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                  ELECTRONIC PUBLISHING DEVELOPMENT AGREEMENT

         This Electronic Publishing Development Agreement (this "Agreement"), is
made as of February 26, 1998 (the "Effective Date"), by and among American
Greetings Corporation, an Ohio corporation ("AG"), AGC, Inc., an Ohio
corporation ("AGC" and, together with AG, the "AG Parties"), and Mindscape, Inc.
a Delaware corporation ("Mindscape"). Except where the context otherwise
requires, the term "AG Parties" is to be read as if it was a single party to
this Agreement.

                                   Background

A.   Mindscape is in the business of developing, marketing, publishing and
     distributing computer software applications; and

B.   The AG Parties are in the business of development, marketing, publishing
     and distributing social expression products; and

C.   The parties' objective is to use their respective strengths and work
     together to produce several American Greetings/Mindscape co-branded
     software products.


                                   Agreements

         NOW, THEREFORE, the parties, intending to be legally bound, agree as
follows (capitalized terms herein not otherwise defined being used as defined in
Section 9):


1.   PRODUCT DEVELOPMENT AND MARKETING.

     1.1. OVERVIEW. Subject to the terms and conditions hereof, the parties
          agree to cooperate with the goal of developing, marketing, publishing
          and selling co-branded personal computer software and content pack
          products in the Full Feature Print Creativity Category and in various
          user and feature focused subcategories thereof, and in the Greeting
          Card Category. In addition to marketing through traditional channels,
          the parties agree to work together to develop an online distribution
          strategy for the products sold hereunder. The categories of products
          to be developed and published and the intended time table for product
          introductions is set forth on Exhibit A hereto.

     1.2. MINDSCAPE ROLE.

         1.2.1.   Mindscape shall publish the Approved Products and shall carry
                  out the manufacturing, distribution, software development,
                  product design, marketing, and sales for all Approved Products
                  (except for marketing and sales through AG Channels).

         1.2.2.   Mindscape agrees to pursue an aggressive marketing strategy
                  with respect to Unlockable Content Packs. Mindscape shall
                  include Unlockable Content Packs on all Approved Products sold
                  by Mindscape, and as



<PAGE>   2

                  mutually agreed on approved versions of PrintMaster and other
                  Mindscape product CD's.

1.3.     AG ROLE.


         1.3.1.   AG shall provide content and marketing expertise, digitized
                  artwork and content (including the licensing to Mindscape as
                  provided hereafter of certain proprietary copyrighted material
                  and Trademarks) as may be agreed among the parties for all
                  Approved Products developed hereunder.

         1.3.2.   The AG Parties shall be permitted (but not required) to
                  purchase Approved Products for marketing and sale through AG
                  Channels.

1.4.     PRODUCT DEVELOPMENT OVERVIEWS.

1.4.1.   For each Listed Product to be developed hereunder, Mindscape shall
         prepare a development plan overview (the "Product Development
         Overview") in consultation with the AG Parties identifying, in
         reasonable detail: a specification of all product features, systems
         requirements, content specifications, resource allocations, the
         development schedule (detailing milestones from project launch at least
         to product launch), content deliverable schedules and the tasks and
         resources generally required of each party. Except as otherwise agreed
         by the parties, each Product Development Overview shall be consistent
         with the overall timeline set forth on Exhibit A.

1.4.2.   The Product Development Overview shall also identify one or more
         individuals from each party to serve as Product Development Manager for
         each party to serve as the primary point of contact and coordination
         between the parties with respect to any Listed Product. Each party may
         change its designation upon notice to the other.

1.4.3.   Each Product Development Overview shall be at a level of detail that
         provides overall project guidance and a timeline for major milestones.
         It shall not be required to detail project tasks comprehensively and
         shall not limit operational or implementation flexibility. The Product
         Development Overview shall be a summary of, but shall not necessarily
         contain all the detail of, the operational product development plan.

1.4.4.   Each Product Development Overview shall be in writing and signed by the
         parties hereto. When a Product Development Overview is signed by the
         parties it shall become a part of this Agreement and the parties shall
         timely carry out their respective obligations under the Product
         Development Overview in accordance with its terms and the terms of this
         Agreement. No Product Development Overview shall be deemed to amend or
         modify any contrary term herein unless specific reference to this
         Section 1.4.4 is made therein and specifically agreed to (by initialing
         or other reasonable means) by duly authorized officers of the parties
         hereto.


                                       2


<PAGE>   3

                  1.4.5.   Prior to marketing any Listed Product resulting from
                           the activities under a Product Development Overview,
                           each party shall each have the right to review and
                           approve relevant materials in connection with each
                           Listed Product. The AG Parties shall be entitled to
                           review and approve the following: (i) at the alpha
                           stage:[
                                                                     ], (ii) at
                           the beta stage:[







                                                                           ] and
                           (iii) at or before product launch, the final
                           implementation of the foregoing items. Subject to the
                           provisions of paragraph 10.14, the parties shall each
                           use commercially reasonable efforts to provide the
                           other with approval within ten (10) business days of
                           the date it receives a request for approval, but no
                           public announcement, marketing or sales shall be made
                           until such final approval is given and the form and
                           content of any announcement is mutually agreed upon
                           by the parties. Upon approval by both parties hereto
                           of all materials for a Listed Product, the Listed
                           Product shall be considered an Approved Product. Any
                           subsequent non-trivial changes or additions to
                           materials approved for an Approved Product shall
                           require the further approval of both parties.

         1.5.     TERMS OF END-USER SALES.

                  1.5.1.   The parties shall cooperate in good faith to
                           establish an End User License Agreement ("EULA")
                           incorporating reasonable terms, conditions and
                           procedures on which Approved Products may be sold so
                           as to protect the Intellectual Property rights and
                           commercial interests of the parties hereto, which
                           terms, conditions and procedures may limit the means
                           by which Approved Products are "sold" so that such
                           products are intended to be licensed rather than
                           sold. Neither party shall sell or otherwise
                           distribute Approved Products other than by means
                           reasonably calculated to make the EULA effective and
                           references herein to "sales" of Approved Products
                           shall refer to such transactions.

2.       EXCLUSIVITY.

         2.1.     GENERAL NON-EXCLUSIVITY. Except as specifically set forth in
                  this Section 2, this Agreement and the rights granted herein
                  shall be non-exclusive and neither party shall be restricted
                  in any way from developing, marketing or selling any product
                  or service.[






                                                 ]



                                       3
<PAGE>   4

         2.2.     SPECIFIC EXCLUSIVE RIGHTS.

                 [



















































                                                                           ]

                  2.3.     END OF EXCLUSIVITY. Notwithstanding Section 2.2, the
                           AG Parties may market, sell, license Creative Content
                           for and otherwise distribute a product in the
                           categories listed on Exhibit A if

         2.3.1.   in the case of Listed Products in any category, (i) a Product
                  Development Overview has been agreed to for a Listed Product
                  in a category and

                                       4

<PAGE>   5

                           (ii) sales of an Approved Product in such category
                           have not commenced within [        ] after the launch
                           date specified on Exhibit A; or

                  2.3.2.   in the case of Listed Products in the [
                                  ], an Approved Product has been in existence
                           for at least [       ] and such Listed Product is not
                           within the top [   ] products in the United States
                           marketplace in its category as reported by [
                                                        ]; or

                  2.3.3.   in the case of Listed Products in categories other
                           than the [                    ], (i) either (x) sales
                           of an Approved Product in such category have not
                           commenced or (y) sales of an Approved Product in such
                           category have commenced, but an updated version of
                           such Approved Product has not begun selling for the
                           current Fiscal Year and (ii) Mindscape commences
                           sales of a Listed Product in such category that is
                           not an Approved Product; or

                  2.3.4.   in the case of a Listed Product in any category that
                           is principally designed for use in one of the
                           languages listed on Exhibit B, sales of an Approved
                           Product have not commenced within [        ] of the
                           commencement of sales of an Approved Product in that
                           category that is principally designed for use in the
                           English language.

                  [









                                                                           ]

3.       PAYMENTS, REVENUE SHARE, GUARANTEES.

         3.1.     OVERALL GUARANTY. The overall minimum royalties payable by
                  Mindscape hereunder shall be [



                                                                           ]

         3.2.     INITIAL LICENSE FEE. On the date hereof, Mindscape shall pay
                  AGC a single nonrefundable trademark licensing fee of [
                                             ]. This fee shall not be creditable
                  against any other minimum payments due hereunder.

