EX-4.59 EXCLUSIVE REQUIEM ONLINE LICENSE AND DISTR






Exhibit 4.59




EXCLUSIVE REQUIEM ONLINE

LICENSE AND DISTRIBUTION AGREEMENT




THIS EXCLUSIVE REQUIEM ONLINE LICENSE AND DISTRIBUTION AGREEMENT (hereinafter referred to as
“Agreement”) is made and entered into on this 21st day of February, 2008 (hereinafter
referred to as “Effective Date”), by and between Gravity Co.,Ltd (hereinafter referred to as
“Licensor”) a corporation duly organised and existing under the laws of the Republic of Korea
(hereinafter referred to as “Korea”) and having its offices at 15F, Nuritkum Square Business
Tower. 1605, Sangam-Dong, Mapo-Gu, Seoul, Korea (hereinafter to as “Korea”)and Gravity Interactive,
Inc., a corporation duly organized and existing under the laws of United States of America(USA) and
having its offices at 4499 Glencoe Avenue Marina Del Rey, CA 90292, USA (“Licensee”)



RECITALS:





WHEREAS, Licensor has developed and owns all rights in computer programs of online game “Requiem
Online” (“Game”);




WHEREAS, Licensee desires to enter into an exclusive license agreement with Licensor under the
mutual conditions specified herein pursuant to which Licensee will make the Game available to End
Users in the Territory specified below; and




WHEREAS, Licensor desires to grant such license to Licensee under the mutual terms and conditions
herein below specified.



AGREEMENT




NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein and other
good and valuable consideration, the parties hereto agree as follows:



Article 1

Definitions




The terms defined in this Article shall have the meaning ascribed to them herein whenever they are
used in this Agreement, unless otherwise clearly indicated by the context.




	1.1	 	“Agreement” shall have the meanings set forth in the introductory section of this agreement,
and all annexes, amendments and supplements hereto.
	 
	1.2	 	“Licensor” shall mean Gravity Co., Ltd.
	 
	1.3	 	“Licensee” shall mean Gravity Interactive, Inc.
	 
	1.4	 	“Confidential Information” shall mean all materials, know-how, software or other similar
types of information including, but not limited to, proprietary information and




 









 






	 	 	materials regarding a Party’s technology, products, business information or objectives,
including the software for the Game and Technical Information as defined in this Agreement, as
well as all information which is designated as confidential in writing by the providing Party
or which is the type that is customarily considered to be confidential information by persons
engaged in similar activities.
	 
	1.5	 	“End Users” shall mean the users of the Game through a network game service system
established and operated by Licensee with individually assigned ID Numbers for each End User.
	 
	1.6	 	“Game” shall have the meaning stipulated in the recitals above, including any modified or
advanced version of the Game distributed by Licensor for error correcting, updating or
debugging purpose, under the same title. Any subtitled version, series or sequel to the Game
which may be developed or distributed by Licensor after the execution of this Agreement shall
be clearly excluded from the scope of this Agreement.
	 
	1.7	 	“ID Number” shall mean an identification number assigned to each End User, with which such
End User can access and use the network game service system established and operated by
Licensee.
	 
	1.8	 	“Intellectual Property” shall mean all patents, designs, utility models, copyrights,
know-how, trade secrets, trademarks, service mark, trade dress and any other intellectual
property rights in or related to the Game or Technical Information.
	 
	1.9	 	“Local Language” shall mean standard spoken English as used in the Territory.
	 
	1.10	 	“Local Version” shall mean the Game provided in the Local Language.
	 
	1.11	 	“Parties” and “Party” shall mean Licensor and Licensee, collectively, individually, and
respectively.
	 
	1.12	 	“Servers” shall mean the servers established, installed and operated by Licensee within the
Territory only for the service of Game to End Users in the Territory.
	 
	1.13	 	“Gross Sales Amount” shall mean the total sales amount paid by End Users for the Game
without deducting any tax or distribution commission.
	 
	1.14	 	“Service Sales Amount” shall mean the amount with the deduction of 10% of value added
tax(VAT) and the Wholesaler-Discounts granted under this Agreement from the Gross Sales
Amount.
	 
	1.15	 	“Prepaid Cards” shall mean the tangible or intangible cards containing a unique code or
other unique identifying information purchased by End Users to access the Game, as generated
by Licensee in its sole and exclusive discretion.
	 
	1.16	 	“Wholesaler-Discounts” shall mean the discounts which are allowed by Licensee to wholesalers
in the Game market; provided, however, that (i) if the payment by End Users is made by way of
off-line prepaid card through a conventional sales channel, including but not limited to
computer game rooms, computer stores, convenient stores, Wholesaler-Discounts granted to any
wholesaler shall not exceed thirty percent (30%)




 









 






	 	 	of the face value of such off-line prepaid card, (ii) if the payment by End Users is made by
way of on-line prepaid card through an online sales channel, including but not limited to
internet home shopping malls, Wholesaler-Discounts granted to any wholesaler shall not exceed
fifteen percent (15%) of the face value of such on-line prepaid card, and (iii) if the payment
by End Users is made through neither a conventional sales channel nor an online sales channel,
the rate of Wholesaler-Discounts shall be determined by mutual agreement between Licensor and
Licensee.






	1.17	 	“Billing System” shall mean the calculation computer program to be installed in necessary
units of computers of the Licensee in order to calculate the Gross Sales Amount.
	 
