Term Lease Agreement - Gravity Corp. and Gravity Interactive LLC
TERM LEASE AGREEMENT
Between
GRAVITY CORPORATION, hereinafter called Lessor
And
GRAVITY INTERACTIVE LLC, hereinafter called Lessee
This Lease Agreement between Lessor and Lessee dated May 01, 2003 contains the
following terms:
1. Objective
Lessor hereby leases to Lessee and Lessee hereby leases from Lessor, all
Equipment and other property, described in Section 2 of this agreement.
2. Leased Equipment
All Equipment shall be leased for the purpose of online game service and the
equipment leased hereunder is as outlined below:
Description Quantity
----------- --------
Servers - pe 1550 20
Servers - pe 1550 8
Servers - pe 1650 11
Servers - pe 6450 1
Servers - pe 6450 1
Servers - pe 6450 2
Cables for KVM switch box 1
---
Total 46
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3. Term of Lease
(1) The date of the Lessee's signing of the Certificate of Acceptance
(Exhibit B which shall be attached hereto and made a part hereof)
shall be the "Lease Commencement Date". The term of this Lease with
respect to each item of Equipment shall commence when the Certificate
of Acceptance (Exhibit B) is signed by Lessee, and the expiration date
of this agreement is April 30, 2003 In case of the revocation of this
leasing contract by the agreement of both parties, lessee has a
purchase option for the foresaid equipments. The purchasing price of
the foresaid equipments shall be the amount equal to the original
equipments cost less accumulated depreciation cost as of purchasing
date. Any right, title and interest pertain to this Leased Equipment
shall transfer to Lessee at the time of Equipment Purchase.
<PAGE>
(2) Upon both parties agreement, renewal shall be extended for 15 days
after the expiration date of this agreement.
4. Order and Delivery of Equipment
(1) Lessor agrees to arrange for delivery of the Equipment within thirty
(30) days of the date of the Lease Agreement.
(2) Satisfactory delivery date shall mean the date Lessee requested
equipments and software are configured and installed.
5. Use of Equipment
(1) Lessee covenants and represents to Lessor that the Equipment will be
used exclusively for online game service purposes and will not be used
at any time during the Term of this Lease for personal, family or any
other purposes.
(2) The Lessee also shall use the Equipments in a careful and proper
manner and shall comply with and conform to all laws, ordinances and
regulations which relate in any way to the possession, use or
maintenance of the Equipment
6. Lessee's Inspection and Acceptance
(1) The Lessee's acceptance of the Equipment shall be evidenced by the
Lessee's signing of the Certificate of Acceptance (Exhibit B). Lessee
shall inspect each item of Equipment within sixty (60) working days
after delivery and installation for acceptability thereof and if
Equipment is acceptable shall promptly execute the Certificate of
Acceptance (Exhibit B).
(2) If Lessee believes delivered Equipments do not meet specified
requirements, Lessee should gives written notice to Lessor specifying
any defect in the Equipment or any other proper objection to the
Equipment. Lessee agrees that it shall be conclusively presumed, as
between Lessor and Lessee, that Lessee has accepted the Equipment and
the Lease shall be deemed to commence on the fifteen days after
delivery unless Lessee gives written notice to Lessor.
(3) If Lessee gives a written notice for the explanation of un-acceptance
of delivered Equipment to Lessor, the Equipment shall be returned
immediately to the Lessor and regenerated in accordance with the
original Lessee specified Instruction.
7. Equipment Location
Lessee shall keep and use the Equipment at the Lessee address location as
specified below. However, Lessee may move the Equipment to another location upon
informing the Lessor of the new location.
4505 GLENCOE AVE.
MARINA DEL REY, CA 90292
U.S.A
<PAGE>
8. Title and Ownership
(1) The Equipment at all times shall be and remain the sole and exclusive
property of Lessor during the Lease Term and Lessee shall have no
right, title or interest herein except the usage right.
(2) At the end of Lease term, lessee has a purchase option for the
foresaid Equipment. Any right, title and interest pertain to this
Leased Equipment shall transfer to Lessee at the time of Equipment
Purchase.
9. Liens and Taxes
(1) Lessor shall keep the Equipment free and clear of liens and
encumbrance.
(2) Lessee shall not assign a third party for responsibility on the
Equipment.
(3) Lessor shall not sell, or transfer this Lease, the Equipment or any
part thereof or any interest therein without an agreement between the
Lessor and the Lessee.
(4) Lessee shall be responsible or liable for any taxes (property, local,
state, or federal) related to ownership of the Equipment.
10. Lease Payments
(1) Lease payments shall be made in accordance with Payment Schedule
(Exhibit C attached hereto and made a part hereof).
The Lease payments for Equipment during the Term shall be payable to
the Lessor in the amounts and at the address set forth below.
