certain Products (as defined
herein) published by Interplay for sale and distribution by UNIVERSAL. UNIVERSAL
also desires to provide marketing and other services for the Products which
UNIVERSAL distributes on behalf of Interplay hereunder.
NOW, THEREFORE, the parties hereby agree as follows:
1. CERTAIN DEFINITIONS
The following terms will have the following meanings as used in this
Agreement:
1.1 ***
1.2 "SCHEDULED TITLE" means the entertainment software products
(including, but not limited to, all sequels, updates, subsequent
versions, spin-offs and derivative works arising therefrom) that
Interplay publishes or is planning to publish in the regular course of
its business in the Territory (or that Interplay otherwise has the
right to market and distribute in the Territory) during the Term,
including but not limited to those titles listed on Exhibit B. Those
Scheduled Titles specifically listed in Exhibit B shall be referred to
as the "NAMED TITLE(S)."
1.3 "PRODUCT" means each of the software products listed in Exhibit A
attached hereto under the heading "Products", plus ***, plus any Named
Titles as provided in Section 1.1 above, plus any Scheduled Title, on
all Platforms on which Interplay, in its reasonable discretion,
decides to publish the Product.
1.4 "ESCROW INSTRUCTIONS" means the Escrow Instructions executed by the
parties and attached hereto as Exhibit C.
1.5 "SKU" means a version of a Product designed to operate on a particular
Platform. An example of a SKU is a version of a Product designed to
play on the Sony PlayStation 2 platform.
1.6 "PLATFORM" means each of the following: personal computers (regardless
of manufacturer or operating system), PlayStation, PlayStation 2, N64,
GameCube, Game Boy, Game Boy Color, Game Boy Advance and Xbox.
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*** Terms represented by this symbol are considered confidential. These
confidential terms have been omitted pursuant to a Confidential Treatment
Request filed with the Securities and Exchange Commission ("SEC") and have been
filed separately with the SEC.
1.7 "LOAN AGREEMENT" means that certain Loan and Security Agreement
between Interplay and ***.
1.8 "TERRITORY" means the United States and its possessions and Canada.
1.9 "TERM" means the period beginning on the Effective Date and ending on
the earlier to occur of (i) *** or (ii) the termination of this
Agreement pursuant to Section 11.1 or 11.2. Notwithstanding the
foregoing, in the event that a Named Title is released within one year
of ***, then the Term with respect to such Title shall be one (1) year
from the date of such Named Title's release.
1.10 "THIRD PARTY LICENSOR" means any licensors or owner (other than
Interplay or UNIVERSAL) of intellectual property that is used in any
Product.
1.11 "THIRD PARTY LICENSE" means any license by a Third Party Licensor of
intellectual property that is used in any Product.
2. DISTRIBUTION RIGHT
2.1 GRANT OF OPTION/DISTRIBUTION RIGHTS.
(a) Interplay hereby grants to UNIVERSAL, and UNIVERSAL hereby accepts
from Interplay, the exclusive distribution rights in the Territory to
***.
(b) Subject to the disbursement of the Funds (as defined in Section
13.17 of this Agreement) to Interplay, Interplay hereby grants to
UNIVERSAL, and UNIVERSAL hereby accepts from Interplay, the first
option to obtain exclusive distribution rights in the Territory to
each Scheduled Title. In regard to Named Titles Interplay hereby
grants to UNIVERSAL, and UNIVERSAL hereby accepts from Interplay the
exclusive distribution rights in the Territory to each Named Title.
Interplay shall present to UNIVERSAL, for UNIVERSAL's review and
comment, the Alpha Version of each Scheduled Title. The "ALPHA
VERSION" of an Scheduled Title is a complete, running software program
containing all the features of the Scheduled Title with all software
modules integrated and working together in a usable and testable
fashion, but not necessarily including the title screen or
demonstration mode. With respect to each such Alpha Version of each
such Scheduled Title, UNIVERSAL shall have the right at any time
during the *** days following UNIVERSAL's receipt of such Alpha
Version to exercise its option to distribute all, but not less than
all, SKUs of such Scheduled Title in the Territory, and shall inform
Interplay in writing of its decision. If UNIVERSAL fails to provide
any written notice to Interplay within such *** day period, UNIVERSAL
shall be deemed to have exercised its option to distribute all SKUs of
such Scheduled Title in the Territory. If UNIVERSAL elects to exercise
it's right to distribute a particular Scheduled Title in the Territory
hereunder, then such Scheduled Title will be considered a Product for
the purposes of this Agreement. If UNIVERSAL declines to distribute
the Scheduled Title, then UNIVERSAL will have no further rights
whatsoever in the Scheduled Title and such Scheduled Title will not
become a "Product" under this Agreement. Notwithstanding the
foregoing, UNIVERSALagrees to exercise its option to obtain exclusive
distribution rights in the Territory to each Scheduled Title submitted
by Interplay which is of reasonable quality. Interplay agrees to
deliver written reports to UNIVERSAL on a regular monthly basis
setting forth the identity and the projected release dates for
Scheduled Titles then in development. For clarity, in the event the
Funds are not disbursed to Interplay for any reason whatsoever, except
as provided in Section 2.1(a) above, UNIVERSAL shall have NO RIGHTS
WHATSOEVER with respect to any Scheduled Titles, Named Titles or any
other entertainment software products (including, but not limited to,
all sequels, updates, subsequent versions, spin-offs and derivative
works arising therefrom) that Interplay publishes or is planning to
publish.
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*** Terms represented by this symbol are considered confidential. These
confidential terms have been omitted pursuant to a Confidential Treatment
Request filed with the Securities and Exchange Commission ("SEC") and have been
filed separately with the SEC.
Page 2
2.2 GRANT OF RIGHTS IN PRODUCTS.
(a) MARKETING AND DISTRIBUTION RIGHTS. Interplay hereby grants to
UNIVERSAL the exclusive (except as expressly set forth in
Sections 2.5 and 2.6 below) right and license to market
(including through public performance and display), distribute
and sell the Products on behalf of Interplay on an
individual-unit (i.e., non-bundled), packaged-goods basis in the
Territory and during the Term to wholesalers, dealers,
subdistributors, online resellers, direct marketers, retailers
and/or other customers (and on a non-exclusive basis, directly to
the public) on terms that are reasonable and customary in the
interactive entertainment software industry. UNIVERSAL may use
subcontractors (in each case acting on UNIVERSAL's behalf) in
exercising the foregoing rights.
(b) MANUFACTURING RIGHTS. Interplay hereby grants to UNIVERSAL the
exclusive (except as set forth in Section 2.5 and 3.10 below)
right and license to copy, reproduce and otherwise manufacture
the Products (including each of the component parts that go into
a final, fully packaged Product unit) on behalf of Interplay. The
parties will mutually agree on the number of units of each SKU
that will be manufactured in each manufacturing run of Product
units. UNIVERSAL may use subcontractors (in each case acting on
UNIVERSAL's behalf) in exercising the foregoing rights.
Notwithstanding the foregoing, with regard to the manufacture of
PC Products only, and following the initial manufacturing run,
UNIVERSAL shall not be required to receive the consent of
Interplay as to the number of units of each SKU that will be
manufactured, provided, however, if Interplay objects to the
number of units of each SKU being manufactured, UNIVERSAL shall
be required to receive Interplay's consent on all subsequent
manufacturing runs.
2.3 LICENSE TO USE PRODUCT TRADEMARKS. Interplay hereby grants UNIVERSAL a
non-exclusive, non-transferable license within the Territory and
during the Term to use (i) the trademarks associated with the Products
(collectively, the "PRODUCT MARKS"), and (ii) the Interplay name and
logo and other Interplay publishing brands as designated by Interplay
(collectively, the "INTERPLAY Marks"), solely in connection with
UNIVERSAL's exercise of the rights granted in Section 2.2 above.
2.4 APPROVAL BY LICENSORS. Notwithstanding any other provision of this
Agreement to the contrary, UNIVERSAL's rights and obligations under
this Agreement with respect to each Product will be conditioned upon
such Product having been approved for distribution in the Territory by
the appropriate platform licensor (e.g., Sony, Microsoft or Nintendo)
if any, and by any applicable content licensors (including any Third
Party Licensors) and other entities whose approval is legally or
contractually required to allow the distribution by UNIVERSAL of the
Products, and use by UNIVERSAL of the Product Marks, in the Territory
as set forth in this Section 2. Interplay will use its diligent good
faith efforts to secure such necessary approvals so that the Products
may be marketed and distributed as provided in this Agreement.
2.5 OEM RIGHTS. Without limiting the generality of Section 2.7 below,
Interplay specifically reserves the right to authorize third parties
to distribute Products with third-party software and/or hardware in
the form of a single combined product and selling such combined
products in or outside of the Territory and as a premium to augment
the value of non-computer related products and so-called "covermounts"
in and outside the Territory ("OEM LICENSES"). Interplay agrees that
it will not grant any OEM Licenses with respect to any Product that
authorize distribution of any combined product that includes such
Product to commence earlier than *** following the first commercial
distribution of such Product by UNIVERSAL hereunder, without the prior
written approval of UNIVERSAL.
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*** Terms represented by this symbol are considered confidential. These
confidential terms have been omitted pursuant to a Confidential Treatment
Request filed with the Securities and Exchange Commission ("SEC") and have been
filed separately with the SEC.
Page 3
2.6 INTERPLAY DIRECT SALES. Interplay shall be entitled to sell Products
directly to customers through Interplay's own direct sales program,
including offering the Products for sale direct to consumers through
Interplay's direct mailing programs, Interplay's telemarketing
programs, Interplay's websites and Interplay's on-line stores;
provided, that Interplay will only sell directly itself, and will not
engage third parties to sell directly to customers on Interplay's
behalf, although Interplay may engage third-party subcontractors to
fulfill orders that Interplay has itself received directly from
consumers.