	1.18	 	“Technical Information” shall mean the software, know-how, data, test result, layouts,
artwork, processes, scripts, concepts and other technical information on or in relation to the
Game and the installation, operation, maintenance, service and use thereof.
	 
	1.19	 	“Daily Average Concurrent User” shall mean the average number between highest number and
lowest number of the users logged simultaneously in the Game daily in the Territory.
	 
	1.20	 	“Territory” shall mean the territory of the following North American countries or North
American continent country-groups:






	 	(a)	 	United States of America
	 
	 	(b)	 	Canada






	1.21	 	“Game Point” shall mean cyber points upon Prepaid cards or accounts of End Users.
	 
	1.22	 	“Closed Beta Test” shall mean the the secured and non-public testing of the beta version of
the localized Game by a select group of the End Users prior to the Open Beta test, which is to
be performed by Licensee in the Territory.
	 
	1.23	 	“Open Beta Test” shall mean the secured testing of the beta version of the localized Game by
offering the Game to the general public for free trial for a limited period of time prior to
the Commercial Launch Date of the Online Game, which is to be performed by Licensee in the
Territory





Article 2

Grant of License





	2.1	 	Licensor hereby grants to the Licensee, and the Licensee hereby accepts from the Licensor,
under the terms and conditions set forth in this Agreement, a non-transferable, exclusive and
royalty-bearing license within the Territory which shall be irrevocable during the period of
this Agreement so long as Licensee maintains in substantial compliance with the material terms
hereof, to do any or all of the following:






	 	(1)	 	To maintain and operate the Game within the Territory, and to grant
Subscriptions to Subscribers to access the Game within the Territory;




 









 






	 	(2)	 	To reproduce, in object code form only, and to market, distribute and sell
to Subscribers or potential Subscribers, the Client Software in CD-ROM or DVD-ROM
medium format or through the Internet; and
	 
	 	(3)	 	To generate, market, promote, sell and distribute Prepaid Cards in
accordance with market demands.






	2.2	 	Licensee acknowledges and agrees that it has no rights or claims of any type to the Game
except such rights granted by this Agreement, and the Licensee irrevocably waives and releases
any claim to title and ownership rights (including trade secret and copyright ownership) in
the Game.
	 
	2.3	 	Unless explicitly approved in writing by the Licensor, the Licensee shall have no right to
sublicense the rights granted under Article 2
	 
	2.4	 	Licensee is permitted to appoint sub-distributors to market, promote, sell and distribute the
client software in CD-ROM or DVD-ROM medium and the Prepaid Cards for the Locals Service,
provided that Licensee agrees to be responsible for each sub-distributor’s compliance with all
of the terms and conditions contained herein applicable to Licensee. Licensee will not
knowingly appoint the sub-distributors who intend or are likely to resell them outside
the Territory.
	 
	2.5	 	Any service, use, promotion, distribution and marketing of the Game outside the Territory and
any use of the Technical Information for any purpose other than the purpose contemplated in
this Agreement are strictly prohibited and result in breach to this Agreement.
	 
	2.6	 	Licensee shall provide Game services only by way of the PC on-line method (excluding mobile
access) using the Servers. However, in consideration of the current level of development of
information technology in the Territory, which primarily operates on a narrow-band basis,
Licensee shall be allowed to make Game services available by use of its own available
equipment. Licensor shall provide Licensee detailed technical specifications for the hardware,
software, and network connections required for the Game. Both Parties shall use commercially
reasonable efforts to modify and upgrade the foregoing technical specifications so as to
optimize the performance of the Game within the Territory.
	 
	2.7	 	The Game shall be serviced, promoted, distributed and marketed under the titles, trademark,
character names and other names of the Game (“Title”) as originally created and used by
Licensor, and/or as modified herein pursuant to the terms of Article 2.7. Notwithstanding the
foregoing, if a change to any of the foregoing Titles is required as a result of any special
lingual or social circumstance of the Territory, the Parties shall decide and use a new Title
(“New Title”) for the Game. All of the rights in or to the Title and New Title shall be
exclusively owned by Licensor and Licensee shall not use any such Title or New Title in a
manner that falls outside the scope of this Agreement without the prior written approval of
Licensor.
	 
	2.8	 	All of the rights in or to the Game, except as granted under this Agreement, including but
not limited to the rights to the character business of the Game, shall remain




 









 






	 	 	exclusively with Licensor. However, Licensor will grant to Licensee the right of first
negotiation for a period of sixty (60) days from Licensor’s decision to do so, the right to
produce and/or sell and distribute in the Territory merchandise relating to the Game,
including, but not limited to, character dolls, reproductions of the characters in
collaterals, and other similar types of toys, gifts, collectibles, and other types of durable
merchandise, as well as such other accessories, under a separate merchandising agreement. Such
right of first negotiation shall include the right of Licensee to match any reasonable and
bona fide offer received by Licensor from any third party.





Article 3

Delivery of Game and Localization





	3.1	 	Subject to the terms and conditions of this Agreement, Licensor shall provide Licensee with
its reasonable assistance and cooperation, including technical assistance, in order to enable
a launch of the beta service and commercial service of the Game in the Territory.
	 
