EXHIBIT 5
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PURSUANT TO RULE 24(B)(2) PROMULGATED UNDER THE SECURITIES
AND EXCHANGE ACT OF 1934, AS AMENDED, CONFIDENTIAL
TREATMENT HAS BEEN REQUESTED FOR CERTAIN PROVISIONS OF
THIS AGREEMENT. SUCH CONFIDENTIAL INFORMATION HAS BEEN (I)
OMITTED FROM THIS VERSION OF THE AGREEMENT, (II) MARKED
WITH ASTERISKS (**) TO INDICATE SUCH DELETIONS AND (III) FILED
SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION
CONFIDENTIAL LICENSE AGREEMENT
FOR NINTENDO 64 VIDEO GAME SYSTEM
(Western Hemisphere)
THIS AGREEMENT is entered into between NINTENDO OF AMERICA INC., a
Washington corporation with an address for notice purposes of 0000 000xx Xxxxxx
X.X., Xxxxxxx, XX 00000 (Fax: 000-000-0000) ("NINTENDO") and GAMETEK,
INC., a California corporation with an address for notice purposes of 0 Xxxxxx
Xxxxx,
Xxxxx 000, Xxxxxxxxx, XX 00000 (Fax: (000) 000-0000), Attention: President
("LICENSEE").
NINTENDO and LICENSEE acknowledge and agree as follows:
1. RECITALS
1.1 NINTENDO markets and sells a high-quality video game system, including
hardware, software and an input controller, marketed by NINTENDO under its
trademarks "Nintendo 64registered trademark" and "N64trademark", for playing
video games.
1.2 LICENSEE desires to gain access to and rights to utilize highly
proprietary
programming specifications, development tools, trademarks and other valuable
intellectual property rights in order to develop video game software and to
purchase and
sell such video game software from NINTENDO for play on the Nintendo 64 system,
which system was developed by NCL and Silicon Graphics, Inc.
1.3 NINTENDO is willing to grant a license to utilize such proprietary
information and intellectual property rights and to sell video game software to
LICENSEE upon the terms and conditions set forth in this Agreement.
2. DEFINITIONS
2.1 "Artwork" shall mean the final art and mechanical formats for the
Licensed
Product including the Game Cartridge box, user instruction manual with consumer
precautions and warranty, Game Cartridge label and inserts.
2.2 "Competing Systems" shall mean hardware platforms, whether marketed
now or in the future, designed to play interactive video games, including, but
without
limitation: Apple/Bandai Xxxxxx or Atmark, Atari Jaguar, Atari Lynx, 3DO Real,
Matsushita M2, Xxxxxxxx XX-I Interactive Player, Sega Master System, Sega
Genesis,
Sega CD, Sega Game Gear, Sega CD/X, Sega Nomad, Sega 32X, Sega Saturn, Sega
Pico,
Sony PSX/Playstation and SNK Neo Geo.
2.3 "Effective Date" shall mean the last date in which all parties shall
have signed this Agreement.
2.4 "Exclusive Licensed Product" shall mean the audiovisual work
tentatively
entitled "ROBOTECH CRYSTAL DREAMS", in its current form and as hereafter
developed, including any adaptation, translation, derivative, sequel or
substantially
similar game which is sold by LICENSEE as a Licensed Product under this
Agreement.
2.5 "Game Cartridge(s)" shall mean interchangeable plastic cartridges
adapted
for use with the N64 System, housing the Game embodied in electronic memory
devices or
comparable medium authorized by NINTENDO for storing and playing Games on the
N64 System.
2.6 "Game(s)" shall mean video game software compatible with the N64
System developed under this Agreement.
2.7 "Guidelines" shall mean the "Nintendo 64 Packaging Guidelines" and the
"Nintendo 64 Development Manual" setting forth trademark, copyright and related
artwork standards, as published from time to time by NINTENDO.
2.8 "Independent Contractor" shall mean any third party agent, consultant,
contractor or independent programmer, other than LICENSEE.
2.9 "Licensed Copyright(s)" shall mean various copyrights in printed
materials,
art or logo designs, trade dress, computer software, microcode, electronic
circuitry and
rights in integrated circuit layout designs employed in the N64 System.
2.10 "Licensed Intellectual Properties" shall mean individually,
collectively or in any combination,
the Licensed Inventions, Licensed Proprietary Information, Licensed
Copyrights and Licensed Trademarks.
2.11 "Licensed Invention(s)" shall mean improvements and inventions
concerning the N64 System, including inventions which are or may become the
subject matter of various patents or patent applications.
