Case MFW Doc 1731 Filed 04/05/18 Page 1 of 8 UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE : : : :

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1 Case MFW Doc 1731 Filed 04/05/18 Page 1 of 8 UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE x In re THQ INC., Debtor x Chapter 11 Case No (MFW) Substantively Consolidated Hearing Date To Be Determined Objection Deadline April 19, 2018 at 400 p.m. (ET) MOTION OF THQ INC. FOR ENTRY OF AN ORDER IN AID OF WIND-DOWN OF THQ INC. S FOREIGN SUBSIDIARIES AND FINDING THE MAXIMUM POTENTIAL RECOVERY BY THQ SOFTWARE DEVELOPMENT (SHANGHAI) CO., LTD. THQ Inc. ( THQI ) hereby files this motion (the Motion ) for entry of an order, substantially in the form attached hereto as Exhibit A (the Proposed Order ), pursuant to sections 105 of title 11 of the United States Code (the Bankruptcy Code ) and the Findings of Fact, Conclusions of Law and Order Confirming Second Amended Chapter 11 Plan of Liquidation of THQ Inc. and its Affiliated Debtors [D.I. 929] (the Confirmation Order ), finding the maximum potential recovery by THQ Software Development (Shanghai) Co., Ltd. ( THQ China ) on account of its claim against THQI in the absence of the settlement agreement between THQI and THQ China. THQI has been advised by its tax professionals that such an order would facilitate the review of THQ China s tax write-off for bad debt by the applicable Chinese tax authorities. Issuance of such an order would therefore advance THQI s liquidation under the Second Amended Chapter 11 Plan of Liquidation of THQ Inc. and its Affiliated Debtors [D.I. 925] (the Plan ) by maximizing creditor recovery and expediting the wind-down The Debtor in this proceeding, along with the last four digits of its taxpayer identification number, is THQ Inc. (1686). The Debtor s current mailing address is Burbank Boulevard, 3rd Floor, Woodland Hills, CA

2 Case MFW Doc 1731 Filed 04/05/18 Page 2 of of THQI s foreign subsidiaries as described in the Status Report of THQ Inc. With Respect to Wind-Down of THQ Inc. s Foreign Subsidiaries, Causes of Action and Derivative Claims, Resolution of Claims and Implementation of the Plan dated December 29, 2017 [D.I. 1726] ( Status Report ). In support of the relief requested herein, THQI relies upon and incorporates by reference herein the Declaration of Amir Agam in Support of the Motion of THQ Inc. for Entry of an Order in Aid of Wind-Down of THQ Inc. s Foreign Subsidiaries and Finding the Maximum Potential Recovery by THQ Software Development (Shanghai) Co., Ltd. (the Agam Declaration ), a copy of which is attached hereto as Exhibit B. In further support of this Motion, THQI respectfully represents as follows JURISDICTION 1. The Court has jurisdiction over this matter pursuant to 28 U.S.C. 157 and 1334(b), and the Amended Standing Order of Reference from the United States District Court for the District of Delaware, dated as of February 29, This is a core proceeding pursuant to 28 U.S.C. 157(b). Venue is proper before this Court pursuant to 28 U.S.C and BACKGROUND A. THQI and the Wind-Down of Its Foreign Subsidiaries. 2. On December 19, 2012 (the Petition Date ), THQI and certain of its wholly owned subsidiaries (the Debtors ) each filed a petition for relief under the Bankruptcy Code with this Court. 3. As of the Petition Date, THQI owned 100% of the equity in THQ International GmbH, a Swiss company ( TIG ), which held certain direct and indirect subsidiaries (together with TIG, the Foreign Subsidiaries ) that historically distributed the Debtors games in countries outside of North America and were involved in the development of 2

3 Case MFW Doc 1731 Filed 04/05/18 Page 3 of 8 video games. THQ China, one of the Foreign Subsidiaries, provided certain services related to the development of video games. All of the Foreign Subsidiaries have either fully liquidated or are in the process of liquidating under the laws of the relevant jurisdiction. 4. As of the Petition Date, THQ China held an intercompany-unsecured claim against THQI in the amount of $2,295,777. On February 19, 2013, THQI filed its Schedules of Assets and Liabilities for THQ Inc. (Case No ) [D.I. 395] and scheduled THQ China s unsecured claim in the amount of $2,295,777. On April 8, 2013, THQ China filed proof of its unsecured claim in the same amount of $2,295,777 [Claim No. 499] ( THQ China s Claim ). 5. On June 21, 2013, the Debtors filed the Debtors Motion for Entry of an Order (I) Equitably Subordinating the Claims of their Foreign Subsidiaries or, in the Alternative, (II) Determining that the Foreign Subsidiaries Claims Should Be Estimated at Zero Dollars for Voting Purposes and the Debtors Should Not Be Required to Reserve for the Foreign Subsidiaries Claims [D.I. 773] (the Subordination Motion ). Pursuant to the Subordination Motion, the Debtors sought, among other things, to equitably subordinate the unsecured claims of the Foreign Subsidiaries, including THQ China s Claim, to the claims of all other creditors. Due to the insolvency of THQI, if the Court granted the relief requested in the Subordination Motion, the Foreign Subsidiaries, including THQ China, would receive no distributions from THQI. 6. On July 16, 2013, the Debtors filed the Plan. 2 On July 17, 2013, the Court entered the Confirmation Order. The Plan became effective on August 2, 2013 (the Effective Date ) [D.I. 1029]. Pursuant to the Plan and Confirmation Order, (i) the Debtors estates were substantively consolidated in accordance with sections 105(a), 541, 1123, and 1129 of the Capitalized terms used but not defined herein shall have the meaning ascribed to such term in the Plan. 3

