Judgement forthe major shareholder of convertible as convertible right is used.

                                                                                 21. Feb 2018

                                                                                Writtenby Geon Hee, Park CTA

                                                                                Translated by Eun Kyung, Park.

1.Outline

Case:convertible right using, after acquisition of convertible bond.

Thejudgement is needed that they are regarded as a major shareholder or not.

Transferingincome tax filing should be followed after the judgement.

Inincome tax, the condition of major shareholder is decided by total amount orshare ratio.

2.Fact

-To acquire convertible bond issued by “A” listed on KOSPI, Association ofinvestment is established and acquired convertible bond worth KRW 10,000million.

-Couponrate is 0.

Paymentyearly 4% interest for the retained by expiration 3 years.

-Convertiblebond right can be executed after 1 year. ( 18/1/2018)

-Certificatesof investment are handed out to association members.

“A”received certificate of investment worth 500 million.

-Whenconvertible right is executed the total market capitalization is over 1500million and share ration is under 1%.

-Atpresent share possession of “A” is none.

3.Question

-Can“A” be regarded as a major shareholder or not according to the total amountstandard when convertible right is executed. (After April 2018 major shareholder 1% listed corporation on KOSPI, over1500 million).

4.Judgement

-Major shareholder judgement; market capitalization is judged by previousbusiness year expiration date.

Inthe above case, market capitalization is over 1500 million in Jan 2019converting date but there is not previous year market capitalization.

Thereforein the case of converting shares and transfering in 2019, they can not beregarded as a major shareholder.

-Itis not included as a share ratio condition for the converting at convertiblebond and they can not be regarded as a major shareholder.

5.Related law and decree.

Incometax 94. Income tax decree 157.