<DOCUMENT>
<TYPE>EX-12.4
<SEQUENCE>14
<FILENAME>u98617exv12w4.txt
<DESCRIPTION>EX-12.4 KOREAN COMMERCIAL CODE
<TEXT>
<PAGE>
                                                                    Exhibit 12.4

COMMERCIAL ACT

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                                     1962.1.20               Act No. 1000
         Amended By                  1962.12.12              Act No. 1212
         Amended By                  1984.4.10               Act No. 3724
         Amended By                  1991.5.31               Act No. 4372
         Amended By                  1991.12.31              Act No. 4470
         Amended By                  1994.12.22              Act No. 4796
         Amended By                  1995.12.29              Act No. 5053
         Amended By                  1998.12.28              Act No. 5591
         Amended By                  1999.2.5                Act No. 5809
         Amended By                  1999.12.31              Act No. 6086
         Amended By                  2001.7.24               Act No. 6488
         Amended By                  2001.12.29              Act No. 6545



                            PART I GENERAL PROVISIONS

                          CHAPTER I COMMON PROVISIONS

ARTICLE 1 (APPLICABLE RULES TO COMMERCIAL MATTERS)

         When there is no provision in this Act as to a commercial matter, the
         commercial customary law shall apply; and if there is no such law, the
         provisions of the Civil Act shall apply.


ARTICLE 2 (COMMERCIAL ACTIVITIES BY PUBLIC JURISTIC PERSONS)

         Except as otherwise provided by any Acts and subordinate statutes, this
         Act shall apply to commercial activities effected by a public juristic
         person.

<PAGE>


ARTICLE 3 (UNILATERAL COMMERCIAL ACTIVITIES)

         If an act of a party among the relevant parties is considered as a
         commercial activity, this Act shall apply to all the parties involved.


                              CHAPTER II MERCHANTS

ARTICLE 4 (MERCHANT-BY NATURE OF BUSINESS)

         A person who engages in commercial activities in his own name is called
         a merchant.


ARTICLE 5 (MERCHANT-BY LEGAL CONSTRUCTION)


         (1) A person who engages in a business in a merchant's way maintaining
         a shop or similar equipment shall be deemed to be a merchant, even if
         he does not engage in commercial activities.

         (2) The provisions of paragraph (1) shall also be applicable to a
         company even if it does not engage in commercial activities.


ARTICLE 6 (BUSINESS OF INCOMPETENT PERSON AND REGISTRATION THEREOF)

         When a minor or a quasi-incompetent person engages in any business upon
         the permission of his legal representative, registration thereof shall
         be effected.


ARTICLE 7 (INCOMPETENT PERSON AND MEMBER WITH UNLIMITED LIABILITY)


<PAGE>

         When a minor or quasi-incompetent person has become a member with
         unlimited liability of a company upon the permission of his legal
         representative, he shall be deemed to be a person with full capacity in
         respect of any act done in the capacity of such member.


ARTICLE 8 (REPRESENTATION OF BUSINESS BY LEGAL REPRESENTATIVE)


         (1) If a legal representative engages in any business on behalf of a
         minor, quasiincompetent or incompetent person, registration thereof
         shall be effected.

         (2) Any restriction upon the authority of legal representative shall
         not be effective against a third person acting in good faith.


ARTICLE 9 (PETTY MERCHANTS)

         The provisions relating to manager, trade names, trade books, and
         commercial registrations shall not apply to petty merchants.


            CHAPTER III TRADE EMPLOYEES

ARTICLE 10 (APPOINTMENT OF MANAGER)

         A merchant may appoint a manager and have him carry out business either
         at the principal office or at a branch office.


ARTICLE 11 (AGENCY AUTHORITY OF MANAGER)


         (1) A manager may perform all judicial and extra-judicial acts relating
         to his business on behalf of the proprietor of the business.


<PAGE>

         (2) A manager may appoint and dismiss shop clerk and other employees
         who are not managers.

