Government Governance
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Korea Zinc creates a vision for tomorrow based on
a solid
management.
Korea Zinc creates the best future value with the best technology and outstanding new talent.
Korea Zinc ensures that outside directors are elected through an independent and transparent process.
Advanced Corporate Governance
Due to the recent global ESG (Environmental, Social and Governance) craze, the importance of
corporate governance is being re-emerged as a criterion for evaluating companies.
Governance structure in ESG is considered to be a concept that encompasses not only the simple
ownership relationship of company shares and the composition of the top management, but also the
actual decision-making structure of the board of directors and the decision-making structure of each
part of the company.
Korea Zinc's decision-making is centered on the board of directors consisting of 6 outside directors
and 5 inside directors, led by President Chang-geun, Choi and Vice President Yoon-beom, Choi, who
served as the company's CEO.
In order to ensure that outside directors do not merely act as rubber-stamps in the
composition of the Board of Directors, Korea Zinc employs an independent and transparent process
to elect outside directors.
Outside directors of Korea Zinc are recommended by the Outside Director Candidate Recommendation
Committee, which consists of one inside director and two outside directors, after examining the
qualifications of preliminary directors and finally, they are appointed at the general shareholders'
meeting.
In 2021, for the first time, Bo-young, Kim, a professor at Han-yang University Business School, was
appointed as a female outside director to diversify the composition of the board of directors.
Transparency in Corporate Governance
Composition of the board of directors and
expert committees
Korea Zinc enhances transparency and efficiency, which are the core of BOD operations.
Regular board meetings are held at least four times a year, and temporary board meetings may be held
as needed.
- The company explains each agenda item with interviews and materials up to one week before the
board meeting date so that each director can make a decision with sufficient consideration in
deliberation and approval of the agenda.
In addition, the Audit Committee under the BOD consists of outside three directors.
For smooth auditing, any directors can request a report on business at any time, investigate the
company's property status, and, if necessary to carry out our work, they may seek advice from
experts at Company expense.
Effective Internal Control System
Korea Zinc’s effective internal control system is a crucial means to pursue and achieve
the corporate goals.
It is employed for business activity management and monitoring, irregular trading prevention and detection, constant performance measurement, and operational productivity improvement. The internal accounting managers review the internal controls, suggests improvements, and reports important issues for further investigation by management.
In accordance with the Act on External Audit of Corporations, which was strengthened at the
end of 2018, the auditor certification level of the internal accounting management system has been
raised from ‘Review’ to ‘Audit’.
Accordingly, the company fully redesigned the internal control based on the
'Internal Accounting Control System Design and Operation System' distributed by the Internal
Accounting Control System Steering Committee.
In the process, Korea Zinc has established and is operating detailed internal accounting guidelines
that cover the organization and competence of the internal accounting management system, performance
evaluation and compensation, change management, and establishment and implementation of education
plans.
| Name | Title | Responsibilities | Major career |
|---|---|---|---|
| Choi Chang-geun | Chairman | general manager | Seoul National University Department of Resources Engineering Resources Engineering, Colorado University of Mines Columbia Graduate School of Business Administration, Resource Economics Korea Zinc Co., Ltd. CEO and Vice President |
| Choi Yoon-beom | CEO, Vice President | general manager | Department of Mathematics/English Literature, Amherst University,
USA Columbia Graduate School of Law (J.D.) Attorney at Cravath, Swaine & Moore LLP (NEW York) President of Korea Zinc Co., Ltd. |
| Noh Jin-Soo | CEO, President | general manager | Department of Business Administration, Kwangwoon University Vice President of Korea Zinc Co., Ltd. Yeungnam University Law Department Korea University Graduate School o f Labor Managing Director, Korea Zinc Co., Ltd. |
| Baek Soon-heum | CEO, Vice President | general manager | Department of Commerce, Yonsei University Chairman Youngpoong Co., Ltd. |
| Jang Hyeong-jin | non-executive director | - | Department of Business Administration, Chonbuk National
University Syracuse University Law School (J.D.) Secretary General of the Fair Trade Commission Advisor to Hwawoo Law Firm (present) |
| Han Cheol-soo | outside director | audit committee | Korea University Law School, Doctor of Public Administration Acting Director of the Board of Audit and Inspection Outside Director, Hanjin Co., Ltd. (Present) Advisor, Pacific Law Firm (present) |
| Sung Yong-Rak | outside director | outside director | Seoul National University Department of Law Chief Judge of Seoul High Court Attorney at Kim & Chang Law Firm (present) |
| Kim Eui-hwan | outside director | outside director | Seoul National University, Department of Business Administration,
Ph.D. in Accounting Deputy Auditor of the Board of Audit and Inspection Seoyeon Co., Ltd. Outside Director (Present) Advisor at Kim & Chang Law Firm (present) |
| Kim Do-hyun | outside director | audit committee | Seoul National University, Department of Aerospace Engineering,
Ph.D. University of Warwick PhD (Business Administration) Professor, School of Business Administration, Kookmin University (current) Chairman, Startup Alliance (present) |
| Kim Bo-young | outside director | outside director | University of Alberta (Master, Doctorate) New York University MBA Professor, Hanyang University Business School (current) |
| Lee Min-ho | outside director | outside director | Seoul National University, Department of Geological Sciences, PhD in Environmental Engineering Environmental Policy Implementation of the Ministry of Environment Director, Yulchon ESG Research Center, Law Firm (current) Adjunct Professor, Graduate School of International Urban Sciences, University of Seoul (current) |
| Name | Title | Responsibilities | Major career |
|---|---|---|---|
| Sung Yong-Rak | outside director | Chairman of the Audit Committee | Seoul National University Department of Law Chief Judge of Seoul High Court Attorney at Kim & Chang Law Firm (present) |
| Han Cheol-soo | outside director | audit committee | Department of Business Administration, Chonbuk National
University Syracuse University Law School (J.D.) Secretary General of the Fair Trade Commission Advisor to Hwawoo Law Firm (present) |
| Kim Do-hyun | outside director | audit committee | Seoul National University, Department of Aerospace Engineering,
Ph.D. University of Warwick PhD (Business Administration) Professor, School of Business Administration, Kookmin University (current) Chairman, Startup Alliance (present) |
Article 1 (Name) This company is called Korea Zinc Co., Ltd. (hereinafter referred to as the
company) and in English it is called Korea Zinc Company, Ltd.
Article 2 (Purpose) The purpose of this company is to manage the following businesses.
