2006 Gohap103268 Agreements

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May 16, 2007

June 13, 2007

1. The plaintiff's claim is dismissed.

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

The defendant shall transmit to the plaintiff the plaintiff a copy of the complaint of this case from October 24, 2006, KRW 909, 643,013, and its related amount.

The amount of 5% per annum and 20% per annum from the next day to the day of full payment.

H. D. Payment

1. Basic facts

A. On September 18, 2006, the Plaintiff entered into an investment contract (hereinafter “instant investment contract”) with respect to the shares of A, a corporation listed on KOSDAQ, with the following terms and conditions. (1) The purpose of this contract is to determine, at the Defendant’s request, the details of the agreement and the necessary matters, and to clarify the rights and obligations between the Plaintiff and the Defendant (Article 1).

(2) As of the date of conclusion of a contract, the total number of shares issued by A is 3,360,463 shares as of the date of conclusion of a contract. The Plaintiff shall acquire shares of A company 1,668,024 (the average unit price of 1,750 shares per share) by investing a total of KRW 3,00,000,000 per share in A company (the average price of at least 5% of the total number of shares issued by A company). The Plaintiff shall decide to purchase shares within the head, and the Defendant shall actively cooperate in securing quantity and unit price in acquiring shares by the Plaintiff, and if the Defendant fails to meet this, the Defendant shall devise and implement the method in order to satisfy 5% of the shares of A company if the Plaintiff fails to meet the requirements, and the Plaintiff shall return at the time of sale of shares owned by the Plaintiff (Article 2(3)). The contract period shall be extended to the period from the date the Plaintiff purchased shares of A company 2 months to the date of sale of shares held by the Plaintiff.

(4) The Plaintiff and the Defendant shall divide the net investment profits, excluding the Plaintiff’s principal of investment 3,00,000,000, and KRW 50:50. However, the Defendant shall guarantee the Plaintiff the minimum investment profits of KRW 900,00,000, which are 30% of the Plaintiff’s principal of investment 3,000,000, and KRW 300,000. In principle, this share transaction shall be conducted on a customs basis, and taxes shall be distributed in advance under the Plaintiff’s responsibility, and the Defendant shall distribute profits to the Defendant (Article 4). (5) In making an investment under this contract, the Defendant shall provide the Plaintiff with KRW 700,00,000,000, and KRW 760,000,000, and KRW 760,000,000, which are owned by the Plaintiff’s stocks of the KOSDAQ-listed corporation B until December 16, 2005.

B. The plaintiff on September 15, 2006, the transfer of the investment contract of this case, between the defendant and the defendant on September 15, 2006.

1. On December 1, 2006, a written consent for the transfer of ownership and disposal of the collateral that the ownership of the said shares shall be transferred to the Plaintiff on the grounds that the ownership of the said shares shall be transferred to B Company’s common shares 760,000.

C. After the conclusion of the instant investment contract, the Plaintiff entered into an investment contract with a Japanese company 00 and purchased at KRW 3,007,532,00 in total, at least 1,750 won per share of KRW 1,220,274 in the name of the said Japanese from September 19, 2006 to September 27, 2006. The Plaintiff purchased shares in the name of the said Japanese company 3,00,007,532,000. Unlike the anticipated price at the time of the instant investment contract after the Plaintiff purchased shares in the name of the said Japanese company, the Defendant requested the Plaintiff to sell all shares to the Plaintiff pursuant to the terms of the instant investment contract. The Plaintiff sold all shares of the A company to KRW 2,301,86,315 on October 10, 206.

E. At KRW 2,301, 866, and 315, the Plaintiff deducted securities company commission 4,603, 730 won, securities transaction tax6, 905, and 598 won, and collected KRW 2,290, 356,987 ( = 2,301, 86, 315 won - 4,603, 603, 730 - 6,905, 598 won) as principal of the investment, and demanded the Defendant to pay the agreed amount under the instant investment contract. The Plaintiff, upon the Defendant’s failure to pay the agreed amount by October 23, 2006, appropriated for the agreed amount under the instant investment contract by commercializing KRW 70,00,000,000, which the Defendant offered as security.

[Ground of recognition] A without dispute, Gap evidence 1, Eul evidence 2-1, Gap evidence 3-1 to 111, Gap evidence 4-1 to 19, and the purport of the whole pleadings

2. The parties' assertion

A. The plaintiff asserts that although the defendant is obligated to pay to the plaintiff the agreed amount of KRW 3,90,00,000 under the investment contract of this case ( = the principal amount of investment of KRW 3,00,000,000 + minimum investment return of KRW 900,000, 000), the plaintiff is obligated to pay KRW 909,643,013 ( = 3,900,000,000 - Amount of KRW 2,290,356, 987 - cashier's checks offered as security 70,00,000,000,000, and delay damages therefrom.

B. As to this, the Defendant asserts to the effect that the instant investment contract is null and void as a juristic act whose content is contrary to good morals and other social order as a revenue guarantee agreement relating to a share transaction.

3. Determination

A. As seen earlier, as seen in the instant investment contract, the Defendant actively cooperates with the Plaintiff in order to secure the volume and unit price in acquiring Company A’s shares, and net investment profits excluding the Plaintiff’s principal of investment 3,00,000,000, and KRW 50:50. The Plaintiff and the Defendant divides net investment profits excluding the principal of investment 3,00,000,000, and the Defendant included the details that guarantee the Plaintiff’s minimum investment profits of KRW 900,00,000, which are 30% of the Plaintiff’s principal of investment 3,00,000,000, which are 30% of the Plaintiff’s principal of investment. Thus, the instant

B. Furthermore, according to Article 188-4 (2) 1 of the Securities and Exchange Act, no person may independently or in collusion with other persons for the purpose of soliciting the sale and purchase transaction of securities at the securities market or the KOSDAQ market, make a mistake in the sale and purchase transaction of securities, or make the price change, or entrust or be entrusted with such sale and purchase. In full view of the testimony and arguments of the witness 00,000 and all of the arguments, when concluding the investment contract of this case as the defendant and the defendant's friendship, 00, etc., which were involved in the conclusion of the investment contract of this case, purchased approximately KRW 5,500,000 per share of 3,00 won per share. Since the investment contract of this case was concluded by the plaintiff for a short period of time after purchasing approximately 5% shares of the A company in the name of Japan, it is reasonable to recognize that the plaintiff can obtain an increase in the market price of this case after the purchase and sale of shares of the A company in the name of 00,000 won.

C. Therefore, as long as the purpose of the instant investment contract is for the purpose of price manipulation prohibited by the Securities and Exchange Act, and market price manipulation is likely to distort the process of price formation and cause damage to the general investors, the instant investment contract, which is a profit security agreement that distributes or guarantees profits from such market price manipulation, shall be deemed null and void as it goes against good morals and other social order, and the Defendant’

4. Conclusion

Thus, the plaintiff's claim of this case is dismissed as it is without merit.

Judges Hwang-ju

Judges Choi Ho-young

Judges Kim Young-young