         (3) Any restriction upon the authority of a manager shall not be
         effective against a third person acting in good faith.


ARTICLE 12 (CO-MANAGER)


         (1) A merchant may cause several managers to exercise the agency of
         authority on a joint basis.

         (2) In the case mentioned in the preceding paragraph, any declaration
         of intention made to any one of the managers shall be effective as to
         the proprietor of the business.


ARTICLE 13 (REGISTRATION OF MANAGER)

         The appointment of a manager and the extinguishment of his agency of
         authority shall be registered by the merchant at the place either of
         the principal office or of the branch office for which he has been
         appointed. The same shall apply to matters as provided for in paragraph
         (1) of the preceding Article, and to any alteration thereof.


ARTICLE 14 (APPARENT MANAGER)


         (1) An employee who has been given a title of a head of business of the
         principal office or of a branch office or such other person as has
         similar title shall be deemed to have the same authority as that of a
         manager of the principal office or of a branch office. This shall not,
         however, apply in respect of judicial acts.


<PAGE>

         (2) The provisions of the preceding paragraph shall not apply in cases
         where the other party has acted in bad faith.


ARTICLE 15 (EMPLOYEE INVESTED WITH PARTIAL COMPREHENSIVE AGENCY AUTHORITY)


         (1) An employee who has been entrusted with certain branches of
         business or specified matters relating to business may effect all acts
         other than judicial acts.

         (2) The provisions of Article 11 (3) shall apply mutatis mutandis to
         the case mentioned in the preceding paragraph.


ARTICLE 16 (EMPLOYEE OF SHOP WHICH SELLS GOODS)


         (1) An employee of a shop which sells goods shall be deemed to have all
         the power in regard to the sale of goods.

         (2) The provisions of Article 14 (2) shall apply mutatis mutandis to
         the case mentioned in the preceding paragraph.


ARTICLE 17 (DUTIES OF TRADE EMPLOYEE)


         (1) Without the allowance of the proprietor of the business, a trade
         employee shall neither effect any transaction falling within the class
         of the proprietor's business on his account or on that of a third
         person nor shall he become a member with unlimited liability, nor a
         director of a company, nor a employee of another merchant.

         (2) In the case that a trade employee has effected a transaction in
         contravention of the provisions of the preceding paragraph, and such
         transaction has been effected on his account, the proprietor of the
         business may regard such a


<PAGE>

         transaction as effected on his own account, and if it has been effected
         for the account of a third person, the proprietor may request the
         employee to transfer the profit accrued from such transaction to
         himself.

         (3) The provisions of the preceding paragraph shall not affect the
         termination of a contract by the proprietor against an employee or the
         proprietor's claims for damages against a trade employee.

         (4) The right mentioned in paragraph (2) shall become extinct after two
         weeks from the time when the proprietor has become aware of such
         transaction or after one year has elapsed from the time when the
         transaction has been effected.


                             CHAPTER IV TRADE NAMES

ARTICLE 18 (FREE CHOICE OF TRADE NAME)

         A merchant may use his full name or any other denomination as his trade
         name.


ARTICLE 19 (TRADE NAME OF COMPANY)

         The word "partnership company", "limited partnership company", "stock
         company" or "limited liability company" shall be contained in the trade
         name of a company according to its nature.


ARTICLE 20 (BAN ON ILLEGAL USE OF TRADE NAME OF COMPANY)

         No person other than a company may use, in the trade name, any word
         which is suggestive of a company. This shall apply even in cases where
         the business of a company has been acquired by transfer.


ARTICLE 21 (UNITARY TRADE NAME)

<PAGE>

         (1) A single trade name shall be used in the same business.

         (2) A trade name of a branch office shall expressly show its dependent
         relationship to the principal office.