	3.2	 	Licensor shall deliver to Licensee all localization materials, including game texts, scripts,
manual texts, documentation, marketing materials and/or image (the “Localization Materials”)
for the Game in English language as needed for Licensee to localize the Game into Local
Language for the exploitation of the Game within the Territory.
	 
	3.3	 	Upon receipt of the Localization Materials, Licensee shall, at its own expense, perform
translation and/or recordings of the Localization Materials into the Local Language to the
reasonable satisfaction of Licensor (“Translations”). The Translations shall be made
faithfully and accurately, shall be of good quality and shall consist of the whole of the
textual, graphical and audio material provided in the Localization Materials, without
alteration, abridgment, or supplement, unless Licensee has received the express written
consent of Licensor approving such modification.
	 
	3.4	 	In case the Translations or contents of the Game requires modification because it may contain
false, misleading, fraudulent, libelous or obscene matter or other matter which is unlawful or
which will give rise to a criminal or civil cause of action and/or will otherwise be
considered obscene, inappropriate, or offensive to the sensibilities of the subscribers
located in the Territory due to cultural morals and norms, Licensee shall inform Licensor of
such required modifications and the reasons thereof and Licensor shall consent to such
modifications so long as such modifications do not materially change the original work and/or
concept.
	 
	3.5	 	Approval: Licensor reserves the right to approve the Translations before integration
pursuant to Article 3.7 below. Licensee will submit the Translations to Licensor for review.
Licensor shall then provide, within a reasonable amount of time, its acceptance or comments
detailing modifications to the Translations, and Licensee shall effect any modifications
directed by Licensor and, as soon as reasonably practicable, shall re-submit the new
Translations for approval by the Licensor and the above approval procedure shall be repeated
until such items are approved by the Licensor.
	 
	3.6	 	Expenses: All costs and expenses arising from the performance of Licensee’s
obligations in this Article 3 shall be borne by Licensee, including the costs of




 









 






	 	 	compensating all translators. Licensee agrees to obtain from all translators proper written
grants of all rights to their works.
	 
	3.7	 	Schedule to service: Licensor and Licensee install Local Version at its servers in
Territory for a test of operation, not later than (30) days from the date of execution of this
Agreement. The close beta test of the Game shall commence not later than (60) days from the
date of signed execution of this Agreement. Licensee shall launch the open beta test of the
Game in the territory within (60) days from the date of launch of the close beta test
of the Game, and the commercial service of the Game in the Territory within (90) days from
the date of launch of the open beta test of the Game. The Parties agree to cooperate with each
other and exert their best efforts to launch the services of the Game in accordance with the
above schedule in this Article Section 3.7. The above target dates for launching the services
of the Game may be changed by mutual agreement between the Parties.
	 
	3.8	 	The Game shall be serviced in the Territory only in the manners permitted by Licensor under
this Agreement. Licensee shall be strictly prohibited from any modification, amendment or
revision of any part of the Game including the title of the Game and the name of the
characters in the Game, without the prior written approval of Licensor.
	 
	3.9	 	Billing System: Licensee’s Billing System must be tested, analyzed and approved by
Licensor prior to being used in the Game. If the Licensee’s Billing System is considered
suitable for the Game by Licensor, such Billing System shall be applied to the Game. If
Licensee’s Billing System has unavoidable or other serious technical conflicts against the
Game and may cause serious problem for the Game service, Licensee shall agree to use a Billing
System recommended by Licensor for the purpose to mutually manage the local billing
transparently. Upon Licensee’s request, Licensor shall send its billing account manager to
synchronize Billing System with the Game and incurring expense for this procedure shall be
borne by Licensor. Licensee shall approve the real-time access of Licensor to the Billing
System under this Agreement.





Article 4

Installation and Technical Support





	4.1	 	Technical Support: During the term of this Agreement, Licensor shall provide
Licensee with the installation and maintenance assistance and support as needed and requested
by Licensee, sufficient enough to enable the Licensee to provide and maintain high-quality
service for the Game. This assistance shall include, but not limited to, software installation
and set-up, maintenance support, patches and updates used by the Game software, reasonable and
appropriate support and assistance for the localization of the Game into the Local Version,
training Licensee’s personnel in respect of the maintenance and operation of the software for
the Game provided that, any and all expenses actually incurred by any engineers dispatched by
Licensor to perform the above installation and maintenance assistance in this Article 4.1,
including, without limitation, lodging, and other general living expenses incurred during
their stay at Licensee’s premises, shall be borne by Licensee.
	 
	4.2	 	During the term of this Agreement, Licensor shall receive Licensee’s personnel in its office
in the Republic of Korea for training with respect to the installation and service of the
software for the Game and the installation, maintenance and operation of the Servers




 









 






	 	 	upon Licensee’s request. The number of the trainees from Licensee shall not exceed three (3)
persons at one time and the total period of training shall not exceed seven (7) man-days
(based on eight (8) hours of training per trainee per day) per person sent, unless otherwise
agreed in writing by Licensor. All of the expenses for travel, lodging, food and other general
living expenses incurred by such sent personnel of Licensee shall be borne by Licensee.
Engineers sent by Licensor to Licensee shall provide training to any local staff if necessary.
	 
	4.3	 	Any further assistance may be rendered by Licensor upon mutual agreement of the Parties and
shall last until the end of commercial service of the Game.





