TRANSLATION) ACCORD AND SATISFACTION AGREEMENT
EXHIBIT B
Son Asset Management Godo Kaisha (“XXX”) and EZER Inc. (“EZER”) hereby agree as follows.
ARTICLE 1. (CONFIRMATION OF EZER CORPORATE BOND HELD BY XXX)
XXX and EZER confirm and agree as of the date hereof that XXX is the holder of that certain EZER Series One Corporate Bond (the “Corporate Bond”) issued by EZER to XXX on December 22, 2006, having the following terms:
XXX and EZER confirm and agree as of the date hereof that XXX is the holder of that certain EZER Series One Corporate Bond (the “Corporate Bond”) issued by EZER to XXX on December 22, 2006, having the following terms:
Total Amount Outstanding:
|
Yen 9,930,000,000 | |
Interest Rate:
|
14.5% per annum (non-compounding, subject to per diem calculation on the basis of 365 days a year, with amounts of less than one yen rounded down) | |
Redemption Date:
|
November 20, 2007 |
ARTICLE 2. (ACCORD AND SATISFACTION AND PAYMENT OF INTEREST)
| (1) | EZER shall transfer to XXX in satisfaction of its obligations pursuant to the Corporate Bond
(the “Accord and Satisfaction”) 3,640,619 shares of common stock of Gravity Co., Ltd. (the
“Shares”) held by EZER on the later to occur of the Redemption Date of the Corporate Bond and
the date on which the Korean Fair Trade Commission approves such transfer (the “Closing
Date”). |
|
| (2) | On the Closing Date, EZER shall deliver to XXX the share certificate (the “Share
Certificate”) representing the Shares. |
|
| (3) | As a result of the Satisfaction and Accord, EZER’s obligations pursuant to the Corporate Bond
shall be extinguished in an amount which is the lesser of (i) 3,640,619 (the number of
transferred shares) multiplied by the United States NASDAQ National Market closing price
(indicated as the price of one forth of one share) of Gravity Co., Ltd. common stock on the
day prior to the Closing Date, multiplied by four, and further multiplied by the yen/dollar
middle rate (TTM) exchange rate reported by Mizuho Corporate Bank, Ltd. (the “Shares Value
Amount”) or (ii) the sum of the outstanding principal amount, accrued interest, early
redemption fees, and delinquent charges (if any) on the Corporate Bond (the “Outstanding
Corporate Bond Amount”). If the Shares Value Amount is less than the Outstanding Corporate
Bond Amount, the difference shall be applied in
satisfaction of the Outstanding Corporate Bond Amount in the following order: (i) delinquent
charges, (ii) accrued interest, (iii) early redemption fees, and (iv) outstanding principal
amount. |
| (4) | In the event that the Shares Value Amount exceeds the Outstanding Corporate Bond Amount, XXX
shall return to EZER the difference between such amounts in cash. |
|
| (5) | In the event the Outstanding Corporate Bond Amount exceeds the Shares Value Amount, EZER
shall continue to owe XXX any remaining payment obligations under the Corporate Bond, and EZER
shall pay delinquent charges in the amount of 14.5% per annum (subject to per diem calculation
on the basis of 365 days a year) on such outstanding amounts until such amounts shall have
been repaid in full. |
ARTICLE 3. (REPRESENTATIONS AND WARRANTIES)
EZER hereby represents and warrants to XXX as of the date hereof that the following are true and
accurate:
| (1) | EZER has good and valid title to the Shares, and is listed as a shareholder in the
shareholder register of Gravity Co., Ltd. The Shares are free and clear of any lien,
pledge, charge or any other restriction of any kind, and EZER has not entered into any
agreement with a third party that would restrict this Accord and Satisfaction. The
applicable laws and the articles of incorporation, bylaws and other internal regulations
of Gravity Co., Ltd. do not contain any provisions that would restrict this Accord and
Satisfaction, and, when the Shares have been registered in the name of XXX, XXX shall
acquire, and shall be able to exercise on the Closing Date, all its rights as shareholder
without any encumbrances. |
|
| (2) | The Share Certificate has been legally and validly issued and constitutes a legal and
valid representation of the Shares. |
|
| (3) | Gravity Co., Ltd. is a stock corporation legally organized and validly existing under
the laws of Korea. |
|
| (4) | There are no judgments, decrees, rulings or settlements (either court-based or
out-of-court) that would result in the acquisition or loss of any shareholder rights with
respect to the Shares, and there are no proceedings or other legal or administrative
procedures pending or threatened with the courts or any administrative body with regard to
these Shares. |
|
| (5) | There are no applications by third parties pending or threatened for injunctions,
enforcement proceedings or auction or other proceedings, or any preliminary
injunctions or dispositions for failure to pay taxes or other duties pending or threatened. |
| (6) | There are no litigation proceedings, injunctive proceedings, foreclosure proceedings,
settlements, arbitration or any other judicial or administrative proceedings pending or
threatened against or with respect to EZER that may adversely affect EZER’s entry into
this Agreement or the performance of EZER’s obligations under this Agreement. |
|
| (7) | There are no litigation, arbitration, mediation or administrative proceedings pending
or threatened relating to, and having a material adverse effect on, the financial
conditions and operations of EZER or its entering into or performance under this
Agreement. |
|
| (8) | The transfer of the Shares and the legal requirements and other procedures relating
to such transfer shall not constitute concealment or a gratuitous transfer or other
fraudulent transfer (“Fraudulent Transfer”), and EZER has no intent to conduct, or
knowledge of, any Fraudulent Transfer, or any other illegal intent. |
|
| (9) | EZER is not currently insolvent and should not be rendered insolvent as a result of
entering into this Agreement or performing its obligations hereunder. No bankruptcy or
dissolution proceedings have commenced with respect to EZER. |
ARTICLE 4. (TERMINATION AND INDEMNIFICATION)
| (1) | XXX may terminate this Agreement at any time without notice if EZER breaches any
representations or warranties under the preceding Article or any of its obligations under
this Agreement. |
|
| (2) | In the event EZER breaches any representations or warranties under the preceding
Article or any of its obligations under this Agreement, EZER shall indemnify and hold XXX
harmless against any losses incurred by XXX as a result thereof, whether or not XXX
exercises its right to terminate this Agreement. |
ARTICLE 5. (EXPENSES)
Unless otherwise agreed, each party to this Agreement shall bear their own expenses with regard to
the execution and drafting of, and performance under, this Agreement.
ARTICLE 6. (EXCLUSIVE JURISDICTION)
The parties hereto shall submit to the initial exclusive jurisdiction of the Tokyo District
Court regarding any and all disputes under this Agreement.
ARTICLE 7. GOOD FAITH DISCUSSIONS
Any matters not set forth in this Agreement shall be decided by mutual good faith discussions
between EZER and XXX in accordance with the spirit of this Agreement.
IN WITNESS WHEREOF, XXX and EZER have caused this Agreement to be signed and sealed in duplicate
and each party shall retain one copy.
October 19, 2007
| Son Asset Management Godo Kaisha: | Xxxxxxxxx Xxx | |||
| Representative Partner | ||||
| 18F Shiodome Sumitomo Bldg. | ||||
| 1-9-2 Higashi Shinbashi | ||||
| Minato-ku, Tokyo | ||||
| (Seal) | ||||
| EZER Inc.: | Yoo Il Young | |||
| Representative Director | ||||
| 0-00-00 Xxxxxx-Xxxxxx | ||||
| Xxxxxx-xx, Xxxxx | ||||
| (Xxxx) |