         3.3.     ROYALTIES.

                  3.3.1.   ROYALTY RATES. Mindscape shall pay the following
                           royalties to AGC with respect to all sales of
                           Approved Products (including, without limitation,
                           products sold to AG):

                           i.       [  ]% of the wholesale price received less
                                    returns, credits, allowances, discounts and
                                    rebates, before any reduction of direct


                                       5


<PAGE>   6

                  Coat of Goods Sold, on all Approved Products sold direct to
                  retail at a suggested retail price of $[     ] and above;

         ii.      [  ]% of the wholesale price received less returns, credits,
                  allowances, discounts and rebates, after reduction for the
                  direct Cost of Goods Sold on all Approved Products sold direct
                  to retail at a suggested retail price under $[     ];

         iii.     [  ]% of the direct to consumer price received less returns,
                  credits, allowances, discounts and rebates, after Direct Cost
                  of Goods Sold on all Approved Products sold direct to
                  consumers by mail and/or electronic fulfillment;

         iv.      [  ]% of the direct to consumer price received less returns,
                  credits, allowances, discounts and rebates, after Direct Cost
                  of Goods Sold on Unlockable Content Packs;

         v.       [  ]% of net revenues received from distribution of products
                  that are OEM Versions of Approved Products, except as follows:

         vi.      in the case of any OEM Version of the [               ] that
                  contains any content provided by the AG Parties, [ ]% of net
                  revenues; and

         vii.     in the case of an OEM Version produced for [
                                                                          ] a
                  percentage of net revenues as mutually agreed in good faith
                  but in no event less than [  ]%; and

         viii.    [     ] for each unit of [        ] that is sold containing AG
                  Content;

3.3.2.   ADVANCES AND MINIMUMS. For each product category listed on Exhibit C,
         Mindscape shall pay AGC the amounts set forth with respect to such
         product category set forth on such Exhibit. Such minimum payments for
         products in the [                      ] shall be required in the
         specified Fiscal Year, whether or not a Product Development Overview or
         Approved Product is produced for such category in such Fiscal Year.
         Minimums shall be reviewed as provided in Section 3.3.5. Minimum
         payments shall be made for each product category in [
                     ] due as follows:
         i.   Upon agreement to the Product Development Overview for such
              product;

         ii.  Upon final approval of the Approved Product;

         iii. Upon first shipment of the Approved Product; and

         iv.  [                       ] after first shipment of the Approved
              Product;

                                        6

<PAGE>   7

         provided, however, that, subject to Section 3.3.5, the full amount of
         the minimum payments due for any Fiscal Year shall, if not previously
         paid, be due and payable on the first business day of the last full
         calendar week of that Fiscal Year.

3.3.3.   MINIMUM INCREASES. Effective upon the approval, pursuant to Section
         1.4.5 of an Approved Product principally designed for a language listed
         on Exhibit B, the minimum royalty hereunder for that Approved Product's
         category may be increased or decreased based on the parties' respective
         expenses incurred in producing such version, as is mutually agreed.

3.3.4.   REPORTING AND PAYMENT. Unless otherwise agreed in writing, Mindscape
         shall provide to AGC, within [           ] days after the close of each
         calendar [       ], commencing after the first full calendar [       ]
         after the Effective Date, a written report of royalties accrued during
         the prior [       ] for each product category hereunder, any amounts
         advanced pursuant to Section 3.3.2 against such royalties and the net
         amount of royalties owed. Payment of such net amount shall be made
         within [         ] days of the end of the quarter. Mindscape shall have
         the right to withhold [                 ] of royalties payable for each
         calendar quarter as a reserve against refunds, returns and other
         credits as provided above. This reserve shall be reconciled and the
         following quarterly report In addition, Mindscape shall also provide
         AGC with a monthly report within 5 days of the end of each month of
         estimated product shipped within such month.

3.3.5. CROSS-APPLICATION OF ADVANCES AND MINIMUMS.

         i.       Royalties in excess of the minimums payable for any Approved
                  Product within any category [
                           ] may be applied against the advances and minimums
                  paid in any other category [
                           ] (such other category referred to as the "Shortfall
                  Category") so long as either (i) an Approved Product in the
                  Shortfall Category has commenced shipping and, if applicable,
                  has been updated to the current Fiscal Year or (ii) any delay
                  in the development of an Approved Product in the Shortfall
                  Category was due to action or inaction by AG or (iii) AG
                  consents.

         ii.      Each Fiscal Year, no later than March 31, the parties shall
                  meet and confer regarding the requirements of Section 3.3.2
                  and the categories in which it is advisable to develop and
                  launch Approved Products. In the event that market conditions
                  in certain categories and/or product development delays have
                  adversely affected royalties hereunder for that Fiscal Year,
                  then the minimums for that Fiscal Year may be deferred into
                  the next Fiscal Year to the extent mutually agreed, provided
                  that in no event shall any deferral of minimums extend beyond
                  the Term.

                                       7

<PAGE>   8



         3.3.6.   BUNDLE ALLOCATION. Mindscape shall not sell or otherwise
                  distribute Approved Products together with other products as a
                  single-priced bundle (a "Bundle") without the prior written
                  approval of the AG. [










                                                                           ]

3.4.     RECORDS AND INSPECTION RIGHTS. Mindscape shall keep and maintain proper
         records and books of account relating to Mindscape's marketing and
         sales of all products containing AG Content and the accounting of
         royalties hereunder. AG may inspect such records to verify rendered
         statements but not more than once in any 12 month period. Any such
         inspection will be conducted after reasonable notice of at least 10
         business days and during regular business hours at Mindscape's offices
         in a manner that does not unreasonably interfere with Mindscape's
         business activities. Such inspection shall be at AG's cost and expense;
         provided, however, if the audit reveals overdue payments in excess of
         [              ] of the payments owed to date, Mindscape shall pay the
         reasonable cost of such audit.

3.5.     SALES TO AG.

         3.5.1.   Mindscape shall sell up to [    ] copies of each Approved
                  Product to AG at a price not exceeding that product's Direct
                  Cost of Goods Sold for promotional purposes only and not for
                  resale. Such purchases shall not be eligible for a royalty. In
                  addition, Mindscape shall supply AG with at least [  ] free
                  copies of each Approved Product upon first shipment of each.

         3.5.2.   Mindscape shall sell to AG or to its foreign licensees such
                  quantity as AG requests of Approved Product for resale by AG
                  through AG Channels at a price [
                                            ]

3.6.     CERTAIN CREDITS. Mindscape shall be entitled to a credit against
         royalties otherwise becoming due hereunder in excess of the Threshold
         Amount for a Fiscal Year up to a maximum of $[        ] per Fiscal Year
         commencing in the [      ] year of the term hereof, up to an aggregate
         maximum of $[        ]. The "Threshold Amount" for a Fiscal Year is the
         aggregate minimum payments required by Section 3.3.2 and Exhibit C for
         that Fiscal Year for each Listed Product other than the Listed Product
         in the [                                               ] and [
                                            ] categories (as such categories are
         described on Exhibit A); provided that if there is an Approved Product
         in either or both of such categories then the Threshold Amount shall
         also include the minimum payments



                                       8

<PAGE>   9

                  required by Section 3.3.2 and Exhibit C for that Fiscal Year
                  for either or both such categories.

4. TERM AND TERMINATION.

         4.1.     TERM. The Term of this agreement ("Term") shall be from
                  February 1, 1998 to [               ], subject to extension as
                  provided below.

         4.2.     RENEWAL BY MINDSCAPE.

                  4.2.1.   Mindscape may, by written notice to AG prior to the
                           expiration of the Term, extend the Term to [
                                  ] if the total royalty payments to AG pursuant
                           to Section 3.3 for periods prior to [               ]
                           exceed $[        ], and for the twelve month period
                           ending [               ], exceed $[        ].

                  4.2.2.   Mindscape may, by written notice to AG prior to the
                           expiration of the Term, extend the Term of this
                           agreement to [              ] if the total royalty
                           payments to AG pursuant to Section 3.3 for periods
                           prior to [               ] exceed $[        ], and
                           for the twelve month period ending [               ],
                           exceed $[        ].

