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1
FORWARD-LOO K ING STA T EM ENTS
The statements contained in this Annual Report on Form 10-K that are not historical fac ts may
be “forward-looking statements” wi thin the meaning of the Private Securities Litigation Reform
Ac t of 1995. Such s tatements include, but are not limited to statements regarding indus try
prospect s and fu ture results of operations or fi nancial position. We generally use words such as
“anticipate,” “believe,” “could,” “es timate,” “expec t,” “ forecas t,” “future” “intend,” “may ,” “plan,”
“positioned,” “potential,” “project,” “scheduled,” “set to,” “ subject to, ” “upcoming” and other
similar expressions to help identi fy forward-looking statement s. These forward- looking
statements are based on current expectations , estimates and projections about the business of
TH Q Inc . and its subsidiaries and are based upon management’s current belief s and certain
assumptions made by management . Such forward-looking statements are subjec t to ri sks and
uncertainties that could cause actual results to differ materially from those expressed or implied
by such forward-looking statements, including, but not limited to, business, competi ti ve,
economic , legal, political and technological fac t ors affecting our indus try, operations, markets,
products or pricing. The forward-looking sta tements contained herein speak only as of the date
on which they were made, and we disclaim any obligation to update any forward-looking
statements to reflect e vents or circums tances after the date of thi s Annual Report. Risks and
uncertainties that may af fect our future results include, but are not limited to, those discussed
under the heading “Risk Fa ctors,” included in I t em 1A herein.
All references to “we ,” “us,” “our,” “TH Q,” or th e “Company” in the following dis cussion and
analysi s mean TH Q Inc. and i ts subsidiaries. Most of the properties and ti tles referred to in t his
Annual Report are subject to trademark protection.
P AR T I
Item 1. B usiness
Introduc tion
We are a leading worldwide developer and publisher of interactive entertainment software for all popular
game systems, including:
• home video game consoles such as the Microsoft Xbox 360 (“Xbox 360”), Nintendo Wii (“Wii”), Sony
PlayStation 3 (“PS3”) and Sony PlayStation 2 (“PS2”);
• handheld platforms such as the Nintendo DS and DSi (collectively referred to as “DS”), and Sony
PlayStation Portable (“PSP”);
• wireless devices, including the iPhone, iTouch and iPad; and
• personal computers (“PCs”), including games played online.
We also develop and publish titles for digital distribution via Sony’s PlayStation Network (“PSN”) and
Microsoft’s Xbox LIVE Marketplace (“Xbox LIVE”) and Xbox LIVE Arcade (“XBLA”), as well as digitally offer
our PC titles through online download stores and services such as Steam. We believe that digital delivery of
games and game content is becoming an increasingly important part of our business.
Our titles span a wide range of categories, including action, adventure, fighting, racing, role-playing,
simulation, sports and strategy. We have created, licensed and acquired a group of highly recognizable
brands, which we market to a variety of consumer demographics ranging from products targeted at core
gamers to products targeted to children and the mass market. Our portfolio of Core Games includes games
based on popular fighting brands such as the Ultimate Fighting Championship (“UFC”) and World Wrestling
Entertainment (“WWE”); racing games based on our MX vs. ATV brand; and action, shooter and strategy
games based on our owned intellectual properties such as Company of Heroes, Darksiders, Red Faction,
and Saints Row, as well as games based on Games Workshop’s Warhammer 40,000 universe. Our Kids,
Family and Casual portfolio includes games based on popular brands such as DreamWorks Animation,
Disney•Pixar, Marvel Entertainment, NBC’s
The Biggest Loser
, Nickelodeon, and Sony Picture Consumer