GRAVITY CORPORATION
620-2 SHINGSA-DONG SHINGU BLDG 5TH
KANGNAM-GU, SEOUL KOREA
(2) Lease payments shall be paid on a MONTHLY BASIS. First Lease payment
shall be due no less than one hundred twenty (120) days after Lease
Commencement Date or thirty days (30) from Lessor's billing date,
whichever is the later, for all Equipment.
11. Loss and Damage
At the end of Lease term, Lessee shall be responsible to return the Equipment to
Lessor under the same condition as when the Equipment was first leased. Lessee
assumes risks and liabilities directly related to loss, theft, damage, or
destruction to any Equipment. No loss, theft, damage or destruction of the
Equipment shall relieve Lessee of the obligation of Lease payments or any other
obligation under this Lease.
12. Purchase Option or Return of Equipment
(1) No less than sixty (60) days prior to the expiration of the Lease, the
Lessor shall provide a written notification to the Lessee of the
purchase option cost of the Equipment. Lessee shall have the option to
purchase all or part of the Equipment at this time for the residual
cost detailed in the Equipment Schedule (Exhibit A).
(2) Lessee shall provide thirty (30) days written notice prior to the end
of the Lease Term that it will purchase the Equipment or that it will
return the Equipment to the Lessor at such time.
<PAGE>
13. Entire Lease Agreement
(1) The terms and conditions of this Term Lease Agreement, Equipment
Schedule (Exhibit A), Certificate of Acceptance (Exhibit B), Payment
Schedule (Exhibit C), and any Modifications upon which it is based
shall constitute the entire Lease Agreement between the Lessee and the
Lessor.
(2) These terms and conditions shall not be amended, altered or changed
except by the written agreement of both parties.
14. Legal jurisdiction
Lessor and Lessee hereby affirm to have the ability to perform responsibly in
connection with this Lease Agreement. When a dispute continues for more than 30
days, this Lease Agreement shall be brought in Seoul District Court in Republic
of Korea.
THIS LEASE IS SUBJECT TO THE TERMS AND CONDITIONS WRITTEN ABOVE AND WHICH LESSEE
AND LESSOR ACKNOWLEDGE HAVING READ. LESSOR AND LESSEE SHALL MAKE TWO COPIES OF
AGREEMENT, AND EACH ONE TO BE KEPT BY BOTH PARTIES.
LESSOR: Gravity Corp.
By: Hwi Young, Jung
-------------------------
/s/ Jung Hwi Young
Title: CEO 05/01/2003 Date
LESSEE: Gravity Interactive, LLC.
By: Jung R. Kim
-------------------------
/s/ Jung Ryool Kim
Title: CEO 05/01/2003 Date
<PAGE>
EQUIPMENT SCHEDULE
(EXHIBIT A)
This Equipment Schedule (Exhibit A) is attached to and is governed by the terms
and provisions of the Term Lease Agreement dated May 01, 2003 by and between,
GRAVITY INTERACTIVE LLC (Lessee) and GRAVITY CORPORATION (Lessor).
1. The Equipment leased hereunder is as outlined below:
(attach additional pages, if necessary)
Items mm/dd/yy Quantity Price($) Remarks
----- -------- -------- -------------- -------
servers - pe 1550 11/06/2001 20 49,529.39
servers - pe 1550 01/02/2002 8 19,534.46
servers - pe 1650 04/08/2002 11 34,739.45
servers - pe 6450 11/06/2001 1 6,117.88
servers - pe 6450 11/10/2001 1 7,641.33
servers - pe 6450 04/26/2002 2 22,316.28
Cables for KVM switch box 1
Sub $139,878.79USD
<PAGE>
CERTIFICATE OF ACCEPTANCE
(EXHIBIT B)
In compliance with the terms, conditions and provisions of the Term Lease
Agreement dated May 01, 2003 ("Lease") by and between the undersigned GRAVITY
INTERACTIVE LLC ("Lessee") and GRAVITY CORPORATION ("Lessor"), Lessee hereby
accepts all of the Equipment for all purposes under the Lease and all attendant
documents as of June 30, 2003 (Lease Commencement Date).
GRAVITY INTERACTIVE LLC (LESSEE)
By: Jung R. Kim
-------------------------
/s/ Jung Ryool Kim
Title: CEO
Date: June 30, 2003
<PAGE>
PAYMENT SCHEDULE
(EXHIBIT C)
1. Lease Terms & Monthly Payment Amount:
Term - XXX 12 months, 24 months, or 36 months
----- ---- ----
Payment Period - MONTHLY BASED ON COMMENCEMENT DATE (JUNE 30, 2003)
----------------------------------------------------
Monthly Lease Payment: $1,165.66USD
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