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Articles of Incorporation

CHAPTER Ⅰ. GENERAL PROVISIONS

Article 1. (Corporate name)

The name of the company shall be "SAMSUNG MOOLSAN CHUSICK HOESA," (the “Company”) which shall be written in English as "SAMSUNG C&T CORPORATION"

Article 2. (Objectives)

The objectives of the Company shall be as follows

  • 1. Export/import and agency thereof
  • 2. Sale of marine and agricultural products and agency thereof
  • 3. Sale of industrial products and raw materials, and agency thereof
  • 4. Manufacture and sale of knit goods and their raw materials
  • 5. Manufacture and sale of needle works and sports goods
  • 6. Manufacture and sale of leather goods
  • 7. Manufacture and sale of materials used for civil engineering and construction
  • 8. Manufacture and sale of pharmaceutical products, medical supplies, and medical equipment
  • 9. Marine transportation
  • 10. Mine development
  • 11. Real estate
  • 12. Supplying to military
  • 13. Contracting for overseas projects
  • 14. Transport and warehousing
  • 15. Development and sale of oil, natural gas and other natural resources in Korea and abroad
  • 16. Storage and sale of coal
  • 17. Brokerage and sale of industrial property
  • 18. Brokerage of licensing agreement and sale of license thereof
  • 19. Export and import of toxicant and sale thereof
  • 19. Export and import of toxicant and sale thereof
  • 21. Data processing, distribution, and sale thereof
  • 22. Manufacture of printed materials and video programs, and sale thereof
  • 23. Broadcasting through cable network
  • 24. Manufacture and sale of petrochemical products
  • 25. Manufacture and sale of the nonferrous metals
  • 26. Ship building, repair and sale
  • 27. Construction and operation of sports facilities
  • 28. General wholesale and synthetic retail
  • 29. Education
  • 30. Sale of motor vehicles
  • 31. Maintenance and repair of motor vehicles
  • 32. Sale of motor vehicle parts and accessories
  • 33. Retail sale of automotive fuel
  • 34. Renting of transportation equipment
  • 35. Other financial intermediation
  • 36. Manufacture, sale and distribution of steel and non-ferrous metal plates
  • 37. Schooling
  • 38. Cultural arts services
  • 39. Engineering, construction and supervision of the following
    • Civil & architectural, pavement, installation of steel material, and electrical facilities
    • Harbor & dredging
    • Reclamation
    • Landscaping
    • Electric & telecommunication
    • fire fighting facilities
    • mechanical facilities
    • Gas &special heating facilities
    • Cultural assets protection services
    • disposal facilities of general and industrial waste
    • disposal facilities of human and animal waste
    • facilities controlling water, air and noise pollution
  • 40. Engineering, manufacture, construction, supervision of plants
  • 41. Overseas construction and development works
  • 42. manufacture, sale, maintenance and lease of transportation and construction equipment with related components
  • 43. Forestry, fruit and floral agriculture, and livestock-breeding
  • 44. Construction, sale and renting of housing
  • 45. Arrangement of travel accommodations for tourists and operation of tourist facilities
  • 46. Overall lease business
  • 47. Investment in manufacture and sale of automobiles with related parts
  • 48. Heavy chemical and electronic business
  • 49. Supply to Armed Forces and the government
  • 50. Manufacture, sale, maintenance, and leasing of various types of machinery, equipment, and parts (Amended on March 18, 2011)
  • 51. Manufacture and sale of light aggregates
  • 52. Renting and repairing of automobiles and heavy equipment
  • 53. Engineering business
  • 54. Operation and renting of shopping centers
  • 55. Power plants, municipal heating &industrial complexes and energy-related business
  • 56. Production and sale of software
  • 57. Manufacturing & sales of construction materials for prefabrication
  • 58. Operation of parking lots, integrated transit centers and related commercial facilities
  • 59. Urban railway business
  • 60. Quarrying of constructional sand and gravel
  • 61. Land readjustment & home lot development business
  • 62. Housing management business
  • 63. Trust business
  • 64. Agency for environmental impact evaluation
  • 65. Agency for energy-consumption planning
  • 66. Maintenance of facilities
  • 67. Harbor, train, airport, bridge, tunnel, road, terminal and related convenience facilities operation
  • 68. Agency of sale and renting of real estate
  • 69. Agency sale of memberships of condo, sports, golf etc.
  • 70. Import and sale of parking control equipment
  • 71. Parking lot service operations
  • 72. Traffic effect evaluation
  • 73. Facility safety examination works
  • 74. Operation of marine rescue parties
  • 75. Welfare works for the elderly
  • 76. Restaurant business
  • 77. Record and cassette manufacture and sales
  • 78. Production and sale of agricultural, marine and dairy goods
  • 79. Credit sales finance
  • 80. Rental of sports and leisure goods
  • 81. Rental of personal and household supplies
  • 82. Construction, operation and renting of recreation facilities
  • 83. Measurement Business
  • 84. Construction Services
  • 85. Agency for merger and acquisition
  • 86. Agency for compound transportation
  • 87. Agency for transportation of cargo
  • 88. Intermediate service of cargo and agency thereof
  • 89. Domestic cargo service
  • 90. Internet business
    • Internet distribution
    • Internet auction
    • Internet broadcast
    • Internet healthcare
    • Internet character creation and sales
    • Internet advertisement
    • Other business related to Internet
  • 91. Electronic cash business
  • 92. Special category telecommunication business, Electrical communication and Information communication business
  • 93. All business necessary, either direct or indirect, to the above
  • 94. Investment, either direct or indirect, into business related to the above
  • 95. Urban development, urban renewal, combined development, real estate development business
  • 96. Investment, construction, management business of social overhead capital facilities
  • 97. New and renewable energy business
    • New and renewable energy development and generation business
    • New and renewable energy equipment production, assembly, installment and sales business
    • New and renewable energy raw material cultivation, storage, processing, distribution business
    • Other new and renewable energy related business
  • 98. Manufacture, sale, construction, and operation of water-related facilities such as desalination facilities, water and sewage facilities, and waste water treatment facilities (Newly established on March 18, 2011)
  • 99. All domestic and overseas business necessary, either direct or indirect, to the above (Amended on March 18, 2011)
  • 100. Domestic and overseas investment, either direct or indirect, into business related to the above (Amended on March 18, 2011)