         4.3.     JOINT RENEWAL. The Term may also be extended by the mutual
                  written agreement of the parties.

         4.4.     TERMINATION.

                  4.4.1.   Either party may terminate this Agreement if the
                           other fails to perform any material term or condition
                           of this Agreement and such failure continues for a
                           period of [              ] following receipt of
                           written notice ("Breach Notice") thereof by the
                           breaching party; provided, however, that if the
                           breach is not susceptible of cure within such [
                             ] period termination shall be effective upon notice
                           or such later date as is provided in the notice,
                           except as provided in the next sentence. If the
                           breach is a "Channel Breach" then cure will be deemed
                           effective if the party in breach (i) has diligently
                           commenced to cure in good faith and continues
                           thereafter to pursue such cure diligently (ii)
                           effects a cure within [      ] of receipt of the
                           Breach Notice. A "Channel Breach" is a breach
                           consisting solely of a matter which may be cured only
                           by replacement of Approved Product already delivered
                           to distributors.

                  4.4.2.   Either party may terminate this Agreement immediately
                           if (1) the other commences a voluntary case or other
                           proceeding under any bankruptcy or insolvency law, or
                           seeks the appointment of a trustee, receiver,
                           liquidation, custodian or similar official of all or
                           any substantial part of its property, or (2) an
                           involuntary case or other proceeding under any
                           bankruptcy or insolvency law seeking the appointment
                           of a trustee, receiver, liquidator, custodian, or
                           similar official for all or any substantial part of
                           the other party's property, is commenced against the
                           other party, and the other party consents to any
                           relief requested, or such proceeding is not stayed or



                                       9

<PAGE>   10

                           discharged within [         ] days, or (3) the other
                           party makes a general assignment for the benefit of
                           creditors or fails generally to pay its debts as they
                           become due.

                  4.4.3.   Either party may terminate this Agreement upon [
                              ] written notice in the event of a change in
                           control of the other party [





                                                         ]. In the event of any
                           such termination by the AG parties, Mindscape will be
                           entitled to be reimbursed in the full amount of any
                           unrecouped advances paid to the AG Parties pursuant
                           to Section 3.3.2(i) and (ii) with respect to Approved
                           Products that have not yet been shipped.

         4.5.     POST TERMINATION SALES. Upon termination or expiration of this
                  Agreement by either party, either party shall have, for a
                  period of [     ] months, the right to sell, subject to the
                  royalties provided for herein, all of the unsold Approved
                  Products in such party's inventory as of the date of
                  termination up to the Permitted Quantity of each Approved
                  Product; provided, however, that prior to disposing of such
                  unsold Approved Products, each party shall give the other an
                  itemized statement of all such unsold Approved Products. The
                  "Permitted Quantity" of an Approved Product shall be [
                        ] of the quantity of that Approved Product sold by that
                  party during the [    ] calendar months immediately preceding
                  the date of termination.

         4.6.     SURVIVAL. Sections 4, 6.1.1(v), 6.1.2(iii), 6.1.3, 6.1.4, 6.3,
                  7 and 8 shall survive the termination or expiration of this
                  Agreement.

5.       PRODUCT TRANSITION.

         1.       LIMITATIONS PRIOR TO SEPTEMBER 1, 1999. Notwithstanding
                  anything to the contrary herein, the parties agree that in no
                  event will they incorporate any AG Intellectual Property into
                  any computer software product designed and marketed primarily
                  for the in-home printing of Social Expression Products in the
                  English or Japanese languages prior to September 1, 1999.

         2.       SALES OF THIRD PARTY INVENTORY. The AG Parties further agree
                  that, should any third party royalties paid to the AG Parties
                  with respect to the sale of unsold inventories of now existing
                  American Greetings branded software products in the Greeting
                  Card Category exceed $[     ] for the [ ] month period
                  commencing [             ], then the minimum royalty payment
                  for such category for such period, as set forth on Exhibit C
                  shall be deemed reduced for the Fiscal Year ending [
                         ] by the amount of such excess, but not exceeding a
                  total reduction of $[         ].

         5.3.     REGISTRATION DATABASE. To the extent that the AG Parties are
                  legally able to do so, it shall give Mindscape reasonable
                  access to its database of customer names which


                                       10

<PAGE>   11

                  has been accumulated from software registration of the
                  CreataCard series of products.

6.       PROPRIETARY RIGHTS.

         6.1.     LICENSING AND OWNERSHIP.

                  6.1.1.   AG GRANT OF RIGHTS.

                  i.       AGC grants Mindscape a license under the AG
                           Copyrights to copy and distribute the AG Delivered
                           Content during the Term solely in Approved Products
                           in the form and in accordance with the marketing
                           plans approved by AG pursuant to the applicable
                           Product Development Overview and Section 1.4.5.

                  ii.      AGC grants Mindscape a license under the AG
                           Trademarks to use the AG Trademarks during the Term
                           on the packaging, documentation and promotional
                           materials used in conjunction with and to identify
                           Approved Products, such Trademarks to be used in the
                           form and in accordance with the marketing plans
                           approved by AG pursuant to the applicable Product
                           Development Overview and Section 1.4.5.

                  iii.     The foregoing licenses shall be exclusive to the
                           extent (but only to the extent) so provided in
                           Article 2 hereof.

                  iv.      Pursuant to the license granted in clause (i) above,
                           but subject to the approval, royalty and other
                           requirements of this Agreement, during the Term,
                           Mindscape may: (a) incorporate the AG Delivered
                           Content into the Approved Products; (b) edit or
                           otherwise modify the AG Delivered Content and create
                           derivative works of the AG Delivered Content for
                           solely for inclusion in Approved Products; (c)
                           prepare translations and conversions of the Approved
                           Products, solely to the extent such translations and
                           conversions constitute Approved Products; (d)
                           reproduce the Approved Products; (e) sell, marker,
                           distribute for rental, and otherwise distribute the
                           Approved Products; and (f) publicly display and
                           perform the Approved Products incidental to the
                           promotion and sale of the Approved Products.

                  v.       Mindscape acknowledges that nothing herein shall give
                           to Mindscape any right, title or interest in any AG
                           Intellectual Property (including any modifications,
                           translations, transformations or other derivative
                           works thereof) except the rights specifically granted
                           in this Article 6; and that any and all goodwill
                           generated by use of the AG Trademarks shall inure to
                           the benefit of AG.

                  vi.      The rights granted Mindscape under this Article 6
                           shall include the right to sublicense these rights to
                           third parties in connection with the localization and
                           distribution of foreign language versions of any


                                       11


<PAGE>   12

                  Approved Product and for the distribution of any Approved
                  Product through the OEM channel, subject to the approval
                  rights of the AG Parties contained in this Agreement and
                  provided that such third parties agree to adhere to the rights
                  and obligations imposed on Mindscape hereunder with respect to
                  the protection of AGC's Intellectual Property rights.

6.1.2.   MINDSCAPE GRANT OF RIGHTS.

         i.       Mindscape grants the AG Parties a license to use and
                  distribute the Approved Products.

         ii.      Pursuant to the license granted in clause (i) above, the AG
                  Parties may; (a) sell, market, distribute for rental, and
                  otherwise distribute the Approved Products; and (b) publicly
                  display and perform the Approved Products incidental to the
                  promotion and sale of the Approved Products.

         iii.     AG acknowledges that nothing herein shall give to the AG
                  Parties any right, title or interest in any Mindscape
                  Intellectual Property (including any modifications,
                  translations, transformations or other derivative works
                  thereof) except the rights specifically granted in this
                  Article 6 and except to the extent that any AG Intellectual
                  Property is incorporated therein.