ARTICLE 22 (EFFECT OF REGISTRATION OF TRADE NAME)

         No trade name which has been registered by another person shall be
         registered as a trade name of the same kind of business in the same
         Seoul Special Metropolitan City, Metropolitan City, and Shi/Kun.
         (Amended by Act No. 3724, Apr. 10, 1984; Act No. 4796, Dec. 22, 1994;
         Act No. 5053, Dec. 29, 1995)


ARTICLE 22-2 (PROVISIONAL REGISTRATION OF TRADE NAME)


         (1) If any person intends to establish a stock or limited liability
         company, he may apply for a provisional registration of the trade name
         to the registry having the jurisdiction over the place of its principal
         office.

         (2) If a company intends to change either or both of its trade name
         or/and purpose, it may apply for a provisional registration of its
         trade name to the registry having the jurisdiction over the place of
         its principal office.

         (3) If a company intends to move its principal office, it may apply for
         a provisional registration of its trade name to the registry having the
         jurisdiction over the place to which it is to move.

         (4) In application of Article 22, the provisional registration of the
         trade name shall be deemed to be as registration of the trade name.

         (5) In making a provisional registration of the trade name, the period
         up to the time the real registration is made, deposit and recovery of
         the deposit money,


<PAGE>

         cancellation of the provisional registration, and other necessary
         procedures shall be determined by the Supreme Court Regulations.
         [This Article Newly Inserted by Act No. 5053, Dec. 29, 1995]


ARTICLE 23 (PROHIBITION OF USE OF TRADE NAME WHICH IS LIKELY TO MISCONCEIVE
OWNERSHIP OF BUSINESS)


         (1) No person shall, for unfair purpose, use any trade name which is
         likely to induce others to believe that it represents the business of
         another person.

         (2) In a case where a person has used such a misrepresenting trade name
         in contravention of the provisions of paragraph (1), any person whose
         interest is likely to be thereby harmed or any person who has
         registered his trade name may demand cessation of its use.

         (3) The provisions of paragraph (2) shall not prejudice any claim for
         damages.

         (4) Any person who uses the registered trade name of another person in
         the same Seoul Special Metropolitan City, Metropolitan City, and
         Shi/Kun, in respect of the same kind of business shall be presumed to
         have done so for unfair purpose. (Amended by Act No. 3724, Apr. 10,
         1984; Act No. 4796, Dec. 22, 1994; Act No. 5053, Dec. 29, 1995)


ARTICLE 24 (LIABILITY OF PERSON WHO HAS LENT HIS NAME)

         A person, who has allowed another person to carry on business using his
         name or trade name, shall be liable jointly and severally with such
         other person to effect performance in respect of any obligation arising
         from a transaction in favor of a third person who has effected such
         transaction in the belief that such other person was the proprietor of
         the business.


ARTICLE 25 (TRANSFER OF TRADE NAME)

<PAGE>

         (1) A trade name may be transferred only in cases where business is
         discontinued or it is transferred together with the business.

         (2) Transfer of a trade name shall not be effective as to third persons
         unless it has been registered.


ARTICLE 26 (EFFECT OF FAILURE TO USE TRADE NAME)

         If a person who has registered his trade name has failed to use it for
         a period of two years without any justifiable reason, he shall be
         deemed to have abolished trade name.


ARTICLE 27 (APPLICATION FOR CANCELLATION OF REGISTRATION OF TRADE NAME)

         If a trade name has been altered or abolished, and the person who has
         registered such trade name has failed to register such alteration or
         abolition within two weeks, any person interested may apply to the
         court for the cancellation of such registration.


ARTICLE 28 (PENALTIES FOR ILLEGAL USE OF TRADE NAME)

         Any person who has violated Articles 20 and 23 (1) shall be punished
         for a fine for negligence not exceeding two million won. (Amended by
         Act No. 3724, Apr. 10, 1984; Act No. 5053, Dec. 29, 1995)


                              CHAPTER V TRADE BOOKS

ARTICLE 29 (KINDS OF AND PRINCIPLES TO MAKE TRADE BOOKS)

<PAGE>


         (1) In order to make clear the situation of property, profit and loss
         in the business, the merchant shall prepare an account book and balance
         sheet.

