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Take Two Interactive Software Inc – ‘10-K’ for 3/31/18 – ‘EX-10.55’

On: Wednesday, 5/16/18, at 6:45pm ET · As of: 5/17/18 · For: 3/31/18 · Accession #: 1628280-18-6877 · File #: 1-34003

  As Of               Filer                 Filing    For·On·As Docs:Size             Issuer                      Filing Agent

 5/17/18  Take Two Interactive Software Inc 10-K        3/31/18  120:14M                                    Workiva Inc Wde… FA01/FA

Annual Report — Form 10-K — Sect. 13 / 15(d) – SEA’34
Filing Table of Contents

Document/Exhibit                   Description                      Pages   Size 

 1: 10-K        Annual Report                                       HTML   1.22M 
 2: EX-10.55    Material Contract                                   HTML     97K 
 3: EX-21.1     Subsidiaries List                                   HTML     50K 
 4: EX-23.1     Consent of Experts or Counsel                       HTML     32K 
 5: EX-31.1     Certification -- §302 - SOA'02                      HTML     36K 
 6: EX-31.2     Certification -- §302 - SOA'02                      HTML     36K 
 7: EX-32.1     Certification -- §906 - SOA'02                      HTML     33K 
 8: EX-32.2     Certification -- §906 - SOA'02                      HTML     33K 
15: R1          Document and Entity Information                     HTML     58K 
16: R2          Consolidated Balance Sheets                         HTML    130K 
17: R3          Consolidated Balance Sheets (Parenthetical)         HTML     54K 
18: R4          Consolidated Statements of Operations               HTML     78K 
19: R5          Consolidated Statements of Comprehensive Income     HTML     71K 
                (Loss)                                                           
20: R6          Consolidated Statements of Cash Flows               HTML    144K 
21: R7          Consolidated Statements of Stockholders' Equity     HTML    117K 
22: R8          Consolidated Statements of Stockholders' Equity     HTML     34K 
                (Parenthetical)                                                  
23: R9          Basis of Presentation and Significant Accounting    HTML    118K 
                Policies                                                         
24: R10         Management Agreement                                HTML     37K 
25: R11         Fair Value Measurements                             HTML    135K 
26: R12         Short-Term Investments                              HTML    102K 
27: R13         Derivative Instruments and Hedging Activities       HTML     52K 
28: R14         Inventory                                           HTML     43K 
29: R15         Software Development Costs and Licenses             HTML     66K 
30: R16         Fixed Assets, Net                                   HTML     51K 
31: R17         Goodwill and Intangible Assets, Net                 HTML    105K 
32: R18         Accrued Expenses and Other Current Liabilities      HTML     49K 
33: R19         Debt                                                HTML     82K 
34: R20         Earnings (Loss) Per Share ("Eps")                   HTML     84K 
35: R21         Commitments and Contingencies                       HTML     86K 
36: R22         Income Taxes                                        HTML    183K 
37: R23         Stock-Based Compensation                            HTML    128K 
38: R24         Share Repurchase Program                            HTML     37K 
39: R25         Segment and Geographic Information                  HTML     78K 
40: R26         Interest and Other, Net                             HTML     46K 
41: R27         Accumulated Other Comprehensive Income (Loss)       HTML     73K 
42: R28         Business Reorganization                             HTML     38K 
43: R29         Supplementary Financial Information                 HTML     99K 
44: R30         Quarterly Financial Information (Unaudited)         HTML     86K 
45: R31         Acquisitions                                        HTML     60K 
46: R32         Basis of Presentation and Significant Accounting    HTML    175K 
                Policies (Policies)                                              
47: R33         Fair Value Measurements (Tables)                    HTML    126K 
48: R34         Short-Term Investments (Tables)                     HTML    103K 
49: R35         Derivative Instruments and Hedging Activities       HTML     43K 
                (Tables)                                                         
50: R36         Inventory (Tables)                                  HTML     42K 
51: R37         Software Development Costs and Licenses (Tables)    HTML     67K 
52: R38         Fixed Assets, Net (Tables)                          HTML     49K 
53: R39         Goodwill and Intangible Assets, Net (Tables)        HTML    105K 
54: R40         Accrued Expenses and Other Current Liabilities      HTML     48K 
                (Tables)                                                         
55: R41         Debt (Tables)                                       HTML     72K 
56: R42         Earnings Per Share ("Eps") (Tables)                 HTML     80K 
57: R43         Commitments and Contingencies (Tables)              HTML     74K 
58: R44         Income Taxes (Tables)                               HTML    175K 
59: R45         Stock-Based Compensation (Tables)                   HTML    111K 
60: R46         Segment and Geographic Information (Tables)         HTML     76K 
61: R47         Interest and Other, Net (Tables)                    HTML     46K 
62: R48         Accumulated Other Comprehensive Income (Loss)       HTML     70K 
                (Tables)                                                         
63: R49         Supplementary Financial Information (Tables)        HTML     98K 
64: R50         Quarterly Financial Information (Unaudited)         HTML     85K 
                (Tables)                                                         
65: R51         Acquisitions (Tables)                               HTML     62K 
66: R52         Basis of Presentation and Significant Accounting    HTML     32K 
                Policies - Wholly Owned Labels (Details)                         
67: R53         Basis of Presentation and Significant Accounting    HTML     58K 
                Policies - Concentration Risk (Details)                          
68: R54         Basis of Presentation and Significant Accounting    HTML     46K 
                Policies - Fixed Assets (Details)                                