2.12 "Licensed Product(s)" shall mean Game Cartridges (or comparable medium
authorized by Nintendo) for employing the Licensed Intellectual Properties and
having electronic memory devices storing the Games.
2.13 "Licensed Proprietary Information" shall mean any of the following
information relating to the N64 System: (a) all current or future information,
know-how, techniques, methods, information, tools, emulator boards, software
development
specifications, and/or trade secrets, (b) any patents or patent applications,
(c) any business, marketing or sales data information, and (d) any other
information or data
relating to development, design, operation, manufacturing, marketing or sales.
"Licensed Proprietary Information" shall include information disclosed to
LICENSEE by NINTENDO, NINTENDO's affiliated companies, SGI, and/or other
third parties working
with NINTENDO. Such Licensed Proprietary Information shall include all
confidential
information disclosed, whether in writing, orally, visually, or in the form of
drawings,
technical specifications, software, samples, pictures, models, recordings, or
other tangible
items which contain or manifest, in any form, the Licensed Proprietary
Information.
Licensed Proprietary Information shall not include: (a) data and information
which was in
the public domain prior to LICENSEE's receipt of the same hereunder, or which
subsequently becomes part of the public domain by publication or otherwise,
except by LICENSEE's
wrongful act or omission, (b) data and information which LICENSEE can
demonstrate, through written records kept in the ordinary course of business,
was in its
possession without restriction on use or disclosure, prior to its receipt of
the same
hereunder and was not acquired directly or indirectly from NINTENDO under an
obligation of confidentiality which is still in force, (c) data and
information which
LICENSEE can show was received by it from a third party who did not acquire
the same
directly or indirectly from NINTENDO and to whom LICENSEE has no obligation of
confidentiality, and (d) data and information which is required to be
disclosed by an
authorized governmental or judicial entity, provided that LICENSEE shall notify
NINTENDO at least thirty (30) days prior to such disclosure.
2.14 "Licensed Trademarks" shall mean registered and unregistered trademarks
and trademark applications used in connection with the N64 System, including
"Nintendoregistered trademark", "Nintendo 64registered trademark"',
"N64trademark," "Official Nintendo Seal of Qualityregistered trademark" and
trade dress in the N64 System.
2.15 "Marketing Materials" shall mean marketing, advertising or promotional
materials which incorporate the Licensed Intellectual Properties which are
developed by or for LICENSEE to promote the sale of the Licensed Products.
2.16 "N64 Letter Agreement" shall mean the letter agreement between the
parties dated 1/27/95 referring to the Exclusive Licensed Product.
2.17 "NCL" shall mean NINTENDO's parent company, Nintendo Co., Ltd. of
Kyoto, Japan.
2.18 "Nintendo 64 System" and "N64 System" shall mean the 64-bit Nintendo
64 video game system, including the hardware, software and input controller
marketed by NINTENDO and Nintendo Co., Ltd.
2.19 "Other Agreements" shall mean that certain Product Developer Non-
Disclosure Agreement for Nintendo 64 entered into between NINTENDO and
LICENSEE with an effective date of 2/2/95.
2.20 "Product Proposal" shall mean a written proposal which provides a
detailed explanation of the Game.
2.21 "Schedule 1" shall mean the "Nintendo of America Inc. Price Sheet N64
Licensed Game Paks" attached to this Agreement and incorporated by reference
into this Agreement.
2.22 "SGI" shall mean Silicon Graphics, Inc. and/or MIPS Technologies, Inc.
2.23 "Term" shall mean (**) years from the Effective Date.
2.24 "Territory" shall mean all countries within the Western Hemisphere,
including the United States, Canada, South America, Central America, Mexico
and all applicable territories and possessions.
3. GRANT OF LICENSE: RESERVATION OF RIGHTS BY NINTENDO
3.1 Grant. For the Term and in the Territory, NINTENDO hereby grants to
LICENSEE, and LICENSEE hereby accepts under the terms and conditions set forth
in this Agreement, a nonexclusive license to employ the Licensed Intellectual
Properties
solely to develop and sell video games incorporated into Game Cartridges for
play on the
N64 System. Except as may be permitted under a separate written authorization
from NINTENDO or Nintendo Co., Ltd., LICENSEE shall not use the Licensed
Intellectual Properties for any other purpose.
3.2 Reservation of Rights in the Licensed Intellectual Properties.
LICENSEE acknowledges NINTENDO and Nintendo Co., Ltd.'s right, title, and
interest in and to the
Licensed Intellectual Properties and the goodwill associated with the Licensed
Trademarks. LICENSEE will not at any time do or cause to be done any act or
thing which in any way impairs or is intended to impair any part of such right,
title, interest or goodwill.