         (2) Except as otherwise provided by this Act, the trade books shall be
         made in accordance with the generally fair and proper accounting
         practices.
         [This Article Wholly Amended by Act No. 3724, Apr. 10, 1984]


ARTICLE 30 (METHOD TO MAKE TRADE BOOKS)


         (1) In an account book, there shall be entered transactions and other
         particulars having effect on property in business.

         (2) A merchant shall, at the time of commencement of his business and
         thereafter at a fixed time, at least once a year, prepare a balance
         sheet based on the account books and those who prepared it should write
         his name and affix his seal or sign thereon, and a company shall
         prepare such a balance sheet in the same manner as a merchant at the
         time of its formation and at the end of each period for the settlement
         of accounts. (Amended by Act No. 5053, Dec. 29, 1995)
         [This Article Wholly Amended by Act No. 3724, Apr. 10, 1984]


ARTICLE 31 (PRINCIPLES FOR VALUATION OF ASSETS)

         Assets to be entered in an account book shall be valued as follows:

         1.The current assets shall be valued on the basis of the acquisition
         cost, manufacturing cost or current price: Provided, That if the
         current price is remarkably lower than the acquisition cost or
         manufacturing cost, the valuation shall be made according to the
         current price; and

         2.The fixed assets shall be valued on the basis of the acquisition cost
         or manufacturing cost, less a reasonable depreciation, but when any
         unexpected


<PAGE>

         diminution has occurred, a reasonable reduction shall be made.
         [This Article Wholly Amended by Act No. 3724, Apr. 10, 1984]


ARTICLE 32 (PRODUCTION OF TRADE BOOKS)

         The court may, on application or by its own initiative, order a party
         to an action to produce his trade books or any part thereof.


ARTICLE 33 (PRESERVATION OF TRADE BOOKS, ETC.)


         (1) Every merchant shall preserve his trade books, and all important
         documents relating to his business, for a period of ten years:
         Provided, That the slips or similar documents shall be kept for five
         years. (Amended by Act No. 5053, Dec. 29, 1995)

         (2) The period mentioned in the preceding paragraph shall be computed
         in the case of trade books as from the time at which the book has been
         closed.

         (3) The books and documents as referred to in paragraph (1) may be
         preserved by means of the microfilms and other data processing systems.
         (Newly Inserted by Act No. 5053, Dec. 29, 1995)

         (4) In case where the books and documents are preserved under paragraph
         (3), the method of preservation and other necessary matters shall be
         determined by the Presidential Decree. (Newly Inserted by Act No. 5053,
         Dec. 29, 1995)


                       CHAPTER VI COMMERCIAL REGISTRATION

ARTICLE 34 (GENERAL RULES)

         Matters as required to be registered under this Act shall, on the
         application of

<PAGE>

         the party concerned, be entered in the commercial register maintained
         by the court having jurisdiction over the place of business office.


ARTICLE 34-2 (COMMERCIAL REGISTRATION BY DATA PROCESSING SYSTEM)


         (1) The affairs concerning the commercial registration may be carried
         out wholly or partially by the data processing system.

         (2) The procedures of the commercial registration affairs as referred
         to in paragraph (1) shall be determined by the Supreme Court
         Regulations.
         [This Article Newly Inserted by Act No. 5053, Dec. 29, 1995]


ARTICLE 35 (REGISTRATION AT PLACE OF BRANCH OFFICE)

         Matters as required to be registered at the place of the principal
         office shall, except as otherwise provided in this Act, be registered
         also at the place of each branch office.


ARTICLE 36
         Deleted. (by Act No. 5053, Dec. 29, 1995)


ARTICLE 37 (EFFECT OF REGISTRATION)


         (1) Matters as required to be registered shall not be effective as to
         any third person acting in good faith without registering them.

