2. The costs of appeal shall be borne by the Plaintiff.

The reasons for this part are the same as the corresponding part of the judgment of the court of first instance, thereby citing it as it is in accordance with the main sentence of Article 420 of the Civil Procedure Act (hereinafter referred to as the "resolution of this case" in this part, and 'the contents of the shareholder proposal' in '4. The contents of '4. shareholder proposal' in 'the contents of '2. 1. 1. 1. 1. 1. 1. 'the resolution of this case' in which B appointed as the defendant's internal director.

2. Determination on the cause of the claim

A. The plaintiff's assertion

1) At the 50th regular general meeting of shareholders of the defendant, the plaintiff proposed the shareholders to consider the "case of four directors" as agenda items and agenda items, and demanded the appointment of the pertinent director by means of a concentrated vote at the time of appointing the pertinent director. Since the contents of the shareholder proposal proposed by the plaintiff are not contrary to the statutes or the articles of incorporation or other cases prescribed by Presidential Decree, the shareholders' meeting of this case should have presented the contents of the limited shareholders proposal as agenda items.

2) However, the defendant's board of directors suggested that the contents of the plaintiff's shareholder proposal (the case in which four directors are selected and appointed by adopting the method of intensive voting) as the first agenda of the plaintiff's meeting of this case (the case in which four directors are selected) and proposed that "other cases of appointment of non-permanent directors are resolved as four in advance," and changed the bill into "other cases in which four directors of non-permanent directors are appointed as cumulative voting." The chairperson of the shareholders' meeting of this case also proposed and rejected the modified bill without presenting the contents of the plaintiff's shareholder proposal to the shareholders' general meeting of this case, and as a result, the "the case of appointment of non-corporate directors after the expiration of the term of office B" was presented as the case of "the case of appointment of non-corporate directors", and as a result, the two was elected as a non-corporate director.

3) The Plaintiff’s proposal without submitting it as it is is and without changing it as mentioned above is erroneous in infringing the shareholder proposal right and the collective voting system as follows. The progress of the general meeting of shareholders of this case constitutes a case where the progress of the general meeting of this case is significantly unfair.

A) Even though a shareholder proposed the proposal to appoint the number of directors, if it is possible to appoint only the number of directors decided according to the resolution after the general resolution of the general meeting of shareholders (i.e., whether the contents of the shareholder proposal will be presented to the agenda according to the preceding resolution), it would result in denying the shareholder proposal right of a minority shareholder under the Commercial Act by the general resolution of the general meeting of shareholders. This constitutes infringement of the shareholder proposal right.

B) The Commercial Act provides that, when multiple directors are selected and appointed, directors shall be selected and appointed by means of a concentrated vote if there is a request by a minority shareholder for a concentrated vote. However, even though a shareholder proposed a shareholder to appoint a number of directors and claimed a concentrated vote by the method of election, if it is decided whether to appoint multiple directors based on the result of the first determination of whether to appoint a number of directors, it would result in excluding the cumulative voting system prepared to guarantee the right to appoint directors of a minority shareholder by a resolution of a general meeting of shareholders. This constitutes infringement of a minority shareholder’s concentrated voting right.

C) The Defendant’s articles of incorporation stipulate the number of directors as “not less than three persons,” but does not impose restrictions on the number of directors. However, despite the Plaintiff’s lawful proposal for the appointment of additional directors, it is substantially limited to the number of directors to determine whether or not to be a few directors prior to the resolution for appointment of directors, such as the instant method of the general meeting of shareholders, as the method of the resolution for appointment of directors. This is also the same as changing the articles of incorporation into a general

D) The agenda proposed by the Plaintiff is the case of appointment of four directors, and it is merely the case that the Plaintiff recommended four candidates to serve as other non-executive directors. The general meeting of shareholders of this case tried to distinguish between the case of appointment of a director at will and the case of appointment of a non-executive director at will. It is unlawful.

4) Therefore, the resolution to appoint B as director at the general meeting of shareholders of this case is erroneous in rejecting the Plaintiff’s proposal and request for a concentrated voting system as above, and the above resolution shall be null and void. Even if the above resolution does not constitute null and void, the above resolution shall be revoked as it violates the above Acts and subordinate statutes and is unfair in the proceedings.