1. Manufacture and sale of zinc ingot, cadmium ingot, copper, cobalt oxide, sulfuric acid (10% or more), cadmium oxide, zinc chloride, zinc sulfide and other by-products by smelting of mineral products
2. Manufacturing and sales of magma, silver ingot, gold ingot, bismuth ingot, antimony ingot, antimony oxide, indium ingot and other non-ferrous metals
3. Manufacturing and sales of alloys and compounds of non-ferrous metals
4. Manufacturing and sales of aluminum secondary metals and alloys
5. Heat supply business
6. Manufacturing and sales of inorganic and organic chemical products
7. Manufacturing and sales of phosphors and related materials
8. Manufacturing and sales of pharmaceuticals for the electronics industry and fine chemical raw materials
9. Manufacturing and sales of electronic materials, semiconductor materials and materials for electronic tubes
10. Waste treatment business
11. Waste recycling and utilization business
12. Waste treatment facility design and construction
13. Environmental pollution prevention facility business
14. Manufacture and sale of Ferric Oxide, powder iron, wrought iron, and molten metal
15. Mining
16. Manufacturing and sales of ready-mixed concrete
17. Stone mining for construction
18. Construction sand and gravel mining
19. Industrial sand mining
20. Processed and sold products and by-products of the preceding items
21. Manufacturing and sales of jewelry and related products
22. Wholesale and retail business of jewelry, watches and related products
23. Sale of Gold Coins
24. General trade business, trade agency business
25. Real Estate Rental
26. Storage and warehousing
27. Freight transport business
28. Land and water cargo handling business
29. Technology service business
30. Wastewater reuse business
31. Sports equipment operation business
32. General retail business
33. Sales of computers and other office equipment
34. Software Advisory, Development and Delivery
35. General construction business
36. Construction work
37. Industrial machinery manufacturing and installation business
38. Machine repair and various equipment repair business
39. Equipment and equipment rental business
40. Service business related to Nos. 36 to 39 above
41. E-commerce and Internet-related businessbr /> 42. Manufacture and sale of liquid and gaseous oxygen, nitrogen and argon
43. Manufacturing and sales of non-ferrous metal powder
44. Soil remediation business
45. Natural gas import and export business
46. Any business incidental to the business of the preceding subparagraphsbr />
Article 3 (Head Office and Branch Offices) The company may have its headquarters in Seoul, and branch offices, agencies, branch offices, and factories where it is deemed necessary.
Article 4 (Method of Announcement) The notice of this company is posted on the company's internet homepage (http://www.koreazinc.co.kr). However, due to computer failure or other unavoidable reasons When it is not possible to make an announcement on the company's Internet website, it will be published in the Korea Economic Daily issued by Seoul Metropolitan Government
Article 2 (Purpose) The purpose of this company is to manage the following businesses.
1. Manufacture and sale of zinc ingot, cadmium ingot, copper, cobalt oxide, sulfuric acid (10% or more), cadmium oxide, zinc chloride, zinc sulfide and other by-products by smelting of mineral products
2. Manufacturing and sales of magma, silver ingot, gold ingot, bismuth ingot, antimony ingot, antimony oxide, indium ingot and other non-ferrous metals
3. Manufacturing and sales of alloys and compounds of non-ferrous metals
4. Manufacturing and sales of aluminum secondary metals and alloys
5. Heat supply business
6. Manufacturing and sales of inorganic and organic chemical products
7. Manufacturing and sales of phosphors and related materials
8. Manufacturing and sales of pharmaceuticals for the electronics industry and fine chemical raw materials
9. Manufacturing and sales of electronic materials, semiconductor materials and materials for electronic tubes
10. Waste treatment business
11. Waste recycling and utilization business
12. Waste treatment facility design and construction
13. Environmental pollution prevention facility business
14. Manufacture and sale of Ferric Oxide, powder iron, wrought iron, and molten metal
15. Mining
16. Manufacturing and sales of ready-mixed concrete
17. Stone mining for construction
18. Construction sand and gravel mining
19. Industrial sand mining
20. Processed and sold products and by-products of the preceding items
21. Manufacturing and sales of jewelry and related products
22. Wholesale and retail business of jewelry, watches and related products
23. Sale of Gold Coins
24. General trade business, trade agency business
25. Real Estate Rental
26. Storage and warehousing
27. Freight transport business
28. Land and water cargo handling business
29. Technology service business
30. Wastewater reuse business
31. Sports equipment operation business
32. General retail business
33. Sales of computers and other office equipment
34. Software Advisory, Development and Delivery
35. General construction business
36. Construction work
37. Industrial machinery manufacturing and installation business
38. Machine repair and various equipment repair business
39. Equipment and equipment rental business
40. Service business related to Nos. 36 to 39 above
41. E-commerce and Internet-related businessbr /> 42. Manufacture and sale of liquid and gaseous oxygen, nitrogen and argon
43. Manufacturing and sales of non-ferrous metal powder
44. Soil remediation business
45. Natural gas import and export business
46. Any business incidental to the business of the preceding subparagraphsbr />
Article 3 (Head Office and Branch Offices) The company may have its headquarters in Seoul, and branch offices, agencies, branch offices, and factories where it is deemed necessary.
Article 4 (Method of Announcement) The notice of this company is posted on the company's internet homepage (http://www.koreazinc.co.kr). However, due to computer failure or other unavoidable reasons When it is not possible to make an announcement on the company's Internet website, it will be published in the Korea Economic Daily issued by Seoul Metropolitan Government
Article 5. Total number of Shares to be issued
The total number of authorized shares shall be 48,000,000 shares.
Article 6. Par Value
The Par Value of each share to be issued by the Company shall be 5,000 Won (Five Thousand Republic of Korea Won).
Article 7. Classes of Shares and Types of Share Certificates
① The classes of shares to be issued by the Company shall be common shares in registered form and preferred shares in registered form.
② Preferred shares in registered form to be issued by the Company shall be non- voting.
③ Share Certificates shall be issued by the Company in eight denominations of one(1), five(5), ten(10), fifty(50), one hundred(100), five hundred(500), one thousand(1,000) and ten thousand(10,000) shares. Article 8. Number and Contents of Preferred Shares.
① The Company may issue the preferred shares with non-voting within 12,000,000 shares.
② The dividend on preferred share with non-voting shall be not less than two percent(2%) per annum but not more than fifteen percent(15%) per annum of the par value of the share as determined by the Board of Directors at the time of issuance.
③ If the dividend ratio of the common shares exceeds that of the preferred shares, the dividend ratio of the preferred shares shall be identically applied to that of the common shares.
④ In case the Company does not pay the dividend on common shares, the Company may not pay the dividend on preferred shares.
⑤ If the resolution not to pay the prescribed dividends on preferred shares is adopted at the meeting of shareholders, the preferred shares shall have voting rights, from the time of the meeting of shareholders following the meeting at which the resolution not to pay dividends on preferred shares is adopted, to the time of the end of the meeting of shareholders at which a resolution to pay dividends for such preferred shares is adopted.
⑥ In case that the Company issues new shares by right issue or bonus issue, then the new shares issued with respect to the preferred shares shall be common shares in the case of right issue and shall be the shares of same class in the case of bonus issue.
Article 9. Report of Address, Name and Seal of Shareholders
① Shareholders, registered pledgees and their legal representatives shall report their addresses,
names and seals (signature in case of a foreigner who is accustomed as such) to the Company by the prescribed form of the Company.
② Shareholders and registered pledgees who reside in a foreign country shall report their appointed agents and the addresses in Korea to whom notices are to be sent.
③ The above provisions shall also apply to changes in any item mentioned in Paragraphs ① and ② above.
④ The Company shall not be liable for any loss or risk caused by failing in complying with the provisions in Paragraphs ①, ② and ③ above.