Article 3. (Location)

  • ① The Company shall have its head office in Seoul
  • ② The Company may have the branch offices, if necessary, by the resolution of board of directors or the committee authorized by the board of directors

Article 4. (Method of public notices)

Public notices of the company shall be given in "THE JOONG-ANG DAILY NEWS", a daily newspaper published in Seoul, or its successor newspaper if its name is changed.

CHAPTER Ⅱ. SHARES

Article 5. (Total number of authorized shares)

The total number of shares which the company is authorized to issue shall be 320,000,000.

Article 6. (Par value)

Par value per share of the company shall be KRW 5,000.

Article 7. (Kind of share certificates)

  • ① The kind of share certificates of the company shall be a registered common share and a registered preferred share.
  • ② The preferred share of the company shall be non-voting and the number of issued shares shall be 30,000,000 shares.
  • ③ The dividend rate of preferred shares shall be not less than 1% per annum adopted on the board of directors or the committee authorized by the board of directors.
  • ④ In case the dividend rate of common shares shall exceed that of the preferred shares, the dividen rate of preferred shares, approved by board of director or the committee authorized by the board of director at the time of issuance, shall be decided as the dividend rate mentioned in clause plus the dividend rate of common shares, or as the same as dividend rate of common shares only.
  • ⑤ In case of issuance of additional shares for value or for free, or in case of the distribution of stock dividends, the company shall, in principle, issue common shares for common shares and preferred shares for preferred shares with the same characteristics thereof in proportion to the number of shares being held. However, the company may issue, if necessary, only one class of shares, in the event of issuance of additional shares for value or the distribution of stock dividends. In this case, all shareholders shall be entitled to subscribe for or receive the shares as above issued.
  • ⑥ The share certificate of the company shall be issued in 8 kinds of one, five, ten, fifty, one hundred, five hundred, one thousand and ten thousand share(s) per certificate.
  • ⑦ In case a dividend of preferred shares has not been paid in a business year, the accumulated amount of dividend not paid shall be paid with priority in the next business year.

