Defendants are not guilty.

1. Defendant B’s facts charged shall not cause damage to the company by acquiring, or causing a third party to obtain, property benefits due to an act in violation of duties as to matters delegated by the said company, as the representative director E Co., Ltd (the latter change to FF Co., Ltd.), Defendant A’s wife and director of the said company, Defendant C as the auditor of the said company, and director, auditor, etc.

The above company issued convertible bonds with a total face value of 100 million won to Defendant A through a resolution of the board of directors on May 12, 1999, and Defendant A exercised the right to convert to the above convertible bonds on January 15, 2001. At the time, Article 17(5) of the above company’s articles of incorporation provides that “In convertible bonds, the conversion shall be made at the end of the business year to which the time when the company requested for conversion of profits or interests on the stocks issued by conversion of stocks into stocks belongs.” Thus, Defendant A recognized the status as a shareholder only after December 31, 201, and it was evident that at the time of resolution of distribution of dividends to the company’s operating income in 200 years through the general meeting of shareholders on March 28, 200 through the general meeting of shareholders, the Defendants held a temporary shareholders’ meeting to the effect that the above decision was lawful by holding a resolution of the resolution of the board of directors to nullify the above issuance of convertible bonds to Defendant A, etc.

Accordingly, Defendant B, the representative director, notified G et al. on August 17, 2007 to the effect that “the general meeting of shareholders shall be held as an agenda item for the payment of unpaid dividends to major shareholders A,” and Defendant B, the representative director, at the office of the subsidiary office of the above company H located in Seocheon-gu, Seocheon-gu, Busan. 31 August 2007.