4 Case MFW Doc 1731 Filed 04/05/18 Page 4 of 8 Bankruptcy Code on the Effective Date, (ii) THQI is the authorized representative of the Debtors consolidated estate and, among other things, had and has the right to settle and compromise any Claims against and Causes of Action of the Debtors without further notice to or approval of the Court; and (iii) the Court retained jurisdiction [t]o hear and determine disputes arising in connection with the interpretation, implementation, or enforcement of the Plan and [t]o resolve any Disputed Claims. Plan, 12.01(h) & (l); see Confirmation Order, at 7, 16, 33 & Pursuant to the authority set forth in the Plan and the Confirmation Order, THQI and TIG (on behalf of THQ China and certain other Foreign Subsidiaries) entered into the Settlement Agreement effective as of February 27, Among other things, the Settlement Agreement provided for a settlement of THQ China s Claim against THQI. Under the Settlement Agreement, THQ China will not receive any distributions from THQI on account of THQ China s Claim and, instead, THQI has established a liquidity fund that THQ China may draw from under certain conditions if, and only if, THQ China does not have sufficient cash to pay all its debts as they become due. 8. On March 5, 2014, THQI filed the Notice of Withdrawal of Motion Regarding Claims of Foreign Subsidiaries [D.I. 1332] (the Notice of Withdrawal ). Pursuant to the Notice of Withdrawal, THQI withdrew the Subordination Motion and submitted certain agreements between THQI and the Foreign Subsidiaries including, among others, the Settlement Agreement. B. Wind-Down of THQ China and Its Tax Liabilities. 9. As described in the Status Report, THQI is liquidating its remaining Foreign Subsidiaries. As part of THQI s efforts to complete the liquidation of THQ China, THQI

5 Case MFW Doc 1731 Filed 04/05/18 Page 5 of filed the Motion of THQ Inc. for Entry of an Order Acknowledging and Approving the Settlement of Claims Between THQ Inc. and THQ Software Development (Shanghai) Co., Ltd. [D.I. 1681] ( Settlement Confirmation Order ), requesting an Order from this Court acknowledging and approving the resolution of THQ China s Claim as set forth in the Settlement Agreement. The Court granted THQI s motion on December 16, 2016 [D.I. 1684]. 10. However, the local tax authorities declined to permit THQ China to write off the full amount of its Claim as worthless debt notwithstanding the Settlement Confirmation Order. THQ China still seeks to maximize tax deductions from the losses arising from the inability of THQI to pay THQ China s Claim. The tax professionals working on behalf of THQI and THQ China have advised THQI that the local Chinese tax authorities require a court order finding that a portion of THQ China s Claim would not have been collected by THQ China, even if the Settlement Agreement were not implemented. In short, THQ China may be entitled to a worthless debt deduction for that portion of THQ China s Claim that THQI could not afford to pay. THQI therefore requests that the Court enter an order finding that the maximum potential amount that THQ China could receive on account of its Claim in the absence of the Settlement Agreement would be no more than 58.5% of its Claim. This request is based on the Agam Declaration, which conservatively forecasts the maximum recovery by THQ China on its Claim. RELIEF REQUESTED 11. By this Motion, THQI seeks entry of the Proposed Order acknowledging the potential recovery of THQ China on its Claim in the absence of the Settlement Agreement. BASIS FOR RELIEF REQUESTED 12. Following the Effective Date, THQI has been coordinating with its remaining Foreign Subsidiaries in the process of liquidating under their relevant jurisdictions. In connection with the liquidation of THQ China and pursuant to the authority set forth in the Plan 5

6 Case MFW Doc 1731 Filed 04/05/18 Page 6 of 8 and Confirmation Order, THQI entered into the Settlement Agreement, under which THQ China will not receive any distribution on account of THQ China s Claim in the amount of $2,295, Also, in accordance with the Settlement Agreement and the Plan, THQ China is working with its tax professionals to consummate an orderly liquidation. THQI was initially advised that the local tax authorities overseeing the liquidation of THQ China would permit certain deductions if this Court entered the Settlement Confirmation Order formally acknowledging and approving the Settlement Agreement. THQI therefore requested, and was granted, entry of the Settlement Confirmation Order. Unfortunately, at this time, the local tax authorities have not accepted the Settlement Confirmation Order along with the Settlement Agreement as a basis for a worthless debt tax deductions based on THQ China s Claim. 14. THQI s tax professionals have advised THQI that the local tax authorities may permit a smaller worthless debt deduction based on a court order finding the amount of THQ China s Claim that would be unrecoverable in the absence of the Settlement Agreement. The tax authorities may permit THQ China to deduct the difference between the full amount of THQ China s Claim and the amount of THQ China s Claim that would have been paid under the Plan had the parties not entered into the Settlement Agreement. Based on the conservative analysis 3 contained in the Agam Declaration, in the absence of the Settlement Agreement, THQ China would recover no more than 58.5% of its unsecured Claim for $2,295,777, or $1,343,030. Therefore, THQI requests the Court find that THQ China would not recover more than $1,343,030 on account of its Claim absent the Settlement Agreement, and, therefore, would have suffered a loss of at least $952,747 had the parties not entered into the Settlement Agreement. Because the calculation of the 58.5% maximum recovery to THQ China includes assumptions The Agam Declaration makes certain assumptions that maximize the amount recoverable by THQ China on its Claim in the absence of the Settlement Agreement, even if THQ China would be likely to recover less. In this instance, conservative assumptions are those that result in a higher recovery to THQ China. 6