69: R55         Basis of Presentation and Significant Accounting    HTML     65K 
                Policies - Revenue Recognition (Details)                         
70: R56         Basis of Presentation and Significant Accounting    HTML     33K 
                Policies - Advertising (Details)                                 
71: R57         Basis of Presentation and Significant Accounting    HTML     51K 
                Policies - Recently Issued Accounting                            
                Pronouncements (Details)                                         
72: R58         Management Agreement (Details)                      HTML     49K 
73: R59         Fair Value Measurements - Assets Measured at Fair   HTML    136K 
                Value (Details)                                                  
74: R60         Fair Value Measurements - Narrative (Details)       HTML     52K 
75: R61         Short-Term Investments (Details)                    HTML     77K 
76: R62         Derivative Instruments and Hedging Activities       HTML     42K 
                (Details)                                                        
77: R63         Inventory (Details)                                 HTML     41K 
78: R64         Software Development Costs and Licenses (Details)   HTML     56K 
79: R65         Fixed Assets, Net (Details)                         HTML     56K 
80: R66         Goodwill and Intangible Assets, Net (Details)       HTML     64K 
81: R67         Goodwill and Intangible Assets, Net (Narrative)     HTML     47K 
                (Details)                                                        
82: R68         Goodwill and Intangible Assets, Net (Amortization   HTML     44K 
                of Intangible Assets) (Details)                                  
83: R69         Goodwill and Intangible Assets, Net (Estimated      HTML     42K 
                Future Amortization) (Details)                                   
84: R70         Accrued Expenses and Other Current Liabilities      HTML     51K 
                (Details)                                                        
85: R71         Debt - Credit Agreement (Details)                   HTML     83K 
86: R72         Debt - 1.75 Convertible Notes (Details)             HTML     34K 
87: R73         Debt - Convertible Debt Information (Details)       HTML     53K 
88: R74         Debt - Interest Expense Components (Details)        HTML     53K 
89: R75         Debt - 1.00 Convertible Notes (Details)             HTML     75K 
90: R76         Earnings Per Share ("Eps") (Details)                HTML     89K 
91: R77         Commitments and Contingencies - Annual Minimum      HTML    137K 
                Obligations (Details)                                            
92: R78         Commitments and Contingencies - Contingent          HTML     33K 
                Consideration (Details)                                          
93: R79         Commitments and Contingencies - Savings Plans and   HTML     38K 
                Income Taxes (Details)                                           
94: R80         INCOME TAXES - Narrative (Details)                  HTML     42K 
95: R81         Income Taxes - Current Income Tax (Details)         HTML    108K 
96: R82         Deferred Taxes (Details)                            HTML     86K 
97: R83         Loss Carryforwards (Details)                        HTML     59K 
98: R84         Income Taxes - Credit Carryforwards (Details)       HTML     36K 
99: R85         Income Taxes - Uncertain Tax Positions (Details)    HTML     54K 
100: R86         Stock-Based Compensation - 2009 Plan (Details)      HTML     37K  
101: R87         Stock-Based Compensation - Compensation Expense     HTML     49K  
                (Details)                                                        
102: R88         Stock-Based Compensation - Narrative (Details)      HTML    136K  
103: R89         Stock-Based Compensation - 2014 Management          HTML     47K  
                Agreement (Details)                                              
104: R90         Stock Activity (Details)                            HTML     76K  
105: R91         Share Repurchase Program (Details)                  HTML     53K  
106: R92         SEGMENT AND GEOGRAPHIC INFORMATION - Narrative      HTML     32K  
                (Details)                                                        
107: R93         Segment and Geographic Information - Revenue by     HTML     48K  
                Geographic Region (Details)                                      
108: R94         Segment and Geographic Information - Revenue by     HTML     42K  
                Product Platform (Details)                                       
109: R95         Segment and Geographic Information - Revenue by     HTML     42K  
                Distribution Channel (Details)                                   
110: R96         Interest and Other, Net (Details)                   HTML     39K  
111: R97         Accumulated Other Comprehensive Income (Loss)       HTML     58K  
                (Details)                                                        
112: R98         Business Reorganization (Details)                   HTML     48K  
113: R99         Supplementary Financial Information (Details)       HTML     62K  
114: R100        Quarterly Financial Information (Unaudited)         HTML     55K  
                (Details)                                                        
115: R101        Acquisitions - Narrative (Details)                  HTML     61K  
116: R102        Acquisitions - Acquisition (Details)                HTML     49K  
117: R103        Acquisitions - Asset and Liabilities Assumed        HTML     60K  
                (Details)                                                        
119: XML         IDEA XML File -- Filing Summary                      XML    219K  
118: EXCEL       IDEA Workbook of Financial Reports                  XLSX    143K  
 9: EX-101.INS  XBRL Instance -- ttwo-20180331                       XML   4.24M 
11: EX-101.CAL  XBRL Calculations -- ttwo-20180331_cal               XML    390K 
12: EX-101.DEF  XBRL Definitions -- ttwo-20180331_def                XML   1.09M 
13: EX-101.LAB  XBRL Labels -- ttwo-20180331_lab                     XML   2.54M 
14: EX-101.PRE  XBRL Presentations -- ttwo-20180331_pre              XML   1.56M 
10: EX-101.SCH  XBRL Schema -- ttwo-20180331                         XSD    272K 
120: ZIP         XBRL Zipped Folder -- 0001628280-18-006877-xbrl      Zip    395K

