Share this Page URL

Representations, Warranties, and Indemni... > Developer Warranties - Pg. 202

The Publishing Contract 202 If either party enters bankruptcy, the counterparty will want to be able to continue with the project without intervention from the creditors and bankruptcy court. Both parties will want to be able to terminate for the bankruptcy of the other, with the provision that the agreement and the rights created thereby shall not be deemed assets and that the bankrupt party will not have the right to sell or assign any of the rights created under the contract. These provisions may or may not be effective in bankruptcy court. Rights After Termination Parties often still have involvement with each other even after a contract is terminated, particularly if any of the fruit of the agreement is still making money. Sell-Off Period This is a window, usually six months, for the publisher to sell off all games and merchandise in its pipeline, after which it will no longer have the rights to do so. Rights Reversion The publisher may request a residual percentage of royalties on new entertainment even after re- version, based on the argument that the game launched the property. The parties may negotiate this point. Clauses Added to Most Long Form Contracts Most of these provisions, while important, won't find their way into the short form. Instead, a "future agreement/residual clause" in the short form will note that the parties intend to fill out the short form into a long form agreement, but if they don't, the short form agreement is binding. The "residual clause" states that the long form agreement will include provisions relating to force majeure , as- signment, severability, and lots of other dense little paragraphs like the ones explained in this sec- tion. Representations, Warranties, and Indemnifications Representations and warranties is the section where the parties promise that certain facts upon which the counterparty is relying are true. Indemnifications (see the "Indemnifications" section that follows) is where the parties promise that, if the representations are not true, the offending party will protect the innocent party from the consequences of the misrepresentation. Most representations concern ownership and use of intellectual property. Ideally, representations, warranties, and in- demnifications should mirror each other from publisher to developer and back again. Common Representations and Warranties Both parties will agree that they are legally authorized to enter into the agreement and perform all of their obligations. Developer Warranties You will warrant and represent that: · All IP you attach to the game is wholly owned by you, is reasonably free of bugs, and tothe best of your knowledge (important because otherwise you are liable for infringements of which you were not aware) does not infringe upon the copyrights, trademarks, or other rights of any person, firm, or corporation. · If the IP is yours, you can license the property and its trademarks and copyrights to the publisher without violating any third party's rights or interfering with a contract. An example of where a license could interfere with another contract would be if you were under option to another pub- lisher to offer it your next original IP for a period of 60 days. If you did not offer the IP to the option holder, you could not safely make this representation.