7 Case MFW Doc 1731 Filed 04/05/18 Page 7 of 8 designed to conservatively calculate the recovery as high as possible, but also includes the Claim from THQ China as if the Settlement Agreement were not in effect, other creditors should not use this amount as a basis for estimating their eventual recovery. 15. THQI s respectfully requests this finding and entry of the Proposed Order to maximize creditor recovery and expedite distributions to creditors in accordance with the Plan. Under the Plan, all remaining monies from THQ China s liquidation will be distributed to THQI, which will in turn distribute funds to its unsecured creditors. It is likely that THQ China will have no or minimal monies to distribute after liquidation; however, tax savings resulting from entry of the Proposed Order would decrease THQ China s reliance on the pool of liquidity funds from which the Foreign Subsidiaries may draw in winding down their operations. To the extent these funds are not used, they will revert to THQI s unsecured creditors. The potential tax savings resulting from entry of the Proposed Order would therefore be passed onto unsecured creditors. The Proposed Order will also help advance the Plan by furthering resolution of THQ China s potential tax liabilities, the satisfaction of which is a condition precedent to completion of the liquidation and deregistration of THQ China. NOTICE 16. Notice of this Motion has been provided to (a) the Office of the United States Trustee for the District of Delaware, (b) THQ China and (c) all parties requesting notice pursuant to Bankruptcy Rule THQI submits that no other or further notice need be given

8 Case MFW Doc 1731 Filed 04/05/18 Page 8 of 8 WHEREFORE, THQI respectfully requests entry of an Order, substantially in the form attached hereto as Exhibit A, granting the relief requested herein and such other and further relief as is just and proper under the circumstances. Dated April 5, 2018 Wilmington, Delaware /s/ Jaime Luton Chapman Michael R. Nestor (Bar No. 3526) M. Blake Cleary (Bar No. 3614) Jaime Luton Chapman (No. 4936) YOUNG CONAWAY STARGATT & TAYLOR, LLP Rodney Square 1000 North King Street Wilmington, Delaware Telephone (302) Facsimile (302) and- Oscar Garza (Ca No ) Jeffrey C. Krause (Ca No ) GIBSON, DUNN & CRUTCHER LLP 333 South Grand Avenue Los Angeles, California Telephone (213) Facsimile (213) Counsel to THQ Inc

9 Case MFW Doc Filed 04/05/18 Page 1 of 2 UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE x In re THQ INC., Debtor x Chapter 11 Case No (MFW) Substantively Consolidated Hearing Date To Be Determined Objection Deadline April 19, 2018 at 400 p.m. (ET) NOTICE OF MOTION TO (I) THE U.S. TRUSTEE; (II) THQ CHINA; AND (III) ANY PARTY REQUESTING NOTICE PURSUANT TO BANKRUPTCY RULE 2002 On April 5, 2018, THQ Inc. ( THQI ) filed the Motion of THQ Inc. for Entry of an Order in Aid of Wind-Down of THQ Inc. s Foreign Subsidiaries and Finding the Maximum Potential Recovery by THQ Software Development (Shanghai) Co., Ltd. (the Motion ). Objections, if any, to the relief requested in the Motion must be filed with the United States Bankruptcy Court, 824 North Market Street, 3rd Floor, Wilmington, Delaware 19801, on or before April 19, 2018 at 400 p.m. (ET). At the same time, you must also serve a copy of the objection upon the undersigned counsel. A HEARING ON THE MOTION WILL BE HELD ON A DATE AND AT A TIME TO BE DETERMINED BEFORE THE HONORABLE MARY F. WALRATH, UNITED STATES BANKRUPTCY COURT JUDGE, IN THE UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE, 824 NORTH MARKET STREET, 5th FLOOR, COURTROOM 4, WILMINGTON, DELAWARE IF YOU FAIL TO RESPOND IN ACCORDANCE WITH THIS NOTICE, THE COURT MAY GRANT THE RELIEF REQUESTED IN THE MOTION WITHOUT FURTHER NOTICE OR HEARING The Debtor in this proceeding, along with the last four digits of its taxpayer identification number, is THQ Inc. (1686). The Debtor s current mailing address is Burbank Boulevard, 3rd Floor, Woodland Hills, CA

10 Case MFW Doc Filed 04/05/18 Page 2 of 2 Dated April 5, 2018 Wilmington, Delaware /s/ Jaime Luton Chapman Michael R. Nestor (Bar No. 3526) M. Blake Cleary (Bar No. 3614) Jaime Luton Chapman (No. 4936) YOUNG CONAWAY STARGATT & TAYLOR, LLP Rodney Square 1000 North King Street Wilmington, Delaware Telephone (302) Facsimile (302) and- Oscar Garza (Ca No ) Jeffrey C. Krause (Ca No ) GIBSON, DUNN & CRUTCHER LLP 333 South Grand Avenue Los Angeles, California Telephone (213) Facsimile (213) Counsel to THQ Inc

11 Case MFW Doc Filed 04/05/18 Page 1 of 3 Exhibit A Proposed Order

12 Case MFW Doc Filed 04/05/18 Page 2 of 3 UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE x In re THQ INC., Debtor x Chapter 11 Case No (MFW) Substantively Consolidated RE Docket No ORDER IN AID OF WIND-DOWN OF THQ INC. S FOREIGN SUBSIDIARIES AND FINDING THE MAXIMUM POTENTIAL RECOVERY BY THQ SOFTWARE DEVELOPMENT (SHANGHAI) CO., LTD. Upon consideration of the Motion of THQ Inc. for Entry of an Order in Aid of Wind- Down of THQ Inc. s Foreign Subsidiaries and Finding the Maximum Potential Recovery by THQ Software Development (Shanghai) Co., Ltd. (the Motion ); 2 and upon the Agam Declaration; and the Court having found that the Court has jurisdiction over this matter pursuant to 28 U.S.C. 157 and 1334; and the Court having found that this is a core proceeding pursuant to 28 U.S.C. 157(b)(2) and the Amended Standing Order of Reference from the United States District Court for the District of Delaware dated as of February 29, 2012; and the Court having found that venue of this proceeding and the Motion in this district is proper pursuant to 28 U.S.C and 1409; and the Court having found that the relief requested in the Motion is in the best interests of the Debtors consolidated estate, their creditors, and other parties in interest; and the Court having found that THQI provided appropriate notice of the Motion and the opportunity 1 The Debtor in this proceeding, along with the last four digits of its taxpayer identification number, is THQ Inc. (1686). The Debtor s current mailing address is Burbank Boulevard, 3rd Floor, Woodland Hills, CA Capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them in the Motion