2.7 RESERVED RIGHTS. All rights not expressly granted to UNIVERSAL in this
Agreement, including all rights outside the Territory, any electric
transmission rights (such as through cable, the Internet and any
on-line services), and all other merchandizing rights of any kind
whatsoever, are specifically excluded from this Agreement and are
retained and reserved by Interplay. Interplay also reserves the right
to publish trailers and demos of the Products (which trailers and
demos will be made available to UNIVERSAL for its use hereunder in
marketing the Products) in combination with other entertainment
software products that are not Products under this Agreement. Any use
by Interplay of such reserved rights, including the use or
authorization of other to use or exploit the Products, the Product
Marks and/or the Interplay Marks, or any portion thereof, for the
purpose of Interplay's reserved rights, shall not be deemed unfair
competition, nor interference with nor infringement of UNIVERSAL's
rights hereunder.
3. OBLIGATIONS OF UNIVERSAL
3.1 MARKETING AND SALES EFFORTS. UNIVERSAL will use commercially
reasonable, good-faith efforts, but in no event less than efforts
substantially equivalent to those employed by UNIVERSAL in the
marketing and distribution of UNIVERSAL-published products of like
sales potential and demographic target, to market and distribute the
Products, and solicit and support sales of the Products, throughout
the Territory.
3.2 MARKETING. UNIVERSAL will create a marketing plan, and will design all
packaging and Product-specific marketing materials, for each Product.
All such marketing plans, packaging and Product-specific marketing
materials will be subject to the prior approval of Interplay, which
approvals will not be unreasonably withheld or delayed by Interplay.
UNIVERSAL will include the Products in UNIVERSAL's general sales and
marketing literature and direct mail marketing materials on a
reasonably consistent basis with other UNIVERSAL-published products of
similar sales potential and demographic target. Subject to Interplay's
approval in each case (which approvals will not be unreasonably
withheld or delayed by Interplay), UNIVERSAL will secure all
media-buys for Product advertising. UNIVERSAL will be entitled to
distribute up to *** of each SKU to its marketing contacts and
customers as demonstration copies (on a not-for-resale basis) without
owing Interplay any Interplay Proceeds (as defined in Section 6.1
below) for such units; provided that such maximum number of units may
be increased by UNIVERSAL on a SKU-by-SKU basis subject to the
approval of Interplay, which approval will not be unreasonably
withheld or delayed.
3.3 BRANDING AND PACKAGING. On Product packaging, in Product-specific
marketing materials and in any specific reference to a Product in any
other UNIVERSAL sales or marketing literature, Interplay's name or
other designated brand shall appear more prominently than UNIVERSAL's
or any third party's, name, logo or brand. The front of the outside
packaging of the Products will include information as to machine,
medium and other operating requirements (such as memory) necessary for
the effective use of the Products by consumers. The design of such
packaging will also include all relevant bar code information. At
UNIVERSAL's option, UNIVERSAL may incorporate artwork (to be subject
to Interplay's approval) that shows UNIVERSAL's or a wholly-owned
subsidiary or parent company of UNIVERSAL, provided such wholly-owned
subsidiary or parent company of UNIVERSAL is in the interactive
entertainment software business ("UNIVERSAL SUBSIDIARY") name and
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*** Terms represented by this symbol are considered confidential. These
confidential terms have been omitted pursuant to a Confidential Treatment
Request filed with the Securities and Exchange Commission ("SEC") and have been
filed separately with the SEC.
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logo (which is intended to inform customers that UNIVERSAL is the
distributor of the Products) in the design of the back of the outside
packaging of the Products, provided that such artwork does not obscure
the title of the Product, or Interplay's name or logo, and is
reasonable in size compared to the size of the packaging. UNIVERSAL
will also be entitled to include the URL of UNIVERSAL's online store
and web site on the Product packaging.
3.4 REPORTS AND FORECASTS. To the extent, and with the frequency, that
UNIVERSAL routinely compiles or receives sales information reports
with respect to UNIVERSAL-published products on an account-by-account
basis, UNIVERSAL will provide Interplay with such reports, to the same
extent and frequency, with respect to each Product. Such reports will
provide such information as UNIVERSAL's current inventory of each
Product, a summary of all unit sales of each Product sold during the
prior period, and whatever competitive product and market analysis
information as may be available to UNIVERSAL and which UNIVERSAL may
disclose without breaching any confidentiality obligation to any third
party. UNIVERSAL will provide Interplay with weekly sell-through and
inventory reports, to the extent that such reports are routinely
compiled by UNIVERSAL for UNIVERSAL-published products. Any reports
provided to Interplay hereunder shall be deemed to be the property of
Interplay and Confidential Information of Interplay (as provided in
Section 12 below); provided, however, that Interplay agrees to abide
by any confidentiality restrictions imposed on UNIVERSAL by third
parties furnishing any information in such reports, when such
restrictions have been communicated to Interplay. UNIVERSAL will also
provide Interplay on a monthly basis with a three-month rolling
forecast of UNIVERSAL's sales of Products, by SKU. In addition,
UNIVERSAL shall provide a preliminary sales forecast for each Product
within *** days after Interplay approves that marketing plan for such
Product. Such forecast shall be based on the anticipated marketing
spend and strategy for the Product, UNIVERSAL's assessment of the
sales potential of that Product (based on the Alpha Version), and such
other factors and information as UNIVERSAL reasonably uses in its
forecasting practices. All such forecasts are provided by UNIVERSAL to
Interplay solely for its internal planning purposes and will not be
taken or relied-upon by Interplay as a representation or warranty as
to UNIVERSAL's future orders or sales of the Products. Without
limiting UNIVERSAL's other obligations hereunder, Interplay
acknowledges that UNIVERSAL is under no obligation whatsoever to order
or sell any particular amount of any Products. In addition to the
foregoing and subject to the Confidentiality provisions set forth in
Section 9 below, with reasonable promptness, UNIVERSAL shall provide
such other business or financial data, reports, and projections as
Interplay may reasonably request in order to comply with regulatory
reporting, tax reporting, and compliance with other contractual
obligations of Interplay.
3.5 CONSUMER/TRADE SHOWS. For consumer/trade shows at which UNIVERSAL
decides to maintain a display booth and for which Interplay gives
UNIVERSAL a timely written request to display its Products at
UNIVERSAL's display booth, subject to available space as reasonably
determined by UNIVERSAL and subject to the parties agreeing on the
apportionment of the costs, UNIVERSAL will provide a reasonable amount
of space in its booth for Interplay to display its Products; provided,
that, for any given consumer/trade show, Interplay shall receive rates
no less favorable than those accorded any other similar party for whom
UNIVERSAL provides distribution services, taking into account the
amount of space at issue and the number of Products being displayed.
The parties shall discuss in good faith the apportionment of costs for
any display space dedicated to Interplay. All travel, accommodation,
equipment, and other expenses incurred by Interplay will be at
Interplay's sole expense. Special signage (if any) must be approved by
UNIVERSAL, and will be at the expense of Interplay. In the event
Interplay does not desire to display its Products at the UNIVERSAL
display booth, or UNIVERSAL determines that there is not enough
available space for Interplay to display its Products, UNIVERSAL will
display and promote the Products as UNIVERSAL deems appropriate on a
non-dedicated space basis at UNIVERSAL's expense.
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*** Terms represented by this symbol are considered confidential. These
confidential terms have been omitted pursuant to a Confidential Treatment
Request filed with the Securities and Exchange Commission ("SEC") and have been
filed separately with the SEC.
Page 5
3.6 PACKAGING, WARRANTIES, ETC. UNIVERSAL will distribute the Products
with packaging, warranties and disclaimers intact as shipped from
Interplay. UNIVERSAL will not alter, erase, deface or overprint any
notice on any item provided by Interplay.
3.7 COMPLIANCE WITH LAWS. UNIVERSAL will comply in all material respects
with all applicable international, national, state, provincial,
regional and local statutes and regulations in distributing the
Products and in performing its duties hereunder.
3.8 INFRINGEMENT. UNIVERSAL will promptly notify Interplay in writing of
any known infringement of Interplay's proprietary rights in the
Products which comes to UNIVERSAL's attention. UNIVERSAL agrees to
cooperate, at Interplay's expense, with reasonable requests for
assistance from Interplay in connection with Interplay's reasonable,
good-faith efforts to protect its proprietary rights in the Products.
3.9 INTERPLAY'S INVOLVEMENT IN UNIVERSAL'S SALES ACTIVITIES. UNIVERSAL
will make all reasonable, good faith efforts to keep Interplay's sales
team apprised of UNIVERSAL's sales force efforts and level of success
in selling the Products..
3.10 MANUFACTURING OF PRODUCTS.
(a) APPROVAL TO MANUFACTURE. UNIVERSAL and Interplay will together
use reasonable commercial efforts to obtain the approval of any
Third Party Licensor(s) whose approval is necessary for UNIVERSAL
to be able to manufacture finished-goods Product units hereunder.
SKUs for which no such Third Party Licensor approval is required,
or for which all necessary Third Party Licensor consents and
approvals have been obtained, will be referred to as "UNIVERSAL
MANUFACTURED SKUS". Console SKUs for which UNIVERSAL and
Interplay are unable to obtain the necessary Third Party Licensor
consent(s) or approval(s) for UNIVERSAL to manufacture
finished-goods Product units will be referred to as "INTERPLAY
MANUFACTURED SKUS". For clarity UNIVERSAL shall be responsible
for the manufacturing all PC SKU's.