Article 7 - 2 (Retirement of Shares)

The Company may retire its shares by a resolution of the Board of Directors according to the guidelines provided by applicable laws and regulations within the profits to be distributed to its shareholders (the amount shall be within the limits set forth by applicable laws and regulations and within the profits to be distributed to its shareholders at the end of the year based on regulations set forth in Paragraph 1 Article 462 of Commercial Code)

Article 8. (Transfer agent)

  • ① The company shall have a transfer agent
  • ② The transfer agent, his place of business and the scope of agency shall be decided by the resolution of the board of directors or the committee authorized by the board of directors.
  • ③ The register of shareholders or the duplicate thereof shall be kept at the place of business of the transfer agent and alteration of shareholder's name, registration or cancellation of pledge, declaration or cancellation of trust property, issue of shares, receipt of applications and the related business shall be handled by the transfer agent.
  • ④ The procedures for handling the matters provided in Clause 3 shall follow the Regulations for Transfer Agency of Securities and so forth

Article 9. (Preemptive right)

  • ① As for the subscription of shareholders of new shares to be issued by the company, according to Article 7 Clause 5, the company shall allot new shares in proportion to the number of shares they hold in case of the abandonment or loss of shareholders' subscription right to the new shares and the occurrence of odd shares resulting from the allocation of new shares, the company shall settle it according to the resolution of the board of directors or the committee authorized by the board of directors.
  • ② Despite of the regulation the clause (1), new shares may be allotted to non-shareholders in case of the following.
    • 1. New shares issuance by means of subscription or underwriting according to the resolution of the board pursuant to such related laws and regulations as the Securities Exchange Law.
    • 2. New shares allotment to employees of the company according to the resolution of the board pursuant to such related laws and regulations under the Securities and Exchange Act.
    • 3. New shares issuance owing to issuance of depository receipts(DR) according to the resolution of the board pursuant to such related laws and regulations under the Securities and Exchange Act.
    • 4. Issuance of new shares through Initial Public Offering according to Clause 3
    • 5. Issuance of new shares through execution of the option to purchase new shares according to Clause 4
    • 6. Issuance of new shares to the financial institution or licensor for urgent financing according to the resolution of the board within the limitation of 30 percent of the total stock number. In this case, the price of new shares should exceed the price stipulated in Clause 5 of Article 84 of the Securities and Exchange Enforcement Ordinance

Article 9 - 2 (Distribution day for new shares)

 When the Company has issued new shares for value or for free, or distributed stock dividend, for the purpose of distribution of profits, the new shares shall be regarded as having issued at the end of the fiscal year immediately preceding to the fiscal year in which the new shares were actually issued. However, when the company has issued new shares for value or for free, or distributed stock dividend after the record date of interim dividend of the Article 37-5, the new shares shall be deemed to have been issued immediately after the record date of interim dividend.

Article 9 - 3 (Public Offering)

  • ① The company may issue new shares within the limitation of 30 percent of the total stock number through Public Offering with the resolution of the board according to Clause 3 of Article 189 of the Securities and Exchange Law
  • ② In case of issuance according to the preceding clause, the type and price of shares should be resolved in the board of directors. In this case, the price of new shares should exceed the price stipulated in Clause 5 of Article 84 of the Securities and Exchange Enforcement Ordinance

Article 9 - 4 (Stock Option)