Article 10. Transfer of Shares and Entries in Shareholders Registry
① A shareholder desiring entries in the shareholders registry due to acquisition by transfer of shares shall submit the prescribed application form of the Company signed or sealed by assignee to the Company together with the share certificates
② No transfer of shares shall be binding of the Company unless the name and the address of the transferee have been properly entered in Shareholders Registry.
③ Any shareholder desiring entries in the shareholders registry due to acquisition by inheritance, bequest, or any other causes than those provided in Paragraph ① above shall submit the prescribed application form of the Company together with the share certificate(s) and the written documents certifying causes of such acquisition to the Company.
④ All applications for transfer of share referred in Paragraphs①, ② and ③ above, shall be accompanied by submission of written evidences of having fulfilled of any other legal requirement to the Company, in case that such other legal requirement must be complied with under other Korean laws and Regulations.
Article 11. Registration of Pledge, etc.
① Anyone desiring creation of a pledge over shares or indication of trust assets on shares shall register the prescribed application form of the Company signed or sealed by the parties involved with the Company. Such application shall be accompanied with the share certificates concerned.
② The registration under Paragraph ① shall be recorded on Shareholders Registry as well as the share certificates concerned. This above provisions shall also apply to any cancellation of pledge or any creation of sub-pledge and any cancellation of trust assets.
Article 12. Reissuance of Share Certificates
Any shareholder desiring the reissuance of a new share certificates shall submit the prescribed application form of the Company to the Company together with the following document. 1. The original or a certified copy of a judgement of nullification in case that the share certificates are lost.
2. The share certificates concerned in case that the share is damaged or stained and shareholders apply for partition or amalgamation of share certificate. But in case such damage or stain is so severe that such certificate(s) is (are) hardly identifiable, Paragraph 1 above shall apply mutatis mutandis thereto.
Article 13. Non-Possession of Share Certificates
① Any shareholder who does not desire to possess the nominative share certificates in his custody shall declare to the Company that he does not desire to do so by the prescribed form of the Company. In this case, any share certificates issued previously shall be submitted to the Company.
② Upon receiving the declaration mentioned in Paragraph ① above, the Company shall without delay enter in shareholders registry and part of a set thereof its statement that it will not issue the share certificates and notify the shareholders thereof.
③ When the Company has made the entry under the provision of Paragraph ②, the share certificates concerned may not be issued, and the share certificates presented to the company in accordance with Paragraph ① shall become null and void.
④ Notwithstanding Paragraph ①, a shareholder may request the issuance of the share certificates to the Company at any time.
Article 14. Transfer Agent
The Company may, if required by resolution of the Board of Directors, retain a transfer agent who shall be authorized on behalf of the Company to deal with the procedural matters for Article 9 through Article 13 relating to the share register and the pledge. In such a case, the procedure related with the share register and the pledge of the Company shall be kept with the procedural matters of the transfer agent.
Article 15. Fees
The Company shall collect fees as determined by the Board of Directors for services rendered in connection with issuance of new share certificate(s), alteration of entries in Shareholders Registry, registration for establishment or cancellation of pledges or trust on shares.
Article 16. Suspension of Altering Entry in the list of shareholders and Record Date
① The Company shall suspend entry of alteration in the list of shareholders with respect to shareholders’ rights from January 1 to January 31 of each year.
② The Company shall deem those shareholders whose names appear in the list of shareholders on December 31 of each year to be the shareholders who are entitled to exercise their rights as shareholders at the annual meeting of shareholders to be convened in respect of the said period for the settlement of accounts.
③ The Company may, in the case of convention of an special meeting of shareholders or in other necessary cases, suspend any entry into the shareholders registry with respect to shareholders’ rights for a period not exceeding three (3) months as determined by a resolution of the Board of Directors in order to determine the shareholders who are registered in the shareholders registry as of such record date and will exercise their rights. If the Board of Directors deems it necessary, the Company may suspend any entry into the shareholders registry and set the record date at the same time. The Company should give at least two(2) weeks’ prior public notice in such cases.
Article 17. Preemptive Right
① Shareholders shall have the preemptive rights to subscribe for the new shares that may be issued by the Company, in proportion to their respective shareholdings. But any shareholders waives or forfeits his/her preemptive rights or if fractional shares result from the allocation of the new shares, the shares which have not been allocated and/or subscribed shall be disposed of in accordance with a resolution of the Board of Directors.
② Notwithstanding the provision of Paragraph ①, the Company may allocate new shares to person other than existing shareholders in the following cases by a resolution of the Board of Directors : 1. In case that such new shares are issued by public offering or cause underwriters to underwrite new shares in accordance with the provisions of the Securities and Exchange Act. 2. In case that the Company issues new shares by general public offering in accordance with the provisions of Securities and Exchange Act. 3. In case that the Company issues new shares for the issuance of depositary receipts(DR) in accordance with the provisions of the Securities and Exchange Act. 4. In case that the Company issues new shares to foreign joint venture partner if it is necessary for management of the Company. Article 17-2. Capital Increase by General Public Offering and others ① The Company may issue new shares by general public offering not more than twenty percent (20%) of the total number of issued and outstanding shares by a resolution of the Board of Directors, in accordance with the procedural requirements set forth in of the Securities and Exchange Act. ② The Company may issue new shares by a resolution of the Board of Directors to foreign joint venture partner if it is necessary for management of the Company, up to an aggregate par value amount of forty billion Korean Won (40,000,000,000Won). ③ In the case of issuing new shares in the manner described in Paragraph ① and ②, the class, number and price thereof shall be determined by a resolution of the Board of Directors. Article 17-3. Commencement Date for Dividends on New shares With regard to payment of dividends on the new shares issued by the Company as a result of issuance of new shares or bonus shares, or stock dividends, such new shares shall be deemed to have been issued at the end of the fiscal year immediately preceding the fiscal year to which the time of issuance thereof belongs.
The total number of authorized shares shall be 48,000,000 shares.
Article 6. Par Value
The Par Value of each share to be issued by the Company shall be 5,000 Won (Five Thousand Republic of Korea Won).
Article 7. Classes of Shares and Types of Share Certificates
① The classes of shares to be issued by the Company shall be common shares in registered form and preferred shares in registered form.
② Preferred shares in registered form to be issued by the Company shall be non- voting.
③ Share Certificates shall be issued by the Company in eight denominations of one(1), five(5), ten(10), fifty(50), one hundred(100), five hundred(500), one thousand(1,000) and ten thousand(10,000) shares. Article 8. Number and Contents of Preferred Shares.
① The Company may issue the preferred shares with non-voting within 12,000,000 shares.
② The dividend on preferred share with non-voting shall be not less than two percent(2%) per annum but not more than fifteen percent(15%) per annum of the par value of the share as determined by the Board of Directors at the time of issuance.
③ If the dividend ratio of the common shares exceeds that of the preferred shares, the dividend ratio of the preferred shares shall be identically applied to that of the common shares.
④ In case the Company does not pay the dividend on common shares, the Company may not pay the dividend on preferred shares.
⑤ If the resolution not to pay the prescribed dividends on preferred shares is adopted at the meeting of shareholders, the preferred shares shall have voting rights, from the time of the meeting of shareholders following the meeting at which the resolution not to pay dividends on preferred shares is adopted, to the time of the end of the meeting of shareholders at which a resolution to pay dividends for such preferred shares is adopted.