LICENSEE shall not represent that it has any ownership in the Licensed
Intellectual Properties. Use of the Licensed Intellectual Properties shall
not create any right, title or interest therein in LICENSEE's favor.
3.3 Reservation of Rights of Distribution Outside the Territory. LICENSEE
shall market and sell the Licensed Products only in the Territory. LICENSEE
shall not directly
or indirectly export any Licensed Products from the Territory nor shall
LICENSEE knowingly permit or assist any third party in doing so.
3.4 Reservation of Rights to Reverse Engineer. LICENSEE may utilize and
study the design, performance and operation of the N64 System and the Licensed
Proprietary Information solely for the purpose of developing software which is
compatible with the N64 System for license under this Agreement. LICENSEE
shall not,
directly or indirectly, reverse engineer or aid or assist in the reverse
engineering of all or
any part of the N64 System, including the hardware, software, input controller
and/or
tools. For purposes of this Agreement, "reverse engineering" shall mean: (a)
the x-ray
electronic scanning and/or physical or chemical stripping of semiconductor
components;
(b) the disassembly, decompilation, decryption, simulation, debugging or code
tracing of
microcode; and/or (c) the disassembly, decompilation, decryption, simulation,
debugging
or code tracing of object code or executable code, specifically including, but
not limited
to, any NINTENDO supplied or developed libraries or microcode. The
limitations set
forth in this Section 3.4 shall not preclude LICENSEE from engaging in reverse
engineering of any Game code which was developed solely by LICENSEE and related
only to the Game and was not supplied by nor derived from any code supplied by
NINTENDO.
3.5 Reservation of Rights of Electronic Transmission. LICENSEE shall not
directly or indirectly duplicate, distribute or transmit Games via electronic
means or any
other means now known or hereafter devised, including without limitation,
wireless,
cable, fiber optic means, telephone lines, satellite transmission, microwave
or radio waves
or over a network of interconnected computers or other devices.
Notwithstanding this
limitation, LICENSEE shall not be prohibited from the electronic transmission
of Games during
the development process for the sole purpose of facilitating development;
provided, however, that no right of retransmission shall attach to any such
transmission,
and, provided further, that LICENSEE shall use reasonable security measures,
customary
within the industry, to reduce the risk of unauthorized interception or
retransmission of such transmissions.
3.6 Notification Obligations. LICENSEE shall promptly notify NINTENDO of
the loss or unauthorized use or disclosure of any Licensed Proprietary
Information and
shall promptly act to recover any such information and/or prevent further
breach of the
confidentiality obligations herein.
4. CONFIDENTIALITY
4.1 Disclosure of Proprietary Information. NINTENDO has and shall during
the Term provide LICENSEE with highly proprietary development information,
development tools, emulation systems, programming specifications and
related resources
and information constituting and incorporating the Licensed Proprietary
Information to
enable LICENSEE to develop video games for use with the N64 System.
4.2 Confidentiality of Licensed Proprietary Information. LICENSEE shall
maintain all Licensed Proprietary Information as strictly confidential and
will use such
Licensed Proprietary Information only in accordance with this Agreement.
LICENSEE
shall limit access to the Licensed Proprietary Information to LICENSEE's
employees
having a strict need to know and shall advise such employees of their
obligation of
confidentiality as provided herein. LICENSEE shall require each such employee
to retain
in confidence the Licensed Proprietary Information pursuant to a
written non-disclosure
agreement between LICENSEE and such employee. LICENSEE shall use its best
efforts to ensure that its employees working with or otherwise having
access to Licensed
Proprietary Information shall not disclose or make unauthorized use of the
Licensed
Proprietary Information.
4.3 Agent/Consultant Confidentiality. LICENSEE shall not disclose the
Licensed Proprietary Information to any Independent Contractor without
NINTENDO's
prior written approval. Each approved Independent Contractor shall be
required to enter
into a written non-disclosure agreement with NINTENDO prior to receiving any
access to
or disclosure of the Licensed Proprietary Information.
4.4 SGI as a Third-Party Beneficiary. LICENSEE hereby acknowledges and
agrees that SGI shall be a third-party beneficiary of LICENSEE's confidentiality
obligations as set forth in this Section 4.
5. DEVELOPMENT; QUALITY STANDARDS;
ARTWORK; MANUFACTURING
5.1 Development and Sale of the N64 System Programs. During the Term,
LICENSEE may develop Games and/or sell Licensed Products for the N64 System in
accordance with this Agreement.
