Japan Tier Reduction Incentive Program. Beginning January 1, 2017, the following new Section 1.7 (Japan Tier Reduction Incentive Program) shall be added to Exhibit 1 of the Xbox One PLA:
Japan Tier Reduction Incentive Program. As of January 1, 2017, and continuing for the duration of the Term (unless otherwise terminated earlier by written notice to Publisher), for Software Titles that are Commercially Released in the Japan Sales Territory and that meet the requirements set forth in Section 1.7.1 of this Exhibit 1, [***].
1.7.1 Program Qualifications for Japan Tier Reduction Incentive Program:
(i) [***];
(ii) [***]
(iii) [***].
1.7.2 FPUs manufactured for the Japan Sales Territory that qualify for this program and in respect of which Publisher pays a reduced royalty rate [***], nor will the Software Titles be permitted to [***] while participating in this program. Such units will be included in the [***]. With respect to any single Software Title, all FPUs manufactured in excess of [***]will be charged the applicable Royalty Tier based on [***].
1.7.3 Publisher shall submit to Microsoft a completed “Xbox One Royalty Tier Selection Form” for the Japan Sales Territory in the form attached to this Agreement as Exhibit 2 (as the same may be updated in the Publisher Guide), at least [***]days prior to the manufacture of FPUs of the Software Title for the Japan Sales Territory (which, if required by the Publisher Guide, shall be done by electronic submission). The Tier selection in such form will be effective only once approved by Microsoft. Microsoft will approve such form, or notify (email sufficient) Publisher of its rejection of such form (and the reasons therefor). If a Software Title that is to be Commercially Released in the Japan Sales Territory is not approved to qualify for the program (e.g., due to Publisher not submitting a completed “Xbox One Royalty Tier Selection Form” in accordance with the Publisher Guide), the royalty rate for such Software Title will [***].
Japan Tier Reduction Incentive Program. [***]
6.1. [***]Program Qualifications for Japan Tier Reduction Incentive Program:
6.1.1. [***]
6.1.2. [***]
6.1.3. [***]
6.2. [***]
6.3. In order to participate in the program, Publisher shall submit to Microsoft a completed “Xbox Console Royalty Tier Selection Form” as specified in the Publisher Guide (which may require electronic submission) for Japan, at least [***] prior to the first manufacturing order being placed for the Software Title. The participation in the program and Tier selection will be effective only once approved by Microsoft. If the Software Title is not approved to qualify for the program (e.g., due to Publisher not submitting a completed “Xbox Console Royalty Tier Selection Form” electronically), the royalty rate for such Software Title will default to Tier 1, regardless of the actual SRP.
Japan Tier Reduction Incentive Program. Unless otherwise terminated earlier by written notice from Microsoft to Publisher, for Software Titles that are Commercially Released in the Japan Sales Territory that meet the requirements set forth in this Section 6, up to [*] of each such Software Title may qualify for the [*] royalty rate set forth in Section 4, Exhibit 2, Table 2 regardless of the royalty rate applicable to the Software Title’s SRP. In the event Microsoft terminates the Japan Tier Reduction Incentive Program, Publisher will be entitled to the reduced royalty rates provided by the program in relation to any Software Title(s) for which Publisher submitted an Xbox One Royalty Tier Selection Form (for Japan) that has been approved by Microsoft prior to receipt of Microsoft’s written notice of termination.