⑥ In case that the Company issues new shares by right issue or bonus issue, then the new shares issued with respect to the preferred shares shall be common shares in the case of right issue and shall be the shares of same class in the case of bonus issue.
Article 9. Report of Address, Name and Seal of Shareholders
① Shareholders, registered pledgees and their legal representatives shall report their addresses,
names and seals (signature in case of a foreigner who is accustomed as such) to the Company by the prescribed form of the Company.
② Shareholders and registered pledgees who reside in a foreign country shall report their appointed agents and the addresses in Korea to whom notices are to be sent.
③ The above provisions shall also apply to changes in any item mentioned in Paragraphs ① and ② above.
④ The Company shall not be liable for any loss or risk caused by failing in complying with the provisions in Paragraphs ①, ② and ③ above.
Article 10. Transfer of Shares and Entries in Shareholders Registry
① A shareholder desiring entries in the shareholders registry due to acquisition by transfer of shares shall submit the prescribed application form of the Company signed or sealed by assignee to the Company together with the share certificates
② No transfer of shares shall be binding of the Company unless the name and the address of the transferee have been properly entered in Shareholders Registry.
③ Any shareholder desiring entries in the shareholders registry due to acquisition by inheritance, bequest, or any other causes than those provided in Paragraph ① above shall submit the prescribed application form of the Company together with the share certificate(s) and the written documents certifying causes of such acquisition to the Company.
④ All applications for transfer of share referred in Paragraphs①, ② and ③ above, shall be accompanied by submission of written evidences of having fulfilled of any other legal requirement to the Company, in case that such other legal requirement must be complied with under other Korean laws and Regulations.
Article 11. Registration of Pledge, etc.
① Anyone desiring creation of a pledge over shares or indication of trust assets on shares shall register the prescribed application form of the Company signed or sealed by the parties involved with the Company. Such application shall be accompanied with the share certificates concerned.
② The registration under Paragraph ① shall be recorded on Shareholders Registry as well as the share certificates concerned. This above provisions shall also apply to any cancellation of pledge or any creation of sub-pledge and any cancellation of trust assets.
Article 12. Reissuance of Share Certificates
Any shareholder desiring the reissuance of a new share certificates shall submit the prescribed application form of the Company to the Company together with the following document. 1. The original or a certified copy of a judgement of nullification in case that the share certificates are lost.
2. The share certificates concerned in case that the share is damaged or stained and shareholders apply for partition or amalgamation of share certificate. But in case such damage or stain is so severe that such certificate(s) is (are) hardly identifiable, Paragraph 1 above shall apply mutatis mutandis thereto.
Article 13. Non-Possession of Share Certificates
① Any shareholder who does not desire to possess the nominative share certificates in his custody shall declare to the Company that he does not desire to do so by the prescribed form of the Company. In this case, any share certificates issued previously shall be submitted to the Company.
② Upon receiving the declaration mentioned in Paragraph ① above, the Company shall without delay enter in shareholders registry and part of a set thereof its statement that it will not issue the share certificates and notify the shareholders thereof.
③ When the Company has made the entry under the provision of Paragraph ②, the share certificates concerned may not be issued, and the share certificates presented to the company in accordance with Paragraph ① shall become null and void.
④ Notwithstanding Paragraph ①, a shareholder may request the issuance of the share certificates to the Company at any time.
Article 14. Transfer Agent
The Company may, if required by resolution of the Board of Directors, retain a transfer agent who shall be authorized on behalf of the Company to deal with the procedural matters for Article 9 through Article 13 relating to the share register and the pledge. In such a case, the procedure related with the share register and the pledge of the Company shall be kept with the procedural matters of the transfer agent.
Article 15. Fees
The Company shall collect fees as determined by the Board of Directors for services rendered in connection with issuance of new share certificate(s), alteration of entries in Shareholders Registry, registration for establishment or cancellation of pledges or trust on shares.
Article 16. Suspension of Altering Entry in the list of shareholders and Record Date
① The Company shall suspend entry of alteration in the list of shareholders with respect to shareholders’ rights from January 1 to January 31 of each year.
② The Company shall deem those shareholders whose names appear in the list of shareholders on December 31 of each year to be the shareholders who are entitled to exercise their rights as shareholders at the annual meeting of shareholders to be convened in respect of the said period for the settlement of accounts.
③ The Company may, in the case of convention of an special meeting of shareholders or in other necessary cases, suspend any entry into the shareholders registry with respect to shareholders’ rights for a period not exceeding three (3) months as determined by a resolution of the Board of Directors in order to determine the shareholders who are registered in the shareholders registry as of such record date and will exercise their rights. If the Board of Directors deems it necessary, the Company may suspend any entry into the shareholders registry and set the record date at the same time. The Company should give at least two(2) weeks’ prior public notice in such cases.
Article 17. Preemptive Right
① Shareholders shall have the preemptive rights to subscribe for the new shares that may be issued by the Company, in proportion to their respective shareholdings. But any shareholders waives or forfeits his/her preemptive rights or if fractional shares result from the allocation of the new shares, the shares which have not been allocated and/or subscribed shall be disposed of in accordance with a resolution of the Board of Directors.
② Notwithstanding the provision of Paragraph ①, the Company may allocate new shares to person other than existing shareholders in the following cases by a resolution of the Board of Directors : 1. In case that such new shares are issued by public offering or cause underwriters to underwrite new shares in accordance with the provisions of the Securities and Exchange Act. 2. In case that the Company issues new shares by general public offering in accordance with the provisions of Securities and Exchange Act. 3. In case that the Company issues new shares for the issuance of depositary receipts(DR) in accordance with the provisions of the Securities and Exchange Act. 4. In case that the Company issues new shares to foreign joint venture partner if it is necessary for management of the Company. Article 17-2. Capital Increase by General Public Offering and others ① The Company may issue new shares by general public offering not more than twenty percent (20%) of the total number of issued and outstanding shares by a resolution of the Board of Directors, in accordance with the procedural requirements set forth in of the Securities and Exchange Act. ② The Company may issue new shares by a resolution of the Board of Directors to foreign joint venture partner if it is necessary for management of the Company, up to an aggregate par value amount of forty billion Korean Won (40,000,000,000Won). ③ In the case of issuing new shares in the manner described in Paragraph ① and ②, the class, number and price thereof shall be determined by a resolution of the Board of Directors. Article 17-3. Commencement Date for Dividends on New shares With regard to payment of dividends on the new shares issued by the Company as a result of issuance of new shares or bonus shares, or stock dividends, such new shares shall be deemed to have been issued at the end of the fiscal year immediately preceding the fiscal year to which the time of issuance thereof belongs.
Article 18. Issuance of Convertible Bonds
① The Company may issue the convertible bonds to persons other than shareholders up to an aggregate par value amount of one hundred twenty billion won (120,000,000,000Won).
② Convertible bonds referred to in Paragraph above may be issued with partial conversion rights under which the right of the bondholders to demand conversion may be limited to a certain percentage of the total amount of convertible bonds.
