- 6 - including such well-known entertainment systems as the Sega Genesis, Sony Playstations, and Nintendo Systems, as well as Apple and IBM-compatible computers. EA derived its revenues during the years in issue predominantly from the sale to both U.S. and foreign customers of standardized video game cartridges and compact discs containing entertainment software. Under a license agreement between EA and Sega Enterprises Ltd. (hereinafter sometimes referred to as Sega), dated July 1992, Sega granted to EA and any affiliate controlled by EA a license to use Sega intangible property to develop, manufacture, market, and sell video game cartridges compatible with the Sega Genesis systems. EA distributed products primarily through its own sales force in the United States, which sold directly to retail chains and outlets. Outside the United States, EA distributed its products primarily through affiliates and third-party distributors. Before the years in issue, EA relied on unrelated video game manufacturers located in Taiwan and Japan to manufacture the video games. Beginning in 1991 (during EA’s fiscal 1992), EA became interested in, and investigated the feasibility of, establishing a video game undertaking in Puerto Rico through a wholly owned subsidiary. In 1992, EA engaged Richard Baker as a consultant to provide advice in connection with the investigation andPage: Previous 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Next
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