At the time, Nintendo restricted their licensees to releasing only five games per year, mandated that Nintendo handle cartridge manufacturing, and required their games to be NES-exclusive for two years.
Atari Games tried to negotiate for a less restrictive license to produce games for the Nintendo Entertainment System; Nintendo refused, so in December 1987, Atari Games agreed to Nintendo’s standard licensing terms. Tengen was incorporated on December 21 of that year.
In 1988, Tengen released its first and only three games licensed by Nintendo: R.B.I. Baseball, Pac-Man, and Gauntlet.
Tengen was a subsidiary of Atari’s arcade department.
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