EX-10.7 12 u99340exv10w7.txt EX-10.7 AGREEMENT, DATED OCTOBER 27, 2004 EXHIBIT 10.7 AGREEMENT GRAVITY Co., Ltd. and Myoung-Jin Lee hereby agree to amend the royalty payment specified in the Agreement on Ragnarok Game Services and Related Matters, which was entered into by both parties on January 22, 2003 and remains effective to-date. 1. Other than the amendment on the royalty rates as provided herein, all terms and conditions of the Agreement on the Ragnarok Game Services and Related Matters dated January 22, 2003 shall remain in force and effect without modification. 2. Neither party shall disclose to a third party provisions hereof without written consent of the other party. 3. The amendment shall be effective retroactive to January 2004. ROYALTY RATE AMENDMENT
Description Before After Base of Royalty ----------- ------ ----- --------------- Domestic Ragnarok Royalty 1.50% 1.50% Net Sales Other domestic royalties Stamp cost on attack version, 10.00% 10.00% Net Profit etc. Other domestic contract Character contract 10.00% 5.00% Net Profit amounts Domestic product sales Character products 10.00% 10.00% Net Profit Overseas Ragnarok royalty Royalty 1.50% 1.50% Net Sales Overseas Ragnarok royalty New contracts 1.50% 1.00% Net Sales contract amounts Extended contracts 1.50% 0.00% - Overseas product sales Character products 10.00% 10.00% Net Profit
Other overseas contract amount Merchandising contracts 10.00% 2.50% Net Profit Character contracts 10.00% 2.50% Net Profit Animation 10.00% 0.00% - PC games and mobile games 5.00% 5.00% Net Profit Others Others 10.00% 2.50% Net Profit
* Net Sales: Total sales - all expenses (VAT, fees payable to payment service providers and fees payable to Internet cafes) * Net Profit: the amount referred to as net income in the profit and loss statement for the current term, as calculated after deducting direct expenses, indirect expenses and taxes. SETTLEMENT PERIOD
Description Before Change After Change Remarks ----------- ------------- ------------ ------- Domestic and overseas royalties Monthly settlement Monthly settlement No change Contract amounts and other sales Monthly settlement Quarterly settlement
EXPENSE CALCULATION BASIS
Description Before Change After Change Remarks ----------- ------------- ------------ ------- Contract amounts and sales Estimated expenses Cumulative sales (30%)
October 27, 2004 /seal/ Representative Director: Richard Hyonkook Kim 6th Floor, Shingu Building, 620-2, Shinsa-dong, Gangnam-gu, Seoul GRAVITY Co., Ltd. /s/ Myoung-Jin Lee Myoung-Jin Lee (740412-1052628) Yonsei Heightsville No. 302, 501-24, Changcheon-dong, Seodaemun-gu, Seoul