6.1.3.   DEVELOPMENTS. To the extent there is developed, conceived, invented or
         otherwise created any new Intellectual Property as a result of
         activities hereunder involving material participation by both parties
         hereto:

         i.       to the extent it (i) consists of a [

                                                                ] or (ii)
                  otherwise constitutes [              ], then, to such extent,
                  such Intellectual Property shall be the property of and is
                  hereby assigned to [ ]; and

         ii.      to the extent it consists of [

                                                                             ]
                  then to such extent, such Intellectual Property shall be the
                  property of and is hereby assigned to [       ], and

         iii.     to the extent it consists of any other Intellectual Property,
                  other than [                                         ] rights
                  therein, to such extent, such Intellectual Property shall be
                  the property of and is hereby assigned to [       ], subject
                  to a fully paid, perpetual, assignable (but only to any
                  current or future Affiliate of [ ]) license, with the right to
                  sublicense (other than to a [                         ]),
                  which is hereby granted to the [        ] to use, copy,
                  modify, display and perform such Intellectual Property and to
                  make, have made, use, sell and import any invention,

                                       12
<PAGE>   13

                  product or process embodied in such Intellectual Property,
                  provided that such license may be exercised only in connection
                  with the [




                                   ]; and

         iv.      to the extent it consists of product names and the
                  Intellectual Property rights therein ("Names"), to such
                  extent, such Intellectual Property shall be the [
                                     ] and is hereby assigned to [
                                  ], but subject to the following:

                  a.       [
                                                                    ]

                  b.       [




                               ]

                  c.       [



                                                               ]

         6.1.4.   RESTRICTIONS ON TRADEMARK USE. Neither party shall take any
                  action that would undermine, conflict with or be contrary to
                  the other's rights and interest in its Trademarks. Each parry
                  acknowledges the other's exclusive ownership of such other's
                  Trademarks, and this Agreement does not grant either party any
                  right, title or interest in or to the other's Trademarks other
                  than the license granted herein. Each party shall have the
                  right to control the nature and quality of the Approved
                  Products, as well as all packaging, display, promotional and
                  advertising materials that bear such party's Trademarks
                  pursuant to the terms of the applicable Product Development
                  Overview. Pursuant to such tight, any materials developed by
                  either party that use the other's Trademarks shall be subject
                  to the prior written approval of the panty owning the
                  Trademarks. The Approved Products and all packaging,
                  advertising and promotional materials, including on-line and
                  other screen displays, shall include such copyright, trademark
                  and other intellectual property notices as are specified by
                  the parties to each other. Mindscape shall manufacture, have
                  manufactured, package, label, sell, distribute, advertise and
                  promote the Approved Products in conformity with AG's
                  reasonable marketing guidelines and practices as set forth in
                  Exhibit D, as modified by AG from time to time with written
                  notice


                                       13


<PAGE>   14

                  to and approval of Mindscape (such approval not to be
                  unreasonably withheld) and in accordance with all applicable
                  laws and regulations.

6.2.     REGISTRATION INFORMATION. All product registration information (names,
         addresses, e-mail address) from all Approved Products (excluding
         PrintMaster and other Mindscape products containing Unlockable Content
         Packs, but not excluding products containing an Unlockable Content Pack
         that has been unlocked) shall be [
                 ]. Each month during the Term, Mindscape shall deliver a copy
         of all such information received the prior month in an electronic
         format reasonably requested by the AG Parties.

6.3.     CONFIDENTIAL INFORMATION.

         6.3.1.   Each party agrees that, with respect to Confidential
                  Information of the other party that it obtains hereunder it
                  shall:

                  i.       not disclose such Confidential Information

                  ii.      use the same care and discretion to prevent
                           disclosure of such Confidential Information as it
                           uses with similar Confidential Information of its own
                           that it does not desire to disclose, but in no event
                           with less than a reasonable degree of care;

                  iii.     receive such Confidential Information and use such
                           Confidential Information only for the purposes and
                           within the scope of this Agreement; and

                  iv.      restrict disclosure of Confidential Information
                           solely to its officers, directors, employees and
                           advisors (collectively, "Representatives") who have a
                           need to know and agree or are bound not disclose such
                           Confidential Information to any third parties.

         6.3.2.   The foregoing restrictions shall not apply to information
                  that:

                  i.       is or hereafter becomes part of the public domain
                           through no wrongful act, fault or negligence on the
                           part of the recipient;

                  ii.      the recipient can reasonably demonstrate, was already
                           in its possession and not subject to an existing
                           agreement of confidentiality;

                  iii.     is received from a third party without restriction
                           and without breach of this Agreement;

                  iv.      was independently developed by the recipient as
                           evidenced by its records; or

                  v.       recipient is required to disclose pursuant to a valid
                           order of a court or other governmental body;
                           provided, however, that the recipient shall first
                           have given notice to the disclosing party and shall
                           give the disclosing party a reasonable opportunity to
                           interpose an objection or obtain a protective order
                           requiring that the Confidential



                                       14
<PAGE>   15

                           Information so disclosed be used only for the
                           purposes for which the order was issued.

         6.3.3.   All notes, data, reference manuals, sketches, drawings,
                  memoranda, electronic media and records in any way
                  incorporating or reflecting any Confidential Information of
                  the disclosing party and all proprietary rights therein shall
                  belong exclusively to such disclosing party and the recipient
                  agrees to return all copies of such materials to the
                  disclosing party as soon as reasonably practicable upon
                  request or upon termination or expiration of this Agreement.

         6.3.4.   Unless required by law or otherwise mutually agreed by the
                  parties, neither of the parties shall disclose the terms of
                  this Agreement. Each party may, however, disclose such terms
                  to its officers, directors, employees, shareholders, outside
                  counsel and auditors who have a need to know and are advised
                  of the nondisclosure requirements contained herein, whether or
                  not they remain employed or affiliated with that party.

7.       REPRESENTATIONS AND WARRANTIES.

         7.1.     RECIPROCAL. Each party represents and warrants that (i) it has
                  corporate power and authority to enter into and perform this
                  Agreement; (ii) it is the sole author or authorized licensee
                  of its intellectual property delivered to the other party
                  pursuant to this Agreement; (iii) the intellectual property
                  delivered by it to the other party hereunder does not and will
                  not infringe or misappropriate any third party proprietary
                  right.

         7.2.     MINDSCAPE. Mindscape represents and warrants that the Approved
                  Products will documentation function in accordance with and
                  other specifications thereof and will not contain any viruses
                  or other similar codes that may be reasonably expected to
                  damage data, software, systems or operations of the users of
                  such products.

         7.3.     DISCLAIMERS. EXCEPT AS EXPRESSLY PROVIDED HEREIN, EACH PARTY
                  DISCLAIMS ALL OTHER WARRANTIES, EXPRESS OR IMPLIED, INCLUDING
                  WITHOUT LIMITATION THE IMPLIED WARRANTIES OF MERCHANTABILITY
                  AND FITNESS FOR A PARTICULAR PURPOSE.

8.       LIABILITY AND INDEMNITY.

         8.1      INDEMNIFICATION. Each party ("Indemnifying Party") agrees
                  that, at its own expense, it shall defend or settle any
                  action, claim, suit or proceeding ("Claim") brought against
                  the other or the other's directors, officers, affiliates,
                  employees or agents (collectively "Indemnified Parties") based
                  upon the Indemnifying Party's breach or alleged breach of any
                  representation or warranty contained herein. In addition, the
                  Indemnifying Party shall indemnify and hold harmless the
                  Indemnified Parties from and against any and all damages,
                  liabilities, losses, settlement amounts and any other costs
                  and expenses (including but not limited to reasonable
                  attorneys' fees), incurred as a result of any such Claim. The
                  Indemnified Parties shall provide the Indemnifying Party with
                  prompt written notification of any Claim,



                                       15


<PAGE>   16

                  with sole control over the defense, and with reasonable
                  cooperation in the defense of any such Claim at the
                  Indemnifying Party's expense.

         8.2.     LIMITATION ON LIABILITY. NEITHER PARTY SHALL BE LIABLE
                  HEREUNDER FOR ANY LOSS OF PROFITS, INCIDENTAL OR CONSEQUENTIAL
                  DAMAGES, EVEN IF THE OTHER PARTY HAS BEEN ADVISED OF THE
                  POSSIBILITY OF SUCH DAMAGES. THE LIABILITY OF EITHER PARTY FOR
                  ANY CLAIM CONCERNING PERFORMANCE OR NONPERFORMANCE BY THE
                  OTHER (EXCLUDING CLAIMS FOR PERSONAL INJURY OR BREACH OF
                  INTELLECTUAL PROPERTY RIGHTS) PURSUANT TO, OR IN ANY WAY
                  RELATED TO, THE SUBJECT MATTER OF THIS AGREEMENT, REGARDLESS
                  OF THE FORM OF ACTION, WHETHER IN CONTRACT OR IN TORT,
                  INCLUDING NEGLIGENCE OR STRICT LIABILITY, SHALL BE LIMITED TO
                  THE GREATER OF (i) 4.25 MILLION DOLLARS OR (ii) THE AGGREGATE
                  ROYALTIES PAID HEREUNDER OVER THE 12 MONTH PERIOD PRECEDING
                  THE EVENTS GIVING RISE THE CLAIM.

9.       DEFINITIONS.

         9.1.     "Affiliate" of an entity shall mean any other entity
                  controlled by, in control of, or under common control with
                  such first entity.

         9.2.     "AG Channels" shall mean websites and online stores of the AG
                  Parties, any AG direct mail programs as may be agreed among
                  the parties, and in any AG traditional retail in-store
                  greeting card departments.

         9.3.     "AG Delivered Content" shall mean the images, text and
                  characters delivered by AG to Mindscape pursuant to Product
                  Development Overviews hereunder.