5.2 Exclusivity; Exclusive Licensed Product. For the Exclusive Licensed
Product, LICENSEE agrees that, commencing on the Effective Date and continuing
for a
period of one (1) year from NINTENDO's first shipment of such Exclusive Licensed
Product to LICENSEE, the Game incorporated into such Exclusive Licensed Product
shall not be sold anywhere in the Territory by LICENSEE or by any third party
for play
on any Competing System. Except as provided herein with regard to the Exclusive
Licensed Product, or as may otherwise be limited by the legitimate
intellectual property
rights of NINTENDO or any third party, LICENSEE shall retain all rights with
regard to
the adaptation of Games for development and sale in any other format,
including on any
Competing System.
5.3 Submission of Game Concept. Before commencing development of a
Game, LICENSEE shall submit to NINTENDO for approval, a Product Proposal. Such
Product Proposal must include a detailed explanation of the manner in which
the Game
will utilize and exploit: (a) the unique 3-D capabilities and high quality
graphics display
of the N64 System; (b) the complex, high-capacity processing speed of the N64
System;
and, (c) the dynamic interfaces and touch control features of the unique N64
System
controller. For that purpose, the Product Proposal shall include: (a) a
description of the
proposed Game; (b) the development team profile, including information
regarding any
Independent Contractor which LICENSEE proposes to retain to work on the Game;
(c) a
description of any special hardware or software requirements; and, (d) the
anticipated
completion date of the proposed Licensed Product. Subsequent to acceptance and
approval of a Product Proposal, LICENSEE shall notify NINTENDO in writing of any
material proposed changes in the Product Proposal and/or the proposed Licensed
Product.
From time to time, at approximately quarterly intervals or such other
reasonable times
NINTENDO may establish for purposes of ensuring utilization and exploitation
of the
N64 System in the manner set forth above, LICENSEE shall submit
work-in-progress on
the Game to NINTENDO for further review in accordance with the criteria set
forth
herein. NINTENDO shall not unreasonably withhold or delay any approval
provided for
herein.
5.4 Delivery of Completed Game. Upon completion of a Game, LICENSEE
shall deliver to NINTENDO one (1) prototype of the Game in a format specified by
NINTENDO, together with written user instructions and a complete screen text
script.
NINTENDO shall promptly evaluate the Game with regard to: (a) its technical
compatibility with and error-free operation on the N64 System; (b) the
suitability of the
Game content, taking into account reasonable standards set forth in the
Guidelines; and,
(c) whether the Game achieves the objectives set forth in LICENSEE's approved
Product
Proposal. LICENSEE shall have satisfied the Game content suitability
criteria by
providing NINTENDO with proof that the Game has been provided with a
certificate of a
rating other than ADULTS ONLY (or its equivalent) from the Entertainment
Software
Ratings Board or comparable independent ratings body which reviews and certifies
product for violent or sexual content.
5.5 Approval of Completed Game. NINTENDO shall, within a reasonable
period of time after receipt, approve or disapprove such Game. If such Game is
disapproved, NINTENDO shall specify in writing the reasons for such
disapproval and
state what corrections and/or improvements are necessary. After making the
necessary
corrections and/or improvements, LICENSEE shall submit a revised Game for
approval
by NINTENDO. The approval of any Game by NINTENDO shall not relieve LICENSEE
of its sole responsibility for the development, quality and operation of the
Game or in any
way create any warranty for a Licensed Product by NINTENDO. NINTENDO shall not
unreasonably withhold or delay any approval provided for herein.
5.6 Development and Quality of Artwork. In connection with the submission
of a proposed Licensed Product to NINTENDO, LICENSEE shall submit all Artwork to
NINTENDO. All Artwork shall conform to the requirements set forth in the
Guidelines.
Within fifteen (15) business days of receipt of the Artwork, NINTENDO shall
approve or
disapprove the Artwork based upon the Guidelines. If any of the Artwork is
disapproved,
NINTENDO shall specify in writing the reasons for such disapproval and state
what
corrections and/or improvements are necessary. After making the necessary
corrections
and/or improvements to the disapproved Artwork, LICENSEE shall resubmit new
Artwork for approval by NINTENDO. NINTENDO shall not unreasonably withhold or
delay its approval of any Artwork.
5.7 Appointment of NCL as Manufacturer. LICENSEE hereby appoints NCL,
and NCL hereby accepts appointment, as manufacturer of the Licensed Products.
LICENSEE shall purchase from NCL through NINTENDO all of its requirements for
the
Licensed Products. NCL shall have the sole responsibility for establishing
and fulfilling
all aspects of the manufacturing process, including selecting the location of
and
specifications for any manufacturing facilities, appointing suppliers and
subcontractors,
and managing all work-in-progress and finished goods inventory. NCL shall
acquire and
retain responsibility for all equipment, tooling, molds or masks used in
connection with
the manufacture of the Licensed Products.