‘EX-10.55’ — Material Contract

This Exhibit is an HTML Document rendered as filed. [ Alternative Formats ]

<! C: C:

Exhibit

[***] INDICATES MATERIAL THAT WAS OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT WAS REQUESTED. ALL SUCH OMITTED MATERIAL WAS FILED SEPARATELY WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO THE RULES APPLICABLE TO SUCH CONFIDENTIAL TREATMENT REQUEST.

Exhibit 10.55

AMENDMENT NO. 5 TO THE

XBOX ONE PUBLISHER LICENSE AGREEMENT

(MIXER INCENTIVE)

This Amendment to the Xbox One Publisher License Agreement (this “Amendment”) is effective as of September 29, 2017 (the “Amendment Effective Date”), by and between Microsoft Corporation, a Washington corporation (“Microsoft”), and Take-Two Interactive Software, Inc. (“Publisher”), and supplements that certain Xbox One Publisher License Agreement between the parties dated as of October 1, 2013, as amended (the “Xbox One PLA”). This Agreement replaces and supersedes the Amendment No. 5 to the Xbox One Publisher License Agreement (Mixer Incentive) between the parties that was effective September 29, 2017 and executed on December 5, 2017.

RECITALS


A.	Microsoft or its affiliates provide a family of computer game and entertainment systems, including the Xbox One, Xbox One S, Xbox One X and their successors and variants (collectively, “Xbox One”), and an associated proprietary online service (“Xbox Live”).


B.	Publisher is a game developer and publisher of software for computer game and entertainment systems. Publisher intends to develop and/or publish software products for Xbox One on the terms in the Xbox One PLA.


C.	The parties now wish to amend certain terms of the Xbox One PLA as set forth below.

Accordingly, for and in consideration of the mutual covenants and conditions contained herein, and for other good and valuable consideration, receipt of which each party hereby acknowledges, Microsoft and Publisher agree as follows:

1.Definitions. Unless defined in this Amendment, capitalized terms shall have the same meanings as those ascribed to them in the Xbox One PLA. The following definition is hereby deleted and replaced with:

2.52 “WSP” or “Wholesale Price” means [***].

2. Exhibit 1, Section 1 (Table 2). The royalty rates applicable to [***] set forth in Table 2 in Exhibit 1, Section 1 shall be replaced with the following:



Standard Software Title	[***]
Tier 1	[***]
Tier 2	[***]
Tier 3	[***]
Tier 4	[***]
Tier 5	[***]
Tier 6	[***]
Tier 7	[***]
Greatest Hits Software Title
GH Tier 1	[***]
GH Tier 2	[***]

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*currency is US Dollars.