(b) UNIVERSAL MANUFACTURED SKUS. UNIVERSAL will be responsible for
manufacturing all units of UNIVERSAL Manufactured SKUs to be
distributed by UNIVERSAL hereunder (and to be distributed by
Interplay pursuant to Section 2.6 above), including all component
parts thereof, and for assembly of finished-goods Product units
of UNIVERSAL Manufactured SKUs, and for securing delivery of such
finished-goods Product units to UNIVERSAL's distribution center
(or to Interplay's distribution center in the case of units
distributed by Interplay pursuant to Section 2.6 above). All such
activities undertaken by UNIVERSAL shall be on behalf of
Interplay. UNIVERSAL and Interplay shall mutually agree in the
number of units of UNIVERSAL Manufactured SKUs to be manufactured
in each production run. Subject to reimbursement as provided in
Section 6.1 below, (i) UNIVERSAL will pay all costs of
manufacturing the units of UNIVERSAL Manufactured SKUs to be
distributed pursuant to this Agreement, including costs of CD-
and DVD-pressing, platform licensor royalties, printing of
packaging and inserts and pack-out ("MANUFACTURING COSTS"); and
(ii) UNIVERSAL will also pay all costs of shipping completed
units of UNIVERSAL Manufactured SKUs to be distributed pursuant
to this Agreement to UNIVERSAL's distribution center, and to
Interplay's distribution center ("SHIPPING COSTS").
(c) INTERPLAY MANUFACTURED SKUS. Interplay will be responsible for
manufacturing all units of Interplay Manufactured SKUs to be
distributed by UNIVERSAL hereunder (and to be distributed by
Interplay pursuant to Section 2.6 above), including all component
parts thereof, and for assembly of finished-goods Product units
of Interplay Manufactured SKUs, and for securing delivery of such
finished-goods Product units to UNIVERSAL's distribution center
(or to Interplay's distribution center in the case of
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*** Terms represented by this symbol are considered confidential. These
confidential terms have been omitted pursuant to a Confidential Treatment
Request filed with the Securities and Exchange Commission ("SEC") and have been
filed separately with the SEC.
Page 6
units distributed by Interplay pursuant to Section 2.6 above).
Subject to reimbursement as provided in Section 6.1 below, (i)
UNIVERSAL will advance Interplay the out-of-pocket (paid to third
parties not owned or controlled by Interplay) Manufacturing Costs
incurred by Interplay in manufacturing units of the Interplay
Manufactured SKUs to be distributed by UNIVERSAL pursuant to this
Agreement; and (ii) UNIVERSAL will also advance Interplay the
out-of-pocket (paid to third parties not owned or controlled by
Interplay) Shipping Costs incurred by Interplay in shipping
completed units of Interplay Manufactured SKUs to be distributed
by UNIVERSAL pursuant to this Agreement to UNIVERSAL's
distribution center. UNIVERSAL will advance such amounts to
Interplay, or pay such amounts directly to the third party
performing such services or who is otherwise owed such payments,
promptly upon Interplay's presentation to UNIVERSAL (or
UNIVERSAL's presentation to Interplay and Interplay's approval)
of a valid and correct invoice or purchase order specifying the
amount owed and the services being provided. UNIVERSAL shall have
a right of prior approval (which will not be unreasonably
withheld of delayed) over the quantity of each manufacturing
order for Product units (or components thereof) intended for
distribution pursuant to this Agreement. By way of clarification,
UNIVERSAL will not be required to advance Interplay the costs or
expenses of manufacturing or shipping units of any Interplay
Manufactured SKUs that are not intended for distribution by
UNIVERSAL pursuant to this Agreement; provided, however, that if
UNIVERSAL agrees to advance Interplay any such costs, UNIVERSAL
will be entitled to reimbursement of such costs as Manufacturing
Costs or Shipping Costs (as applicable) pursuant to Section 6.1
below.
3.10 PRESS RELATIONS. UNIVERSAL will be responsible for all media-relations
and press-relations activity and publicity with respect to the
Products. UNIVERSAL mayl include demonstration copies of the Products,
or sample Product units, in periodic mailings to public relations
contacts that UNIVERSAL has developed, in a manner that is consistent
with UNIVERSAL's standard business practices. UNIVERSAL may work
closely with Interplay's marketing and development personnel to make
sure that UNIVERSAL's media-relations and press-relations activities
are coordinated with, and enhance, Interplay's marketing and
development efforts for the Products.
3.11 TIMELY DISTRIBUTION. UNIVERSAL agrees to use its best efforts to
commercially release the Products in a timely manner. Subject to
UNIVERSAL's receipt of all necessary Interplay and Third Party
approvals, in no event shall UNIVERSAL release the Product later than:
(i) with respect to PC Products, UNIVERSAL agrees to release the
Products for commercial distribution within *** days of UNIVERSAL's
possession of a gold master version of the Product; (ii) with respect
to UNIVERSAL Manufactured SKU"s which are console platforms, UNIVERSAL
shall cause such Product(s) to commence the manufacturing process
within *** days of UNIVERSAL's possession of a gold master version of
the Products and upon receipt of finished goods UNIVERSAL shall
release the Products for commercial release within *** days of receipt
of such finished goods; and (iii) with respect to Interplay
Manufactured SKU"s which are console platforms, UNIVERSAL shall
release the Products for commercial release within *** days of receipt
of such finished goods.
4. OBLIGATIONS OF INTERPLAY
Interplay represents to UNIVERSAL that it is able to and intends to
publish, and be the consignor of, the Products and to manufacture or cause to be
manufactured the Products, and that, as between Interplay and UNIVERSAL,
Interplay is solely responsible for all obligations attendant upon such roles
(except as set forth in Section 3.10 above). Accordingly, Interplay represents,
covenants and agrees as follows:
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*** Terms represented by this symbol are considered confidential. These
confidential terms have been omitted pursuant to a Confidential Treatment
Request filed with the Securities and Exchange Commission ("SEC") and have been
filed separately with the SEC.
Page 7
4.1 PRODUCT QUALITY. The Products: (a) are marketable and have been
prepared and developed with reasonable diligence and skill; (b) are
and will continue to be of high quality in all material respects and
will be free of defects (minor bugs generally acceptable within
industry standards shall not be considered a defect under this
Agreement) in material and workmanship in all material respects and
(c) will conform in all material respects to the functional and other
descriptions contained in the written materials accompanying them and
in all advertising and promotional materials produced, released or
approved by Interplay.
4.2 PRODUCT DELIVERY. Except as otherwise expressly stated in this
Agreement, Interplay will be responsible for, and will pay all costs
associated with, shipment and insurance of Products to UNIVERSAL, and
from UNIVERSAL to Interplay.
4.3 MARKETING SUPPORT. Interplay will provide UNIVERSAL with reasonable,
good faith cooperation and support in UNIVERSAL's efforts to market
the Products. In addition, subject to UNIVERSAL's approval, not to be
unreasonably withheld or delayed, Interplay may provide supplemental
marketing for the Products in the Territory, at Interplay's expense.
4.4 PRODUCT TESTING AND APPROVALS At Interplay's cost, Interplay agrees to
use reasonable, good faith efforts to test and ensure that each
Product runs in the different hardware and software configurations in
which the Product is designed to run and with all peripherals with
which the Product is designated to work in a manner that is consistent
with the Product's documentation, advertising material and normal user
expectations. Interplay is responsible for making timely submissions
to, and obtaining all necessary approvals from, all platform
licensors, content licensors and any other entities whose approval or
acceptance are necessary in order that the Products may be published,
marketed and distributed hereunder.
4.5 FINANCIAL REPORTING. Interplay shall provide UNIVERSAL with copies of
all Interplay financial reports that are filed with the Securities and
Exchange Commission (the "SEC"), at the time they are filed. *** All
information disclosed by Interplay to UNIVERSAL under this Section
will be Confidential Information pursuant to Section 9 below, except
to the extent such information is subject to the exceptions set forth
in Section 9.3.
4.6 CO-OP ADVERTISING. Interplay will fund (through the General Reserve as
Deductions in the calculation of Interplay Proceeds as set forth in
Section 6.3(c) below) and assist in managing such cooperative
advertising with UNIVERSAL's third-party resellers, as is mutually
agreed upon by UNIVERSAL and Interplay.
4.7 SUPPORT. At Interplay's cost, Interplay will provide warranty
replacement services to consumers of the Products located in the
Territory in a timely manner to at least high industry standards.
Interplay will also provide consumer support regarding the operation
and play of the Products (via phone and email during Interplay's
normal business hours) in accordance with high industry standards. The
documentation for each Product will specify contact information for
Interplay regarding warranty replacement support, and will specify
Interplay's customer support phone number and/or Internet site address
for all other customer support inquiries.
4.8 COSTS OF DEVELOPMENT, PAYMENT OF CONTENT LICENSE ROYALTIES. Interplay
shall be responsible for all costs and expenses associated with the
development of the Products. This shall include, but not be limited
to, any royalties, fees or other compensation that is owed to Third
Party Licensors as a result of the development, manufacture,
marketing, distribution or sale of the Products, other than amounts
owed to Sony, Nintendo or Microsoft due to the manufacturing and
distribution of SKUs designed for play on game machines marketed by
those companies (which amounts are subject to the provisions of
Section 3.10 above).
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*** Terms represented by this symbol are considered confidential. These
confidential terms have been omitted pursuant to a Confidential Treatment
Request filed with the Securities and Exchange Commission ("SEC") and have been
filed separately with the SEC.
Page 8
5. ORDER PROCEDURE, TITLE AND RISK OF LOSS
5.1 INTERPLAY MANUFACTURED SKUS. The following terms will be applicable
for all units of Interplay Manufactured SKUs to be distributed by
UNIVERSAL pursuant to this Agreement. Conversely, the following terms
will not apply to units of UNIVERSAL Manufactured SKUs distributed by
UNIVERSAL hereunder.