5.8 Manufacture of Licensed Products. Upon approval of a Game and the
Artwork and upon receipt from LICENSEE of an order in accordance with Section 7
herein, NCL will manufacture the Licensed Products for LICENSEE, including the
Artwork.
5.9 Retention of Sample Licensed Products. NCL may, at its own expense,
manufacture samples of the Licensed Products, only to the extent necessary, to
be used by
NINTENDO for archival purposes, legal proceedings against infringers of
the Licensed
Intellectual Properties, and for other lawful purposes.
6. PURCHASE PRICE; PAYMENT; DELIVERY
OF COMPLETED LICENSED PRODUCT
6.1 Minimum Initial Orders. Upon placement of an initial order, LICENSEE
shall order a minimum quantity of (**) units of a Licensed Product.
6.2 Subsequent Minimum Orders. LICENSEE may subsequently order
additional Licensed Product in a minimum quantity of (**) units per title.
6.3 Purchase Price. The purchase price to be paid by LICENSEE to
NINTENDO for the Licensed Products shall be in accordance with NINTENDO's
pricing
schedule currently set forth in the attached Schedule 1. The purchase price
includes the
cost of manufacturing, printing and packaging the Licensed Products and a
royalty for the
use of the Licensed Intellectual Properties. Schedule 1 is subject to change by
NINTENDO at any time without notice.
6.4 Payment. At the time an order is placed, LICENSEE shall provide to
NINTENDO an irrevocable letter of credit in favor of NINTENDO and payable
at sight,
issued by a bank acceptable to NINTENDO and confirmed, at LICENSEE's expense, if
requested by NINTENDO. The letter of credit shall be in United States dollars
in an
amount equal to the purchase price of the Licensed Products ordered.
All associated
banking charges are for LICENSEE's account.
6.5 Shipment and Delivery. The Licensed Products shall be delivered
F.O.B.
Japan, with shipment at LICENSEE's direction and expense. Orders may be
delivered by
NINTENDO in partial shipments, each directed to no more than two (2)
destinations
designated by LICENSEE in the Territory. Title to the Licensed Products shall
vest in
accordance with the terms of the applicable letter of credit.
7. MARKETING, SALE AND RENTAL OF THE LICENSED PRODUCTS
7.1 Marketing Materials. LICENSEE agrees that any Marketing Materials
shall
all be of high quality and shall comply with the Guidelines.
7.2 Submission of Proposed Marketing Materials. Prior to actual use or
distribution, LICENSEE shall submit to NINTENDO for review and evaluation
initial
samples of all Marketing Materials. NINTENDO shall, within fifteen (15)
business days
of receipt of such samples, approve or disapprove of the quality of such
samples. If any
of the samples are disapproved as to quality, NINTENDO shall specify the
reasons for
such disapproval and state what corrections and/or improvements are necessary.
After
making the necessary corrections and/or improvements to the disapproved samples,
LICENSEE may resubmit new samples for approval by NINTENDO as to quality. No
Marketing Materials shall be distributed or utilized by LICENSEE without
obtaining prior
written approval as to quality by NINTENDO. NINTENDO shall not unreasonably
withhold or delay its approval of the proposed Marketing Materials.
7.3 Warranty and Repair. With respect to the Licensed Product, LICENSEE
shall provide to the original consumer a minimum ninety (90) day limited
warranty,
comparable to that offered by NINTENDO. LICENSEE shall also provide to the
original
consumer, either directly or indirectly through authorized service centers,
reasonably
accessible product service, including out-of-warranty service for a period of
three (3)
years following sale of the Licensed Product. In the event LICENSEE is unable
to obtain
sufficient quantities of repair parts for service obligations from defective
and/or product
returns, NINTENDO shall cooperate in providing reasonable quantities of repair
parts to
LICENSEE at its standard cost.
7.4 Business Facilities: Sales of Game Cartridges. LICENSEE agrees to
develop, maintain and utilize during the Term: (a) suitable office facilities
within the
Territory, adequately staffed to enable LICENSEE to fulfill all
responsibilities under this
Agreement; (b) necessary warehouse, distribution, marketing, sales, collection
and credit
operations to facilitate proper handling of the Licensed Product; and, (c)
customer service
and game counseling support, including telephone service, to adequately
support the
Licensed Product.
7.5 Defects; Recall. In the event of a material programming defect in the
Licensed Product, which defect in the reasonable judgment of NINTENDO would
significantly impair the ability of a consumer to play the Licensed Product,
NINTENDO
may require the LICENSEE to recall the Licensed Product and undertake
suitable repairs
or replacements prior to sale.