13 Case MFW Doc Filed 04/05/18 Page 3 of 3 for a hearing on the Motion under the circumstances; and the Court having determined that the legal and factual bases set forth in the Motion establish just cause for the relief granted herein; and upon all of the proceedings had before the Court; and after due deliberation and good and sufficient cause appearing therefor, IT IS HEREBY FOUND AND DETERMINED THAT A. As of the Petition Date, THQI owed THQ China $2,295,777. B. In the absence of the Settlement Agreement, THQ China would have recovered no more than fifty-eight and one-half percent (58.5%) of THQ China s Claim, which would total no more than $1,343,030, due to the insolvency of THQI. THQ China would have lost at least $952,747 of THQ China s Claim absent the Settlement Agreement. IT IS HEREBY ORDERED THAT 1. The Motion is granted as set forth herein. 2. The terms and conditions of this Order shall be immediately effective and enforceable upon its entry. 3. THQI and its authorized representatives are authorized and empowered to take any and all actions necessary to implement and effectuate the relief granted pursuant to this Order. 4. This Court shall retain jurisdiction with respect to any matters, claims, rights or disputes arising from, based upon or related to this Order

14 Case MFW Doc Filed 04/05/18 Page 1 of 24 Exhibit B Declaration of Amir Agam

15 Case MFW Doc Filed 04/05/18 Page 2 of 24 UNITED STATES BANKRUPTCY COURT FOR THE DISTRICT OF DELAWARE x In re THQ INC., Debtor x Chapter 11 Case No (MFW) Substantively Consolidated DECLARATION OF AMIR AGAM IN SUPPORT OF THE MOTION OF THQ INC. FOR ENTRY OF AN ORDER IN AID OF WIND-DOWN OF THQ INC. S FOREIGN SUBSIDIARIES AND FINDING THE MAXIMUM POTENTIAL RECOVERY BY THQ SOFTWARE DEVELOPMENT (SHANGHAI) CO., LTD. I, Amir Agam, hereby declare, pursuant to section 1746 of title 28 of the United States Code, as follows 1. I am a Senior Managing Director of FTI Consulting, Inc. ( FTI ). THQ Inc. ( THQI ) and certain of its wholly owned subsidiaries (collectively, the Debtors ) retained FTI on or around November 7, 2012, to provide financial advisory and consulting services. FTI has assisted the Debtors in the financial aspects of their restructuring efforts. 2. I submit this declaration in support of Motion of THQ Inc. for Entry of an Order in Aid of Wind-Down of THQ Inc. s Foreign Subsidiaries and Finding the Maximum Potential Recovery by THQ Software Development (Shanghai) Co., Ltd. (the Motion ) Except as otherwise stated, all statements in this declaration are based upon my review of relevant documents, my discussions with THQI and its professionals, including other members of FTI, and my personal knowledge and experience. I am over eighteen (18) years of age and if called upon I would competently testify to each of the facts set forth below. 4. I have more than 19 years of experience advising corporations and other constituents on restructuring transactions. I have been one of the individuals at FTI primarily 1 The Debtor in this proceeding, along with the last four digits of its taxpayer identification number, is THQ Inc. (1686). The Debtor s current mailing address is Burbank Boulevard, 3rd Floor, Woodland Hills, CA All capitalized terms not otherwise defined herein shall have the meaning ascribed to such terms in the Motion.

16 Case MFW Doc Filed 04/05/18 Page 3 of 24 responsible for day-to-day discussions with THQI relating to general restructuring and liquidation advice, analysis of prior operations and cash flow, the disposition of THQI s remaining assets, and the claims reconciliation and objection process, including the reconciliation and resolution of the claims of the Foreign Subsidiaries. 5. THQI is a Delaware corporation that, as of the Petition Date, owned 100% of the equity in TIG, which held certain direct and indirect subsidiaries (together with TIG, the Foreign Subsidiaries ) that historically distributed the Debtors games in countries outside of North America and were involved in the development of video games. THQ China provided certain services related to the development of video games. All of the Foreign Subsidiaries have either fully liquidated or are in the process of liquidating under the laws of the relevant jurisdiction. 6. THQI scheduled the unsecured claim of THQ China in the net amount of $2,295, THQ China also filed a proof of claim in the net amount of $2,295, A copy of the Proof of Claim is attached hereto as Exhibit After confirmation of the Plan and the effective date of the Plan, THQI and certain of the Foreign Subsidiaries, including TIG on behalf of THQ China, entered into the Settlement Agreement. A true and correct copy of the Settlement Agreement is attached hereto as Exhibit Currently, in accordance with the Settlement Agreement, THQ China is in the process of a liquidation including, among other things, working with its tax professionals to complete an orderly out-of-court liquidation. I am informed by professionals working with THQI and THQ China that the foreign tax authorities overseeing the liquidation of THQ China will not permit certain deduction for worthless debt based on the Settlement Agreement and the Order Approving the Treatment of THQ China s Claim Pursuant to the Settlement Agreement Between THQ Inc. and THQ China. 9. Based on the advice of THQI s tax professionals, it also my understanding that the local Chinese tax authorities may permit certain deductions for worthless debt based on the portion of THQ China s Claim that would be unrecoverable in the absence of the Settlement Agreement on account of the insolvency of THQI. 2