  • ① The Company may grant the option to purchase new shares to directors, officers and employees of the Company (including directors, officers and employees of affiliate company stipulated in Clause 1 of Article 189 of the Securities and Exchange Act. This definition applies the same in this Article.) within the limits stipulated in Clause 4 of Article 189 of the Securities and Exchange Act by a special resolution of the General Meeting of Shareholders; provided however that the Company may grant the option to purchase new shares by a resolution of the Board of Directors within the limits set forth by applicable laws and regulations.
  • ② The directors, officers and employees who may be granted the option have and shall have contributed to the establishment, management, overseas business or technological innovation of the Company; provided however that the directors, officers and employees who are not be entitled to the option under applicable laws and regulations shall be excluded.
  • ③ The stocks to be issued to the officers or employees by the exercise of their option to purchase new shares (in case the Company pays, either in cash or treasury shares, the difference between the exercise price of option to purchase new shares and the market price, they refer to the shares which are the basis for such calculation) shall be registered common stock or Registered preferred stock.
  • ④ The total number of stocks to be delivered in accordance with the exercise of the option to purchase new shares shall be up to the extent permitted by the relevant laws and regulations.
  • ⑤ Conditions for granting Stock Option, such as the contents and exercise price thereof, shall be determined by a special resolution of the General Meeting of Shareholders or resolution of the Board of Directors in accordance with applicable laws and regulations and the Articles of Incorporation provided, however, that the matters which are not provided for as matters reserved for special resolutions of the General Meeting of Shareholders or resolutions of the Board of Directors under applicable laws, regulations and the Articles of Incorporation may be determined by the Board of Directors or the committee authorized by the Board of Directors.
  • ⑥ The Stock Option may be exercised for 8 years after the second anniversary of the date of the resolution of the General Meeting of Shareholders or the Board of Directors provided, however, that the persons who are granted the Stock Option shall exercise the option on the condition that the person has been employed by the Company at least for two years from the date of the resolution except otherwise stated in applicable laws and regulations.
  • ⑦ The Company may cancel the grant of stock options by a resolution of the Board of Directors in any of the following cases
    • 1. In case an officer or employee voluntarily retires from his/her office of leaves the Company after the grant of option to purchase new shares
    • 2. In case an officer or employee causes Substantial damages to the Company due to his/her willful misconduct or negligence; or
    • 3. In case any of the causes for cancellation set forth in option to purchase new shares agreement occurs.

Article 10. (omitted)

Article 11. (Report of addresses, names and seal impression or signature of shareholders)

  • ① All shareholders and registered pledges shall report to the transfer agent referred to in Article 8 their addresses, names and seal impressions or signature.
  • ② Shareholders and registered pledges residing outside Korea shall report the place and agent in Korea to receive notices.
  • ③ In case of change in the preceding clause 1 and 2, the same shall apply Article 12. (Close and closing day of register of shareholders)

Article 11 - 2 (Protection of minority shareholders)

  • ① Shareholders possess the rights as a single or minority shareholder as stipulated in the Commercial Act and related regulations, which the management group of the company must respect.
  • ② Shareholders stipulated in clause 1 of Article 466 of the Commercial Act and clause 3 of Article 191-13 of the Securities and Exchange Act, may demand, in writing with the reasons specified thereon, to inspect or copy the company’s account books and related documents.
  • ③ The company shall not refuse the shareholder's demand mentioned in the clause above unless it proves that such demand is improper.

Article 12. (Close and closing day of register of shareholders)

  • ① The company shall suspend transfer of shares, registration or cancellation of pledges and declaration or cancellation of property under trust commencing from January 1, of each year to January 31 of the year. However, the Company may, if unavoidable, adjust the closing period of register of shareholders within 3 months, under which circumstances the Company shall make public announcement in the newspaper 2 weeks prior to the commencement of closing period.
  • ② The company shall allow the shareholders listed in the shareholder register as of December 31 of each year to exercise their rights in the general meeting of shareholders for that term for settlement of account.
  • ③ In case of calling an extraordinary general meeting or when it is necessary, the transfer of shares may be suspended with public announcement of two weeks in advance for a period not exceeding three months, or a closing day may be determined by a resolution of the board of directors or the committee authorized by the board of directors.. When the board of directors or the committee authorized by the board of directors deems it necessary, the suspension of transfer of shares and the closing day may be decided at the same time

CHAPTER Ⅲ. GENERAL MEETINGS OF SHAREHOLDERS

Article 13. (Convening and notice of meeting)

  • ① The company shall convene the ordinary general meeting of shareholders within three(3) months after the close of each business year and may convene an extraordinary general meeting of shareholders when necessary.
  • ② The general meeting of shareholders shall be convened by the representative director by the resolution of the board of directors or the committee authorized by the board of directors, except as otherwise provided for by law. In case the representative director is unable to perform his duty, Article 23-2 shall be applied.
  • ③ A convening notice in writing or in any form of electronic documents setting out the date, place and agenda of the meeting shall be given to shareholders two weeks prior to the date set forthe General Meeting of Shareholders.
  • ④ With respect to the shareholders holding less than one hundredth or less of the total number of issued and outstanding shares which are entitled to vote, the convening notice may be replaced by giving public notice twice or more in the "JOONG-ANG DAILY NEWS and the KOREA ECONOMIC DAILY" published in Seoul announcing the convening of the general meeting and the matters constituting the objectives of the meeting two weeks in advance.