7.6 Rental. In the event LICENSEE elects to engage in the commercial
rental
of the Licensed Products within the Territory on such terms and conditions as
LICENSEE
shall determine, LICENSEE shall secure appropriate authorizations and/or
assignments
from the author(s) of the copyrightable elements in the computer programs
for the
Licensed Product. LICENSEE shall clearly provide notice on the
Artwork for each
Licensed Product of any rental right or reservation thereof.
7.7 Nintendo Promotional Materials, Publications and Events. At its
option,
NINTENDO may: (a) insert in the packaging for the Licensed Product promotional
materials concerning Nintendo Powerregistered trademark magazine; (b) utilize
screen shots, package art
and related art and information regarding the Licensed Product in Nintendo
Powerregistered trademark or
other media or marketing programs which promote NINTENDO products; and (c)
exercise public performance rights of the Licensed Product, related trademarks
and art in
NINTENDO sponsored contests, tours and events which generally promote NINTENDO
products.
8. LICENSEE'S COPYRIGHTS AND TRADEMARKS
8.1 Copyright and Trademark Warranties. LICENSEE represents and warrants
that, throughout the Territory, LICENSEE is either: (a) the sole owner of all
right, title
and interest in and to the trademarks, copyrights and Artwork used on or in
association
with the Licensed Products; or (b) the holder of sufficient rights to the
trademarks,
copyrights and Artwork which have been licensed from a third party for use in
the
Licensed Product.
8.2 Licensee's Indemnification. LICENSEE shall indemnify and hold
NINTENDO harmless from any claims, losses, liabilities, damages, expenses and
costs,
including, without limitation, reasonable attorneys' fees and costs, which
result from: (a)
a breach of any of the representations or warranties provided by LICENSEE
herein; (b)
any claim of infringement of any third party's intellectual property rights
with respect to
the Licensed Product, excluding claims based solely upon NINTENDO's trademarks,
copyrights and patents; or, (c) any claim of bodily injury (including death)
or property
damage arising out of, or in connection with, the development, sale and/or use
of any of
the Licensed Products. NINTENDO shall give LICENSEE prompt written notice
of the
assertion of any such claim and provided, further, that LICENSEE shall have
the right to
select counsel and control the defense and/or settlement of any such claim,
subject to the
right of NINTENDO to participate in any such action or proceeding at its own
expense
with counsel of its own choice.
8.3 Insurance. LICENSEE shall, at its own expense, obtain a policy of
general
liability insurance by a recognized insurance company. Such policy of
insurance shall be
in an amount of not less than Five Million Dollars ($5,000,000 USD) and
shall provide
for adequate protection against any suits, claims, loss or damage or any alleged
intellectual property infringements by the Licensed Products. Such policy
shall name
NINTENDO as an additional insured and may not be canceled without thirty
(30) days
prior written notice to NINTENDO. A Certificate of Insurance shall be
provided to
NINTENDO's Licensing Department within thirty (30) days of the Effective Date.
If
LICENSEE fails to maintain such insurance during the Term, NINTENDO may secure
and maintain such insurance at LICENSEE's expense.
9. LIMITATION OF LIABILITY
9.1 Disclaimer of Licensed Intellectual Properties. NINTENDO makes no
representations, guarantees or warranties concerning the scope or validity of
the Licensed
Intellectual Properties, and does not warrant that the sale of the Licensed
Products by
LICENSEE will not infringe upon the patent, trade secret, copyright, mask
work or
trademark rights of another in the Territory. THE RISK OF INFRINGEMENT IS
HEREBY ASSUMED BY LICENSEE.
9.2 Warranty Disclaimer. NINTENDO DISCLAIMS ANY AND ALL
WARRANTIES OF THE LICENSED PRODUCTS AS BETWEEN NINTENDO AND
LICENSEE AND AS BETWEEN NINTENDO AND ANY THIRD PARTY
PURCHASERS FROM LICENSEE. LICENSEE PURCHASES AND ACCEPTS ALL
LICENSED PRODUCTS FROM NINTENDO ON AN "AS IS" AND "WHERE IS"
BASIS AND WITHOUT ANY WARRANTIES, EXPRESS OR IMPLIED. WITH
RESPECT TO THE LICENSED PRODUCTS, NINTENDO DISCLAIMS ALL
WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A GENERAL OR
PARTICULAR PURPOSE AND SHALL IN NO EVENT BE LIABLE FOR ANY
INCIDENTAL AND/OR CONSEQUENTIAL DAMAGES OF LICENSEE, ITS
RETAILERS OR CUSTOMERS. LICENSEE SHALL BE SOLELY RESPONSIBLE
FOR PROVIDING WARRANTY AND REPAIR/REPLACEMENT SERVICES FOR
ANY DEFECTIVE LICENSED PRODUCTS.