17 Case MFW Doc Filed 04/05/18 Page 4 of I have analyzed the sources of recovery and outstanding claims of unsecured creditors, including the potential recoveries to the unsecured creditors if THQ China s Claim was not impacted by the Settlement Agreement. Attached hereto as Exhibit 3 is a summary of projected accumulation of cash from various additional sources of recovery, and the resulting percentage distribution to general unsecured creditors holding allowed claims. In performing my analysis for the purpose of the relief requested by the Motion, I made assumptions that favored a higher recovery by THQI than that which is reasonably expected which in turn would lead to a higher eventual distribution to unsecured creditors with outstanding claims. Among other sources of recovery, I took into account currently available funds for unsecured creditors, release of unused operating reserve amounts, distributions from various Foreign Subsidiaries to THQI, and release of certain other reserves. Finally, I included approximately $800,000 in additional recoveries as an additional cushion. There is no identified source for the $800,000, but this was added to decrease the likelihood that THQI would ever be able to exceed the recoveries shown in this analysis. 11. Based on the settlement of THQ China s Claim under the Settlement Agreement, THQ China will not receive a distribution on account of THQ China s Claim. The premise of the settlement with THQ China was that THQ China was solvent such that any amount paid to THQ China would be returned to THQI by dividend at the conclusion of THQ China s liquidation, which would have a negligible impact on the overall percentage distribution to THQI s unsecured creditors. For this reason the liquidation analysis described herein is a simplified model that provides an aggressive projection of the maximum amount THQI s unsecured creditors would receive in the absence of the Settlement Agreement with THQ China. 12. Taking into account the assumptions and analysis described above, THQI s general unsecured creditors 3 would receive approximately $78.9 million in cumulative general unsecured distributions to satisfy the aggregate allowed unsecured claim amount, including a claim of 3 This excludes certain one-time payments that were made as part of settlements to resolve general unsecured claims. 3

18 Case MFW Doc Filed 04/05/18 Page 5 of 24 $2,295,777 for THQ China, of approximately $134.8 million. The unsecured distributions to THQI s general unsecured creditors, including THQ China, would constitute no more than fiftyeight and one-half percent (58.5%) of the total unsecured claim base. In other words, under the assumptions made in the analysis above, THQI s general unsecured creditors will suffer a loss of at least forty-one and one-half percent (41.5%) of their claims due to the insolvency of THQI. Therefore in the absence of the Settlement Agreement, THQ China would potentially have recovered no more than fifty-eight and one-half percent (58.5%) of its $2,295, unsecured Claim, or $1,343,030. It would have lost at least $952,747 based on THQI s insolvency, if THQ China had not entered into the Settlement Agreement. Pursuant to 28 U.S.C. 1746, I declare under penalty of perjury that the foregoing is true and correct. Dated April 4, 2018 Amir Agam 4

19 Case MFW Doc Filed 04/05/18 Page 6 of 24 Exhibit 1 THQ China Proof of Claim

20 Case MFW Doc Filed 04/05/18 Page 7 of 24

21 Case MFW Doc Filed 04/05/18 Page 8 of 24

22 Case MFW Doc Filed 04/05/18 Page 9 of 24 Exhibit 2 Settlement Agreement

23 Case MFW Doc Filed 04/05/18 Page 10 of 24 AGREEMENT TO ESTABLISH LIQUIDITY RESERVE FOR THQ INTERNATIONAL GMBH PENDING FINAL LIQUIDATIONS 1. Parties. This Agreement is entered into by and among THQ Inc. ("THQI"), and THQ International GmbH ("TIG"), on behalf of itself and the following direct and indirect subsidiaries of TIG THQ Italy, THQ Interactive Entertainment Espana SL, THQ Korea, Ltd., THQ China and THQ Japan K.K. (collectively the "TIG Subsidiaries"), effective February 27, 2014 (the "Effective Date"). THQI and TIG are referred to herein individually as a "Party" and collectively as "Parties." 2. Recitals. 2.1 T~-IQI filed a voluntary chapter 11 petition on December 19, 2012 (the "Petition Date") in the United States Bankruptcy Court for the District of Delaware (the "Bankruptcy Court"). 2.2 TIG and the TIG Subsidiaries have each filed a proof of general unsecured claim or are deemed to have filed such a proof of unsecured claim against THQI in the amounts set forth in E~ibit A, which is attached hereto and incorporated herein by this reference (collectively, the "TIG Claims"). Each of the TIG Subsidiaries has been or will soon be fully liquidated and its claims against THQI have been or will soon be transferred to TIG upon final liquidation of each such TIG Subsidiary. TIG has received from the following TIG Subsidiaries a transfer of the claims against THQI previously owned by those TIG Subsidiaries in the amounts set forth in E~ibit "A" attached hereto THQ Italy, THQ Interactive Entertainment Espana SL, THQ Korea, Ltd., and THQ Japan K.K. These claims against THQI shall be referred to herein as the "Former TIG Subsidiaries' Claims." 2.3 The parties currently believe that TIG and each TIG Subsidiary is solvent, based on inquiries to date and subject to solvent liquidation procedures of TIG and each TIG Subsidiary, but propose to establish the TIG Liquidity Fund (as defined below) to provide TIG and the TIG Subsidiaries with additional liquidity pending their final liquidation and the transfer of the TIG Claims to THQI. 2.4 THQI filed the Amended Chapter 11 Plan of Liquidation of THQ, Inc. and its Affiliated Debtors on May 28, 2013, and on July 15, 2013, TIG, the TIG Subsidiaries and several other affiliates, filed a joint objection to confirmation (the "Confirmation Objection"). THQI filed its Second Amended Chapter I1 Plan of THQ Inc. and Its Affiliated Debtors, dated July 16, 2013 ("Plan"), which responded to the Confirmation Objection by providing, inter alia, that creditors would receive post-petition interest before any surplus is distributed to the Stock Trust (as defined in the Plan) for the benefit of equity holders if THQI has sufficient proceeds to pay all creditors in full. The Bankruptcy Court entered its Findings of Fact and Conclusions of Law, and Order Confirming Second Amended Chapter 11 Plan of Liquidation of THQ Inc. and its Affiliated Debtors (the "Confirmation Order"). NOW, THEREFORE, the Parties agree as follows