Article 14. (Place of meeting)

The general meeting of the shareholders shall in principle be held at the place where the head office is located. However, if necessary, the meeting could be held at a place either in Seoul or Gyeonggi-do where the branch office is located.

Article 15. (Chairman)

  • ① The representative director shall be chairman of the general meeting of shareholders.
  • ② In case there are more than one representative director, the chairmanship shall be assumed by a representative director who is also chairman, vice-chairman, president, vice president, senior managing director or managing director in that order. If the representative director is unable to perform his duty, a director appointed as the acting representative director in the order set by the board of directors shall assume the chairmanship.

Article 16. (Maintenance of order by chairman)

The chairman of a general meeting of shareholders may order persons, who intentionally speak or behave obstructively or who disturb the proceedings of the meeting, to stop or retract a speech or to leave the place of the meeting, and such persons shall comply with his order.

Article 17. (Voting right)

Except as otherwise provided for by law, each shareholder shall have one vote for each share.

Article 18. (Voting method of the meeting)

Except as otherwise agreed, resolutions of the meetings of shareholders shall require the presence of shareholders totally twenty five percents(25%) of total number of share issued and outstanding for a quorum, and the resolutions shall be adopted by a majority of shareholders present

Article 19. (Voting by proxy)

  • ①  A shareholder may exercise his voting right by a proxy who shall be required to be a Shareholder of the company. The proxy shall present a power of attorney prior to opening of the general meeting.
  • ② In case the legal representative of a shareholder grants power of attorney to another shareholder under the preceding paragraph, a document evidencing the power of legal representation shall be attached.
  • ③ A shareholder may, by a single power of attorney, grant general power of representation regarding several general meeting of shareholders.

Article 20. (Minutes)

The proceedings of the general meeting of shareholders shall be entered into the minutes and the chairman and directors present shall affix their seals or sign thereon.

CHAPTER Ⅳ. DIRECTORS, BOARD OF DIRECTORS AND COMMITTEES

Article 21. (Election of directors)

  • ① The company shall have five(5) to twelve(12) directors who shall be elected by the general meeting of shareholders. According to the relevant laws and regulations, outside directors shall be elected from the persons recommended by the Outside Director Recommendation Committee.
  • ② The representative director shall be elected by the board of directors.
  • ③ The chairman, vice chairman and president shall be elected by resolution of the board of directors or the committee authorized by the board of directors from among the directors and a certain number of vice presidents, senior managing directors and managing directors may be elected when necessary.
  • ④ Except as otherwise provided for in the relevant laws and regulations, the directors shall be elected at a general meeting of shareholders if the approval of a majority vote of the shareholders present at such meeting is obtained and such majority also represents at least one-fourth(1/4) of the total number of shares issued and outstanding.
  • ⑤ An External Director shall have professional background in management, economics, accounting, law or engineering and many experiences in his field and be fully qualified according to the relevant regulation. Employees who are or used to be in recent two years in the company or affiliate companies will be excluded.
  • ⑥ The concentrated voting prescribed in the Article 383-2 of the Commercial Law shall not be applicable when 2 or more directors are elected.

Article 22. (Term of office)

The term of office of a director and a outside director shall be three(3) years, but where the term of office expires before the closing of the ordinary general meeting of shareholders convened in respect of the last term for the settlement of accounts during his term of office, the term of office shall be extended to the closing of such general meeting.

Article 22-2

  • ① If there is any deficiency in board, the member will be supplemented by the general shareholders' meeting. However, such deficiency does not affect the minimum required number of members and ordinary management
  • ② The concentrated voting prescribed in the Article 383-2 of the Commercial Law shall not be applicable when 2 or more directors are elected.

Article 23. (Duties of directors)

  • ① The representative director shall represent the company in accordance with the law and shall execute the matters decided by the board of directors and shall control all the affairs of the company.
  • ② President, vice president, senior managing director and managing director shall assist the representative director and their responsibilities will be determined according to board of directors or the committee authorized by the board of directors. In case president deceases, vice president will succeed president position.
  • ③ A director shall notify the Auditor Committee in case he/she has a reasonable reason that the Company will suffer a substantial harm or injury.