         9.4.     "AG Trademarks" shall mean the trademarks specifically
                  identified on Exhibit E hereto.

         9.5.     "AG Copyrights" shall mean the copyright in AG Delivered
                  Content.

         9.6.     "Approved Products" shall mean software products developed
                  pursuant to a Product Development Overview hereunder and
                  approved pursuant to Section 1.4.5.

         9.7.     "Confidential Information" shall mean oral or written
                  information, of whatever kind and in whatever form, relating
                  to past, present or future products, software, research,
                  development, inventions, processes, techniques, designs or
                  other technical information and data, and marketing plans,
                  provided that such information has been reasonably identified
                  as or could be reasonably considered to be proprietary or
                  confidential, that either party (a) may have received prior to
                  the date of this Agreement, whether directly from the other or
                  indirectly from third parties, or (b) may receive hereunder
                  from the other.

         9.8.     "Creative Content" shall mean images, text and characters of a
                  nature similar to any contemplated by the parties to become AG
                  Delivered Content.


                                       16


<PAGE>   17

         9.9.     "Direct Cost of Goods Sold" shall mean the direct cost to
                  source, manufacture (including reasonable manufacturing
                  overhead and obsolescence), (including royalties paid to third
                  parties in connection with the licensing of third party
                  intellectual property). Direct Cost of Goods Sold shall not
                  include technical support cost, development costs,
                  advertising, promotion, selling costs, distribution,
                  warehousing costs, administrative overhead costs or interest.

         9.10.    "Fiscal Year" shall mean the period commencing March 1 each
                  calendar year and ending the last day of February the
                  following calendar year.

         9.11.    "Full Feature Print Creativity Category" shall mean the
                  category of personal computer software products that support a
                  broad range of printable projects for both home and business
                  use such as the currently existing versions of [

                                                             ]. Products in this
                  category may include functionality to produce greeting cards,
                  but they are not designed and marketed primarily for the
                  purpose of creating greeting cards.

         9.12.    "Greeting Card Category" shall mean the category of personal
                  computer software products that, from both a marketing and
                  product focus standpoint, feature primarily greeting cards and
                  related social expression products, such as Micrografx'
                  CreataCard series, [
                                                                            ].

         9.13.    "Greeting Card Company" shall mean [
                                                     ] and any other entity or
                  business unit of an entity the primary business of which is
                  the greeting card business.

         9.14.    "Intellectual Property" shall mean intellectual property of
                  any kind, including, without limitation, copyrights, patents,
                  trade secrets and trademarks and any applications or
                  registrations (as applicable) for the foregoing and any
                  licenses from third parties for any of the foregoing.

         9.15.    "Listed Product" shall mean a [                       ] in one
                  of the categories listed on Exhibit A.

         9.16.    "OEM Versions" shall mean a modified version of a product
                  developed and sold pursuant to an agreement between AG or
                  Mindscape and a third party that sells its own product, and
                  bundled with such product for sale to consumers.

         9.17.    "Restricted Entity" shall mean any entity listed on Exhibit F
                  and any Affiliate of such entities.

         9.18.    "Social Expression Product" shall mean a combination of art
                  and verse designed to convey sentiment regarding an array of
                  human interaction and emotion, specifically, (i) a Social
                  Expression Product that is printed on paper (or similar
                  substance) and readable by the ultimate recipient without the
                  use of a computer or (ii) a Social Expression Product which is
                  to be electronically delivered, i.e., in an electronically
                  transmitted format, (iii) post cards, (iv) invitations, (y)
                  announcements, (vi) awards and (vii) certificates.



                                       17
<PAGE>   18

         9.19.    "Trademark" shall mean any trademark, service mark, trade
                  name, trade dress, design logo or similar proprietary right.

         9.20.    "Unlockable Content Pack" shall mean a collection of
                  theme-specific or occasion- specific Creative Content that is
                  either (i) sold as a separate product or (ii) embedded within
                  another product such that the consumer can be charged a
                  separate fee to obtain access to such content.

10.      MISCELLANEOUS.

         10.1.    AMENDMENT. This Agreement may only be amended by a writing
                  signed by the authorized representatives of the parties
                  hereto.

         10.2.    ASSIGNMENT. This Agreement shall inure to the benefit of and
                  be binding upon the parties hereto and their respective
                  transferees, successors and assigns. Either party hereto may
                  make an assignment of this Agreement or any of its rights or
                  interests herein. No such assignment shall relieve the
                  assignor of any obligation hereunder. Notwithstanding the
                  foregoing, without the prior written consent of AG, which may
                  be withheld in its sole discretion, Mindscape may not assign
                  or delegate its rights or obligations hereunder to a
                  Restricted Entity of if the assignment or delegation can
                  reasonably be expected to impair Mindscape's performance
                  hereunder.

         10.3.    COUNTERPARTS. This Agreement may be executed in multiple
                  counterparts, each of which shall be deemed an original and
                  all of which together shall be deemed the same agreement.

         10.4.    DISPUTE RESOLUTION. Any disputes arising out of or relating to
                  this Agreement ("Disputes") shall be governed by the following
                  procedures in the following order until finally resolved:

                  10.4.1.  If a dispute arises out of or relates to this
                           Agreement, or the breach hereof, within [  ] days of
                           receipt of written notice of a dispute, the parties
                           shall attempt in good faith to resolve such dispute
                           by negotiation among senior executives who have
                           authority to settle the controversy;

                  10.4.2.  If the dispute cannot be settled through such
                           negotiations within the [  ] day period set forth
                           above, the parties agree to try in good faith to
                           settle the dispute by mediation within [  ] days
                           immediately following the [  ] day period set forth
                           above, in the forum of the party against whom a
                           dispute resolution is sought or claim is made under
                           the Commercial Mediation Rules of the American
                           Arbitration Association. For clarification, the forum
                           shall be Cleveland, Ohio for claims made or
                           resolutions sought by Mindscape and San Francisco,
                           California for claims made or resolutions sought by
                           the AG Parties.

                  10.4.3.  If the dispute cannot be settled by such mediation,
                           the parties agree to submit the dispute to binding
                           arbitration in the forum of the party against whom a
                           dispute resolution is sought or claim is made as
                           provided above, under the forum state and applicable
                           Federal law upon receipt of a written



                                       18
<PAGE>   19

                  demand for arbitration by either of the parties setting forth
                  the names of the other party or parties. Within [  ] days
                  after such commencement, each party shall select one person to
                  act as arbitrator, and the two selected shall select a third
                  arbitrator within [  ] days of appointment. If the arbitrators
                  fail to select a third arbitrator, then the American
                  Arbitration Association shall select the third arbitrator.
                  Except as otherwise provided herein, the arbitrator shall have
                  the authority to award any remedy or relief a state or federal
                  court of the state of the forum could order or grant,
                  including, without limitation, specific performance, the
                  awarding of compensatory damages, the issuance of an
                  injunction and other equitable relief, but excluding any
                  punitive or consequential damages. If the remedy sought is a
                  monetary award, each party shall simultaneously, on the
                  [  ] business day following the commencement of the
                  arbitration, propose to the arbitrators the amount that party
                  believes should be awarded, and with respect to compensatory
                  damages, the arbitrators shall make an award in whichever of
                  the two amounts they deem most reasonable. The Arbitrators'
                  decision shall be issued with findings of fact and conclusions
                  of law and shall be non-appealable. Notwithstanding anything
                  in this Section 10.4 to the contrary, the losing party in a
                  dispute hereunder shall pay all reasonable legal fees and
                  expenses incurred by the prevailing party in connection with
                  the arbitration.

         10.5.    ENTIRE AGREEMENT. This Agreement sets forth the entire
                  understanding of the parties with respect to the subject
                  matter hereof and supersedes all prior contracts, memoranda,
                  agreements, arrangements, communications and discussions,
                  whether oral or written.

         10.6     FORCE MAJEURE. Neither party shall be liable for any failure
                  or delay in performing its obligations under this Agreement,
                  or for any loss or damage resulting therefrom, due to causes
                  beyond its control (each, a "Force Majeure"), including but
                  not limited to, acts of God, the public enemy, riots, fires,
                  natural catastrophes or epidemics. In the event of such
                  failure or delay, the date of delivery or performance shall be
                  extended for a period not to exceed the time lost by reason of
                  the failure or delay; provided that the party affected by such
                  delay is using reasonable commercial efforts to mitigate or
                  eliminate the cause of such delay or its effects. Each party
                  shall notify the other in writing promptly of any failure or
                  delay in, and the effect on, its performance.