10. INFRINGEMENT OF LICENSED INTELLECTUAL PROPERTIES
AND LICENSEE'S TRADEMARKS AND COPYRIGHTS
10.1 Reporting. In the event: (a) any claim is asserted against either
party
alleging that any of the Licensed Intellectual Properties or a Licensed
Product constitutes
an infringement of another's rights; or, (b) either party discovers that any
of the Licensed
Intellectual Properties or LICENSEE's copyrights or trademarks used in
connection with
the Licensed Products have been infringed by a third party, then the party
with such
knowledge shall promptly notify the other party.
10.2 Licensed Intellectual Properties. NINTENDO shall have the sole
right, at
its expense, to commence and/or defend a legal action or negotiate a
settlement relating to
any alleged infringement by the Licensed Intellectual Properties. LICENSEE
agrees to
give reasonable assistance in any such legal action, but at no expense to it.
NINTENDO
shall be entitled to all of the recovery or damages collected as a result of
such legal action
or negotiated settlement. In the event of a legal action against LICENSEE
alleging an
infringement by the Licensed Intellectual Properties as incorporated into
LICENSEE's
Licensed Products which NINTENDO affirmatively elects in writing not to defend,
LICENSEE may defend or settle such legal action, at its option and expense.
NINTENDO agrees to provide reasonable assistance in defending any such legal
action.
LICENSEE agrees to keep NINTENDO fully informed with respect to developments in
any such legal action and to provide NINTENDO reasonable notice of the terms
of any
proposed settlement and to consider any comments by NINTENDO before
settlement is
made.
10.3 Infringement of Licensed Products. LICENSEE shall take reasonable
steps
to xxxxx any infringement of LICENSEE's copyrights and trademarks in the
Licensed
Products. LICENSEE shall also take all reasonable and necessary steps,
including legal
action, to defend against any alleged infringement caused by any of LICENSEE's
software programs developed under this Agreement or any Artwork, title or
designation
used in conjunction with any of the Licensed Products. NINTENDO shall give to
LICENSEE reasonable assistance and cooperation in any such legal action, but
at no expense to NINTENDO.
11. TERM AND TERMINATION
11.1 Default or Breach. In the event that either party is in default or
commits a
breach of this Agreement which is not cured within thirty (30) days after
written notice
thereof, then this Agreement shall automatically terminate on the date
specified in such notice.
11.2 Termination Other Than by Breach. Upon the expiration of this
Agreement
or its termination other than by LICENSEE's breach, LICENSEE shall have a
period of
one hundred eighty (180) days to sell any unsold Licensed Products. All
Licensed
Products in LICENSEE's control following expiration of such sell-off period,
shall be
destroyed by LICENSEE within ten (10) days.
11.3 Termination by LICENSEE's Breach. If this Agreement is terminated by
NINTENDO as a result of a breach of its terms and conditions by LICENSEE,
LICENSEE shall immediately cease all distribution, promotion or sale of any
Licensed
Products. All Licensed Products in LICENSEE's control as of such termination
shall be
destroyed by LICENSEE within ten (10) days.
11.4 Licensed Intellectual Property Rights. Upon expiration and/or
termination
of this Agreement, LICENSEE will cease all use of the Licensed Intellectual
Properties
for any purpose, and will not disclose to third parties any Licensed Proprietary
Information. LICENSEE shall also return to NINTENDO all writings, drawings,
models,
data and other materials and things in LICENSEE's possession or in the
possession of any
past or present employee, agent or contractor receiving the information through
LICENSEE, which constitute or relate to or disclose any Licensed Proprietary
Information without making copies or otherwise retaining any such information.
11.5 Termination by Nintendo's Breach. If this Agreement is terminated by
LICENSEE as a result of a breach of its terms or conditions by NINTENDO,
LICENSEE
may continue to sell the Licensed Products in the Territory until the
expiration of the
Term, at which time the provisions herein relating to termination other than
by default of
LICENSEE shall apply to any unsold Licensed Products.
12. GENERAL PROVISIONS
12.1 Nonassignability/Sublicensing. This Agreement is personal to LICENSEE
and may not be sold, assigned, delegated, sublicensed or otherwise
transferred or
encumbered, including by operation of law or by the sale or transfer of more
than ten
percent (10%) of the stock, assets or ownership interest or control of
LICENSEE, without
the prior written consent of NINTENDO.
