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THQ Announces Settlement of Class Action Lawsuit

by Thomas on Dec. 23, 2002 @ 3:54 p.m. PST

THQ Inc. today announced that agreement in principle has been reached to settle the class action lawsuit first filed against the Company in February 2000. The settlement remains subject to negotiation of a final written agreement between THQ and the plaintiffs, as well as court approval.

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.

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