③ The Class of shares to be issued upon conversion shall be common shares up to sixty billion won, and preferred shares up to sixty billion won. The conversion price shall not be lower than the par value of the shares as determined by the Board of Directors at the time of issuance of the relevant convertible bonds.
④ The period during which conversion may be requested shall be from the next day after the date of issuance of the relevant convertible bonds to the date one day prior to the redemption date of the bonds. Provided, that the Board of Directors may, by its resolution, adjust the conversion period within the above period.
⑤ With respect to the interest on convertible bonds and the dividends on shares to be issued upon conversion, the provision of Article 17-3 shall apply mutatis muta
Article 19. Issuance of Bonds with Warrants
① The Company may issue bonds with warrants to person other than shareholders up to an aggregate par value amount of one hundred twenty billion won(120,000,000,000Won).
② The aggregate price of new shares which may be subscribed for by the holders of warrants shall be determined by the Board of Directors, but shall not exceed the aggregate par value of the bonds with warrants.
③ The Class of shares to be issued upon exercise of warrants shall be common shares up to sixty billion won, and preferred shares up to sixty billion won. The issue price shall not be lower than the par value of the shares as determined by the Board of Directors at the time of issuance of the relevant bonds with warrants.
④ The period during which warrants may be exercised shall be from the next day after the date of issuance of the relevant bonds with warrants to the date one day prior to the redemption date of the bonds. Provided, that the Board of Directors may, by its resolution, adjust the exercise period for warrants within the above period.
⑤ With respect to the distribution of dividends on shares to be issued upon exercise of warrants, the provision of Article 17-3 shall apply mutatis mutandis.
① The Company may issue the convertible bonds to persons other than shareholders up to an aggregate par value amount of one hundred twenty billion won (120,000,000,000Won).
② Convertible bonds referred to in Paragraph above may be issued with partial conversion rights under which the right of the bondholders to demand conversion may be limited to a certain percentage of the total amount of convertible bonds.
③ The Class of shares to be issued upon conversion shall be common shares up to sixty billion won, and preferred shares up to sixty billion won. The conversion price shall not be lower than the par value of the shares as determined by the Board of Directors at the time of issuance of the relevant convertible bonds.
④ The period during which conversion may be requested shall be from the next day after the date of issuance of the relevant convertible bonds to the date one day prior to the redemption date of the bonds. Provided, that the Board of Directors may, by its resolution, adjust the conversion period within the above period.
⑤ With respect to the interest on convertible bonds and the dividends on shares to be issued upon conversion, the provision of Article 17-3 shall apply mutatis muta
Article 19. Issuance of Bonds with Warrants
① The Company may issue bonds with warrants to person other than shareholders up to an aggregate par value amount of one hundred twenty billion won(120,000,000,000Won).
② The aggregate price of new shares which may be subscribed for by the holders of warrants shall be determined by the Board of Directors, but shall not exceed the aggregate par value of the bonds with warrants.
③ The Class of shares to be issued upon exercise of warrants shall be common shares up to sixty billion won, and preferred shares up to sixty billion won. The issue price shall not be lower than the par value of the shares as determined by the Board of Directors at the time of issuance of the relevant bonds with warrants.
④ The period during which warrants may be exercised shall be from the next day after the date of issuance of the relevant bonds with warrants to the date one day prior to the redemption date of the bonds. Provided, that the Board of Directors may, by its resolution, adjust the exercise period for warrants within the above period.
⑤ With respect to the distribution of dividends on shares to be issued upon exercise of warrants, the provision of Article 17-3 shall apply mutatis mutandis.
Article 20. Types of Meeting of Shareholders
① The Company’s meeting of shareholders shall consist of annual meetings and special meetings.
② The annual meeting shall be held within three months after the end of each fiscal year and special meeting may be held at any time when necessary.
Article 21. Convening of Meeting of Shareholders
① Except as otherwise provided by laws and regulations, the meeting of shareholders shall be convened in accordance with a resolution of the Board of Directors.
② The Representative Director - President of the Company shall convene all Meetings of Shareholders. If the Representative Director - President is unable to perform his duties, a Director designated by the Board of Directors shall act for him.
③ In convening a meeting of shareholders, a written notice thereof, which sets forth the time, date, place and agenda of the meeting, shall be sent to each shareholders at least two (2) weeks prior to the date of the meeting.
④ The written notice to shareholders holding not more than one percent of the total number of issued and outstanding shares with voting rights may be replaced by public notices made at least twice in the Han Kook Kyung Jae Shinmoon and Maeil Kyung Jae Shinmoon, circulated in Seoul two weeks prior to the meeting. The public notice of a meeting shall include the statement that the meeting of shareholders will be held and the agenda of the meeting.
⑤ At meeting of shareholders, the shareholders may deliberate only on the subjects set forth in the written notice.
⑥ The Meeting of Shareholders shall be held at the place where the head office of the Company is located but also may be held at a nearby place in accordance with a resolution of the Board of Directors.
Article 22. Chairman
① The Representative Director - President shall preside over the meeting of shareholders as chairman.
② If the Representative Director - President is unable to perform his duties, a Director appointed by the Board of Directors shall act for him.
Article 23. Maintenance of Order by the Chairman
① The Chairman of a 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 leave the place of the meeting, and such persons shall comply with his/her order.
② The chairman of a meeting of shareholders may restrict the time and number of speeches of a shareholder as deemed necessary for the purpose of harmonious progress in the proceeding of the meeting.
Article 24. Voting Rights
① Unless otherwise provided in the relevant laws and regulations, each shareholder shall have one vote for each share he/she owns in all matters under consideration at a meeting of shareholders
. Article 25. Exercise of Votes by Proxy
① A shareholder of the Company may exercise his/her voting rights by proxy.
② The proxy is not required to be a shareholder of the Company, shall present documents evidencing his/her power of representation before opening of a meeting of shareholders.
Article 26. Method of Resolution
Unless otherwise provided in the relevant laws, regulations and the Articles of Incorporation, all resolutions of the meetings of shareholders shall be adopted by the affirmative votes of the majority of shareholders present at the meeting ; provided, that such votes shall represent at least one fourth (1/4) of total number of issued and outstanding shares of the Company.
Article 27. Minutes of Meeting of Shareholders
The substance of the course and proceedings of a meeting of shareholders and the results thereof shall be recorded in minutes on which the names and seals of the chairman and the directors present at the meeting shall be affixed or which shall be signed by such persons, and shall be kept at the head office and branches of the Company.
① The Company’s meeting of shareholders shall consist of annual meetings and special meetings.
② The annual meeting shall be held within three months after the end of each fiscal year and special meeting may be held at any time when necessary.
Article 21. Convening of Meeting of Shareholders
① Except as otherwise provided by laws and regulations, the meeting of shareholders shall be convened in accordance with a resolution of the Board of Directors.
② The Representative Director - President of the Company shall convene all Meetings of Shareholders. If the Representative Director - President is unable to perform his duties, a Director designated by the Board of Directors shall act for him.
③ In convening a meeting of shareholders, a written notice thereof, which sets forth the time, date, place and agenda of the meeting, shall be sent to each shareholders at least two (2) weeks prior to the date of the meeting.
