Independent studio Chair Entertainment Group has signed an exclusive deal with Epic Games to license the award-winning Unreal Engine 3 for all its present and upcoming game development projects.

The deal covers all games developed for Xbox 360, PlayStation 3 and PC and the first game that will be released under the new agreement will be Undertow for Xbox Live Arcade, which is due to go live worldwide this Winter. The game, which Chair says reveals some of the most stunning graphics seen on Xbox Live Arcade, features a 15 level campaign for single-player or co-op play, and two robust multiplayer modes for up to 16 players which has been delivered in just 50 megabytes of data – something that has not been achieved in any other Xbox Live Arcade to date.

“The versatility and technological advantages provided by the Unreal Engine 3 have determined it to be our exclusive choice of technology for next-generation development,” said Geremy Mustard, technical director at Chair Entertainment. “UE3 will enable our overflowing creative vision to spill into the hands of gamers sooner and at a much higher level of quality.”

Mark Rein, Vice-President, Epic Games, comments: “We love working with cool independent studios like Chair that are truly focused on delivering value to gamers and creating experiences that break new boundaries in gameplay and creativity. Sure, we love working with the big developers and publishers too, but there’s something really satisfying about seeing a young company with great talent doing some awesome stuff with our technology. Undertow is just the first great game you’ll see from these guys – prepare to be wowed some more.”