Article 23-2 (Directors’ duty of care as good manager)

Directors shall perform the business of the company with the care of a good manager. (Newly established on March 1, 2005)

Article 23-3 (Directors’ duty of loyalty)

Directors shall perform their duties faithfully for the interest of the company in accordance with the relevant Acts, subordinate statutes and the articles of incorporation

Article 24. (Board of directors)

  • ① The Board of Directors shall consist solely of directors and Outside Directors appointed in accordance with the laws and the Article of Incorporation.
  • ② The proceedings of the Board of Directors shall be recorded in minutes, which shall include agenda, proceedings, results, opponents and his/her cause of opposition and on which the names and seals of the chairman and all directors present at the meeting shall affix their seals or sign.

Article 24-2 (Committees)

  • ① The Company may establish the following committees within the Board of Directors by the resolution of the Board of Directors.
    • 1. Management Committee
    • 2. Audit Committee
    • 3. Outside Director Recommendation Committee; and
    • 4. Other committee as deemed necessary by the Board of Directors
  • ② Power and operation of each committee shall be determined by the resolution of the Board of Directors, except as otherwise provided for in the relevant laws and regulations.
  • ③ Articles 24,26 and 27 shall apply mutatis mutandis in respect of the committee.

Article 24-3

  • ①The Company may establish the Execution Committee as set forth in Article 24-2 by aresolution of the Board of Directors.
  • ②Execution committee reviews and decides regarding important agenda, which was consigned by board.
  • ③Details concerning composition and operation of the Execution Committee shall be determined by the Board of Directors.

Article 24-4

  • ①The Company may establish the Audit Committee as set forth in Article 24-2 by a resolution of the Board of Directors.
  • ②Details concerning composition and operation of the Audit Committee shall be determined by the Board of Directors.

Article 24-5

  • ①The Company may establish the Outside Director Recommendation Committee as set forth in Article 24-2 by a resolution of the Board of Directors.
  • ②Details concerning composition and operation of the Outside Director Recommendation Committee shall be determined by the Board of Directors.

Article 25. (Chairman of the board of directors)

  • ① The representative director shall be the chairman of the board of directors
  • ② The representative director shall preside over the meeting of the Board of Directors. In the event that the number of representative director is more than one(1) or the representative director is unable to perform his/her duties, Clause ② of Articles 15 shall apply mutatis mutandis.

Article 26. (Convening of the meeting of board of directors)

  • ① The meeting of the board of directors shall be convened by the chairman and the chairman shall give each director of the date and time at least twelve (12) hours prior thereto. However, upon agreement of all directors and auditor, the convening procedures may be omitted.
  • ② Each director may convene a meeting of the board of directors with the consent of the chairman when deemed necessary for the performance of the business. In such case, the preceding paragraph shall apply mutatis mutandis.

Article 27. (Resolution of the board of directors)

Resolution of the board of directors shall be adopted by the presence of a majority of the directors and the vote of a majority of the directors present. A director having special interest with respect to the resolution may not exercise his voting right.

Article 27-2 (Approval of internal trade)

  • ① The company shall obtain approval from the Board of Directors in case of following
    • 1. in case of large-scale internal trading as set forth in Article 11 ? 2 of the Monopoly Regulation and Fair Trade Act with or for such specially-related persons defined in the aforementioned Act; or
    • 2. in case of a trade as set forth in clause 2 of Article 191 ? 19 of the Securities and Exchange Act with main shareholders of the company (including their specially-related persons defined in the aforementioned Act) and specially-related persons defined in the aforementioned Act, provided, however, that this shall not apply in case of the total trade amount being approved by the Board of Directors as set forth in clause 3 ? 2 of the Articles of Incorporation.
  • ② The Board of Directors shall consider the intent of the concerned laws and make rational business judgments in case of approving a transaction under clause (1) set forth above. (Newly established on March 1, 2005)

Article 28. (Prohibition of competition by director)

A director shall not conduct the same kind of business as the company without consent of resolution of the board of directors, except when the director is elected with the knowledge that his business is in competition with the company.

Article 29. (Omitted)

Article 30. (Omitted)

Article 31. (Remuneration of officers)

The ceiling of remuneration for the directors shall be determined by the resolutions of the general meeting of shareholders.