3. Inventory Repurpose Program. Publisher may repackage, refurbish, and/or repurpose and Commercially Release FPUs under a different retail program (e.g., Publisher may repurpose and Commercially Release [***] Standard FPUs as Game of the Year Editions) only as permitted under the requirements of the Inventory Repurpose Program described in the Publisher Guide, which may include administrative fees. This program will be available to Publisher upon Publisher’s execution of this Amendment.

4. Mixer Incentive Program. A new Mixer Incentive Program shall be added as a new Exhibit 10 to the Xbox One PLA, attached hereto.

5. Exhibits. Exhibits 2 and 6 of the Xbox One PLA are hereby amended and restated in their entirety as attached hereto.

Except and to the extent expressly modified by this Amendment, the Xbox One PLA shall remain in full force and effect and is hereby ratified and confirmed. In the event of any conflict between this Amendment and the Xbox One PLA the terms of this Amendment shall control.

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed as of the Amendment Effective Date.



Microsoft Corporation DocuSigned b	Take-Two Interactive Software, Inc. DocuSigned by:
Signature: /s/ *Annie Nendorfer* F732F7CF0E8A4EF...	Signature: /s/ *Dan Emerson* 238DEE6BF4834F0...
Name: Annie Neudorfer	Name: Dan Emerson
Title: Xbox Program Manager	Title: EVP&GC
Date: 1/10/2018	Date: 1/10/2018

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EXHIBIT 2 – XBOX ONE ROYALTY TIER SELECTION FORM

PLEASE COMPLETE, SIGN THE FORM AND SUBMIT VIA EMAIL TO: 3PPOPS@MICROSOFT.COM WITH A CC (COPYING) TO YOUR ACCOUNT MANAGER.


A.	This form must be submitted ten (10) Business Days prior to the first manufacturing order being placed for the Software Title(s) for each respective Sales Territory. For any given Sales Territory, if this form is not submitted on time, exceeds incentive limits, or is rejected by Microsoft, the Royalty Rate will default to Tier 1.


B.	A separate form must be submitted for each Software Title, Sales Territory, and Edition.


C.	This paper form should be used only in instances where XDP Royalty Configuration cannot be used (e.g., sub-publishing, compilations, etc.). For more information, please contact your Account Manager.


1.	Publisher Name: ____________


2.	Xbox One Software Title Name: ____________


3.	Date of First Commercial Release (mm/dd/yy): ____________


4.	Authorized Replicators to be used:



If more than one, please list all (name, location):
Expected Mfg Date:	Volume Forecast:


5.	Retail Edition(s) (choose one): Choose an item. (Reference Edition Type when placing Authorized Replicator(s) orders)

Edition Contents:


6.	Sales Territory: Choose an item.


7.	Select Xbox One Royalty Tier: Choose an item. WSP: _______ SRP (Japan only):_______

To determine the correct Royalty Tier and WSP or SRP (Japan only), please refer to Exhibit 1, Section 1 of the PLA and the Publisher Guide.

For Japan Tier Reduction Incentive Program only - Yes, this Software Title qualifies for the program.


8.	For non-standard editions and compilations only, please provide Software Title Names and Binary IDs below.



Title	Software Title Name	Binary ID
Title 1
Title 2
Title 3
Title 4

The undersigned represents that: (a) this Edition has been approved by Publisher’s Account Manager; (b) he or she has authority to submit this form on behalf of Publisher; (c) the information contained herein is true and accurate; and (d) the stated WSP is the highest at which the Edition will be sold within the Sales Territory, in accordance with the WSP definition in the PLA.

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To avoid manufacturing delays at your Authorized Replicator, your disc manufacturing order, intended for the Japan Tier Reduction Incentive Program must indicate: Xbox One Japan Tier Reduction Incentive Program		By (sign) Name, Title (Print) E-Mail Address (for confirmation of receipt)

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DocuSign Envelope ID: 4C2579D7-B77B-4D46-AF9B-741487D134D7

EXHIBIT 6 – XBOX LIVE INCENTIVE PROGRAM


1.	Xbox Live Incentive Program

In order to encourage Publisher to support Xbox Live functionality and drive increased usage of Xbox Live, Publisher may qualify for certain quarterly incentive payments based on the amount of Xbox Live Share generated by Publisher’s Multiplayer Software Titles.