④ The written notice to shareholders holding not more than one percent of the total number of issued and outstanding shares with voting rights may be replaced by public notices made at least twice in the Han Kook Kyung Jae Shinmoon and Maeil Kyung Jae Shinmoon, circulated in Seoul two weeks prior to the meeting. The public notice of a meeting shall include the statement that the meeting of shareholders will be held and the agenda of the meeting.
⑤ At meeting of shareholders, the shareholders may deliberate only on the subjects set forth in the written notice.
⑥ The Meeting of Shareholders shall be held at the place where the head office of the Company is located but also may be held at a nearby place in accordance with a resolution of the Board of Directors.
Article 22. Chairman
① The Representative Director - President shall preside over the meeting of shareholders as chairman.
② If the Representative Director - President is unable to perform his duties, a Director appointed by the Board of Directors shall act for him.
Article 23. Maintenance of Order by the Chairman
① The Chairman of a 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 leave the place of the meeting, and such persons shall comply with his/her order.
② The chairman of a meeting of shareholders may restrict the time and number of speeches of a shareholder as deemed necessary for the purpose of harmonious progress in the proceeding of the meeting.
Article 24. Voting Rights
① Unless otherwise provided in the relevant laws and regulations, each shareholder shall have one vote for each share he/she owns in all matters under consideration at a meeting of shareholders
. Article 25. Exercise of Votes by Proxy
① A shareholder of the Company may exercise his/her voting rights by proxy.
② The proxy is not required to be a shareholder of the Company, shall present documents evidencing his/her power of representation before opening of a meeting of shareholders.
Article 26. Method of Resolution
Unless otherwise provided in the relevant laws, regulations and the Articles of Incorporation, all resolutions of the meetings of shareholders shall be adopted by the affirmative votes of the majority of shareholders present at the meeting ; provided, that such votes shall represent at least one fourth (1/4) of total number of issued and outstanding shares of the Company.
Article 27. Minutes of Meeting of Shareholders
The substance of the course and proceedings of a meeting of shareholders and the results thereof shall be recorded in minutes on which the names and seals of the chairman and the directors present at the meeting shall be affixed or which shall be signed by such persons, and shall be kept at the head office and branches of the Company.
Article 28. Number, Term of office of Directors
① The Company shall have at least three (3) directors.
② The term of office of the directors shall expire at the close of the ordinary meeting of shareholders convened with respect to the last fiscal year which ends on or before a date two(2) years from the date of inauguration, and any directors are entitled to be reelected.
Article 29. Election, Remuneration and Severance Pay of Directors
① Directors shall be elected by a meeting of Shareholders, and the cumulative vote shall not apply. However, outside directors shall be elected from among the recommend candidates by The Committee for Recommending Candidates for Outside Directors
② Directors’ remuneration shall be determined by a meeting of shareholders.
③ Severance payment for directors shall be paid in accordance with the Company’s regulation on Severance Payment for Officers which have been duly approved by a resolution of a meeting of shareholders.
Article 30. Appointment of Representative Directors, Etc.
The Board of Directors shall appoint representative directors of the Company from among its members and may appoint several chairmen, vice chairmen, presidents, vice presidents, executive managing directors, and managing directors. Provided, that the presidents shall be appointed from among the representative directors.
Article 31. Board of Directors and Duties of Directors
① The Board of Directors shall be composed of directors.
② The Board of Directors shall decide all major matters regarding the execution of business of the Company.
③ The Representative Director - President shall represent the Company and direct the Company’s overall business.
④ Vice-president(s), executive managing directors, managing directors and directors shall assist the president and shall perform their respective responsibilities as determined by the Board of Directors. In the absence of the representative director-president, they shall perform his/her duty in the foregoing order of priority.
Article 31-2. Directors’ Obligations to Report
If any director becomes aware of any facts which may cause substantial losses to the Company, such director shall immediately report it to the Audit Committee.
Article 32. Convening of the Board of Directors’ Meeting
① Meetings of the Board of Directors shall be convened by the Chairman. In the absence of the Chairman, the Vice Chairman shall convene such meeting. In the absence of the Vice Chairman, the President shall convene such meeting. In the absence of the President, the Director appointed by the Board of Directors shall convene such meeting.
② In convening a meeting of the Board of Directors, a notice thereof shall be given to each director one(1) day prior to the date of the meeting. Provided, however, that such notice may be omitted with the consent of all directors.
Article 33. Presiding Officer and Resolution
① The Chairman shall preside over all meetings of the Board of Directors. In the absence of the Chairman, the Vice Chairman shall preside over such meetings. In the absence of the Vice Chairman, the President shall preside over such meetings. In the absence of the President, the Director appointed by the Board of Directors shall preside over such meetings.
② Resolutions of the Board of Directors shall be adopted in the presence of a majority of the directors in office and by the affirmative vote of a majority of the directors present. Provided, that the Board of Directors may allow all its directors to join in discussion on the adoption of a resolution by means of a communication system transmitting and receiving visual images and sounds simultaneously without the personal attendance of all or part of them. In this case the director or directors concerned shall be deemed to have attended the meeting.
③ No directors having a specific interest in any resolution of the Board of Directors shall be allowed to exercise their vote upon such a resolution.
Article 34. Minutes
The minutes shall include the agenda, procedure and results of the proceedings of the meeting of Board of Directors, and all directors present at the meeting shall sign and seal the same or affix their signatures thereto, and shall be kept at the head office.
Article 34-2. Committees
① The Company may establish Committees in the Board of Directors by resolutions of the Board of Directors, as described below;
1. Audit Committee
2. Committee for Recommending Candidates for Outside Directors
3. Other Committee that the Board of Directors deems it necessary
② Unless otherwise provided in the relevant laws and regulations, the details concerning the power and operation of each of such committees shall be determined by resolutions of the Board of Directors.
③ Provisions of Articles 32,33 and 34 hereof shall apply mutatis mutandis to such Committees.
Article 34-3. Audit Committee
① The Company may establish an Audit Committee by resolutions of the Board of Directors pursuant to Article 34-2 hereof.
② The details concerning the composition and operation of Audit Committee shall be determined by resolutions of the Board of Directors.
Article 34-4. Committee for Recommending Candidates for Outside Directors
① The Company may establish an Committee for Recommending Candidates for Outside Directors by resolutions of the Board of Directors pursuant to Article 34-2 hereof.
② The details concerning the composition and operation of Committee for Recommending Candidates for Outside Directors shall be determined by resolutions of the Board of Directors.
Article 35. < Deleted>
Article 36. < Deleted>
Article 37. < Deleted>
① The Company shall have at least three (3) directors.
② The term of office of the directors shall expire at the close of the ordinary meeting of shareholders convened with respect to the last fiscal year which ends on or before a date two(2) years from the date of inauguration, and any directors are entitled to be reelected.
Article 29. Election, Remuneration and Severance Pay of Directors
① Directors shall be elected by a meeting of Shareholders, and the cumulative vote shall not apply. However, outside directors shall be elected from among the recommend candidates by The Committee for Recommending Candidates for Outside Directors
② Directors’ remuneration shall be determined by a meeting of shareholders.