(a) FORM OF ORDER. All orders will be placed by UNIVERSAL using its
then-standard order form(s), provided, however, the terms of such
order form shall not contain any terms and conditions which are
in addition to, different from and/or inconsistent with this
Agreement. No order placed by UNIVERSAL shall be effective unless
and until accepted by Interplay in writing. No reference to such
form(s) being a "purchase order" or any other term or reference
in such form to "purchase" of Products will cause the order and
sale of any Products by UNIVERSAL to be construed to be on any
basis other than a "sale or return" basis with all sales made on
Interplay's behalf by UNIVERSAL. Subject to the foregoing, any
terms included on such order form will govern such order,
provided that if any such terms conflict with the terms of this
Agreement, this Agreement will control. Any terms included on the
order form regarding cancellation of an order will be deemed to
be in addition to, and not in lieu of, the terms in this
Agreement. In no event will the terms of any Interplay
acknowledgment, sales order or other written or oral response to
an order from UNIVERSAL govern the order, and Interplay agrees
that all such terms will be null and void, unless acknowledged in
writing by UNIVERSAL.
(b) PARTIAL DELIVERIES. UNIVERSAL is not obligated to accept partial
delivery of any order of any shipments of any Product. In the
event UNIVERSAL accepts a partial delivery of a shipment of
Product, the portion of the shipment not delivered will be deemed
a separate order.
(c) INCOMING INSPECTION. UNIVERSAL has the right to inspect incoming
inventory of Product units. Such inspection must be performed
within ten (10) days of UNIVERSAL's receipt of such Product units
and UNIVERSAL is obligated to promptly inform Interplay of any
defects UNIVERSAL discovers. UNIVERSAL may return an entire
shipment of Product units to Interplay for replacement in cases
where UNIVERSAL's inspection indicates defect rates above two
percent (2%). If an inspected Product unit is found to be
correct, UNIVERSAL will repackage it, at UNIVERSAL's expense, and
Interplay will provide to UNIVERSAL whatever stickers or other
parts are required for such repackaging, at UNIVERSAL's expense.
Interplay acknowledges that such inspection does not relieve
Interplay of any responsibilities of its warranty to UNIVERSAL of
Product quality.
5.2 UNIVERSAL MANUFACTURED SKUS. Regardless of the fact of UNIVERSAL's
responsibility for manufacturing and shipping units of UNIVERSAL
Manufactured SKUs, and regardless of any statement or provision in any
forms or correspondence relayed between the parties relating to
UNIVERSAL's manufacturing and shipping of units of the UNIVERSAL
Manufactured SKUs, the units of such UNIVERSAL Manufactured SKUs will
be deemed to be provided by Interplay, and received by UNIVERSAL,
hereunder on a "sale or return" basis with all manufacturing, shipping
and sales of such units made on Interplay's behalf by UNIVERSAL.
5.3 TITLE AND RISK OF LOSS. As between UNIVERSAL and Interplay, title to
all Product units (whether Interplay Manufactured SKUs or UNIVERSAL
Manufactured SKUs) shall at all times remain with Interplay.
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*** Terms represented by this symbol are considered confidential. These
confidential terms have been omitted pursuant to a Confidential Treatment
Request filed with the Securities and Exchange Commission ("SEC") and have been
filed separately with the SEC.
Page 9
5.4 INTERPLAY DIRECT SALES OF UNIVERSAL MANUFACTURED SKU'S . Solely with
respect to any UNIVERSAL Manufactured SKU's being ordered by Interplay
for its Direct Sales activities, as set out in Section 2.6, such units
shall be provided to Interplay on a form and in a manner to be agreed
upon, but consistent with the normal business practices of UNIVERSAL
and Interplay the cost of such UNIVERSAL Manufactured SKU's shall be
deducted from the Interplay Proceeds as set forth in Section
6.1(iii)..
6. PRICE; PAYMENT
6.1 PRICE. The proceeds payable by UNIVERSAL to Interplay for units of any
Product distributed by UNIVERSAL (the "INTERPLAY PROCEEDS") shall be
the price at which UNIVERSAL sells such Product units to its customers
(the "PRICE"), less the following amounts only:
***
The balance shall be payable to Interplay as Interplay Proceeds.
Interplay will have the right to determine the Price for each Product
in its sole discretion (which will include UNIVERSAL's standard
Included Fees and Charges as specified by UNIVERSAL), and may revise
the Price for any Product by customer from time to time, subject to
the provisions of Section 6.5 below. At the time of the first
commercial shipment of each Product, in order to convey to consumers
the high quality of the Product, Interplay will set the Price within
the range of then-standard dealer price levels for "front-line"
interactive entertainment software products of comparable quality and
sales potential. Any change in the Price of any Product will become
effective as to UNIVERSAL *** days after the date of Interplay's
written notice to UNIVERSAL of the Price change or earlier as may be
mutually agreed upon by the parties. UNIVERSAL will incorporate a
change in Price of a Product in UNIVERSAL's next published price list.
6.2 DISTRIBUTION FEE. The "DISTRIBUTION FEE" is the fee charged by
UNIVERSAL for distribution of the Products and is calculated by
multiplying the Price, less the General Reserve, by the applicable
percentage set forth in Exhibit A under the heading "Distribution Fee
Percentage."
6.3 ADVANCE. UNIVERSAL shall pay Interplay non-refundable (except as
otherwise provided herein), recoupable (as set forth in Section 6.4
below), advance, as follows: (i) *** within two days following the
full execution of this Agreement and approval and ratification of this
Agreement by Interplay's Board of Directors (ii) *** in accordance
with Section 13.17 and (iii)*** within two days of Interplay's
delivery to UNIVERSAL of ***. All amounts paid to Interplay by
UNIVERSAL pursuant to this Section 6.3 shall be referred to as the
"ADVANCE".
6.4 RECOUPMENT OF ADVANCE. The Advance shall be recoupable by UNIVERSAL
against amounts earned by UNIVERSAL by the Distribution Fee and as
follows: (i) unless and until UNIVERSAL recoups the Advance the
Distribution Fee shall be increased by *** percent (***%) and (ii)
unless and until the Advance is recouped by UNIVERSAL, UNIVERSAL shall
be entitled to deduct from monthly amounts payable to Interplay an
amount equal to *** percent (***%) of the Interplay Proceeds.
Notwithstanding the foregoing, Interplay shall have right at any time
during the term to pre-pay or otherwise reimburse UNIVERSAL the
Advance without penalty of any kind whatsoever. For clarity, upon
recoupment of the Advance (either by pre-payment of Interplay or
recoupment by UNIVERSAL) the Distribution Fee shall be as set forth on
Exhibit A and UNIVERSAL shall no longer be entitled to deduct from
monthly amounts payable to Interplay an amount equal to *** percent
(***%) of the Interplay Proceeds. When the aggregate amount of this
Section 6.4(i) and (ii) equal the Advance the Advance shall be fully
recouped. ***
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*** Terms represented by this symbol are considered confidential. These
confidential terms have been omitted pursuant to a Confidential Treatment
Request filed with the Securities and Exchange Commission ("SEC") and have been
filed separately with the SEC.
Page 10
6.5 DEDUCTIONS. "DEDUCTIONS" means the following amounts attributable to
each Product:
(a) PRICE PROTECTION AND POST-SALE MARKDOWNS. *** percent (***%) of
any price protection or post-sale markdown deductions granted to
UNIVERSAL's customers with respect to units of the Products.
Interplay will determine the extent of any price protection or
post-sale markdown deductions extended to any Products. UNIVERSAL
will be entitled to a Deduction equal to *** percent (***%) of
any price protection or post-sale markdown deductions granted to
UNIVERSAL's customers with respect to units of the Products that
were not originally distributed by UNIVERSAL.
(b) CO-OP ADVERTISING. Amounts approved by Interplay in writing for
all co-op advertising. If any co-op advertising program includes
other UNIVERSAL products in addition to Products, and the
expenses of such co-op advertising program are not billed
separately by the customer for each Product and other UNIVERSAL
products in the program, then the amount of the Deduction will be
based on a valid and signed insertion order in which the combined
deduction for the multiple titles can be separated. Interplay
will fund an amount of support with respect to each Named Product
of *** percent (***%) of Net Sales for direct marketing costs,
and no less than *** percent (***%) of Net Sales with respect to
each Named Product for MDF/COOP expenses. "NET SALES" shall be
defined as the Price less the General Reserve.
(c) RETURN OF GOODS. UNIVERSAL will return to Interplay all returned
Products by such means as Interplay directs at Interplay's sole
option and expense. If Interplay does not direct UNIVERSAL as to
a method of return within *** days after written notice from
UNIVERSAL, UNIVERSAL may return such Products to Interplay by any
means deemed reasonable by UNIVERSAL and may, at UNIVERSAL's
option, debit the costs of returning such Products against
amounts otherwise due Interplay (as a Deduction) or require
Interplay to reimburse UNIVERSAL for such costs. UNIVERSAL shall
provide to Interplay documentary evidence of UNIVERSAL's costs
incurred pursuant to this Section. Interplay will pay all
transportation and shipping charges associated with such returns.
(d) OTHER AGREED DEDUCTIONS. Other deductions mutually agreed upon in
writing by UNIVERSAL and Interplay, amounts owed by Interplay to
UNIVERSAL pursuant to Sections 7.2 and 7.3 below, and other
penalties or additional charges assessed against UNIVERSAL by any
UNIVERSAL customer(s) as a result of an Unacceptable Delivery by
Interplay. "UNACCEPTABLE DELIVERY" means (i) Interplay's failure
to deliver a Product order (accepted by Interplay hereunder) to
UNIVERSAL on-time such that UNIVERSAL is either (A) unable to
ship the goods to its customer(s) on or before a date required by
such customer(s) or (B) is required to use a more expensive
shipping means than employed by UNIVERSAL in its regular course
of business (in which event the Deduction shall equal the
increase in shipping costs); or (ii) Interplay's delivery of
defective, improperly packaged or improperly labeled Product
units which are then rejected by UNIVERSAL's customer(s). The
deductions described in this subsection (d) may be measured on a
Product-by-Product basis, or prorated from UNIVERSAL's total
expenses, depending on UNIVERSAL's standard accounting practices.