B. Determination

1) Whether the instant resolution was unlawful or unfair

A) Whether a shareholder proposal provision was violated

(1) Article 363-2(1) of the Commercial Act provides that a shareholder who holds no less than 3/100 of the total issued and outstanding shares other than nonvoting shares may make a proposal to a director as an object of the general meeting of shareholders in writing or by electronic document (hereinafter referred to as “shareholders’ proposal”) at least six weeks prior to the general meeting of shareholders. Paragraph (3) of the same Article provides that a director shall report to the board of directors if a shareholder proposal is made under paragraph (1), and the board of directors shall make such a proposal as an object of the general meeting of shareholders, except where the contents of the shareholder proposal violate Acts and subordinate statutes or the articles of incorporation or other cases prescribed by Presidential Decree. In this case, a shareholder proposal shall be given an opportunity to explain the proposal at the general meeting of shareholders. Furthermore, Article 12 of the Enforcement Decree of the Commercial Act lists

(2) According to the provisions of the Commercial Act and the facts of recognition as seen earlier, there is no evidence to deem that the Plaintiff’s proposal was made to the Defendant and the Defendant’s directors by meeting the requirements and procedures prescribed in Article 363-2 of the Commercial Act, that “the instant proposal violates the statutes or the articles of incorporation, or that it constitutes grounds for refusal under Article 12 of the Enforcement Decree of the Commercial Act. Therefore, the Defendant’s board of directors is obliged to submit the instant bill as the subject matter to the general meeting of shareholders.

However, the defendant's board of directors did not present the bill of this case as it is at the general meeting of shareholders, and the "case of appointing other non-executive directors" and the "case of deciding the appointment number of other non-executive directors" by modifying the contents proposed by the plaintiff shall be passed first, so that the bill of this case may be presented as the subject of the general meeting of shareholders, and as a result, the "the subject of this case" was not presented as the subject of the general meeting of shareholders, and there is room to view that the defendant's above modified bill of this case was unlawful because it was contrary to the purport of the provision of the shareholder's right of proposal as stipulated in Article 363-2 of the Commercial Act.

B) Whether the concentrated voting regulations are violated

(1) Article 382-2(1) of the Commercial Act provides, “If a general meeting of shareholders is convened to elect two or more directors, shareholders who hold no less than 3/100 of the total issued and outstanding shares other than nonvoting shares may request that the company appoint directors by means of a concentrated vote, except as otherwise provided in the articles of incorporation.” Article 382-2(3) and (4) of the same Act provides, “If a request is made under paragraph (1) of the same Article, shareholders shall have the same number of voting rights per share as the number of directors to be elected, with respect to a resolution of election of directors, and the voting rights may be exercised by means of a concentrated vote for one or several candidates.”

(2) As seen above, the centralized voting system is one of the voting methods for the appointment of directors, and is possible only when a general meeting of shareholders is convened for the purpose of appointing more than two directors. Therefore, the shareholder proposal right as seen earlier differs from the requirement, content, nature, etc. of the exercise requirement. In other words, the concentrated voting right cannot be the contents of the shareholder proposal, and even if a request for a concentrated voting was made, there is no room for applying the cumulative voting system in cases where a multiple shareholders’ general meeting of shareholders does not elect a director.

(3) In this case, the Plaintiff proposed 'four directors' to be elected and requested 'four directors' to be elected by the method of 'central voting'. Here, the Plaintiff's proposal is 'four directors', and 'central voting' request is only a method of selecting multiple directors premised on the appointment of directors. As seen earlier, it is reasonable that the Defendant's board of directors proposed 'four directors' proposal by the Plaintiff as the agenda of the general meeting of shareholders, and it should have been resolved on the agenda of the general meeting of shareholders in this case. However, the resolution of the general meeting of shareholders on the adoption of the agenda of 'four directors' proposal by the Plaintiff is sufficient if the resolution of the general meeting of shareholders is adopted by the general meeting of shareholders. This is because the centralized voting system can not be used when determining one voting method for the election of directors, whether to adopt the submitted proposal by the general meeting of shareholders, etc.

In other words, only after the resolution is passed at a general meeting of shareholders to appoint multiple directors, it is possible to elect directors by means of cumulative voting only after the resolution is passed by the general meeting of shareholders.It is because it is not possible that the shareholder simultaneously filed a claim for a "serious voting" in order to protect the shareholder's concentrated voting right, the authority of the resolution of the general meeting of shareholders should be excluded in order to protect the shareholder's concentrated voting right.