Article 5

Payment and Taxes





	5.1	 	License Fee
	 
	 	 	Licensee shall pay to Licensor a non-recoupable and non-refundable license fee (“License Fee”)
in the amount of Two Hundred Thousand United States Dollars (US$200,000) in accordance with
the following schedule and subject to the terms of this Agreement:






	 	 	 	Within Fourteen (14) calendar days from the Effective Date and Licensee’s receipt of a
written invoice in such amount from Licensor, the sum of Twenty Thousand US$ (US$20,000).
	 
	 	 	 	Within Fourteen (14) calendar days after the commencement of the commercialization service
of the Game and Licensee’s receipt of a written invoice in such amount from Licensor, the
sum of Thirty Thousand US$ (US$30,000).
	 
	 	 	 	Within Forty (40) calendar days after the commencement of the commercialization service of
the Game and Licensee’s receipt of a written invoice in such amount from Licensor, the sum
of Fifty Thousand US$ (US$50,000).
	 
	 	 	 	Within Sixty (60) calendar days after the commencement of the commercialization service of
the Game and Licensee’s receipt of a written invoice in such amount from Licensor, the sum
of Fifty Thousand US$(US$50,000).
	 
	 	 	 	Within Ninety (90) calendar days after the commencement of the commercialization service
of the Game and Licensee’s receipt of a written invoice in such amount from Licensor, the
sum of Fifty Thousand US$(US$50,000).






	5.2	 	Royalty Payment and Report
	 
	Upon Licensee’s receipt of Licensor’s written invoice, Licensee shall pay to Licensor as




 









 







	 Royalty Payments Twenty Five percent (25%) of the Service Sales Amount during the commercial period
of this Agreement. Subject to Article 5.2 below, the Royalty Payment shall be paid by Licensee on a
monthly basis within Twenty (20) days after the end of the applicable month. The Royalty Payment
shall be deemed made upon presentation by Licensee of remittance confirmation or notice to Licensor
of payment. Unless Licensor actually receives the remitted amount, the Royalty Payment shall not be
deemed to have been paid. Licensee may not set-off the Royalty Payment against any claims Licensee
may have against the Licensor. Licensee shall also provide Licensor with a report (“Royalty
Report”) on a monthly basis within Fifteen (15) days after the end of the applicable month. Each
Royalty Report shall contain detailed information concerning the calculation of Service-Sales
Amount for the applicable month.
	 
	5.3	 	Manner of Payment: Any and all payments under this Agreement by Licensee to Licensor
shall be made in US Dollars (USD) and by wire transfer to any bank account designated by
Licensor.
	 
	5.4	 	Interest: In the event any payment is not made by Licensee within the due date
described in this Agreement, a default interest at the rate of eighteen percent (18%) per
annum of the actual amount of the delayed payment shall be applied. For the avoidance of
doubt, Licensor’s entitlement to such Default Interest pursuant to this Article 5.4 shall not
affect any of the other rights of Licensor under this Agreement.
	 
	5.5	 	Taxes: Any and all taxes including the sales tax, income tax on any payment to
Licensor under this Agreement shall be borne by Licensee. However, Licensee is allowed to
withhold the amount of withholding tax up to Twenty Two percent (22%: Federal 15% and State
7%) from the respective payment made to Licensor under this Agreement only if Licensor is
entitled to receive such payments as a tax credit under the relevant laws of the Republic of
Korea or any existing tax treaty between the respective countries of operation of Licensor and
Licensee. In the event that any amount is withheld for the tax payment under this Article 5.5,
Licensee shall promptly inform Licensor of such payment and provide Licensor with a
certification issued by the relevant tax authorities with respect to the relevant payment. Any
withholding tax in excess of the aforesaid limit shall be borne by Licensee, and shall not be
deducted from the actual payment amount.





Article 6

Report & Audit





	6.1	 	Licensee shall provide Licensor with all relevant and non-privileged information pertaining
to the development of its business in relation to the Game. Without limiting the generality of
the foregoing, Licensee shall inform Licensor promptly in the event of its launch of the beta
service or the commercial service of the Game.
	 
	6.2	 	Licensee shall provide Licensor with a monthly report (the “Monthly Report”) within fifteen
(15) days after the end of the applicable month in writing on its business activities in
relation to the Game, including, but not limited to, the number of End User, the fees charged
by Licensee, the total service amounts for the pertinent month, advertising activities and the
expenses thereof, complaints received from End Users and market trends in the Territory.




 









 






	6.3	 	Licensee shall keep all of their records, including all contractual, accounting documents,
company related documents in relation to its business and other activities related to this
Agreement in its principal offices during the term of this Agreement and for not less than
five (5) years after the expiration or termination of this Agreement.
	 
	6.4	 	During the term of this Agreement and for five (5) years after the expiration or termination
hereof, Licensor may by itself or through an accountant designated by Licensor investigate and
audit the accounting documents of Licensee with respect to its Game business upon fourteen
(14) days prior written notice to Licensee. For this purpose, Licensor may request Licensee to
produce relevant documents, and may visit Licensee’s office and make copies of Licensee’s
documents. Licensee shall provide all assistance and co-operation required by Licensor for
such investigation and audit.
	 