6.6 PAYMENT. UNIVERSAL will provide a report to Interplay on a monthly
basis within *** days after the close of each of UNIVERSAL's fiscal
months showing (a) the aggregate Price (by SKU) for all Product units
shipped by UNIVERSAL to its customers during such fiscal month, (b)
the totals of all *** incurred or advanced by
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*** Terms represented by this symbol are considered confidential. These
confidential terms have been omitted pursuant to a Confidential Treatment
Request filed with the Securities and Exchange Commission ("SEC") and have been
filed separately with the SEC.
Page 11
UNIVERSAL during such fiscal month, (c) the amount of each of the
deductions taken by UNIVERSAL pursuant to clauses 6.1(i) through
6.1(v) above in such fiscal month; (d) the amount of each category of
Deductions taken by UNIVERSAL in such fiscal month; (e) the amount of
Monthly Gross Payables, the Target Reserve Balance and the amount
withheld in or paid out from the General Reserve for such fiscal month
(as such terms are defined in Section 6.8 below); and (f) the amount
of Interplay Proceeds owed to Interplay for such fiscal month. At the
time UNIVERSAL delivers such report to Interplay each month, UNIVERSAL
will pay Interplay the total of the Interplay Proceeds owed to
Interplay for such fiscal month. All Interplay Proceeds not paid when
due shall bear interest accruing at *** % per year from the date
payment is first due.
6.8 GENERAL RESERVE.
(a) ACCRUAL OF THE GENERAL RESERVE. UNIVERSAL shall be entitled to
accumulate and maintain a cash reserve in the amounts set forth
below in this Section 6.8(a) (subject to the provisions of
paragraphs (b) and (c) below) which reserve shall be deducted
from the amounts UNIVERSAL owes to Interplay and held by
UNIVERSAL in dedicated account (the "GENERAL RESERVE"). The
General Reserve will be applied by UNIVERSAL to recover
undisputed amounts owed to UNIVERSAL pursuant to Section 6.5
inclusive during the Term (and upon the expiration or termination
of this Agreement). From September 1, 2001, through September 1,
2002 UNIVERSAL's will be entitled to set aside in the General
Reserve *** percent (***%) of Monthly Gross Sales (as defined
below) accrued in such fiscal months and *** % of the of Monthly
Gross Sales accrued in such fiscal months thereafter until the
expiration or termination of this Agreement. "MONTHLY GROSS
SALES" means the aggregate Price of all Products ties units
shipped by UNIVERSAL during such fiscal month.
(b) *** REVIEW AND PARTIAL DISBURSEMENT OF GENERAL RESERVE. ***
months after each *** month period beginning with the *** month
period endidng March 31, 2002 the accumulated General Reserve
will be compared to the undisputed Deductions owed to UNIVERSAL
pursuant to Section 6.5 and the net amount will be settled out
the Distribution Fee applicable during the period. If the General
Reserve exceeds net of actual and undisputed amounts owed to
UNIVERSAL, UNIVERSAL will pay such excess to Interplay within ***
days. In the event the amounts actually owed to UNIVERSAL
pursuant to Section 6.5 exceed the General Reserve for the given
period, UNIVERSAL shall be entitled to deduct the difference from
Interplay Proceeds then due and payable.
(c) DISPUTES REGARDING WITHDRAWALS FROM THE GENERAL RESERVE. In the
event Interplay in good faith disputes UNIVERSAL's right
hereunder to make a particular withdrawal from the General
Reserve (or the amount of such withdrawal): (ia) UNIVERSAL shall
immediately re-deposit the disputed amount into the General
Reserve, and (iib) the parties shall resolve such dispute as
expeditiously as possible.
(d) REPAYMENT IF GENERAL RESERVE IS NOT FULLY USED AFTER EXPIRATION
OR Termination. The process described in paragraph (b) above will
continue for a period of *** months following the expiration or
earlier termination of this Agreement. To the extent that the
General Reserve is not fully used to offset amounts otherwise due
from Interplay to UNIVERSAL following the expiration or earlier
termination of this Agreement, UNIVERSAL will pay to Interplay
the amount left in the General Reserve *** months after the date
of expiration or termination of this Agreement and any applicable
sell-off periods as provided in Section 11.7(b) or extensions
provided in Sections 1.6 and 11.10. To the extent the General
Reserve is less than amounts owed to UNIVERSAL hereunder
following expiration or earlier termination of this Agreement
Interplay shall pay such defecit to UNIVERSAL within *** days
following the date of expiration or termination
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*** Terms represented by this symbol are considered confidential. These
confidential terms have been omitted pursuant to a Confidential Treatment
Request filed with the Securities and Exchange Commission ("SEC") and have been
filed separately with the SEC.
Page 12
of this Agreement and any applicable sell-off periods as provided
in Section 11.7(b) or extensions provided in Sections 1.6 and
11.10.
6.9 ***
6.10 COLLECTIONS AND BAD DEBT. Interplay will be responsible for all risk
of collection of amounts owed by the following UNIVERSAL customers as
a result of UNIVERSAL's activities under this Agreement: ***.
With respect to all other UNIVERSAL customers, UNIVERSAL will be
responsible for all risk of collection of amounts owed by UNIVERSAL's
customers as a result of UNIVERSAL's activities under this Agreement,
and UNIVERSAL will not deduct any bad debt expenses or associated
write-offs incurred as a result of its activities under this
Agreement. ***
7. RETURNS AND PRODUCT RECALLS/AUDIT
7.1 RIGHT TO RETURN. Interplay understands and acknowledges that UNIVERSAL
receives Product units from Interplay hereunder on a "sale or return"
basis and Interplay is the ultimate responsible party for all
Products, subject to the provisions of this Agreement . UNIVERSAL has
the right to return to Interplay at any time any Product units held by
UNIVERSAL, subject to the provisions of this Agreement.
7.2 PRODUCT RECALL. Without prejudice to the foregoing, in the event of an
Interplay-authorized recall based solely on errors in the program code
for which Interplay has developed corrections, Interplay will pay all
costs associated with the recall, including but not limited to
Handling Charges, customer notification costs, Product replacement
costs, and all freight costs. The term "HANDLING CHARGES" will mean
***.
7.3 AUDIT. Interplay will have the right, *** per calendar year, to have
reputable, experienced auditors examine UNIVERSAL's relevant books,
records and accounts for the purpose of verifying the accuracy of
payments made by UNIVERSAL as required by this Agreement. Each audit
will be conducted at UNIVERSAL's place of business (or another place
agreed to by Interplay and UNIVERSAL) during UNIVERSAL's normal
business hours with at least *** business days prior written notice to
UNIVERSAL. Each audit may cover any period of the Term that has not
previously been audited by Interplay. If an audit discloses a
shortfall in UNIVERSAL's payments to Interplay: (a) UNIVERSAL will
within *** days pay the amount of such shortfall to Interplay;
Interplay will pay the fees and expenses of the auditors for the
examination; except that, if any examination discloses a shortfall in
the payments due Interplay of more than *** percent (***%) in any
one-year period, then UNIVERSAL will pay the fees and expenses of the
auditor for that examination. Furthermore, solely in the event of such
*** percent (***%) shortfall, Interplay shall be entitled to conduct
an additional follow-up audit within the twelve (12) month period
following the first audit, without otherwise affecting Interplay's
audit rights for the calendar year in which the follow-up audit is
conducted
8. INTELLECTUAL PROPERTY PROTECTION
8.1 PROTECTION OF INTELLECTUAL PROPERTY. The parties agree to use
commercially reasonable efforts to protect the intellectual property
associated with the Products. Immediately upon discovery of any
infringement of such intellectual property, the discovering party
shall notify the other party of such infringement, and the parties
shall cooperate in prosecuting any action to stop or otherwise
mitigate the infringement.
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*** Terms represented by this symbol are considered confidential. These
confidential terms have been omitted pursuant to a Confidential Treatment
Request filed with the Securities and Exchange Commission ("SEC") and have been
filed separately with the SEC.
Page 13
8.2 PREVENTION OF GREYMARKET ACTIVITY. The parties shall each use
commercially reasonable efforts to prevent greymarket activity.
"GREYMARKET" includes (i) the sale, outside of the Territory, of units
of the Products licensed hereunder for distribution within the
Territory; and (ii) the sale, in the Territory, of units of the
Products other than those licensed for distribution in the Territory.
Immediately upon discovery of any such Greymarket activity, the
discovering party shall notify the other party, and the parties shall
cooperate in prosecuting any action to stop or otherwise mitigate the
activity.
8.3 OWNERSHIP. As between Interplay and UNIVERSAL, UNIVERSAL agrees that
Interplay shall own all copyright and other proprietary rights, title
and interest in the Products, and all intellectual property rights
embodied therein, including all rights to the titles, names,
trademarks, characters, artwork and code, and all other materials
(collectively, the "OTHER MATERIALS") which are created by or for
UNIVERSAL for the purpose of packaging, advertising, marketing and
promoting the Products, including all cartons, containers, packaging,
packing and wrapping material, tags, labels, ancillary manuals,
imprints or other devices, advertisements, press releases and
promotional literature. UNIVERSAL will not attack the title of
Interplay or its Third Party Licensors in and to the Products or Other
Materials, nor any copyright or trademarks pertaining thereto, nor
will UNIVERSAL attack the validity of any Third Party Licenses.
UNIVERSAL agrees that it will neither apply for nor seek to obtain
trademark registration for the Products. If, for any reason, the Other
Materials do not qualify as a work made for hire under applicable law,
or UNIVERSAL may be entitled to claim any ownership interest in the
Products or Other Materials under any applicable law, then UNIVERSAL
hereby assigns and agrees to assign exclusively to Interplay (or any
designee of Interplay), any and all of UNIVERSAL's right, title and
interest therein. Any assignment of copyright hereunder includes all
rights of paternity, integrity, disclosure and withdrawal and any
other rights that may be known as or referred to as "moral rights"
(collectively "MORAL RIGHTS"). To the extent such Moral Rights cannot
be assigned under applicable law and to the extent the following is
allowed by the laws in the various countries where Moral Rights exist,
UNIVERSAL hereby waives such Moral Rights and consents to any action
of Interplay (or its designee) that would violate such Moral Rights in
the absence of such consent. Notwithstanding the foregoing, UNIVERSAL
shall retain ownership of any intellectual property which is
proprietary to UNIVERSAL and which has been added to the Products
packaging, provided, however, UNIVERSAL shall grant Interplay a
non-exclusive, royalty-free, license to use such UNIVERSAL
intellectual property solely in connection with the Products in the
Territory and in accordance with the terms of this Agreement and
Interplay's rights thereunder.