If the plaintiff first rejected the shareholder's proposal called "election of a number of directors" as a resolution of the general meeting of shareholders in the above case, it is unreasonable to view that the 'central voting system prepared for minority shareholders' is no longer applicable. However, this is merely limited to the intrinsic limit of the 'in cases where two or more directors are elected at the same general meeting of shareholders', but it does not constitute a violation or infringement of the 'central voting system' in accordance with the provision that 'in cases where two or more directors are elected

(4) According to the above facts, the bill of this case was not presented at the general meeting of shareholders of this case, and there was no other resolution to appoint two or more directors. Accordingly, the resolution of this case was made only for the case of the appointment of the ex-company director B of the ex-company director whose term of office has expired (the resolution for the appointment of one director). Ultimately, the resolution of this case was made by means of a common resolution rather than a concentrated voting method, because the requirement of the "election of two or more directors" as provided by Article 382-2 of the Commercial Act was not satisfied, and as seen earlier, it is not necessarily required to adopt the shareholders' proposal with the contents of the "election of two or more directors" as stated above at the general meeting of shareholders. Therefore, the above result is considered to be due to the inherent limit of the centralized voting system. Accordingly, the plaintiff's assertion that the "resolution of this case" violates the provisions of the concentrated voting is without merit.

C) As to other unlawful assertion

(1) The Plaintiff asserts that “In spite of the fact that the Defendant’s articles of incorporation do not limit the number of directors’ number, it is unlawful to determine whether or not to be a few directors prior to the resolution of appointment of directors, such as the progress of the instant general meeting of shareholders, with respect to the number of directors, as it modifies the articles of incorporation provisions on the number of directors to the general

However, the Commercial Code provides that "the directors shall be appointed at a general meeting of shareholders" (Article 382 (1)), "whether to appoint additional directors" and "the number of directors to be appointed at the general meeting of shareholders" are matters that can be decided by a general resolution of the general meeting of shareholders, and such resolution does not constitute an amendment to the articles of incorporation for the fixed number of directors. Therefore, the plaintiff's above assertion is without merit.

(2) The plaintiff asserts that "the agenda proposed by the plaintiff is a case of four directors," and that "the candidate is a person who will serve as other non-executive directors." The plaintiff asserts that the general meeting of shareholders of this case does not distinguish "the case of appointment of director at will" and "other cases of appointment of non-executive directors" from "the case of appointment of director at will."

According to the above facts of recognition, it is recognized that '4 cases of appointment of directors' proposed by the plaintiff and 'cases of appointment of 'in-house directors B' of 'in-house directors whose term of office has expired as determined by the board of directors' are separate proposals, and it cannot be viewed that there was any error in separating them and presenting them as individual agenda items. Accordingly, the plaintiff's above assertion is without merit.

2) As to whether the resolution of this case is null and void (the main part of the claim)

If the contents of a resolution by a general meeting of shareholders violate Acts and subordinate statutes, such resolution shall be null and void, and any interested person may seek confirmation of its invalidation (see Article 380 of the Commercial Act).

However, even if the defendant's mistake related to the above provision of shareholders' proposal was considered, the contents of the resolution of this case that appointed B as the defendant's internal director cannot be deemed to violate the law, and there is no other evidence to acknowledge it. Therefore, the plaintiff's allegation in this part

3) As to whether there exists a ground for revocation of the resolution in the instant case (the part of preliminary claim)

The defendant board of directors presented the proposal of this case to the general meeting of shareholders without presenting the proposal of this case as it is. As a result, the bill of this case was not presented to the general meeting of shareholders as an agenda item. This may not be viewed as unlawful because it was contrary to the purpose of the provision of the right to proposal of shareholders under the Commercial Act.

However, even if the defendant's above modified proposal was illegal, the modified proposal was affected by the violation of the law of the modified proposal in order for the plaintiff to be found to have a ground for revocation on the "resolution" of this case. However, the plaintiff's proposal and the "case of the appointment of an internal director director B after the expiration of the term of office of the defendant's board of directors" are separate proposals, so it cannot be viewed that the above two bills should be handled at once, and the defendant's board of directors' resolution of "the case of the appointment of an internal director B after the expiration of the term of office of the defendant's board of directors" would be unrelated to the result of the plaintiff's resolution, and even if the plaintiff's proposal was presented to the shareholders' general meeting of shareholders, in light of the progress and result of the above shareholders' resolution of this case, it cannot be concluded that the plaintiff's modified proposal was without any influence on the plaintiff's resolution of this case.

3. Conclusion

Therefore, the plaintiff's main and ancillary claims of this case are all dismissed without merit, and the judgment of the court of first instance is just, and the plaintiff's appeal is dismissed as it is without merit. It is so decided as per Disposition.

Judges Kim Dong-dong

Judges Kang Jae-sung