	6.5	 	All expenses incurred for such investigation and audit shall be borne by Licensor.
	 
	6.6	 	If such investigation and audit reveals underpayment by greater than five percent (5%) of the
monthly Royalty Payment amount, Licensee shall bear all expenses for such investigation and
audit and shall immediately pay to Licensor the unpaid amount together with a per annum
default interest thereon equivalent to 18% percent thereof. In the event of Licensee’s
understatement of the Royalty Payment amount without any justifiable reasons, Licensor shall
be entitled to terminate this Agreement pursuant to Article 13.3(b) below.





Article 7

Advertising & Promotion





	7.1	 	Licensee shall exert its best efforts to advertise, promote and perform marketing activities
for the Game in the Territory.
	 
	7.2	 	For the advertising and promotion of the Game in the Territory, Licensee agrees to spend Ten
percent (10%) of Service Sales Amount for each twelve-month period from the date of commercial
service. Such amount shall include funds spent directly by Licensee or by third parties with
which Licensee has marketing or distribution agreements. Licensee shall provide Licensor with
detailed information on Licensee’s advertising activities every month in the Monthly Reports
as stipulated in Article 6.2 In addition, Licensee shall provide Licensor with a separate
marketing activity report on June 30 and December 31 of each year covering the preceding six
(6) months’ period. Such report shall be made within thirty (30) days after the end of a half
year period.
	 
	7.3	 	Licensor shall provide Licensee with samples of the marketing and promotional materials for
the Game that have been or will be produced on behalf of Licensor during the term of this
Agreement. Licensee shall pattern all of its advertising, marketing and promotional
materials for the Game in the Territory after the samples furnished to Licensee by Licensor,
and Licensee shall provide Licensor with samples of the advertising, marketing and promotional
materials for the Game produced by Licensee no later than seven (7) days before
launching of each campaign. Within seven (7) days after the receipt of samples




 









 






	 	 	of Licensee’s advertising, marketing and promotional materials, Licensor shall notify
Licensee in writing of Licensor’s approval or disapproval thereof, or of any changes that
Licensor may require Licensee to make thereto. Licensor’s failure to respond within the
said period of seven (7) days after receipt of such samples of advertising material shall
be deemed as approval of such advertising materials.






	7.4	 	Except as otherwise provided herein, the ownership of and the copyright in the marketing and
advertising materials produced or used by Licensee on the Game (“Advertising Materials”) shall
remain exclusively with Licensor, and Licensee shall not use the Advertising Materials for any
purpose other than promotion, distribution, marketing and advertising of the Game pursuant to
the terms and conditions of this Agreement.
	 
	7.5	 	Licensee may provide End Users with free points and free accounts as may be reasonably
necessary, at Licensee’s sole discretion, for the purposes of the promotion, operation and
advertisement of the Game only with prior written approval from Licensor. The detailed
information on the free points and accounts provided by Licensee to End Users shall be
provided to Licensor on a monthly basis in the Monthly Report as stipulated in Article 6.2.





Article 8

Other Obligations of Licensee





	8.1	 	Licensee shall exert its best efforts to supply, distribute and promote the Game in the
Territory.
	 
	8.2	 	Licensee shall be solely responsible for service, use, promotion, distribution and marketing
of the Game in the Territory, and Licensor shall not be responsible for or obligated to
provide any of the foregoing above and beyond the obligations stipulated in this Agreement.
	 
	8.3	 	Licensee shall provide full and comprehensive installation and maintenance support to End
Users to assist them in their use of the Game, including but not limited to Licensee’s
maintaining 24-hour installation and maintenance contact window, on-line customer services,
sufficient outbound bandwidth and circuits for operating business under this Agreement, and
game servers required for on-line game operation.
	 
	8.4	 	Licensee shall provide its best efforts to protect the Intellectual Property rights of
Licensor and shall assist Licensor to procure appropriate legal and administrative measures
against any and all activities by third parties infringing the Game or any of the Intellectual
Property rights of Licensor on or in relation to the Game, including without limitation to,
manufacture or sales of counterfeiting CDs, manuals, workbooks or other products.
	 
	8.5	 	Licensee shall abide by all laws and regulations of the Territory in its service, use,
promotion, distribution and marketing of the Game in the Territory.




 









 






	8.6	 	Licensee shall provide a prior written notice to Licensor in the event Licensee intends to
change its marketing strategies, including advertising, marketing, promotional materials,
product packaging and price policies relating to the Game, and other important policies.
	 
	8.7	 	Licensee shall indemnify and hold harmless Licensor and its officers and employees from any
kind of losses, costs, expenses or liabilities, including reasonable attorneys’ fees resulting
from any claim by a third party on or in relation to Licensee’s service, use, promotion,
distribution and marketing of the Game.
	 
	8.8	 	Upon Licensor’s request, Licensee shall provide Licensor with suitable office space and
office supplies in Licensee’s office for the auditing activities of Licensor. Access to such
office space shall be limited only to persons designated by Licensor. All expenses incurred by
Licensor’s employees and auditor dispatched to Licensee’s offices for transportation, postage,
telecommunications, lodging, food and other general living expenses, and the salaries for such
employees and cost for auditors during their stay at such offices shall be borne and paid by
Licensor.
	 