9. CONFIDENTIALITY
9.1 CONFIDENTIAL INFORMATION DEFINED. For the purposes of this Agreement,
"CONFIDENTIAL INFORMATION" means all information that can reasonably
be construed to be confidential or proprietary information of the
disclosing party, including any design elements, character profiles,
unpublished copyrighted material, release dates, marketing, sales and
promotional strategies, information about new products, properties and
characters, computer code (if any), data, manuals, formulae,
specifications, processes, methods, the terms and conditions of this
Agreement, and/or any other information or documents of or relating to
the business of the disclosing party.
9.2 DUTY TO MAINTAIN CONFIDENTIALITY. Except as expressly approved by the
disclosing party, the party receiving Confidential Information from
the disclosing party agrees: (i) to use the Confidential Information
solely for the purpose of performing its obligations under this
Agreement; (ii) to hold the disclosing party's Confidential
Information in strict confidence as a fiduciary, and to take all
reasonable precautions to protect such Confidential Information; (iii)
not to divulge any such Confidential Information or any information
derived therefrom to any third person, other than its directors,
officers, employees, affiliates, attorneys, auditors, financial
advisors, consultants, or prospective investors or lenders, and, in
the case of
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*** Terms represented by this symbol are considered confidential. These
confidential terms have been omitted pursuant to a Confidential Treatment
Request filed with the Securities and Exchange Commission ("SEC") and have been
filed separately with the SEC.
Page 14
UNIVERSAL, third-party subcontractors pursuant to Section 2.2 above
(collectively, the "REPRESENTATIVES"); provided, that in each case
such Representative shall be given access to the Confidential
Information only on a "need-to-know" basis and shall expressly agree
in writing to retain the Confidential Information in strictest of
confidence; (iv) not to make any use whatsoever at any time of such
disclosing party's Confidential Information for the benefit of any
person other than the disclosing party or as expressly contemplated by
the disclosing party, and (v) not to copy, reproduce or directly or
indirectly reverse engineer all or any part of such disclosing party's
Confidential Information.
9.3 EXCEPTIONS. "Confidential Information" shall not include information
which: (i) at the time of disclosure, is in the public domain or
which, after disclosure, becomes part of the public domain by
publication or otherwise through no action or fault of the receiving
party; (ii) the receiving party can show was in its possession at the
time of disclosure and was not acquired, directly or indirectly, from
the other party; (iii) was received from a third party having the
legal right to transmit the same; (iv) is independently developed,
conceived, or created without use of or reference to any Confidential
Information of the other party; (v) is disclosed pursuant to valid
court order, regulatory (including the SEC), contractual requirement
or other legal process. Further, nothing in this Section 9 shall
prevent either party from making any disclosure required by a public
stock exchange, the Securities and Exchange Commission or similar
governmental or regulatory body.
9.4 RETURN OR DESTRUCTION OF CONFIDENTIAL INFORMATION. The receiving party
agrees to cease using the Confidential Information upon the earlier of
(i) expiration or earlier termination of the Term of this Agreement,
or (ii) receipt of a written request to do so by the disclosing party,
and, with respect to such Confidential Information provided in writing
or in some other tangible form, to return it to the disclosing party
within three (3) business days after receipt of a written request to
do so. At the request of the disclosing party, such receiving party
will also destroy all written material, memoranda, notes and other
writings or recordings whatsoever prepared by or for it based upon,
containing or otherwise reflecting any of the disclosing party's
Confidential Information. Nothing herein shall prevent either party
from using such Confidential Information with respect to any claims
brought by the parties following the expiration or termination of the
Term.
10. REPRESENTATIONS AND WARRANTIES; INDEMNITY
10.1 INTERPLAY REPRESENTATIONS AND WARRANTIES. Interplay makes the
following representations and warranties:
(a) INTELLECTUAL PROPERTY RIGHTS. Interplay has the right to grant to
UNIVERSAL the licenses and rights granted under this Agreement,
and UNIVERSAL's use of such licenses in accordance with the terms
of this Agreement will not infringe upon any third party's
copyright, patent, trademark or other intellectual property
rights.
(b) AUTHORITY. Subject to the Loan Agreement and Section 13.16 below,
Interplay (and the officers executing on its behalf) have the
required authority and capacity to enter into this Agreement and
all documents required to be entered into pursuant to this
Agreement. All corporate and other actions required to be taken
by Interplay to authorize the execution, delivery and performance
of this Agreement and all transactions contemplated in this
Agreement have been duly and effectively taken. Upon the full
execution and delivery of this Agreement, this Agreement will
become a valid, binding and enforceable obligation upon
Interplay.
(c) NO CONFLICTS. Except for the Loan Agreement, Interplay's
execution, delivery and performance of this Agreement will not
result in the breach of any term or provision of, or constitute a
default under, any agreement by which Interplay is bound, nor
will such
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*** Terms represented by this symbol are considered confidential. These
confidential terms have been omitted pursuant to a Confidential Treatment
Request filed with the Securities and Exchange Commission ("SEC") and have been
filed separately with the SEC.
Page 15
actions, to the best of Interplay's knowledge result in the
violation of any obligation, law, ordinance, regulation, order or
decree applicable to Interplay.
(d) NO CONFLICTING AGREEMENTS. So long as this Agreement remains in
effect, Interplay shall not commit any act or enter into any
agreement or understanding with any third party which is
inconsistent or in conflict with this Agreement.
(e) LIMITATION. THE WARRANTIES STATED IN SECTION 4.1 AND THIS SECTION
10.1 ARE INTERPLAY'S SOLE AND EXCLUSIVE WARRANTIES PERTAINING TO
THE PRODUCTS, AND INTERPLAY HEREBY DISCLAIMS ANY OTHER WARRANTY,
EXPRESS OR IMPLIED, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY
OF MERCHANTABILITY, OR FITNESS FOR A PARTICULAR PURPOSE.
(f) COMPLIANCE WITH LAWS. Interplay will at all times comply with all
government laws and regulations, including but not limited to,
product safety and other similar laws, relating or pertaining to
the manufacture, distribution, sale and advertising of the
Products.
(g) NO INFRINGEMENT. Assuming the truth of Section 10.1(a),
Interplay's creation of the Other Materials hereunder will not
infringe upon any third party's copyright, patent, trademark or
other intellectual property rights (and, Interplay hereby
acknowledges that no approval by UNIVERSAL of the Products shall
constitute an approval of any such infringement).
(h) *** With respect to Interplay's grant of rights under Section
2.1(a) of this Agreement Interplay's execution, delivery and
performance under this Agreement will not result in the breach of
any term or provision of, or constitute a default under the Loan
Agreement
10.2 UNIVERSAL REPRESENTATIONS AND WARRANTIES. UNIVERSAL makes the
following representations and warranties:
(a) AUTHORITY. UNIVERSAL (and the officers executing on its behalf)
have the required authority and capacity to enter into this
Agreement and all documents required to be entered into pursuant
to this Agreement. All corporate and other actions required to be
taken by UNIVERSAL to authorize the execution, delivery and
performance of this Agreement and all transactions contemplated
in this Agreement have been duly and effectively taken. Upon the
full execution and delivery of this Agreement, this Agreement
will become a valid, binding and enforceable obligation upon
UNIVERSAL.
(b) NO CONFLICTS. UNIVERSAL's execution, delivery and performance of
this Agreement will not result in the breach of any term or
provision of, or constitute a default under, any agreement by
which UNIVERSAL is bound, nor will such actions, to the best of
UNIVERSAL's knowledge result in the violation of any obligation,
law, ordinance, regulation, order or decree applicable to
UNIVERSAL.
(c) NO CONFLICTING AGREEMENTS. So long as this Agreement remains in
effect, UNIVERSAL shall not commit any act or enter into any
agreement or understanding with any third party which is
inconsistent or in conflict with this Agreement.
(d) NO LIENS. UNIVERSAL will not cause or allow any liens or
encumbrances to be placed against, nor grant any security
interest in, the Products without Interplay's prior consent in
its sole discretion.
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*** Terms represented by this symbol are considered confidential. These
confidential terms have been omitted pursuant to a Confidential Treatment
Request filed with the Securities and Exchange Commission ("SEC") and have been
filed separately with the SEC.
Page 16
(e) COMPLIANCE WITH LAWS. UNIVERSAL will at all times comply with all
government laws and regulations, including but not limited to,
product safety and other similar laws, relating or pertaining to
the manufacture, distribution, sale and advertising of the
Products.
(f) NO INFRINGEMENT. Assuming the truth of Section 10.1(a),
UNIVERSAL's creation of the Other Materials hereunder will not
infringe upon any third party's copyright, patent, trademark or
other intellectual property rights (and, UNIVERSAL hereby
acknowledges that no approval by Interplay of the Products or
Other Materials shall constitute an approval of any such
infringement).
10.3 INDEMNIFICATION. Interplay and UNIVERSAL each agree to indemnify and
hold harmless the other from all claims, suits, judgments, damages,
costs and expenses (including costs of suit and reasonable attorneys'
fees) (collectively, "CLAIMS") as a result of indemnitor's breach or
an allegation of indemnitor's breach of any of its representations,
warranties and covenants made in this Agreement; provided, HOWEVER,
that (i) the indemnitor shall have been provided with prompt written
notice of the assertion of any such claim and that the indemnitor
shall have the authority and power to control the defense and/or
settlement thereof, subject to the right of indemnitee to participate
in any such proceeding at its own expense with counsel of its own
choosing, and (ii) the indemnitee shall not agree to the settlement of
any such claim, action or proceeding without the prior written consent
of the indemnitor, which consent shall not be unreasonably withheld.