24 Case MFW Doc Filed 04/05/18 Page 11 of Lipuidity Reserve in Lieu of Claims Litigation. 3.1 THQI will withdraw its motion to subordinate the TIG Claims in THQI's chapter 11 cases with prejudice and will not object to the TIG Claims. The TIG Claims shall be Allowed Claims as defined in the Plan. 3.2 TIG and the THQ China will retain the TIG Claims they currently own, but no reserves will be required with respect to the TIG Claims and no distributions will be made on account of the TIG Claims at this time, pending the anticipated transfer of the TIG Claim, the anticipated transfer of THQ China and THQ China's Claim against THQI to THQI, and the transactions described below. 33 TIG shall declare a cash dividend to THQI in an amount equal to the Former TIG Subsidiaries' Claims. Once that dividend has been declared and all necessary steps have been completed under Swiss law for payment of that dividend, in lieu of paying that dividend in cash the amount of that dividend shall be setoff against the Fortner TIG Subsidiaries' Claims in full and final satisfaction of the Former TIG Subsidiaries' Claims. 3.4 THQI shall establish a segregated cash account in the amount of $1,000,000 (the "TIG Liquidity Fund"). The TIG Liquidity Fund shall be deposited into a segregated account at a financial institution to which THQI and TIG mutually agree with the financial institution confirming that it has no rights to the TIG Liquidity Fund and is unable to exercise any rights of set-offwith respect thereto. 3.5 Except for the situation described in section 3.9, THQI shall have no right to draw on the TIG Liquidity Fund or to have all or any portion of the TIG Liquidity Fund released. 3.6 TIG and each TIG Subsidiary shall have the right to draw on the TIG Liquidity Fund if, and only if, TIG or that TIG Subsidiary does not have sufficient cash to pay all of its debts as they become due. Subject to paragraph 3.7, TIG and each TIG Subsidiary can draw up to its pro rata share of the TIG Liquidity Fund based on the ratio of the balance of that entity's claim divided by all of the TIG Claims. 3.7 To draw money from the TIG Liquidity Fund, TIG or a TIG Subsidiary shall deliver to THQI (i) a list of the debts that are due, (ii) evidence that the cash held by that entity is insufficient to pay the debts that are due or expected to be due, and (iii) a calculation showing the portion of the TIG Liquidity Fund to which that entity is entitled, which has not yet been drawn. Upon the appointment of a liquidator over TIG or any TIG Subsidiary (a "Liquidator") any Liquidator shall succeed to the right of TIG or that TIG Subsidiary to request cash from the TIG Liquidity Fund. THQI shall have no right to object to the request of TIG, a TIG Subsidiary or a Liquidator for a draw on the TIG Liquidity Fund as long as THQI receives the information required by (i), (ii) and (iii) above. 3.8 If the remainder of the TIG Liquidity Fund available to TIG or any one TIG Subsidiary has not been used by that entity or its Liquidator when that entity has paid its debts in full and completed its liquidation, the unused portion of the TIG Liquidity Fund will then be reallocated to TIG and the other TIG Subsidiaries on a pro rata basis based on the 2

25 Case MFW Doc Filed 04/05/18 Page 12 of 24 aggregate amount of the TIG Claims of those entities that are not yet fully and completely liquidated. For avoidance of doubt, THQ Italy and THQ Interactive Entertainment Espana SL have paid all their debts in full and are completely liquidated. 3.9 The remaining balance in the TIG Liquidity Fund that is not used by TIG, TIG Subsidiaries, or Liquidators will be released to THQI after the liquidations of TIG and all of the TIG Subsidiaries are completed. 4. Solvent Dissolution and Liquidation of TIG and the TIG Subsidiaries. TIG and each of the TIG Subsidiaries will comply with the applicable law of its subject jurisdiction to commence and complete the solvent liquidations currently underway. They will use their assets to pay their debts as they become due. 5. Directors and Officers Insurance. THQI will obtain or has obtained a tail for claims made for a period of not less than six (6) years after the effective date of the Plan on the directors and officers insurance policy that it had prior to the Effective Date of the Plan. The parties will use their best efforts to obtain not less than $5,000,000 of Directors and Officers insurance after the effective date of the Plan and THQI and TIG shall continue, as far as permissible by applicable law, to indemnify each officer and director of TIG and each TIG Subsidiary so long as that officer or director is serving for TIG or a TIG Subsidiary. For the avoidance of doubt, it is agreed between the Parties that the directors and officers of TIG and each TIG Subsidiary shall have or may obtain further and additional Directors and Officers insurance payable by TIG or the TIG Subsidiaries on terms that they consider in their absolute discretion to be reasonable. 6. Release. THQI and TIG shall execute the General Release attached hereto as Exhibit B and incorporated herein by this reference, which will exclude (i) the TIG Claims, (ii) any claims TIG or the TIG Subsidiaries may have against any insurance policy owned by the Debtors (as defined in the General Release) covering officers and directors of TIG or the TIG Subsidiaries, including any tail coverage purchased and for indemnification as provided in paragraph 5, above, (iii) claims against the TIG Liquidity Fund; and (iv) claims-for actions which occur in the future. 7. No Bankruptcy Court Approval Necessary. THQI represents that it is authorized pursuant to the Plan to enter into and execute this Agreement, and that this Agreement will be effective without approval of the Bankruptcy Court. THQI further represents that it can bind the Stock Trustee and the Litigation Trustee to this Agreement as set forth in paragraph 8.6. THQI shall file a copy of this Agreement with the Bankruptcy Court within 5 business days of the Effective Date. 8. Miscellaneous. 8.1 Entire Agreement. This Agreement represents the entire agreement and understanding among the Parties with respect to the transactions contemplated herein. This Agreement supersedes all prior agreements, understandings, arrangements, covenants, representations or warranties, written or oral, by any officer, employee or representative of either Party dealing with the subject matter hereof.