Each Accounting Period, Microsoft will calculate Publisher’s Xbox Live Share, and if: (i) Publisher is ranked in the [***] in terms of Xbox Live Share with Multiplayer Software Titles in the applicable Accounting Period, (ii) the Multiplayer Subscribers meets or exceeds [***], (iii) the subscription fee for real time Multiplayer Software Titles over Xbox Live is greater than [***] (or region equivalent) per year; (iv) Publisher is up-to-date on all payments owed to Microsoft; (v) Publisher has executed all amendments to the Agreement, and (vi) Publisher is in full compliance with the Agreement, then Microsoft will pay Publisher the quarterly incentive payment set forth in Section 4 below.


2.	Definitions

2.1 “Accounting Period” means each Microsoft [***] within the Program Term, provided that if the Program Term ends within such a [***], then the applicable payment calculation set forth below shall be made for a partial Accounting Period.

2.2 “Day” means a period of twenty-four hours, commencing at midnight and continuing until midnight the following day using Coordinated Universal Time (UTC).

2.3 “Guest(s)” means an individual who accesses Xbox Live and is not a Multiplayer Subscriber or a Subscriber.

2.4 “Multiplayer Game Session” means an instance of synchronous game play in which [***] End Users participate across unique Xbox 360, Xbox One, or Windows Store UWP platform(s).

2.5 “Multiplayer Software Title(s)” means a Software Title for Xbox One, Xbox 360, or Windows Store UWP that supports synchronous multiplayer game play over Xbox Live and initiates a Multiplayer Game Session with participation of [***] Unique Users across unique Xbox 360, Xbox One, or Windows Store UWP platform(s) during an Accounting Period.

2.6 “Multiplayer Subscriber(s)” means the [***] Subscribers during an Accounting Period, each of which must have: (i) [***]; (ii) [***]; and (iii) [***]. If a bundled multiplayer subscription includes multiple paid Xbox Live accounts and gamertags, the number of Multiplayer Subscribers attributable to such multiplayer subscription will be [***]. For avoidance of doubt, [***] will not be counted as Multiplayer Subscribers.

2.7 “Subscriber(s)” means an individual who establishes an account on Xbox Live.

2.8 “Unique Users” means the number of unique Subscribers and Guests per Xbox One, Xbox 360, and/or Windows Store UWP platform(s) who have played a Multiplayer Game Session in a Multiplayer Software Title on Xbox Live during a given Day or calendar month. Each Subscriber or Guest will count as one Unique User for a Multiplayer Software Title per Day or calendar month per Xbox One, Xbox 360, and/or Windows Store UWP platform(s), though there is no limit to the number of Multiplayer Software Titles for which that Subscriber or Guest can be counted as a Unique User.

2.9 “Windows Store UWP(s)” means an Xbox Live-enabled Universal Windows Platform (UWP) Multiplayer Software Title commercially released in the Windows Store.

2.10 “XPA Multiplier” means a multiplier applied to Xbox One Unique Users for qualifying Multiplayer Software Title(s) that support Xbox Play Anywhere (“XPA”) at Commercial Release of the Xbox

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One and Windows Store UWP versions as calculated per the example below. For calendar year 2018, the XPA Multiplier will be [***]


3.	Xbox Live Share. Publisher’s Xbox Live Share will be determined using the following calculation: [***]

“Daily Unique User Share” means the [***] who participated in at least one Multiplayer Game Session on Xbox One, Xbox 360, and/or Windows Store UWP platform(s) within one Day for all of Publisher’s Multiplayer Software Titles aggregated over the Accounting Period divided by [***] who participated in at least one Multiplayer Game Session on Xbox One, Xbox 360, and/or Windows Store UWP platform(s) within one Day for all Multiplayer Software Titles aggregated over the Accounting Period.

“Monthly Unique User Share” means the [***] who participated in at least one Multiplayer Game Session on Xbox One, Xbox 360, and/or Windows Store UWP platform(s) within one calendar month for all of Publisher’s Multiplayer Software Titles aggregated over the Accounting Period divided by [***] who participated in at least [***] Multiplayer Game Session on Xbox One, Xbox 360, and/or Windows Store UWP platform(s) within [***] month for all Multiplayer Software Titles aggregated over the Accounting Period.