③ Severance payment for directors shall be paid in accordance with the Company’s regulation on Severance Payment for Officers which have been duly approved by a resolution of a meeting of shareholders.
Article 30. Appointment of Representative Directors, Etc.
The Board of Directors shall appoint representative directors of the Company from among its members and may appoint several chairmen, vice chairmen, presidents, vice presidents, executive managing directors, and managing directors. Provided, that the presidents shall be appointed from among the representative directors.
Article 31. Board of Directors and Duties of Directors
① The Board of Directors shall be composed of directors.
② The Board of Directors shall decide all major matters regarding the execution of business of the Company.
③ The Representative Director - President shall represent the Company and direct the Company’s overall business.
④ Vice-president(s), executive managing directors, managing directors and directors shall assist the president and shall perform their respective responsibilities as determined by the Board of Directors. In the absence of the representative director-president, they shall perform his/her duty in the foregoing order of priority.
Article 31-2. Directors’ Obligations to Report
If any director becomes aware of any facts which may cause substantial losses to the Company, such director shall immediately report it to the Audit Committee.
Article 32. Convening of the Board of Directors’ Meeting
① Meetings of the Board of Directors shall be convened by the Chairman. In the absence of the Chairman, the Vice Chairman shall convene such meeting. In the absence of the Vice Chairman, the President shall convene such meeting. In the absence of the President, the Director appointed by the Board of Directors shall convene such meeting.
② In convening a meeting of the Board of Directors, a notice thereof shall be given to each director one(1) day prior to the date of the meeting. Provided, however, that such notice may be omitted with the consent of all directors.
Article 33. Presiding Officer and Resolution
① The Chairman shall preside over all meetings of the Board of Directors. In the absence of the Chairman, the Vice Chairman shall preside over such meetings. In the absence of the Vice Chairman, the President shall preside over such meetings. In the absence of the President, the Director appointed by the Board of Directors shall preside over such meetings.
② Resolutions of the Board of Directors shall be adopted in the presence of a majority of the directors in office and by the affirmative vote of a majority of the directors present. Provided, that the Board of Directors may allow all its directors to join in discussion on the adoption of a resolution by means of a communication system transmitting and receiving visual images and sounds simultaneously without the personal attendance of all or part of them. In this case the director or directors concerned shall be deemed to have attended the meeting.
③ No directors having a specific interest in any resolution of the Board of Directors shall be allowed to exercise their vote upon such a resolution.
Article 34. Minutes
The minutes shall include the agenda, procedure and results of the proceedings of the meeting of Board of Directors, and all directors present at the meeting shall sign and seal the same or affix their signatures thereto, and shall be kept at the head office.
Article 34-2. Committees
① The Company may establish Committees in the Board of Directors by resolutions of the Board of Directors, as described below;
1. Audit Committee
2. Committee for Recommending Candidates for Outside Directors
3. Other Committee that the Board of Directors deems it necessary
② Unless otherwise provided in the relevant laws and regulations, the details concerning the power and operation of each of such committees shall be determined by resolutions of the Board of Directors.
③ Provisions of Articles 32,33 and 34 hereof shall apply mutatis mutandis to such Committees.
Article 34-3. Audit Committee
① The Company may establish an Audit Committee by resolutions of the Board of Directors pursuant to Article 34-2 hereof.
② The details concerning the composition and operation of Audit Committee shall be determined by resolutions of the Board of Directors.
Article 34-4. Committee for Recommending Candidates for Outside Directors
① The Company may establish an Committee for Recommending Candidates for Outside Directors by resolutions of the Board of Directors pursuant to Article 34-2 hereof.
② The details concerning the composition and operation of Committee for Recommending Candidates for Outside Directors shall be determined by resolutions of the Board of Directors.
Article 35. < Deleted>
Article 36. < Deleted>
Article 37. < Deleted>
Article 38. Fiscal Year
The fiscal year of the Company shall commence on January 1 and end on December 31 of each year.
Article 39. Accounting System
All accounting books and records of the Company shall be kept and dealt with in accordance with generally accepted accounting principles and practices in the Republic of Korea.
Article 40. Preparation of Financial Statements
① The Representative Director - President of the Company shall prepare and submit to Audit Committee for audit the following documents and their supplementary schedules together with an business report, six(6) weeks prior to the date set for the annual meeting of shareholders convened for the fiscal year to which such documents are related and, upon Audit Committee’s audit, shall submit the aforementioned documents and the business report to the annual meeting of shareholders;
1. Balance sheet ;
2. Income statement ; and
3. Statement of Appropriation of Retained Earnings or Statement of Disposition of Accumulated Deficit.
② Audit Committee shall submit the auditors’ report to the Representative Director-President one(1) week prior to the day set for the annual meeting of shareholders.
③ The Representative Director-President shall keep on file the documents described in Paragraph ① above and supplementary documents together with the business report and the auditors’ report at the head office of the Company from one (1) week before the day set for the annual meeting of shareholders and shall submit them to the annual meeting of shareholders for approval.
④ The Representative Director-President shall give public notice of the balance sheet and the opinion of independent auditor immediately after the documents referred to in Paragraph ① above have been approved at the meeting of shareholders.
Article 41. Disposition of Profit
The Company shall dispose of the unappropriated retained earnings of each fiscal year as follows :
1. Legal reserve ;
2. Other statutory reserves ;
3. Dividends ;
4. Discretionary reserve ;
5. Other appropriation of retained earnings ; and
6. Unappropriated retained earnings to be carried over to subsequent.
Article 41-2. Retirement of Shares
① The Company may retire its shares based on a resolution of the board of directors as dividends for its shareholders.
② In the event that it is intended to retire shares under Paragraph ①, the board of directors shall vote on matters falling under each of the following subparagraphs.
1. Kinds and numbers of shares to be retired;
2. Total value of shares to be acquired for retirement; and
3. Period for which it is intended to acquire shares. In this case, such period shall expire prior
to an annual meeting of shareholders called for the first time after the resolution of the board of directors
③ The company shall, if it acquires its shares for the purpose of retiring such shares under Paragraph ①, acquire such shares as provided by the relevant Acts.
④ The company shall, if it retires its shares under paragraph ①, report the matters of each subparagraph of Paragraph ② and the fact of retiring such shares to an annual meeting of shareholders called for the first time after a resolution of the board of directors with respect to the retirement of such shares.
Article 42. Dividend
① Dividends may be paid in either cash or shares.
② Dividends in Paragraph ① above shall be paid to the shareholders or pledgees registered in the shareholders registry of the Company as of the end of each fiscal year.
③ In case the dividends are distributed in shares, if the Company has issued several classes of shares, such distribution may be made through share of different classes by a resolution a meeting of shareholders.
④ The right to dividends shall be extinguished by prescription if the right has not been exercised for five years and dividend to be payable shall not include the interest thereon.
⑤ After the expiration of the prescription period set forth in Paragraph ④, unclaimed dividends shall revert to the Company.
Article 42-2. Interim Dividend
① The company may pay profit interim dividends in cash through a resolution of the board of directors to the shareholders who are registered in the shareholder registry as of June 30 of each year as provided by the Securities and Exchange Act.