12.2 Force Majeure. Neither party shall be liable for any breach of this
Agreement occasioned by any cause beyond the reasonable control of such party,
including governmental action, war, riot or civil commotion, fire, natural
disaster, labor
disputes, restraints affecting shipping or credit, delay of carriers,
inadequate supply of
suitable materials, or any other cause which could not with reasonable
diligence be
controlled or prevented by the parties. In the event of material shortages,
including
shortages of microcomputer chips necessary for production of the Licensed
Products,
NINTENDO reserves the right to allocate essential materials among itself and its
licensees.
12.3 Waiver; Severability; Integration. The failure of any party to
enforce any
provision of this Agreement shall not be construed to be a waiver of such
provision or of
the right of such party to thereafter enforce such provision. In the event
that any term,
clause or provision of this Agreement shall be construed to be or adjudged
invalid, void
or unenforceable, such term, clause or provision shall be construed as severed
from this
Agreement, and the remaining terms, clauses and provisions shall remain in
effect. This
Agreement constitutes the entire agreement between the parties relating to
the subject
matter hereof, provided, however, that the Other Agreements shall remain in
effect,
except as may be modified by specific reference herein. All prior negotiations,
representations, agreements and understandings, including the N64 Letter
Agreement, are
merged into, extinguished by and completely expressed by this Agreement. Any
amendment to this Agreement shall be in writing, signed by both parties.
12.4 Governing Law: Venue. This Agreement shall be governed by, subject to
and construed under the laws of the State of Washington. Any legal actions
prosecuted or
instituted by NINTENDO or by LICENSEE under this Agreement, with respect to any
matters arising under or growing out of this Agreement, shall only be brought
in a court
of competent jurisdiction in King County, Washington and each party hereby
consents to
the jurisdiction and venue of such courts for such purposes.
12.5 Equitable Relief. LICENSEE acknowledges that in the event of its
breach
of this Agreement, no adequate remedy at law may be available to NINTENDO
and that
NINTENDO shall be entitled to seek injunctive or other equitable relief in
addition to any
relief available at law.
12.6 Attorneys' Fees. In the event it is necessary for either party of this
Agreement to undertake legal action to enforce any of the terms, conditions
or rights
contained herein, or to defend any such action, then the prevailing party in
any such
action shall be entitled to recover from the other party all reasonable
attorneys' fees, costs
and expenses relating to such legal action.
12.7 Notices. All notices required or permitted under this Agreement
shall be
sufficiently given when: (a) personally served or delivered; (b) deposited,
postage
prepaid, with a guaranteed air courier service, addressed as stated herein, or
to such other
person or address either party may designate in a notice; or, (c) by
facsimile, with an
original sent concurrently by first class U.S. mail. Notice shall be deemed
effective upon
the earlier of actual receipt or two (2) business days after transmittal.
12.8 Counterparts; Signature by Facsimile. This Agreement may be signed in
counterparts, which shall together constitute a complete Agreement. A signature
transmitted by facsimile shall be considered an original for purposes of this
Agreement.
IN WITNESS WHEREOF, NINTENDO and LICENSEE have entered into this
Agreement on the dates set forth below.
NINTENDO: LICENSEE:
NINTENDO OF AMERICA, INC. GAMETEK, INC.
By: s/ Xxxx X. Xxxxx By: s/ Xxxxx Xxxxxx
------------------- ---------------------
Its: Executive Vice President, Its: President and Chief
Administration Operating Officer
Date: 3/31/97 Date: 26 March 1997
--------------------- --------------------------
SCHEDULE 1
NINTENDO OF AMERICA INC. PRICE SHEET
N64 LICENSED GAME PAKS
MEMORY CAPACITY NOA PRICE
32 Megabit $(**)
32 Megabit + E2 ROM $(**)
64 Megabit $(**)
64 Megabit + E2 ROM $(**)
96 Megabit $(**)
96 Megabit + E2 ROM $(**)
PRICE INCLUDES AN INSTRUCTION MANUAL UP TO 40 PAGES. THERE WILL BE AN EXTRA
CHARGE FOR
MANUALS LARGER THAN 40 PAGES (INCLUDING THE FRONT AND BACK COVER).
EXTRA PACKAGING
(MUST BE ORDERED WITH PRODUCT ON SEPARATE PO)
Game Pak Box $(**)
Instruction Manual
(under 40 pages) $(**)
Instruction Manual
(over 40 pages) $(**)
Game Pak Label $(**)
Game Pak Poster $(**)
Warranty Card $(**)
ALL PRICES SUBJECT TO CHANGE WITHOUT PRIOR NOTICE
1/30/97