26 Case MFW Doc Filed 04/05/18 Page 13 of Waiver. Any waiver by any Party of any breach or of a failure to comply with any provision of this Agreement (a) shall be valid only if set forth in a written instrument signed by the Party to be bound; and (b) shall not constitute, or be construed as, a continuing waiver of such provision, or a waiver of any other breach of, or failure to comply with, any provision of this Agreement. 8.3 Amendment. This Agreement may be amended only by a written agreement signed by duly authorized representatives or officers of each of the Parties. 8.4 Exuenses. Each Party shall be responsible for its own expenses incurred in connection with the preparation of this Agreement, the performance of its obligations hereunder and the consummation of the transactions contemplated hereby. 8.5 Third Parties. Nothing contained in this Agreement, express or implied, is intended to or shall be construed to confer upon or give to any person, firm, corporation, association, labor union or trust (other than the Parties, their Affiliates and their respective permitted successors and assigns), any claims, rights or remedies under or by reason of this Agreement. 8.6 Successors. This Agreement shall be binding upon any successor in interest to any Party, including, without limitation, the Litigation Trustee and Stock Trustee (as defined in the Plan) and any Liquidator appointed over TIG or any TIG Subsidiary. 8.7 Headings. The headings contained in this Agreement are inserted for convenience only and shall not be deemed to constitute a part of this Agreement. 8.8 Counterparts. More than one counterpart of this Agreement may be executed by the Parties, and each fully executed counterpart shall be deemed an original. 8.9 Governing Law. This Agreement shall be construed and enforced in accordance with the laws of the State of California, without giving effect to rules governing the conflict of laws; provided, however, that nothing contained herein will alter the applicable law of each jurisdiction with respect to the contemplated liquidations of TIG and each TIG Subsidiary in accordance with the laws of the jurisdiction of its formation Enforcement of Agreement. The Parties hereto agree that irreparable damage would occur in the event that any provision of this Agreement is not performed in accordance with its specific terms or where otherwise breached. It is accordingly agreed that the Parties shall be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereof, this being in addition to all other remedies available at law or in equity. 4

27 Case MFW Doc Filed 04/05/18 Page 14 of 24

28 Case MFW Doc Filed 04/05/18 Page 15 of 24 IN WITNESS W~-ICREOf~, the Parties have caused this Agreement to be executed by their duty authorized at~'icers. Dated i'ebruary~!, 20t4 THQ Inc. Name C L Kw ~. Its ~~.L.a~ Dated E'ebruary, THQ International GmbH ny Name Its fi

29 Case MFW Doc v ~; 1' X ~# `*~ u~ t 9i!Y k ~ X. lac ~' t*~-w d;d~~ a~n~rrs,r'er~.~cx~s. c ~,S l ~t,.vu~r, Filed 04/05/18 Page 16 of 24 ~ c ca~a~ ~#~ c ~ir~enene if~ ~+c r..~~a<! h} 1 ~rii a a hrmj }~ttirrwr~ T-~71i ~?. m r ~ A m'' ~_ y~~~.. ~~ ~

30 Case MFW Doc Filed 04/05/18 Page 17 of 24 Exhibit A TIG's Claims' Claim Claimant Name Type Amount No. N/A THQ Italy Unsecured 1,047,x THQ International GmbH Unsecured 5,2?7, THQ Interactive ~nt~;rtainment Espana SL Unsecured 2,346, l I THQ C11ina Unsecured 2,295, THQ Korea Ltd. Unsecured 1,05$, TIIQ Japan K.K. Unszcured 88, In connection with the respective liquidations of THQ Italy, THQ China, THQ Japan K.K. and TIG Interactive Entertainment Espana SL, each of their respective claims against THQI has been transferred by dividend to THQ International GmbH.