The foregoing indemnity shall not extend to any Claims to the extent
they arise out of any matter against which the party to be indemnified
has received insurance proceeds sufficient to cover such Claims.
10.4 LIMITATION OF LIABILITY. THE LIABILITY OF EITHER PARTY, IF ANY, FOR
DAMAGES FOR ANY CLAIM OF ANY KIND WHATSOEVER AND REGARDLESS OF THE
LEGAL THEORY, WITH REGARD TO THE LICENSE GRANTED HEREUNDER, SHALL NOT
INCLUDE COMPENSATION, REIMBURSEMENT OR DAMAGES ON ACCOUNT OF THE LOSS
OF PRESENT OR PROSPECTIVE PROFITS, EXPENDITURES, INVESTMENTS OR
COMMITMENTS, WHETHER MADE IN ESTABLISHMENT, DEVELOPMENT OR MAINTENANCE
OF REPUTATION OR GOODWILL OR FOR ANY OTHER REASON WHATSOEVER. IN NO
EVENT SHALL EITHER PARTY BE LIABLE FOR SPECIAL, INCIDENTAL, OR
CONSEQUENTIAL DAMAGES.
11. DEFAULT AND REMEDIES
11.1 DEFAULT. A party hereto shall be in default ("DEFAULT") in the
following circumstances:
(a) if that party breaches any covenant, representation or warranty
it makes in this Agreement (other than a payment obligation
hereunder) or if any representation or warranty is or becomes
untrue, and such breach or untruth is material, and such breach
or untruth is not cured within thirty (30) days after receipt of
written notice from the non-defaulting party;
(b) if that party breaches a payment obligation under this Agreement,
and such breach is material, and such breach is not cured within
the following applicable time period after receipt of written
notice from the non-defaulting party: (i) *** for the first or
second such breach by the breaching party, (ii) *** for the third
such breach by the breaching party and (iii) *** for all
successive breaches by the breaching party;
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*** Terms represented by this symbol are considered confidential. These
confidential terms have been omitted pursuant to a Confidential Treatment
Request filed with the Securities and Exchange Commission ("SEC") and have been
filed separately with the SEC.
Page 17
(c) upon the institution by or against that party of insolvency,
receivership or bankruptcy proceedings and such proceeding is not
dismissed within thirty (30) days of its being filed;
(d) upon that party's making of an assignment for the benefit of
creditors; or
(e) upon that party's dissolution or liquidation.
11.2 NO CURE RIGHT. Notwithstanding anything to the contrary herein,
UNIVERSAL shall immediately be deemed in Default hereunder (and
UNIVERSAL shall have no cure period) in the event UNIVERSAL delivers
or sells the Products outside the Territory or knowingly sells
Products to a third party who UNIVERSAL knows intends to, or who
UNIVERSAL reasonably should suspect intends to, sell or deliver such
Products outside the Territory.
11.3 ***
11.4 ***
11.5 ***
11.6 REMEDIES CUMULATIVE. Each right and remedy of the parties provided for
in this Agreement shall be cumulative and shall be in addition to
every other right or remedy provided for in this Agreement or
available at law or in equity, except as otherwise expressly limited
by this Agreement, and the exercise or the beginning of the exercise
by a party of any one or more of the rights or remedies provided for
in this Agreement or available at law or in equity, except as
otherwise limited by this Agreement, shall not preclude the
simultaneous or later exercise by the party of any or all other rights
or remedies provided for in this Agreement or available at law or in
equity, except as otherwise limited by this Agreement.
11.7 EFFECT OF EXPIRATION OR TERMINATION.
(a) Upon the expiration or termination of this Agreement other than a
termination by Interplay for a Default by UNIVERSAL, UNIVERSAL
may continue to sell-off, on a non-exclusive basis, Product
inventory remaining in UNIVERSAL's possession as of the date of
termination or expiration, for a period of *** days after such
expiration or termination.
(b) To the extent UNIVERSAL does not return inventory to Interplay,
UNIVERSAL's customers will retain the right to sell all of their
inventory of the Products.
(c) Upon any termination of this entire Agreement or of any specific
Product by Interplay due to a Default by UNIVERSAL, UNIVERSAL
shall (i) immediately cease and desist from all further
distribution of such Product(s) (and UNIVERSAL hereby expressly
agrees that Interplay shall have the right to enjoin UNIVERSAL
from conducting any further distribution and marketing activities
in connection with such Product(s)), and (ii) within *** days
thereafter, at *** cost, return to Interplay all inventory of
such Product(s) then in UNIVERSAL's possession. In the event
UNIVERSAL tenders any Product units to Interplay and Interplay
does not accept such Product units, UNIVERSAL may require that
the carrier return such inventory to UNIVERSAL's warehouse(s) and
Interplay will then owe UNIVERSAL, in addition to the amount due
for such Product units ***. UNIVERSAL will not be obligated to
retender any and all
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*** Terms represented by this symbol are considered confidential. These
confidential terms have been omitted pursuant to a Confidential Treatment
Request filed with the Securities and Exchange Commission ("SEC") and have been
filed separately with the SEC.
Page 18
Product units until Interplay pays in cash all amounts then due
UNIVERSAL under this Agreement, at which time UNIVERSAL shall
promptly retender such Products.
(d) UNIVERSAL may retain and apply the General Reserve against
amounts owed to UNIVERSAL under this Agreement, and UNIVERSAL
will repay any unused portions of the General Reserve, all as
provided in Section 6.8 above.
11.8 PARTIAL TERMINATION FOR LOSS OF DISTRIBUTION RIGHTS. In the event that
Interplay loses the right to grant to UNIVERSAL the rights to
distribute and sell any Product, then upon such loss of rights, the
Product will be deleted from coverage under this Agreement. Any such
partial termination will be treated as an Interplay-authorized Product
recall pursuant to the terms of Section 7.3 above.
11.9 SURVIVING PROVISIONS. The provisions of Sections, 2.4 , 6, 7, 8, 9,
10, 11.7, 11.8, 12 and 13 shall survive the expiration or termination
of this Agreement.
11.10 ANCILLARY REMEDIES. Notwithstanding the foregoing, in the event that
Interplay cancels more than *** of the *** Named Titles or a month
delay from the anticipated release date (as noted in Exhibit B) with
respect to *** or more of the Named Titles occurs, then UNIVERSAL may
elect one (and only one) of the following remedies :
***
For the purposes of this section, the various marketing plans and forecasting
reports as provided herein shall be used to determine the value of such
cancelled or delayed titles. UNIVERSAL acknowledges and agrees that delays
and/or cancellations as provided herein shall not constitute a Default, as
provided herein.
12. ASSIGNMENT
Neither this Agreement, nor the parties' rights and obligations hereunder,
may be transferred, assigned or sublicensed to a third party, without the prior
written consent of the other party; provided, however, that either party may
transfer or assign its rights and/or obligations hereunder to any person
acquiring such party by merger or acquiring all or substantially all of such
party's assets without requiring the consent of the other party and UNIVERSAL
may assign this Agreement to a UNIVERSAL Subsidiary without the consent of
Interplay.
13. MISCELLANEOUS
13.1 AMENDMENTS AND MODIFICATIONS. No amendment or modification of this
Agreement shall be valid unless made in a writing executed by all
parties.
13.2 BINDING EFFECT. Subject to Section 12 above, all provisions of this
Agreement shall inure to the benefit of, and be binding upon, the
parties and their successors-in-interest and permitted assigns.
13.3 FURTHER DOCUMENTS. Each party shall execute and deliver all such
further instruments, documents and papers, and shall perform any and
all acts, necessary to give full force and effect to all the terms and
provisions of this Agreement.
13.4 REQUESTS, CONSENTS AND APPROVALS. Unless otherwise specified herein,
any consents and/or approvals requested of either party pursuant to
this Agreement shall not be unreasonably withheld, conditioned or
delayed. Without limitation, UNIVERSAL acknowledges and agrees that it
shall be deemed "reasonable" for Interplay to withhold its consent
and/or approval where necessary for Interplay to comply with the terms
of any Third Party Licenses.
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*** Terms represented by this symbol are considered confidential. These
confidential terms have been omitted pursuant to a Confidential Treatment
Request filed with the Securities and Exchange Commission ("SEC") and have been
filed separately with the SEC.
Page 19
13.5 INTERPRETATION. No uncertainty or ambiguity herein shall be construed
or resolved against any party, whether under any rule of construction
or otherwise; on the contrary, this Agreement has been negotiated by
all parties and shall be construed and interpreted according to the
ordinary meaning of the words used so as to fairly accomplish the
purposes and intentions of the parties. Descriptive headings in this
Agreement are for convenience only and shall not control or affect the
meaning or construction of any provision of this Agreement. The word
"include" or "including" used in this Agreement shall describe
examples of the antecedent clause, and shall not be construed to limit
the scope of such clause. Unless specifically stated otherwise, any
reference to a particular period of days herein shall be interpreted
as reference to calendar days; provided, however, that if such period
would otherwise end on a Saturday, Sunday or generally recognized U.S.
public holiday, then the period shall be deemed to end on the next
business day.
13.6 APPLICABLE LAW. California law, without regard to conflicts or choice
of laws principles, shall govern the interpretation of this Agreement.