② A resolution of the board of directors listed in Paragraph ① shall be made not less than 45 days from the fixed date referred to in Paragraph ①
③ The interim dividends shall be within the limit of the net amount of property in a balance sheet in the immediately preceding term for the settlement of accounts, after deducting the following : 1. The amount of capital in the immediately preceding term for the settlement of accounts;
2. The total amount of capital surplus reserve and legal reserve accumulated until the immediately preceding term for the settlement of accounts;
3. The amount determined to pay profits at an annual meeting in the immediately preceding term for the settlement of accounts;
4. The discretionary reserve accumulated until the immediately preceding term for the special purpose by the articles of incorporation or through the resolution of regular shareholder’s meeting; and
5. The legal reserve to be accumulated in the term for the settlement of accounts pursuant to interim dividends.
④ If the Company issue new shares by capitalization of reserves, share dividend, convertible request of convertible bonds, exercise of bonds with warrants etc. between the commencement of the fiscal year and the fixed date referred to in Paragraph ①, with respect to the interim dividends on the new shares, the new shares shall be deemed to have been issued at the end of the immediately preceding fiscal year.
⑤ When the company pay interim dividends, the dividend ratio of the preferred shares under Article 8 apply identically that of the common shares.
The fiscal year of the Company shall commence on January 1 and end on December 31 of each year.
Article 39. Accounting System
All accounting books and records of the Company shall be kept and dealt with in accordance with generally accepted accounting principles and practices in the Republic of Korea.
Article 40. Preparation of Financial Statements
① The Representative Director - President of the Company shall prepare and submit to Audit Committee for audit the following documents and their supplementary schedules together with an business report, six(6) weeks prior to the date set for the annual meeting of shareholders convened for the fiscal year to which such documents are related and, upon Audit Committee’s audit, shall submit the aforementioned documents and the business report to the annual meeting of shareholders;
1. Balance sheet ;
2. Income statement ; and
3. Statement of Appropriation of Retained Earnings or Statement of Disposition of Accumulated Deficit.
② Audit Committee shall submit the auditors’ report to the Representative Director-President one(1) week prior to the day set for the annual meeting of shareholders.
③ The Representative Director-President shall keep on file the documents described in Paragraph ① above and supplementary documents together with the business report and the auditors’ report at the head office of the Company from one (1) week before the day set for the annual meeting of shareholders and shall submit them to the annual meeting of shareholders for approval.
④ The Representative Director-President shall give public notice of the balance sheet and the opinion of independent auditor immediately after the documents referred to in Paragraph ① above have been approved at the meeting of shareholders.
Article 41. Disposition of Profit
The Company shall dispose of the unappropriated retained earnings of each fiscal year as follows :
1. Legal reserve ;
2. Other statutory reserves ;
3. Dividends ;
4. Discretionary reserve ;
5. Other appropriation of retained earnings ; and
6. Unappropriated retained earnings to be carried over to subsequent.
Article 41-2. Retirement of Shares
① The Company may retire its shares based on a resolution of the board of directors as dividends for its shareholders.
② In the event that it is intended to retire shares under Paragraph ①, the board of directors shall vote on matters falling under each of the following subparagraphs.
1. Kinds and numbers of shares to be retired;
2. Total value of shares to be acquired for retirement; and
3. Period for which it is intended to acquire shares. In this case, such period shall expire prior
to an annual meeting of shareholders called for the first time after the resolution of the board of directors
③ The company shall, if it acquires its shares for the purpose of retiring such shares under Paragraph ①, acquire such shares as provided by the relevant Acts.
④ The company shall, if it retires its shares under paragraph ①, report the matters of each subparagraph of Paragraph ② and the fact of retiring such shares to an annual meeting of shareholders called for the first time after a resolution of the board of directors with respect to the retirement of such shares.
Article 42. Dividend
① Dividends may be paid in either cash or shares.
② Dividends in Paragraph ① above shall be paid to the shareholders or pledgees registered in the shareholders registry of the Company as of the end of each fiscal year.
③ In case the dividends are distributed in shares, if the Company has issued several classes of shares, such distribution may be made through share of different classes by a resolution a meeting of shareholders.
④ The right to dividends shall be extinguished by prescription if the right has not been exercised for five years and dividend to be payable shall not include the interest thereon.
⑤ After the expiration of the prescription period set forth in Paragraph ④, unclaimed dividends shall revert to the Company.
Article 42-2. Interim Dividend
① The company may pay profit interim dividends in cash through a resolution of the board of directors to the shareholders who are registered in the shareholder registry as of June 30 of each year as provided by the Securities and Exchange Act.
② A resolution of the board of directors listed in Paragraph ① shall be made not less than 45 days from the fixed date referred to in Paragraph ①
③ The interim dividends shall be within the limit of the net amount of property in a balance sheet in the immediately preceding term for the settlement of accounts, after deducting the following : 1. The amount of capital in the immediately preceding term for the settlement of accounts;
2. The total amount of capital surplus reserve and legal reserve accumulated until the immediately preceding term for the settlement of accounts;
3. The amount determined to pay profits at an annual meeting in the immediately preceding term for the settlement of accounts;
4. The discretionary reserve accumulated until the immediately preceding term for the special purpose by the articles of incorporation or through the resolution of regular shareholder’s meeting; and
5. The legal reserve to be accumulated in the term for the settlement of accounts pursuant to interim dividends.
④ If the Company issue new shares by capitalization of reserves, share dividend, convertible request of convertible bonds, exercise of bonds with warrants etc. between the commencement of the fiscal year and the fixed date referred to in Paragraph ①, with respect to the interim dividends on the new shares, the new shares shall be deemed to have been issued at the end of the immediately preceding fiscal year.
⑤ When the company pay interim dividends, the dividend ratio of the preferred shares under Article 8 apply identically that of the common shares.
Article 43. Working Regulations
The Company may enact rules and regulations as required for the operation and management of the Company, which shall be decided by resolution of the Board of the Board of Directors.
Article 44. Other Sources of Law
① Matters not provided for in this Articles of Incorporation shall be governed by Commercial Act, laws of the Republic of Korea or by resolution of the Meeting of Shareholders.
② If any laws referred to in this Articles of Incorporation are amended, such amended laws shall be correspondingly applied.
Article 45. Amendment of the Articles of Incorporation
The resolution of amendment of the Articles of Incorporation shall be adopted by affirmative vote of no less than two third(2/3) of the voting right of the shareholders present at the meeting. Provided, that such vote represent at least one third(1/3) of total number of issued and outstanding shares of the Company.
The Company may enact rules and regulations as required for the operation and management of the Company, which shall be decided by resolution of the Board of the Board of Directors.
Article 44. Other Sources of Law
① Matters not provided for in this Articles of Incorporation shall be governed by Commercial Act, laws of the Republic of Korea or by resolution of the Meeting of Shareholders.
② If any laws referred to in this Articles of Incorporation are amended, such amended laws shall be correspondingly applied.
Article 45. Amendment of the Articles of Incorporation
The resolution of amendment of the Articles of Incorporation shall be adopted by affirmative vote of no less than two third(2/3) of the voting right of the shareholders present at the meeting. Provided, that such vote represent at least one third(1/3) of total number of issued and outstanding shares of the Company.