4.	Incentive Payment. The incentive payments shall be determined pursuant to Table 1 below and paid each Accounting Period:



Xbox Live Share Rank	Table 1: Incentive Payment
Xbox Live Share Rank	[***]	[***]	[***]	[***]
First	[***]	[***]	[***]	[***]
Second	[***]	[***]	[***]	[***]
Third	[***]	[***]	[***]	[***]
Fourth	[***]	[***]	[***]	[***]
Fifth	[***]	[***]	[***]	[***]

Example. Assume the Average Multiplayer Subscribers for the Accounting Period equaled [***], and Publisher has [***] Multiplayer Software Titles that generated, on aggregate:


•	[***] daily Unique Users (aggregation of each Day in the Accounting Period) on Xbox One, Xbox 360, and Windows Store UWP (inclusive of any XPA Multipliers)


•	[***] monthly Unique Users (aggregation of each calendar month in the Accounting Period) on Xbox One, Xbox 360, and Windows Store UWP (inclusive of any XPA Multipliers)

All Multiplayer Software Titles combined generated, on aggregate:


•	[***] daily Unique Users (aggregation of each Day in the Accounting Period) on Xbox One, Xbox 360, and Windows Store UWP (inclusive of any XPA Multipliers)


•	[***] monthly Unique Users (aggregation of each calendar month in the Accounting Period) on Xbox One, Xbox 360, and Windows Store UWP (inclusive of any XPA Multipliers)

Publisher’s Xbox Live Share would be:

a. [***]

b. [***]

c. [***]

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If the Average Multiplayer Subscribers for the Accounting Period equaled [***] and Publisher is ranked [***] in Table 1, the incentive payment for the Accounting Period will be [***].

Example Illustrating the XPA Multiplier. Assume the Average Multiplayer Subscribers for the Accounting Period equaled [***], and Publisher has one Multiplayer Software Title. The following demonstrates the results of (a) Publisher’s Multiplayer Software Title “A” without an XPA Multiplier, and (b) Publisher’s Multiplayer Software Title “A” with an XPA Multiplier of [***].



Aggregate For the Accounting Period	(a) Multiplayer Software Title “A” (Without XPA Multiplier)	(b) Multiplayer Software Title “A” (With XPA Multiplier [***])
(Xbox One daily Unique Users) + (Windows Store (UWP) daily Unique Users) + (Xbox 360 daily Unique Users)	[***]	[***]
(Xbox One monthly Unique Users) +(Windows Store (UWP) monthly Unique Users) + (Xbox 360 monthly Unique Users)	[***]	[***]
Total	[***]	[***]

Next, assume that All Multiplayer Software Titles combined generated the following, on aggregate:

(a) Without the XPA Multiplier:


•	[***] daily Unique Users (aggregation of each Day in the Accounting Period) on Xbox One, Xbox 360, and Windows Store UWP (inclusive of any XPA Multipliers)


•	[***] monthly Unique Users (aggregation of each calendar month in the Accounting Period) on Xbox One, Xbox 360, and Windows Store UWP (inclusive of any XPA Multipliers)

(b) With the [***] XPA Multiplier:


•	[***] daily Unique Users (aggregation of each Day in the Accounting Period) on Xbox One, Xbox 360, and Windows Store UWP (inclusive of any XPA Multipliers)


•	[***] monthly Unique Users (aggregation of each calendar month in the Accounting Period) on Xbox One, Xbox 360, and Windows Store UWP (inclusive of any XPA Multipliers)

Publisher’s Xbox Live Share would be:

[***]

a. [***]

b. [***]


5.	Payments. In the event Publisher qualifies for an incentive payment under the Xbox Live Incentive Program during an Accounting Period, Microsoft will provide payment for any amount due to Publisher [***] after the end of each Accounting Period.


6.	Other Xbox Live Incentive Program Requirements.

6.1 Multiplayer Software Title simship, feature and content parity. Any Multiplayer Software Title that does not meet the following simship, feature and content parity requirements will not be included in the Xbox Live Share calculation for Publisher:

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6.1.1 [***];

6.1.2 [***]; and

6.1.3 [***].

6.1.4 Each Multiplayer Software Title must be in compliance with the post-Commercial Release hardware feature parity requirements set forth in Section 9.5 of the Agreement on a country-by-country basis where Xbox 360 and/or Xbox One are available.

6.2 Minimum Xbox Live Unique User Threshold. To qualify for the Xbox Live Incentive Program, Publisher’s minimum Unique User total for the applicable Accounting Period must be at least [***] (calculated using an aggregation of all monthly Unique Users for Xbox One and Xbox 360 during the Accounting Period). To qualify for first, second or third place ranking of Xbox Live Share, Publisher’s minimum Unique User total for the applicable Accounting Period must be at least [***] (calculated using an aggregation of all monthly Unique Users for Xbox One, Xbox 360 and Windows Store UWP platform(s) during the Accounting Period).