31 Case MFW Doc Filed 04/05/18 Page 18 of 24 EXHIBIT B GENERAL RELEASE

32 Case MFW Doc Filed 04/05/18 Page 19 of 24 Mutual Release This Release is entered into by and among THQ Inc. ("THQI"), THQ Digital Studios Phoenix, Inc., THQ Wireless Inc., Volition Inc. and Vigil Games, Inc. (together with THQI, collectively, "Debtors"), on the one hand, and (i) THQ International GmbH ("TIG") on behalf of itself and THQ Italy, THQ Interactive Entertainment Espana SL, THQ Korea, Ltd., THQ China and THQ Japan K.K., and (ii) THQ (UK) Limited, (iii) T.HQ (Holdings) Limited, (iv) THQ France S.a.r.l. ("THQ France"), and (v) THQ Entertainment GmbH ("THQ Germany" and, together with TIG, collectively, the "Subsidiaries"), on the other hand, effective February _, 2014 (the "Effective Date"), pursuant to the Agreement to Settle and Satisfy Transfer Pricing Claims and Establish Liquidity Reserve for Subsidiaries Pending Final Liquidations and the Agreement to Establish Liquidity Reserve for THQ International GmbH Pending Final Liquidations (collectively, the "Distribution Agreements"). The Debtors and the Subsidiaries are referred to herein individually as a "Party" and collectively as "Parties' NOW, THEREFORE, for and in consideration of the mutual covenants and promises set forth in the Distribution Agreements, and for good and valuable consideration, the receipt of which is hereby acknowledged, the Debtors and the Subsidiaries, intending to be fully bound, hereby agree as follows 1. Release by the Subsidiaries. Each of the Subsidiaries, on behalf of itself and any other party, person, or entity claiming under or through it, hereby releases, acquits and forever discharges the Debtors and all of the Debtor's officers,.directors, employees, agents, representatives and attorneys, for all time periods on or prior to the Effective Date, from any and all claims, demands, obligations, liabilities, damages, costs, fees and expenses, actions, causes of action, or suits at law or in equity, of whatever kind or nature, known or unknown, suspected to exist or not suspected to exist, anticipated or not anticipated, excluding only the following (i) the claims filed or deemed to be filed by the Subsidiaries in the Debtors' chapter 11 cases (which shall be dealt with in the manner described in the Distribution Agreements), (ii) any claims relating to or arising out of any insurance policy owned by the Debtors, including any tail coverage purchased and for indemnification as provided in the Distribution Agreements, (iii) claims under the Distribution Agreements, including, without limitation, claims against the Main Liquidity Fund, the German Liquidity Fund, the French Liquidity Fund, and the TIG Liquidity Fund; and (iv) claims for actions which occur after the Effective Date. 2. Release by the Debtors. Each of the Debtors, on behalf of itself (as a debtor and reorganized debtor), its estate and any other party, person or entity claiming under or through it, including, but not limited to the Litigation Trustee and the Stock Trustee (as those terms are defined in the Distribution Agreements) hereby releases, acquits and forever discharges each of the Subsidiaries and all officers, directors, employees, agents, representatives and attorneys of each of the Subsidiaries, for all time periods on or prior to the Effective Date, from any and all claims, demands, obligations, liabilities, damages, costs, fees and expenses, actions, causes of action, or suits at law or equity, of whatever kind or nature, known or unknown, suspected to exist or not suspected to exist, anticipated or not anticipated (collectively, "Claims"), excluding only the following (i) any Claims relating to or arising out of any insurance policy owned by the Debtors, including any tail coverage purchased and for indemnification as provided in the Distribution Agreements, (ii) Claims under the Distribution

33 Case MFW Doc Filed 04/05/18 Page 20 of 24 Agreements, including, without limitation, Claims to the surplus in the Main Liquidity Fund, if any, as provided in the Distribution Agreements; (iii) Claims against THQ Germany and THQ France for transfer pricing limited to the dollar amounts set forth in the Settlement Agreement; and (iv) Claims for actions which occur after the Effective Date. For the avoidance of doubt, the Claims released shall include (x) all Claims of the Debtors and the Debtors' estates under the United States Bankruptcy Code, including, but not limited to Claims that can be brought under or through chapter 5 of the United States Bankruptcy Code, and (y) all Claims in any way relating. to the billing which was or could have been issued by any Debtor to any Subsidiary for any period prior to the Effective Date, including, but not limited to invoicing for transfer pricing, except as provided in 2(iii) of this Release. 3. Waiver of Section 1542 or Similar Law. It is the intention of the Parties in executing this Release that once the releases are effective the Release shall be effective as a bar to each and every claim, demand, and causes of action that the Parties may have against one another arising prior to the Effective Date except as to the obligations and rights created pursuant to the Distribution Agreements and the Claims specifically excluded from the releases, above. In furtherance of this intention, the Parties hereby expressly waive any and all benefits or rights conferred by the provisions of Section 1542 of the California Civil Code, or any similar provision of California law, federal law, or the law of any other state now in effect in effect in the future. The Parties hereby expressly consent that this Release shall be given full force and effect according to each and all of its express terms and conditions, including those related to unknown and unsuspected claims, demands, and causes of action, if any, as well as those relating to any other claims, demands, and causes of action specified above. Section 1542 of the California Civil Code provides as follows A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH THE DEBTOR. 4. Representations. Each Party represents that it has full authority to execute and perform its obligations under this Release. Each person who executes this Release on behalf of a Party hereto represents that he or she is duly authorized to execute this Release on behalf of such Party. 5. Governing Law and Jurisdiction. This Release shall be construed in accordance with the laws of the State of California. 6. Binding on Successors. This Release and the rights and obligations created hereby shall be binding upon and shall inure to the benefit of the heirs, successors, transferees, and assigns of the Parties hereto, including the Stock Trustee and the Litigation Trustee (as those terms are defined in the Distribution Agreement) as well as any subsequent trustee appointed in any Debtor's bankruptcy case.

34 Case MFW Doc Filed 04/05/18 Page 21 of Execution in Counterparts. This Release may be executed in any number of counterparts and by different Parties in separate counterparts, each of which when so executed and delivered shall be deemed to be an original and all of which taken together shall constitute but one and the same instrument. Delivery of an executed counterpart of a signature page by facsimile or PDF transmission shall be effective as delivery of a manually executed counterpart. IN WITNESS WHEREOF, the undersigned have executed, or have caused to be executed, this Release as of the day and year first written above. Dated February ~ 2014 THQ Inc. By Name Its Dated February _, 2014 THQ Digital Studios Phoenix, Inc., By Name Its Dated February _, 2014 THQ Wireless Inc. By Name Its Dated February _, 2014 Volition Inc. By Name Its Dated February _, 2014 Vigil Games, Inc. By Name Its Dated February _, 2014 THQ (UK) Limited By Name Its 3