         10.7.    FURTHER ASSURANCES. The parties each agree to execute and
                  deliver any appropriate instruments or documents to confirm
                  the assignments and licenses provided for herein and to enable
                  the other to perfect the same by filing, registration or
                  otherwise in any state, territory, or country, as may be
                  reasonably requested and prepared by such other from time to
                  time.

         10.8.    GOVERNING LAW. This Agreement shall be governed by and
                  construed and enforced in accordance with the substantive laws
                  of the State of Ohio.

         10.9.    NOTICES.


                                       19
<PAGE>   20

10.9.1.  All notices, requests, demands, claims, and other communications
         hereunder shall be in writing and shall be sent by registered or
         certified mail, return receipt requested, postage prepaid, addressed to
         the intended recipient as set forth below:

         If to Mindscape:

                  Mindscape, Inc.
                  88 Rowland Way
                  Novato, CA 94945

                  Attention: Executive Vice President Home Products

         with a copy to:

                  Mindscape, Inc.
                  88 Rowland Way
                  Novato, CA 94945

                  Attention: General Counsel

         If to the AG Parties (or either of them):

                  American Greetings Corporation
                  10500 American Road
                  Cleveland, Ohio 44144

                  Attention: Senior Vice President - Electronic Marketing

         with a copy to:

                  American Greetings Corporation
                  10500 American Road
                  Cleveland, Ohio 44144

         Attention: General Counsel

         All notices shall be effective only upon receipt. Any party may send
         any notice, request, demand, claim, or other communication hereunder to
         the intended recipient at the address set forth above using any other
         means (including personal delivery, expedited courier, messenger
         service. telecopy, telex, ordinary mail, or electronic mail), but no
         such notice, request, demand, claim, or other communication shall be
         deemed to have been duly given unless and until it actually is received
         by the intended recipient. Any party may change the address to which
         notices, requests, demands, claims, and other communications hereunder
         are to be delivered by giving the other parties notice in the manner
         herein set forth.

10.10.   PUBLICITY. Neither party shall make any public announcement regarding
         the terms or existence of this Agreement without the prior written
         consent of the other.

10.11.   RELATIONSHIP. This Agreement is not intended by the parties to, and
         shall not be deemed to, constitute or create a joint venture, pooling
         arrangement, partnership,

                                       20


<PAGE>   21

         or other business organization or entity of any kind and the rights and
         obligations of the parties shall be only those expressly set forth
         herein. Each party shall operate as an independent contractor in the
         performance of this Agreement and not as agents or employees of the
         other. Each party shall ensure that neither it nor its agents or
         employees shall act or hold themselves Out as agents or employees of
         the other.

10.12.   WAIVERS. No purported waiver by any party of any default by any other
         party of any term or provision contained herein shall be deemed to be a
         waiver of such term or provision unless the waiver is in writing and
         signed by the waiving party. No such waiver shall in any event be
         deemed a waiver of any subsequent default under the same or any other
         term or provision contained herein.

10.13.   APPROVALS: This Agreement requires the parties to secure approval from
         each other for various activities. Unless there is a specific provision
         to the contrary, it is understood that all responses to requests for
         approval shall be made within [     ] business days of receipt of the
         request for approval (and all necessary materials for making a
         reasonably informed decision) by the party from whom approval is sought
         and that approvals shall not be unreasonably withheld. Each party shall
         be entitled to learn the reason for a refusal to approve and shall have
         a reasonable period of time to meet the objection. Mindscape
         understands that if any refusal to approve by the AG parties is because
         it believes the material, presentation or use in questions impairs the
         Trademarks and goodwill of the AG Parties, the refusal to approve shall
         be deemed reasonable. In any such case, the AG Parties agree to specify
         the problem and help suggest a solution. When an item is submitted by
         one party (the "Sending Party") to the other for approval and no
         approval or rejection is received within [    ] business days, the
         Sending Party shall notify the other party (the "Receiving Party") by
         sending a further written notice that an approval or rejection has not
         been received, such notice to be conspicuously labeled "Urgent Legal
         Notice," and sent as provided in Section  10.9 by overnight courier,
         requiring signature verification of receipt. If the Receiving Party,
         after said notification, still does not give approval or rejection
         within a further [      ] business days, the item shall be deemed
         [     ].


                                       21


<PAGE>   22

     IN WITNESS WHEREOF, the parties hereto have caused their duly authorized
officers to execute this agreement as of the date set forth above.



AMERICAN GREETINGS CORPORATION                 AGC, INC.


By:   /s/ John M. Klipfell                     By:   /s/ Dale A. Cable
      ----------------------------                   -------------------------

Name:  John M. Klipfell                        Name:  Dale A. Cable
      ----------------------------                   -------------------------

Title: SR VP ELECTRONIC MARKETING              Title: TREASURER
      ----------------------------                   -------------------------



MINDSCAPE, INC.


By:   /s/ John Moore
      ----------------------------

Name: John Moore
      ----------------------------

Title: CEO
      ----------------------------




                                       22


<PAGE>   23


[







































                                                            ]
<PAGE>   24
                                                                       Exhibit B
                     [        ]  Languages other than English

[



               ]
<PAGE>   25


[







                                                      ]

                                     Page 1
<PAGE>   26

                                                                      Exhibit 1

[










                                                            ]
<PAGE>   27

[











                                                                      ]
<PAGE>   28

[














                                                            ]
<PAGE>   29

[

















                                                  ]
<PAGE>   30
[



































                                                                    ]
<PAGE>   31
[
















                                                        ]




<PAGE>   32
[

















                                                                 ]
<PAGE>   33

[





















                                             ]
<PAGE>   34

[













                                        ]
<PAGE>   35

[




















                                                            ]

<PAGE>   36

[




























                                   ]
<PAGE>   37

[
















                                                       ]
<PAGE>   38


[









                         ]
<PAGE>   39
                                                                       Exhibit E

LICENSED TRADEMARKS


1.       American Greetings
2.       Carlton Cards
3.       CreataCard
4.       John Sands


<PAGE>   40

                                                                       EXHIBIT F

[







                              ]

<PAGE>   41

LICENSED PROPERTIES                                                   EXHIBIT G
1.       King Features
             -    Betty Boop
             -    Popeye
             -    Berenstain Bears
             -    Sunday Funnies
             -    School House Rock
2.       Team NFL
             -    All team logos
             -    The Quarterback Club
3.       National Enquirer
             -    Banner Front Page
4.       Rock Art (Grateful Dead Art)
5.       Three Stooges
6.       Elvis
7        Major League Baseball (MLB)
             -    All team logos
8.       Duckman
9.       Gary Patterson
10.      Marvel Comics
             -    All Marvel Characters
11.      Simpsons
12.      NBA
13.      NHL
14.      WWF
15.      Nickelodeon
             -   Rugrats
             -   Ren & Stimpy
             -   AAHHA! Real Monsters
16.      Scooby Doo
17.      The Mask
18.      Power Rangers
19.      Flintstones
20.      Drew Carey
21.      Ace Ventura
22.      Opus n' Bill
23.      Married w/ Children
24.      Nintendo
             -   Super Mario Brothers
             -   Donkey-Kong
25.      The Beatles
26.      I Love Lucy
27.      Muppets
28.      Pink Panther
29.      MTV
             -   Beavis & Butthead
30.      United Media
             -   Dilbert
             -   Comic Zone
31.      South Park
32.      Looney Tunes
33.      Cartoon Network
34.      DC Comics
             -   Batman
             -   Superman
35.      Star Trek
36.      X-Files



<PAGE>   42



                                                                       Exhibit H

[









                                   ]
<PAGE>   43
                                                          Draft of June 29, 1998


                             AMENDMENT NUMBER 1 TO
                  ELECTRONIC PUBLISHING DEVELOPMENT AGREEMENT

     This Amendment Number 1 to Electronic Publishing Development Agreement
(this "Amendment"), is made as of June __, 1998 (the "Effective Date"), by and
among American Greetings Corporation, an Ohio corporation ("AG"), AGC, Inc., an
Ohio corporation ("AGC" and, together with AG, the "AG Parties"), and Mindscape,
Inc. a Delaware corporation ("Mindscape"). Except where the context otherwise
requires, the term "AG Parties" is to be read as if it was a single party to
this Agreement.