6.3 Xbox One Unique Users Requirement. Only Xbox One Unique Users that participate in a Multiplayer Game Session, where session-state information was created and maintained on Xbox [***] (as described in the [***]) will be included in the Xbox Live Share calculation for Publisher.

6.4 Windows Store UWP Unique Users Requirement. Only Windows Store UWP Unique Users that participate in a Multiplayer Game Session, where session-state information was created and maintained on Xbox [***] ([***]) will be included in the Xbox Live Share calculation for Publisher.

6.5 Xbox 360 Unique Users Requirement. Only Xbox 360 Unique Users that participate in a presence-enabled Multiplayer Game Session for a Publisher Multiplayer Software Title ([***]) containing two or more Unique Users during an Accounting Period will be included in the Xbox Live Share calculation for Publisher.

6.6 Code to Content Program Participation. Any Multiplayer Software Title that (i) is not subject to an [***]; and (ii) does not meet the [***] will not be included in the Xbox Live Share calculation for Publisher. For all Software Titles that Publisher initially Commercially Released after [***] with a worldwide initial manufacturing order quantity of at least [***] prior to the Software Title’s first Commercial Release in any country, the Code to Content Program Participation requirements are: Publisher must submit (i) the [***]), (ii) the [***] and (iii) [***] in accordance with the [***] and its associated publisher guide. Such submission must be made in order to allow [***] simultaneously with the corresponding [***] on a country-by-country basis.


7.	Program Term, Termination, and Changes. This Xbox Live Incentive Program will commence on January 1, 2018, and will be available until December 31, 2018, unless earlier terminated by Microsoft upon written notice to Publisher (“Program Term”). Microsoft may change or discontinue the Xbox Live Incentive Program by providing Publisher with [***] advance written notice.

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EXHIBIT 10 – MIXER INCENTIVE PROGRAM


1.	Mixer Incentive Program

In order to encourage Publisher to support Native Interactivity and drive increased usage of Mixer, Publisher may qualify for certain [***] incentive payments based on the amount of Mixer Native Interactivity Viewing Share generated by Publisher’s software titles with Native Interactivity, as described in this Exhibit.

Each Accounting Period, Microsoft will calculate Publisher’s Mixer Native Interactivity Viewing Share, and if: (i) Publisher is ranked in [***]Mixer Native Interactivity Viewing Share in the applicable Accounting Period; (ii) the aggregate number of eligible software titles with Native Interactivity [***] (1); (iii) Publisher is up-to-date on all payments owed to Microsoft; (iv) Publisher has executed all amendments to the Agreement, and (v) Publisher is in full compliance with the Agreement (including the requirements of this Mixer Incentive Program), then Microsoft will pay Publisher the quarterly incentive payment set forth in Section 4.


2.	Definitions

(a) “Accounting Period” means each Microsoft [***] within the Program Term, provided that if the Program Term ends within such a [***], then the applicable payment calculation set forth below shall be made for a partial Accounting Period.

(b) “Eligible Native Interactivity Title” means a Native Interactivity Title that (i) is available in the Xbox One Store in addition to any other gaming platforms on which it is available, and (ii) is Xbox Live enabled.

(c) “Native Interactivity” means a software title that integrates with [***] of the Mixer interactive SDKs that implement the Mixer interactive protocol at a game client or service level where such integration enables Mixer viewers to meaningfully participate in gameplay via Mixer interactivity controls.

(d) “Native Interactivity Title(s)” means a software title that supports Native Interactivity during an Accounting Period.

(e) “Native Interactivity Viewing Hour” means [***] of aggregate time spent viewing a Native Interactivity Title on Mixer.

(f) “Official Mixer Channel(s)” means at least [***] official Mixer channel provided and managed by Publisher during the Accounting Period.

(g) “Official Mixer Channel Multiplier” or “Multiplier” means a [***] multiplier applied to the sum of Publisher’s Native Interactivity Viewing Hours for the Accounting Period.

(h) “Program Term” means January 1, 2018 until December 31, 2018.

(i) “Viewing Hour” means [***] of aggregate time spent viewing a software title streamed on Mixer.

(j) “Viewing Hour Share” means the sum of all Viewing Hours for all Publisher’s software titles on Mixer during the Accounting Period divided by the total Viewing Hours for all software titles on Mixer during the Accounting Period.

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3.	Mixer Native Interactivity Viewing Share. Publisher’s “Mixer Native Interactivity Viewing Share” will be the sum of Native Interactivity Viewing Hours for all of Publisher’s Eligible Native Interactivity Titles during the Accounting Period divided by the sum of all Native Interactivity Viewing Hours for all Native Interactivity Titles during the Accounting Period.