	8.9	 	Licensee shall not (1) copy, modify, display or distribute to any person all or any part of
the Game, except as provided for herein; (2) disassemble, decompile or reverse engineer the
Game, or any part thereof; (3) use, distribute or provide the Game to any third parties,
except as authorized in this agreement; (4) distribute or make the Game, or any executables
derived or produced therefrom; (5) knowingly distribute, make available or disclose the Game
to any third party except as authorized herein; (6) license, sublicense, distribute or make
available the Game to any third party, except as provided in this Agreement; (7) assist any
other person or entity in doing any of the foregoing. Licensee shall use commercially
reasonable efforts to prevent any third party from doing all or any of the foregoing without
the permission of Licensor. Licensee shall be responsible for all matters arising out of any
payment relating to sub-distributor.





Article 9

Technical Information and Intellectual Property





	9.1	 	Technical Information and Intellectual Property shall be exclusively owned by Licensor, and
this Agreement shall not grant Licensee or permit Licensee to exercise any right or license in
or to the Technical Information and Intellectual Property except for the License granted under
this Agreement. Licensee shall not obtain or try to obtain any registered industrial property
or copyright in or over any of the Technical Information and Intellectual Property of Licensor
regardless of the Territory and exploitation area.
	 
	9.2	 	Licensor hereby represents and warrants that Licensor is the legal owner of the Technical
Information and Intellectual Property; that it has a legal and valid right to grant the rights
and License under this Agreement to Licensee, and that the Game and Technical Information do
not violate or infringe any patent, copyright and trademark of any third party in Korea.




 









 






	9.3	 	Licensor further guarantees and warrants to Licensee that the Game and the corresponding
Technical Information and accompanying Intellectual Property:






	 	a)	 	shall not violate any Intellectual Property rights of any third party or any
rights of publicity or privacy in Korea;
	 
	 	b)	 	shall not violate any law, statute, ordinance or regulation (including without
limitation the laws and regulations governing export control, unfair competition,
anti-discrimination or false advertising) of Korea or any other country; and
	 
	 	c)	 	shall not contain any obscene, child pornographic or indecent contents.






	9.4	 	Licensor agrees to indemnify and hold harmless Licensee from any kind of losses, costs,
expenses or liabilities, including reasonable attorneys’ fees and costs of settlement,
resulting from the breach by Licensor of its express warranties given herein provided that
Licensee (a) promptly notifies Licensor of such claim; (b) allows Licensor to control the
defense of such claim and/or any related settlement negotiations; and (c) provides any
reasonable assistance requested by Licensor in connection with such claim.
	 
	9.5	 	For the purpose to prevent and/or halt any threatened or actual infringement or violation of
Intellectual Property rights by third parties in the Territory, Licensee shall take all
reasonable action, legal or otherwise to prevent and/or halt any threatened or actual
infringement or violation of Intellectual Property rights by third parties in the Territory,
or to address and answer any third party claims or demands in respect of the Intellectual
Property rights at Licensee’s own cost.





Article 10

Limitation of Liability





	10.1	 	Except as may be otherwise provided for herein, Licensor makes no warranties, express or
implied, concerning the Game including but not limited to its merchantability or salability in
the Territory.
	 
	10.2	 	In no event will either party be liable to the other for any indirect, consequential,
incidental, punitive or special damages, whether based on breach of contract, tort (including
negligence) or otherwise, and whether or not such party has been advised of the possibility of
such damage.
	 
	10.3	 	The aggregate liability of either Party under or relating to this Agreement whether in
contract, tort (including without limitation negligence) or otherwise, shall be limited to an
amount equal to the total amount of the payments made by Licensee during the preceding period
of six (6) months preceding the first date in which either Party demands damages in writing
against the other Party.
	 
	10.4	 	Licensee shall solely be responsible for any and all obligations to End Users imposed by the
government of the Territory and Licensee shall indemnify and protect Licensor against any and
all claims by End Users due to faults attributable to Licensee in the




 









 






	 	 	event that Licensee terminates the service of Game to End Users for any reason whatsoever
and/or this Agreement for any reason whatsoever.





Article 11

Confidentiality





	11.1	 	All Confidential Information disclosed by either Party under this Agreement shall be
maintained in confidence by the receiving Party and shall not be used for any purpose other
than explicitly granted under this Agreement. Each Party agrees that it shall provide
Confidential Information received from the other Party only to its officers, employees,
consultants and advisors who need to know for the performance of this Agreement. The receiving
Party shall be responsible for any breach of this Article by its officers, employees,
consultants and advisors.
	 
	11.2	 	In the event that any Confidential Information, including but not limited to the source codes
of the Game, Technical Information and financial information, is disclosed or divulged to any
third party who is not authorized to have access to or obtain such Confidential Information
under this Agreement, the Parties shall cooperate with each other and exert their best efforts
to protect or restore such Confidential Information from such unauthorized disclosure or
divulgement. If such disclosure or divulgement of the Confidential Information was made due to
the receiving Party’s gross negligence or bad faith, the receiving Party shall be responsible
for all of the damages incurred by the disclosing Party, including but not limited to any
attorneys’ fees incurred by the disclosing Party in order to protect its rights under this
Article 11.
	 
	11.3	 	The confidential obligation shall not apply, in the event that it can be shown by competent
documents that the Confidential Information;






	 	(a)	 	becomes published or generally known to the public before or after the
execution of this Agreement without any breach of this Agreement by any Party;
	 
	 	(b)	 	was known by the receiving Party prior to the date of disclosure to the
receiving Party;
	 
	 	(c)	 	either before or after the date of disclosure is lawfully disclosed to the
receiving Party by a third party who is not under any confidentiality obligation to the
disclosing Party for such information;
	 
	 	(d)	 	is independently developed by or for the receiving Party without reference to
or reliance upon the Confidential Information; or
	 
	 	(e)	 	is required to be disclosed by the receiving Party in accordance with the
applicable laws and orders from the government or court; provided that, in this case,
the receiving Party shall provide prior written notice of such disclosure to the
disclosing Party and takes reasonable and lawful actions to avoid and/or minimize the
degree of such disclosure.