                                   Background

A. Mindscape and the AG Parties entered into an Electronic Publishing
   Development Agreement on February 25, 1998 (the "Existing Agreement"); and

B. Mindscape and the AG parties now wish to append the same.


                                   Agreements

     NOW, THEREFORE, the parties, intending to be legally bound, agree as
follows (capitalized terms herein not otherwise defined being used as defined in
the Existing Agreement):

1. AMENDMENTS

The Existing Agreement is amended in the following respects:

   1.1 ROYALTY CALCULATION. Section 3.3 is hereby amended by inserting at the
       end thereof a Section 3.3.7, as follows:

       In determining the amount of royalties due hereunder, rebates to
           consumers shall be deemed marketing expenses and, as such, shall not
           be applied as a deduction in the calculation of royalties. REBATES TO
           RETAILERS OR WHOLESALERS, HOWEVER, SHALL NOT BE AFFECTED BY THE
           FOREGOING.

   1.2 APPLICATION OF MINIMUM ROYALTY. Section 3.3.5 is hereby amended by
       renumbering subparagraphs (i) and (ii) to be (ii) and (iii),
       respectively, and inserting a new subparagraph (i) as follows:

       Any royalties paid pursuant to Section 3.3.1 in a Fiscal Year with
           respect to any product in any product category listed on Exhibit C
           shall be applied to reduce the amount of the minimum payments
           otherwise applicable pursuant to Section 3.3.2 for that product
           category in that Fiscal Year.

   1.3 FISCAL YEAR. Section 9.10 is hereby amended in its entirety to read as
       follows:

       "Fiscal Year" shall mean the period ending the last day of February of
           each calendar year and commencing March 1 of the prior calendar year.
           Fiscal year 1999, for example, commenced on March 1, 1998 and ends on
           February 28, 1999.


<PAGE>   44


        1.4. CONFIDENTIALITY. This Amendment shall be deemed part of the
             Agreement for purposes of Section 6.3.4 and 10.10 of the Existing
             Agreement.

  2.    MISCELLANEOUS.

        2.1. EFFECT OF AMENDMENT. As amended hereby, the Existing Agreement
             shall continue in full force and effect in accordance with its
             terms.

        2.2. COUNTERPARTS. This Agreement may be executed in multiple
             counterparts, each of which shall be deemed an original and all of
             which together shall be deemed the same agreement.

        2.3. DISPUTE RESOLUTION. The dispute resolution provisions of the
             Existing Agreement shall apply to this Amendment.

        2.4. GOVERNING LAW. This Amendment shall be governed by and construed
             and enforced in accordance with the substantive laws of the State
             of Ohio.

        2.5. NOTICES. All notices, requests, demands, claims, and other
             communications hereunder shall be given in the manner and with the
             effect provided in the Existing Agreement.


        IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute this agreement as of the date set forth above.


AMERICAN GREETINGS CORPORATION              AGC, INCL


By: /s/ John M. Klipfell                    By: /s/ John M. Klipfell
    -------------------------------             -------------------------------
Name: John M. Klipfell                      Name: John M. Klipfell
Title: SR VP - ELECTRONIC MARKETING         TITLE: VICE PRESIDENT


MINDSCAPE, INC.

By: /s/ Cynthia Hudson
    -------------------------------
Name: -----------------------------
Title: ----------------------------
<PAGE>   45
                             AMENDMENT NUMBER 2 TO
                  ELECTRONIC PUBLISHING DEVELOPMENT AGREEMENT

         This Amendment Number 2 to Electronic Publishing Development Agreement
(this "Amendment"), is made as of September 3, 1998 (the "Effective Date"), by
and among American Greetings Corporation, an Ohio corporation ("AG"), AGC, Inc.,
an Ohio corporation ("AGC" and, together with AG, the "AG Parties"), and
Mindscape, Inc. a Delaware corporation ("Mindscape"). Except where the context
otherwise requires, the term "AG Parties" is to be read as if it was a single
party to this Amendment.

                                   Background

A.   Mindscape and the AG Parties entered into an Electronic Publishing
     Development Agreement on February 25. 1998 (as subsequently amended by
     Amendment No. 1 thereto, the "Existing Agreement"); and

B.   In connection with certain transactions between Mindscape and Micrografx,
     Inc. ("Micrografx"). Mindscape and the AG Parties now wish to further amend
     the same.

                                   Agreements

         NOW, THEREFORE, the parties, intending to be legally bound, agree as
follows (capitalized terms herein not otherwise defined being used as
defined in Section 3 hereof):


1.   CONDITIONAL AMENDMENTS.

     Subject to the terms and conditions of this Agreement, the Existing
     Agreement is amended in the following respects:

         1.1.     ROYALTY CREDIT.

                  1.1.1    Section 3.3 of the Existing Agreement is hereby
                           amended by inserting at the end thereof a Section
                           3.3.8 as follows:

                                    Notwithstanding the foregoing, in the event
                                    that the Transfer Payment is greater than
                                    $[       ], then, solely with respect to the
                                    [              ], the royalty rate
                                    identified in clauses [
                                      ] of Section 3.3.1 shall be reduced by[ ]%
                                    ([ ]%, rather than [ ]% for clauses[
                                              ], and [ ] % rather than [  ]% for
                                    clause [ ]) until such time as the aggregate
                                    amount of such royalty reduction equals the
                                    lesser of: (i)[               ] of the
                                    Transfer Payment or (ii) $[         ]

                  1.1.2.   The following additional definitions are inserted in
                           Section 9 of the Existing Agreement:

                                    "CreataCard Products" shall mean the
                                    Approved Products that are identified on
                                    part I of Exhibit A to Amendment No. 2 to
                                    this Agreement and any later approved
                                    versions of the same.


<PAGE>   46

                                    "Transfer Payment" shall mean the total cash
                                    payments by Mindscape to Micrografx pursuant
                                    to the agreement referred to in Section 2.1.
                                    of Amendment No. 2 to this Agreement.

         1.2.     EXCLUSIVITY EXCEPTION. Sections 5.1 of the Existing Agreement
                  (Limitations prior to September 1, 1999) and 9.18 of the
                  Existing Agreement (Social Expression Products) are hereby
                  deleted in their entirety.

         1.3.     GUARANTY SCHEDULE. Exhibit C of the Existing Agreement
                  (Guaranty Schedule) is hereby amended by (i) setting all
                  amounts under the column headed "1999" to zero and (ii)
                  adjusting the column designated "Total" so as to reflect the
                  foregoing and be mathematically accurate.

         1.4.     AGREEMENT SCOPE. For all purposes of the Existing Agreement,
                  including, without limitation, Section 3.3 thereof, each of
                  the products listed on Exhibit A hereto (part 1 and part 2)
                  shall be deemed to be Approved Products under the Existing
                  Agreement and any Creative Content of the AG Parties embodied
                  therein shall be deemed to be AG Delivered Content under the
                  Existing Agreement. Mindscape and AG shall cooperate in good
                  faith with respect to appropriate approvals of any necessary
                  collateral materials in accordance with Section 1.4.5 and
                  10.13 of the Existing Agreement

         1.5.     TRANSFERRED AGREEMENTS. Immediately upon their assignment to
                  Mindscape, the Transferred Agreements shall be deemed
                  terminated and shall be of no further force or effect.
                  Mindscape and the AG Parties each hereby irrevocably release
                  and forever waive any claims, actions, causes of action,
                  remedies, obligations, damages and liabilities of every name
                  and nature, whether in law or in equity, whether known or
                  unknown, absolute or contingent arising out of the Transferred
                  Agreements, including but any limited to any Claim in any way
                  relating to any breach or alleged breach thereof occurring
                  prior to the date hereof Mindscape and the AG Parties shall
                  have no claim or obligation whatsoever to the other under or
                  with respect to the Transferred Agreements

         1.6.     CONFIDENTIALITY. This Amendment shall be deemed part of the
                  Agreement for purposes of Section 6.3.4 and 10.10 of the
                  Existing Agreement.

         1.7.     CORRECTION OF TYPOGRAPHICAL ERROR. The reference in Section
                  1.4.5 of the Existing Agreement to "Section 10.14" is hereby
                  corrected to refer to Section 10.13.

         1.8.     UNLOCKABLE CONTENT. Mindscape shall provide reporting of
                  revenue deriving from unlockable content packs in sufficient
                  detail for the AG Parties to pay any royalties that must be
                  paid to their licensors.