Article 32. (Severance allowance of officers)

Severance allowances of the directors shall be handled in accordance with "Officer's Severance Pay Regulations" separately adopted.

Article 33. (Omitted)

CHAPTER Ⅴ. ACCOUNTINGS

Article 34. (Business year and settlement of account)

The business year of the company shall be from January 1 to the last day of December of each year and the settlement of accounts shall be made as of the last day of December of each year.

Article 35. (Preparation and keeping of financial statements)

  • ① Representative director of the company shall, by the date stipulated by applicable laws and regulations, prepare the documents listed below, together with their itemized statements and the business report, have them audited by the Audit Committee and submit them to the General Meeting of Shareholders.
    • 1. Balance sheet
    • 2. Profit and loss statement
    • 3. Statement of disposition of earned surplus or statement of disposition of loss.
  • ② The Audit Committee shall submit to the representative director the audit report by the date stipulated by applicable laws and regulations.
  • ③ Representative director of the company shall keep the documents referred to in Clause ① , together with the business report and audit report, in the manner stipulated by applicable laws and regulations.
  • ④ When approval of the documents referred to in Clause 1 by the shareholders meeting is obtained, Representative director of the company shall without delay publish the balance sheet and the opinion of external inspector

Article 36. (Disposition of profits)

Profit (including carried-over earned surplus) of each business year of the company shall be disposed of as follows

  • 1. Earned profit reserve (earned profit reserve under the Commercial Code)
  • 2. Other statutory reserve
  • 3. Dividends to shareholders
  • 4. Voluntary reserve
  • 5. Other disposition of earned surplus
  • 6. Earned surplus carried over to the next term

Article 37. (Dividends)

  • ① Dividends may be paid in cash or with shares.
  • ② Dividends referred to in paragraph (1) (annual dividend), (5) (interim dividend) shall be paid to shareholders registered in the shareholders register or registered pledges as of the end of each term of the settlement of accounts or the record date of interim dividend.
  • ③ No interest shall accrue on the dividends.
  • ④ In case of distribution of stock dividends, the Company shall, upon resolution of the meeting of the shareholder, be able to distribute different kinds of shares provided that two or more kinds of shares have been issued.
  • ⑤ For one time only during the business year of the Company, the Company may distribute dividend in cash on June 30 to be the record date upon resolution of board of directors.

Article 38. (Extinguishment by prescription of right to demand payment of dividends)

  • ① The right to demand for payment of dividends shall be extinguished by prescription if the right is not exercised for five (5) years.
  • ② Dividends after the expiration of the prescriptive period as provided in paragraph (1) shall escheat to the company.

CHAPTER Ⅵ. BONDS

Article 39. (Issuance of convertible bonds)

  • ① The company may issue convertible bonds for the others but shareholders up to an amount in which the total par value shall not exceed KRW800,000,000,000.
  • ② Convertible bonds mentioned in Clause 1 may be issued with partial conversion condition under which the right of bond holders to demand conversion may be limited to a certain percentage of the total par value of convertible bonds as determined by the board of directors.
  • ③ Any share to be issued by exercising preemptive rights shall be of the total amount of the par value of common shares (KRW600,000,000,000) and non-voting preferred shares (KRW200,000,000,000) and the issue price of the shares shall be determined to be the par value of the share or more by the board of directors when the debentures are issued.
  • ④ The period in which request for conversion can be made shall be from the day succeeding the day of issuance of the concerned bond to the day immediately before the date of maturity, provided that the period can be determined by the board of directors during the period aforesaid in accordance with relevant laws and regulations in Korea.
  • ⑤ About the convertible bond in paragraph (1), as for the interest or dividend for shares to be issued due to the conversion, the conversion into shares shall be regarded as having been made at the end of the fiscal year in which conversion may be made. However, when the Company has issued new share according to the conversion after the record date of interim dividend of the Article 37-5, the new shares shall be deemed to have been issued immediately after the record date of interim period.