 









 





Article 12

Term





	12.1	 	This Agreement shall become effective on the Effective Date of this Agreement and shall
remain in effect for a period of Three (3) years counted from the commercial service date,
unless sooner terminated in accordance herewith.
	 
	12.2	 	This Agreement shall automatically renew for successive One (1) year periods, unless either
party provides the other with written notice of its intention not to renew at least Three (3)
months prior to the end of the initial term of this Agreement(The “First Renewal”). Licensee
agrees that the Royalty Payments (as described in Article5.2) in the First Renewal hereof
shall be increased from Twenty Five percent (25%) to Twenty Eight percent (28%), however there
shall be no license extension fee, which is imposed on or payable by the Licensee.
	 
	12.3	 	No later than Three (3) months prior to the expiration of the First Renewal, Licensor shall
give Licensee the first right of negotiation for a period of Ninety (90) days for
re-execution of a License Agreement for an additional term of One (1) year (the “Second
Renewal”) for the Game. The Second Renewal shall be made based on the concurrent users and
revenues of the Game during the time of the negotiation. If no agreement in writing is made
between the Parties for renewal or re-execution of a license agreement during such period,
this Agreement shall expire without any further extension or renewal.





Article 13

Termination





	13.1	 	This Agreement may be terminated upon the mutual agreement of the Parties.
	 
	13.2	 	Each Party shall have the right to immediately terminate this Agreement:






	 	(a)	 	upon written notice to the other Party in the event of the other Party’s
material breach of this Agreement and such breach shall continue for a period of thirty
(30) days after the breaching Party’s receipt of written notice setting forth the
nature of the breach or its failure to perform and the manner in which it may be
remedied;
	 
	 	(b)	 	if the other Party or its creditors or any other eligible party files for its
liquidation, bankruptcy, reorganization, composition or dissolution, or if the other
Party is unable to pay any kind of debts as they become due, or the creditors of the
other Party have taken over its management; or
	 
	 	(c)	 	in accordance with Section 13.3 below.






	13.3	 	Notwithstanding Article 13.2 above, Licensor may immediately terminate this Agreement upon a
written notice to Licensee:




 









 












	 	(a)	 	if Licensee fails to pay any due payments including License Fee or Royalty
Payments, for any given month as set forth in Article 5.1 and 5.2, within twenty (20)
days after receiving written notice from Licensor for late payment;
	 
	 	(b)	 	in the event of a willful, gross understatement by Licensee of the Payments due
Licensor without any justifiable reasons, as defined in Article 6.6 above;
	 
	 	(c)	 	if the Close Beta Test and/or Open Beta Test of the Game is not launched in the
Territory within the period set forth in Article 3.7, unless such failure has been
caused by Licensor or is due to force majeure event as set forth in Article 14;
	 
	 	(d)	 	if the commercial service of the Game is not launched in the Territory within
the period set forth in Article 3.7, unless such failure has been caused by Licensor or
is due to force majeure event as set forth in Article 14; or
	 
	 	(e)	 	if the service of the Game in the Territory is stopped, suspended, discontinued
or disrupted for more than fifteen (15) consecutive days during the term of this
Agreement due to causes attributable to Licensee.;
	 
	 	(f)	 	if the Game in the Territory is provided upon free or unreasonably low
price, compared to fair market value, by Licensee without prior written approval from
Licensor except as otherwise specified in Article 7.5;






	13.4	 	Upon the effective date of such termination, all rights granted to Licensee hereunder shall
immediately cease and shall revert to Licensor, and Licensee shall immediately cease servicing
of the Game and return to Licensor any and all software, technical documents and other
materials or information provided by Licensor to Licensee under this Agreement, and shall
destroy any and all copies of such software, technical documents, materials or information.
Furthermore, Licensee shall provide and deliver to Licensor any and all such information and
documents related to the Game, including but not limited to database related to the Game and
information and/or data source about the Game users, as may be requested by Licensor.
	 
	13.5	 	No termination of this Agreement shall affect the Parties’ rights or obligations that were
incurred prior to the termination. The expiration or termination of this Agreement shall not
affect the effectiveness of Articles 6, 9, 10, 11, and 13.4, which shall survive the
expiration or termination of this Agreement.
	 
	13.6.	 	Licensor shall have no liability to Licensee for damages of any kind, including
indirect, incidental or consequential damages, on account of the termination or
expiration of this Agreement in accordance with its terms.
	 
	13.7	 	Upon termination or expiration of this Agreement, Licensee shall shut down and
terminate the service of Game provided by Licensee. Licensor shall have the right to
assume the service of the Game one (1) month prior to such termination. Licensor
may elect to purchase any equipment purchased by Licensee for the service of the
Game at the fair market value of such equipment on the date Licensor elects to
assume the service of the Game as determined by an independent third party expert
appointed by mutual consent of the Parties.