         1.9.     MINDSCAPE AFFILIATE. Learning Company Properties, Inc. an
                  affiliate of Mindscape, by its execution hereof, agrees to be
                  subject to all applicable restrictions in the Existing
                  Agreement, as amended hereby, on the use or other exercise of
                  rights with respect to AG Copyrights, AG Delivered Content, AG
                  Trademarks and any other intellectual property of the AG
                  Parties. Mindscape agrees that any funds received by Learning
                  Company Properties, Inc. in respect of


<PAGE>   47

                  Approved Products shall be subject to the royalties provided
                  in the Existing Agreement.

2.       CONDITIONS.

         The rights and obligations of the parties hereto shall not be effective
         until, and shall be subject to the satisfaction or waiver in writing
         of, the following conditions:

         2.1.     MINDSCAPE/MICROGRAFX AGREEMENT. AG shall have been provided
                  with and given an opportunity to review the agreement between
                  Micrografx and Mindscape providing for the assignment of the
                  Transferred Agreements and shall have been satisfied, in its
                  sole discretion, with the terms and conditions thereof.

         2.2.     MICROGRAFX/AG AGREEMENT. AG shall have entered into an
                  agreement with Micrografx providing the AG Parties' consent to
                  the assignment to Mindscape of the Transferred Agreements and
                  AG shall have been satisfied. in its sole discretion, with the
                  terms and conditions thereof.

         provided however, that AG and Mindscape shall use commercially
         reasonable efforts to cause such conditions to be satisfied as promptly
         as possible.

3.       DEFINITIONS.

         3.1.     "Transferred Agreements" shall mean (i) that certain Master
                  Agreement between the AG Parties and Micrografx dated February
                  9, 1996 as amended April 1, 1997: (ii) Subagreement A between
                  the AG Parties and Micrografx dated February 9, 1996 as
                  amended April 1, 1997; (iii) Subagreement B between the AG
                  Parties and Micrografx dated February 9, 1996 as amended April
                  1, 1997; (iv) Subagreement D between the AG Parties and
                  Micrografx dated April 1, 1997; (y) Subagreement E between the
                  AG Panties and Micrografx dated April 1, 1997.

         3.2.     Capitalized terms used herein without definition are used as
                  defined in the Existing Agreement.


4.       MISCELLANEOUS.

         4.1.     EFFECT OF AMENDMENT. As amended hereby, the Existing Agreement
                  shall continue in full force and effect in accordance with its
                  terms.

         4.2.     COUNTERPARTS. This Agreement may be executed in multiple
                  counterparts, each of which shall be deemed an original and
                  all of which together shall be deemed the same agreement.

         4.3.     DISPUTE RESOLUTION. The dispute resolution provisions of the
                  Existing Agreement shall apply to this Amendment.

         4.4.     GOVERNING LAW. This Amendment shall be governed by and
                  construed and enforced in accordance with the substantive laws
                  of the State of Ohio.

         4.5.     NOTICES. All notices, requests, demands, claims, and other
                  communications hereunder shall be given in the manner and with
                  the effect provided in the Existing Agreement.



<PAGE>   48

         4.6.     TERMINATION. This Agreement shall terminate and be of no
                  further force or effect in the event the assignment of the
                  Transferred Agreements shall not have occurred by September 4,
                  1998 at 5 p.m. Eastern Time.


         IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute this agreement as of the date set forth above.

AMERICAN GREETINGS CORPORATION               AGC, INC.

By: /s/ John M. Klipfell                     By: /s/ John M. Klipfell
   ---------------------------------------       -------------------------------

Name: JOHN M. KLIPFELL                       Name: JOHN M. KLIPFELL
     -------------------------------------         -----------------------------

Title: Sr VP Electronic Marketing            Title: Sr VP Electronic Marketing
      ------------------------------------         -----------------------------




MINDSCAPE, INC.


By: /s/ R. Scott Murray
   --------------------------------------------------------

Name: R. SCOTT MURRAY
     ------------------------------------------------------

Title: Executive Vice President and Chief Financial Officer
      -----------------------------------------------------

as to Section 1.9:
LEARNING COMPANY PROPERTIES, INC.


By: /s/ R. Scott Murray
   --------------------------------------------------------

Name: R. SCOTT MURRAY
     ------------------------------------------------------

Title: Executive Vice President and Chief Financial Officer
      -----------------------------------------------------


<PAGE>   49

                             AMENDMENT NUMBER 4 TO
                  ELECTRONIC PUBLISHING DEVELOPMENT AGREEMENT

     This Amendment Number 4 to Electronic Publishing Development Agreement
(this "Amendment"), is made as of April 12, 1999 (the "Effective Date"), by and
among American Greetings Corporation, an Ohio corporation ("AG"), AGC, Inc., an
Ohio corporation ("AGC" and, together with AG, the "AG Parties"), and Mindscape,
Inc. a Delaware corporation ("Mindscape"). Except where the context otherwise
requires, the term "AG Parties" is to be read as if it was a single party to
this Amendment.

                                   Background

A.   Mindscape and the AG Parties entered into an Electronic Publishing
     Development Agreement on February 26, 1998 (as subsequently amended by
     Amendment No. 1, Amendment No. 2 and Amendment No: 3 thereto, the "Existing
     Agreement"); and

B.   Mindscape and the AG Parties now wish to further amend the same:

                                   Agreements

     NOW, THEREFORE, the parties, intending to be legally bound, agree as
follows (capitalized terms herein not otherwise defined being used as defined in
Section 3 hereof):

1.   CLARIFICATION OF PAYMENT TIMING. The Existing Agreement is amended in the
     following respects:

     1.1. In each of clauses i, ii, iii, iv and v of Section 3.3. 1 of the
          Existing Agreement, the term "received" is replaced with the term
          "invoiced."

     1.2  At the end of Section 3.3.1 of the Existing Agreement, the following
          is inserted: Mindscape agrees that invoices are issued upon product
          shipment and that all amounts required to be paid are reflected in
          such invoices.

     1.3  In Section 3.3.4 of the Existing Agreement, the figure [
                  ] is replaced with [             ] and the following is
          added at the end of the section:

               With respect to each [         ], Mindscape shall report and pay
               based on product sales that occur in that [     ], without regard
               to whether payment for such sales shall have been actually
               received by Mindscape, subject to subsequent reconciliation of
               refunds, returns and credits as provided in the preceding
               sentence.

2.   TRANSITION. The parties acknowledge that as of the date hereof, there is an
     amount (the "Transition Amount") that would be past due if the timing of
     Mindscape's payment obligations were determined in compliance with the
     terms of Section 3.3.1 as amended hereby. The AG Parties hereby agree, that
     notwithstanding the requirements of the Existing Agreement, as amended
     hereby, Mindscape may pay the Transition Amount in [         ] installments
     payable on [                         ] and July 15, 1999 provided that
     Mindscape provides a report of the amount thereof no later than April 30,
     1999 such report to be subject to Section 3.4 and the other requirements of
     the Existing Agreement.


<PAGE>   50

3.   MISCELLANEOUS.

     3.1. EFFECT OF AMENDMENT. As amended hereby, the Existing Agreement shall
          continue in full force and effect in accordance with its terms.

     3.2. COUNTERPARTS. This Agreement may be executed in multiple counterparts,
          each of which shall be deemed an original and all of which together
          shall be deemed the same agreement.

     3.3. DISPUTE RESOLUTION. The dispute resolution provisions of the Existing
          Agreement shall apply to this Amendment.

     3.4. GOVERNING LAW. This Amendment shall be governed by and construed and
          enforced in accordance with the substantive laws of the State of Ohio.

     3.5. NOTICES. All notices, requests, demands, claims, and other
          communications hereunder shall be given in the manner and with the
          effect provided in the Existing Agreement; provided, however, that an
          additional copy of any notices to Mindscape shall be sent as follows:

               The Learning Company
               One Athenaeum Street
               Cambridge, MA 02142
               Attn: Scott Murray, Executive Vice President and Chief Financial
               Officer
               Attn: General Counsel


         IN WITNESS WHEREOF, the parties hereto have caused their duly
authorized officers to execute this agreement as of the date set forth above.

AMERICAN GREETINGS CORPORATION          AGC, INC.

By: /s/ John M. Klipfell                By: /s/ John M. Klipfell
   ------------------------------          -------------------------------

Name: JOHN M. KLIPFELL                  Name: JOHN M. KLIPFELL
     ----------------------------            -----------------------------

Title: SR VP                            Title: VP
      ---------------------------             ----------------------------

MINDSCAPE, INC.

By: /s/ John Moore
   ------------------------------

Name: JOHN MOORE
     ----------------------------

Title: Pres
      ---------------------------

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