Article 40. (Issuance of bonds with warrants)

  • ① The company may issue bonds with warrants for the others but shareholders up to an amount in which the total par value shall not exceed KRW800,000,000,000.
  • ② The amount of new shares for which can be demanded by holders of bond with warrants shall be determined by the board of directors provided that maximum amount of new shares to be subscribed by holders of bonds with warrants shall not exceed the total par value of bonds with warrants.
  • ③ The shares to be issued due to the exercise of preemptive rights shall be of the total amount of the par value of common shares (KRW600,000,000,000) and non-voting preferred shares (KRW200,000,000,000) and the issue price of the shares shall be par or above par as determined by the board of directors at the time of issuing bonds with warrants.
  • ④ The period in which a bondholder may exercise his preemptive rights to new shares shall be from the day succeeding the day of issuance of bonds with warrants to the day immediately before the date of maturity. Provided that the period can be determined by the board of directors during the period aforesaid in accordance with relevant laws and regulations in Korea.
  • ⑤ As for the interest or dividend for bond holders who has exercised his preemptive rights to new shares, the issuance of new shares shall be regarded as having been made immediately before of fiscal year in which total amount of new shares issued is to be paid. However, when the Company has issued new share according to the conversion after the record date of interim dividend of the Article 37-5, the new shares shall be deemed to have been issued immediately after the record date of interim period.

CHAPTER Ⅶ. MISCELLANEOUS

Article 41. (Adoption of administrative regulations)

The company may adopt administrative regulations necessary for the administration of the business and management of the company by resolution of the board of directors or the committee authorized by board of directors when necessary.

Article 42. (Other business)

The company may conduct social welfare services when deemed necessary.

Article 43. (Names and address of promoters)

The names and addresses of promoters of this company are as follows

  • Name in full Address
  • Byoung Chull Lee 39, 3-Ka, Bosoo-Dong, Busan City
  • Hong Je Cho 30, 3-Ka, Bosoo-Dong, Busan City
  • Saeng Ki Kim 62, 3-Ka, Bumin-Dong, Busan City
  • Keun Mu Lee 30, 3-Ka, Bosoo-Dong, Busan City
  • Jae So Kim 27-9, Samdeok-Dong, Daegu City
  • Sung Je Cho 1128-2, Donchon-Ri, Buk-Myeon, Haman-Kun, Kyeongsang-Namdo
  • Soon Ku Huh 61, Inkyo-Dong, Daegu City

ADDENDUM (March 14, 1996)

Article 1 (Execution Date)

These Articles of Incorporation shall enter into force on March 14, 1996.

Article 2 (Measures on Passage)

Articles 11, 18, 20, 23, 24, 28, 29, 30, and 37 shall be effective as of October 1, 1996 and Article 9-2 shall be effective on the following business year firstly starting after this amendments.

ADDENDUM (February 28, 1997)

Article 1 (Execution Date)

These Articles of Incorporation shall enter into force on February 28, 1997.

Article 2 (Measures on Passage)

The dividend for the the non-accumulating and non-voting preferred shares of the company issued prior to the amendments on Articles of Incorporation and the Execution date shall exceed that of the common shares annually by 1% of the par value, but the dividend shall not be applicable in case no dividend is paid out to common shares. The issuance of preferred shares for free on preferred shares shall be issued in accordance with Article 7.

ADDENDUM (March 30, 1998)

Article 1 (Execution Date)

These Articles of Incorporation shall be effective from March 30, 1998.

ADDENDUM (March 27, 1999)

Article 1 (Execution Date)

These Articles of Incorporation shall be effective from March 27, 1999.

Article 2

The Article 21 (6) and 22-2 (2) shall be effective from June 29, 1999.

ADDENDUM (March 18, 2000)

Article 1

These Articles of Incorporation shall enter into force on March 18, 2000.

Article 2

The Outside Directors elected at a general meeting of shareholders convened at the date of the amendment of these Articles of Incorporation shall be deemed to have been recommended by the Outside Director Recommendation Committee.

ADDENDUM (March 1, 2005)

Article 1 (Enforcement date)

These Articles of Incorporation shall enter into force on March 1, 2005.

ADDENDUM (February 28, 2007)

Article 1 (Enforcement date)

These Articles of Incorporation shall enter into force on March 1, 2007.

ADDENDUM (March 28, 2008)

Article 1 (Execution Date)

These Articles of Incorporation shall enter into force on March 29, 2008.

ADDENDUM (March 18, 2011)

Article 1 (Execution Date)

These Articles of Incorporation shall enter into force on March 18, 2011.

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