4.	Incentive Payment. The amount of each incentive payment shall be determined based on the aggregate number of all Eligible Native Interactivity Titles at the close of each Accounting Period pursuant to Table 1 below. In no event will more than [***] incentive payments be paid each Accounting Period.



Table 1: Incentive Payment
Rank	[***]	[***]	[***]	[***]
First	[***]	[***]	[***]	[***]
Second	[***]	[***]	[***]	[***]
Third	[***]	[***]	[***]	[***]


5.	Examples.

Standard Example. Assume the aggregate number of Native Interactivity Titles for the Accounting Period [***], and Publisher has [***] Eligible Native Interactivity Titles that generated, on aggregate:


•	Title A: [***] Native Interactivity Viewing Hours (aggregation in Accounting Period, inclusive of any Multipliers)


•	Title B: [***] Native Interactivity Viewing Hours (aggregation in Accounting Period, inclusive of any Multipliers)

Next, assume all Native Interactivity Titles combined generated, on aggregate for the Accounting Period, [***] Native Interactivity Viewing Hours (inclusive of any Multipliers).

As a result, Publisher’s Native Interactivity Viewing Share would be: [***]

If the aggregate number of Eligible Native Interactivity Titles for the Accounting Period [***] the incentive payment for the Accounting Period to Publisher would be [***].

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Example illustrating [***] Assume the aggregate number of Eligible Native Interactivity Titles for the Accounting Period equals [***], and Publisher has one Eligible Native Interactivity Title for the Accounting Period. The following demonstrates the results of (a) Publisher’s Eligible Native Interactivity Title “A” without the Multiplier, and (b) Publisher’s Eligible Native Interactivity Title “A” with the Multiplier of [***].



Accounting Period Aggregate	(a) Eligible Native Interactivity Title “A” (Without Multiplier)	(b) Eligible Native Interactivity Title “A” (With Multiplier of [***])
Native Interactivity Viewing Hours	[***]	[***]

Next, assume that all Native Interactivity Titles combined generated the following Native Interactivity Viewing Hours, on aggregate:


•	Without the Multiplier: [***] (aggregation in Accounting Period, inclusive of any Multipliers applicable to other publishers)


•	With the Multiplier: [***] (aggregation in Accounting Period, inclusive of any Multipliers applicable to other publishers)

As a result, Publisher’s Native Interactivity Viewing Share would be:


•	Eligible Native Interactivity Title “A” (without Multiplier) = [***]


•	Eligible Native Interactivity Title “A” (with Multiplier of [*]) = [*]


6.	Payments. In the event Publisher qualifies for an incentive payment under the Mixer Incentive Program during an Accounting Period, Microsoft will provide payment for any amount due to Publisher in US Dollars (USD) within [***] after the end of each Accounting Period.


7.	Other Mixer Incentive Program Requirements.

7.1 Mixer Native Interactivity Title simship, feature and content parity. Each Eligible Native Interactivity Title that does not maintain feature and content parity relative to native interactivity features offered on competitive streaming platforms (e.g., Twitch, YouTube, Facebook), subject to platform limitations, and does not release such native interactivity features on Mixer at least simultaneously with such native interactivity features offered on competitive streaming platforms, will not be included in the Native Interactivity Viewing Share calculation for Publisher.

7.2 Minimum Viewing Hour Share Threshold. To qualify for the Mixer Incentive Program, Publisher’s minimum Viewing Hour Share must be [***] for all software titles on Mixer during the Accounting Period.

7.3 To qualify for the Multiplier, the Official Mixer Channel must broadcast a substantially similar (as determined by Microsoft acting reasonably and in good faith) type and volume of content relative to Publisher’s official channels on Mixer’s competitive platforms (e.g., Twitch, YouTube, Facebook).


8.	Program Term, Termination, and Changes. This Mixer Incentive Program will be available during the Program Term unless earlier terminated by Microsoft upon written notice to Publisher. Microsoft may change or discontinue the Mixer Incentive Program by providing Publisher with [***].

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Dates Referenced Herein and Documents Incorporated by Reference

This ‘10-K’ Filing	Date	Other Filings

	12/31/18	10-Q
Filed as of:	5/17/18
Filed on:	5/16/18	8-K
For Period end:	3/31/18
	1/1/18
	12/5/17	4
	9/29/17
	10/1/13
		List all Filings

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Take Two Interactive Software Inc – ‘10-K’ for 3/31/18 – ‘EX-10.55’

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