13.7 LEGAL ACTION. Should any litigation or arbitration occur between the
parties respecting or arising out of this Agreement, the prevailing
party shall be entitled to recover its reasonable attorneys' fees and
other costs in connection with such litigation, including reasonable
attorneys' fees incurred after a judgment has been rendered by a court
of competent jurisdiction. Any judgment shall include an attorneys'
fees clause that shall entitle the judgment creditor to recover
attorneys' fees incurred to enforce a judgment on this Agreement,
which attorneys' fees shall be an element of post-judgment costs; the
parties agree that this attorneys' fee provision shall not merge into
any judgment.
13.8 VENUE. The parties agree that all actions or proceedings arising
directly or indirectly from this Agreement shall be arbitrated or
litigated before arbitrators or in courts having a situs within Orange
County, California and hereby consent to the jurisdiction of any
local, state or federal court in which such an action is commenced
that is located in Orange County, California. The parties agree not to
disturb such choice of forum. The parties waive the personal service
of any and all process upon them, and consent that all such service of
process may be made by certified or registered mail, return receipt
requested, addressed to the respective parties at the address set
forth above.
13.9 NO PARTNERSHIP OR JOINT VENTURE. This Agreement does not create a
partnership or joint venture between the parties, and shall not be
construed as doing so. This Agreement does not create any right by
either party to bind the other party.
13.10 NO THIRD PARTY BENEFICIARIES. No person other than the parties hereto
and their permitted successors and assigns shall receive any benefits
of this Agreement.
13.11 NOTICES. All notices, statements and other documents, and all
approvals or consents that any party is required or desires to give to
any other party, shall be given in writing and shall be served in
person, by express mail, by certified mail, by overnight delivery, or
by facsimile at the respective addresses set forth below, or at such
other addresses as may be designated by such party in accordance with
this Section.
IF TO INTERPLAY: WITH A COPY TO:
Interplay Entertainment Corp. Stradling Yocca Carlson & Rauth
Attention: Chief Executive Officer 660 Newport Center Dr., Suite 600
16815 Von Karman Avenue Newport Beach, California 92660
Irvine, California 92606 Attention: Dan Murphy
Telephone: (949) 553-6655 Telephone: (949) 725-4000
Facsimile: (949) 252-0667 Facsimile: (949) 725-4100
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*** Terms represented by this symbol are considered confidential. These
confidential terms have been omitted pursuant to a Confidential Treatment
Request filed with the Securities and Exchange Commission ("SEC") and have been
filed separately with the SEC.
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IF TO UNIVERSAL: WITH A COPY TO:
Vivendi Universal Interactive Vivendi Universal Interactive
Publishing North America, Inc. Publishing North America, Inc.
Attention: Chief Executive Officer Attention: Corporate Counsel
6080 Center Drive 6080 Center Drive
Los Angeles, California, 90045 Los Angeles, California, 90045
Telephone: 310-431-4000 Telephone: 310-431-4000
Delivery shall be deemed conclusively made (i) at the time of service,
if personally served, (ii) five days after deposit in the United
States mail, properly addressed and postage prepaid, if delivered by
express mail or certified mail, (iii) upon confirmation of delivery by
the private overnight deliverer, if served by overnight delivery, and
(iv) at the time of electronic transmission (with successful
transmission confirmation), provided a copy is mailed within 24 hours
after such transmission.
13.12 SEVERABILITY. Any provision of this Agreement that is found by a
court of competent jurisdiction to be void, invalid or unenforceable
shall be curtailed and limited only to the extent necessary to bring
such provision within the requirements of the law, and such finding
and curtailment shall not affect the validity or enforceability of any
other provision of this Agreement.
13.13 ENTIRE AGREEMENT. This Agreement (and all Exhibits attached hereto
and incorporated herein by this reference) constitute the entire
agreement among the parties with respect to the subject matter hereof.
13.14 COUNTERPARTS; DELIVERY. This Agreement may be executed in
counterparts and delivered by facsimile.
13.15 ORDINARY COURSE OF BUSINESS. Interplay and UNIVERSAL each acknowledge
that any indebtedness created under this Agreement shall be in the
ordinary course of business and that the terms of this Agreement are
ordinary business terms between Interplay and UNIVERSAL and are
ordinary business terms for the industry in which Interplay and
UNIVERSAL participate.
13.16 UNIVERSAL and Interplay agree that a condition precedent to the
effectiveness of this Agreement is the approval and ratification of
the Agreement by Interplay's Board of Directors.
13.17 Upon execution of this Agreement UNIVERSAL shall deposit ***
("Funds") with the Agent (as defined below) and the Funds shall be
disbursed to Interplay in accordance with the Escrow Instructions
which shall be executed concurrently with this Agreement and attached
hereto as Exhibit C ("Escrow Account"). The parties agree the escrow
agent shall be Stradling Yocca Carlson & Rauth, a Professional
Corporation ("Agent"). Interplay shall pay the administrative costs
associated with the Escrow Account. In the event the Funds are
disbursed to UNIVERSAL in accordance with the Escrow Instructions,
Interplay shall pay interest on the Funds at a rate of *** per annum.
13.18 Neither party will not be liable for any delay in any of its
obligations pursuant to this Agreement resulting from any cause beyond
a party's reasonable control or caused by acts of God, acts of civil
or military authorities, priorities, fires, strikes, floods,
epidemics, governmental rules or regulations, war, riot, delays in
transportation or shortages.
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*** Terms represented by this symbol are considered confidential. These
confidential terms have been omitted pursuant to a Confidential Treatment
Request filed with the Securities and Exchange Commission ("SEC") and have been
filed separately with the SEC.
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IN WITNESS WHEREOF, the parties hereto have executed the Agreement by their duly
authorized representatives as set forth below.
VIVENDI UNIVERSAL INTERACTIVE
PUBLISHING NORTH AMERICA INTERPLAY ENTERTAINMENT CORP.
By: /S/ PHIL O'NEIL By: /S/ BRIAN FARGO
------------------------------ -------------------------------
Name: PHIL O'NEIL Name: BRIAN FARGO
---------------------------- -----------------------------
Title: SENIOR VICE PRESIDENT Title: CHIEF EXECUTIVE OFFICER
---------------------------- ----------------------------
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confidential terms have been omitted pursuant to a Confidential Treatment
Request filed with the Securities and Exchange Commission ("SEC") and have been
filed separately with the SEC.
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EXHIBIT A
PRODUCTS/DISTRIBUTION FEE
PRODUCTS: ***
DISTRIBUTION FEE PERCENTAGE: ***
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*** Terms represented by this symbol are considered confidential. These
confidential terms have been omitted pursuant to a Confidential Treatment
Request filed with the Securities and Exchange Commission ("SEC") and have been
filed separately with the SEC.
EXHIBIT B
NAMED TITLES
For purposes of this Agreement the "Named Titles" are as follows:
Title of Games Currently Known as:
1. ***
2. ***
3. ***
4. ***
5. ***
6. ***
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*** Terms represented by this symbol are considered confidential. These
confidential terms have been omitted pursuant to a Confidential Treatment
Request filed with the Securities and Exchange Commission ("SEC") and have been
filed separately with the SEC.
EXHIBIT C
ESCROW INSTRUCTIONS
WHEREAS, Vivendi Universal interactive Publishing North America
("Universal") and Interplay Entertainment Corp. ("Interplay," and collectively
with Universal, the "Parties") have entered into that certain Distribution
Agreement of even date herewith (the "Agreement"); and
WHEREAS, in accordance with Sections 13.17 of the Agreement, the Parties
have agreed that Universal will deposit $*** (including interest thereon the
"Funds") with the escrow agent (the "Agent") named therein, to be disbursed in
accordance with the instructions provided herein.
NOW, THEREFORE, the Parties instruct the Agent as follows:
1. Agent shall receive and maintain the Funds in safe keeping, for
disbursement in accordance with these instructions.
2. Agent shall disburse the Funds to Interplay within *** business days of
Interplay's delivery to the Agent, prior to ***, of a written certification
(which may be by facsimile) executed by an authorized officer of Interplay
certifying any one or more of the following facts: (i) that Interplay has
obtained *** consent and/or waiver of all conflicts between the Agreement and
the *** Agreement between Interplay and *** (the "Loan Agreement"); (ii) that
the *** ; or (iii) that Interplay has *** .
3. In the event that Interplay has not delivered a certification as
provided above prior to *** , upon written instructions from Universal (which
may be by facsimile) Agent shall disburse the Funds to Universal no later than
*** business days after receipt of such written instructions from Universal.
4. The Parties acknowledge and understand that the funds shall be held by
Agent in a trust account, and that only minimal interest will be earned on such
Funds.
5. Agent at its option shall be entitled to file an action of interpleader
requiring the Parties to answer and litigate any claims and rights among
themselves if in Agent's sole discretion a conflict, controversy or dispute
arises between the Parties. Agent is authorized to deposit with the clerk of the
court all documents and funds held in escrow, and the parties shall indemnify
Agent for, and hold it harmless against, any loss, liability, cost or expense,
including but not limited to reasonable attorneys' fees, reasonably incurred on
the part of Agent in connection with such action and in connection with Agent's
duties and obligations under this Agreement, as well as the reasonable costs and
expenses of defending against any claim or liability relating to this Agreement.
Upon initiating such action, Agent shall be fully released and discharge of and
from all obligations and liability imposed by the terms of this Agreement.
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*** Terms represented by this symbol are considered confidential. These
confidential terms have been omitted pursuant to a Confidential Treatment
Request filed with the Securities and Exchange Commission ("SEC") and have been
filed separately with the SEC.
We so instruct:
VIVENDI UNIVERSAL INTERACTIVE PUBLISHING NORTH AMERICA
By:
--------------------------------
Its:
-------------------------------
INTERPLAY ENTERTAINMENT CORP.
By:
--------------------------------
Its:
-------------------------------
We agree to comply with the above instructions:
"AGENT"
By:
--------------------------------
Its:
-------------------------------
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*** Terms represented by this symbol are considered confidential. These
confidential terms have been omitted pursuant to a Confidential Treatment
Request filed with the Securities and Exchange Commission ("SEC") and have been
filed separately with the SEC.