Under the terms of the settlement the Company and its directors and officers liability insurer will pay a total of $10,150,000 to the plaintiffs. The Company will record a charge of $2 million for legal and other costs related to this settlement.
At the time the suit was commenced, the Company had purchased directors and officers liability insurance in the amount of $10 million; however the insurer recently questioned its obligation respecting $5 million of the coverage. The Company expects to arbitrate the insurance company's obligation. To the extent the insurance company is not obligated to fund the $5 million in question, the Company would be responsible for the difference.
THQ Inc. is a leading worldwide developer and publisher of interactive entertainment software for a variety of hardware platforms including PC CD-ROM, wireless devices, and those manufactured by Sony Computer Entertainment America Inc., Nintendo and Microsoft. The THQ Web site is located at www.thq.com. The THQ Wireless site is located at www.thqwireless.com.