 









 











Article 14

Force Majeure





	14.1	 	Notwithstanding anything in this Agreement to the contrary, no default, delay or failure to
perform on the part of either Party shall be considered a breach of this Agreement if such
default, delay or failure to perform is shown to be due entirely to causes occurring without
the fault of or beyond the reasonable control of the Party charged with such default, delay or
failure, including, without limitation, causes such as strikes, lockouts or other labour
disputes, riots, civil disturbances, actions or inactions of governmental authorities or
suppliers, electrical power supply outage, a failure or breakdown in the services of internet
service providers, epidemics, war, embargoes, severe weather, fire, earthquake and other
natural calamities or, acts of God or the public enemy. Force majeure shall include actions
taken by the government of the Republic of Korea or agencies thereof, which restrict the
ability of Licensee to remit payments to Licensor under this agreement, or failure of the
government of the Republic of Korea or agencies thereof to approve such payments.
	 
	14.2	 	If the default, delay or failure to perform as set forth above in Article 14.1 exceeds one
hundred eighty (180) days from the initial occurrence, a Party who is not affected by such
force majeure event shall have the right to terminate this Agreement with a written notice to
the other Party.





Article 15

General Provisions





	15.1	 	Licensee may not assign, delegate or otherwise transfer in any manner any of its rights,
obligations and responsibilities under this Agreement, without prior written consent of
Licensor. Licensor may, with prior written notice to Licensee, assign, delegate or otherwise
transfer all or part of its rights, obligations and responsibilities under this Agreement to a
third party designated by Licensor.
	 
	15.2	 	It is understood and agreed by the Parties that this Agreement does not create a fiduciary
relationship between them, that Licensee shall be an independent contractor, and that nothing
in this Agreement is intended to constitute either Party an agent, legal representative,
subsidiary, joint venture, employee or servant of the other for any purpose whatsoever.
	 
	15.3	 	If any kind of notices, consents, approvals, or waivers are to be given hereunder, such
notices, consents, approvals or waivers shall be in writing, shall be properly addressed to
the Party to whom such notice, consent, approval or waiver is directed, and shall be either
hand delivered to such Party or sent by certified mail, return receipt requested, or sent by
FedEx, DHL or comparable international courier service, or by telephone, facsimile or
electronic mail (in either case with written confirmation in any of the other accepted forms
of notice) to the following addresses or such addresses as may be furnished by the respective
Parties from time to time:




 









 










If to Licensor.

Attention: Mr. Charles Baik

15F, Nuritkum Square Business Tower. 1605, Sangam-Dong, Mapo-Gu, Seoul, Korea

Tel: +82-2-2132-7000

Fax: +82-2-2132-7070



If to Licensee

Attention:                                         

4499 Glencoe Avenue Marina Del Rey, CA 90292, USA

Tel: +1-310-827-0799

Fax: +1-310-827-0813





	15.4	 	No course of dealing or delay by a Party in exercising any right, power, or remedy under this
Agreement shall operate as a waiver of any such right, power or remedy except as expressly
manifested in writing by the Party waiving such right, power or remedy, nor shall the waiver
by a Party of any breach by the other Party of any covenant, agreement or provision contained
in this Agreement be construed as a waiver of the covenant, agreement or provision itself or
any subsequent breach by the other Party of that or any other covenant, agreement or provision
contained in this Agreement.
	 
	15.5	 	This Agreement, including all exhibits, addenda and schedules referenced herein and attached
hereto, constitutes the entire agreement between the Parties hereto pertaining to the subject
matter hereof, and supersedes all negotiations, preliminary agreements, and all prior and
contemporaneous discussions and understandings of the Parties in connection with the subject
matter hereof.
	 
	15.6	 	This Agreement shall be written in English and all disputes on the meaning of this Agreement
shall be resolved in accordance with English version of this Agreement.
	 
	15.7	 	This Agreement may be amended only upon the execution of a written agreement between Licensor
and Licensee that makes specific reference to this Agreement.
	 
	15.8	 	This Agreement shall be governed by and construed in accordance with the laws of the Republic
of Korea.
	 
	15.9	 	All disputes, controversies, or differences which may arise between the Parties, out of or in
relation to or in connection with this Agreement, or for the breach thereof, shall be finally
settled by arbitration in Seoul, Korea, in accordance with Arbitration Rules of the Korean
Commercial Arbitration Board and under the laws of Korea. The award rendered by the arbitrator
shall be final and binding upon both Parties concerned.
	 
	15.10	 	If any article, sub-article or other provision of this Agreement or the application of such
article, sub-article or provision, is held invalid, then the remainder of the Agreement and
the application of such article, sub-article or provision to persons or circumstances other
than those with respect to which it is held invalid shall not be affected thereby.
	 
	15.11	 	Headings in this Agreement have been inserted for purpose of convenience only and




 









 






	 	 	are not to be used in construing or interpreting this Agreement.





IN WITNESS WHEREOF, the Parties have executed this Agreement on the date first above-written.



	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Gravity Co., Ltd	 	 	 	Gravity Interactive, Inc	 	 
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	By:

	 	 	 	 	 	 	 	By:	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 
	 

	 	Name:
	 	Il Young, Ryu
	 	 	 	 	 	Name:
	 	Il Young, Ryu	 	 
	 

	 	Title:
	 	Chairman & CEO
	 	 	 	 	 	Title:
	 	CEO