         (2) Even after the registration is made, if the third person fails to
         know it for any justifiable reason, the provisions of paragraph (1)
         shall be applicable.
         [This Article Wholly Amended by Act No. 5053, Dec. 29, 1995]

<PAGE>

ARTICLE 38 (EFFECT OF REGISTRATION AT LOCATION OF BRANCH OFFICE)

         In case where matters required to be registered at the place of a
         branch office have not been registered, the provisions of the preceding
         Article shall apply only to transactions at such branch office.


ARTICLE 39 (FALSE REGISTRATION)

         A person who has either intentionally or negligently registered any
         matters which are different from the truth shall assert the difference
         of such matters to a third person acting in good faith.


ARTICLE 40 (REGISTRATION OF CHANGES OR EXTINGUISHMENT)

         If any change has occurred to any of the matters registered, or if any
         of such matters have been extinguished, the party concerned shall
         effect registration of such change or extinguishment without delay.


                        CHAPTER VII TRANSFER OF BUSINESS

ARTICLE 41 (PROHIBITION OF COMPETITIVE BUSINESS OF TRANSFEROR)


         (1) When a person has transferred his business, he shall neither, for a
         period of ten years, carry on the same kind of business in the same
         Seoul Special Metropolitan City, Metropolitan City, or Shi/Kun, nor in
         any adjacent Seoul Special Metropolitan City, Metropolitan City, or
         Shi/Kun, unless the parties have made any specific agreement. (Amended
         by Act No. 3724, Apr. 10, 1984; Act No. 4796, Dec. 22, 1994; Act No.
         5053, Dec. 29, 1995)

         (2) If the transferor has made an agreement not to carry on the same
         kind of


<PAGE>

         business, such agreement shall be valid, only in the same Seoul Special
         Metropolitan City, Metropolitan City, Shi/Kun and in any adjacent Seoul
         Special Metropolitan City, Metropolitan City, Shi/Kun, and only for a
         period not exceeding twenty years. (Amended by Act No. 3724, Apr. 10,
         1984; Act No. 4796, Dec. 22, 1994; Act No. 5053, Dec. 29, 1995)


ARTICLE 42 (LIABILITY OF BUSINESS TRANSFEREE WHO CONTINUES TO USE TRADE NAME)


         (1) If the transferee of a business continues to use the trade name of
         the transferor, he shall also be liable to effect performance in
         respect of any claim of a third person arising from the business of the
         transferor.

         (2) The provisions of the preceding paragraph shall not apply in cases
         where the transferee has, without delay after the transfer of the
         business, effected the registration to the effect that he shall not be
         liable for any obligation of the transferor. The same shall apply to a
         third person to whom both the transferor and the transferee have,
         without delay after the transfer of the business, dispatched notice to
         the above effect and who has received such notice.


ARTICLE 43 (PERFORMANCE OF OBLIGATIONS TO BUSINESS TRANSFEREE)

         In the case mentioned in paragraph (1) of the preceding Article, a
         performance made to the transferee in respect of any obligation that
         has arisen from the business of the transferor shall be valid, in cases
         where the obligor effecting the performance has acted in good faith and
         without gross negligence.


ARTICLE 44 (LIABILITY OF BUSINESS TRANSFEREE WHO HAS MADE ADVERTISEMENT OF
OBLIGATION ACCEPTANCE)

         If, in cases where the transferee does not continue to use the
         transferor's trade name, he has made an advertisement to the effect
         that he will be liable for any obligation arising from the business of
         the transferor, the transferee shall also

<PAGE>

         be liable to effect performance of such obligation.


ARTICLE 45 (DURATION OF LIABILITY OF BUSINESS TRANSFEROR)

         If the transferee is liable for any obligation of the transferor in
         accordance with the provisions of Article 42 (1) or of the preceding
         Article, the obligation of the transferor in respect of a third person
         cease to exist after the lapse of two years subsequent to the transfer
         of the business or to an advertisement.


                          PART II COMMERCIAL ACTIVITIES

                           CHAPTER I COMMON PROVISIONS

ARTICLE 46 (BASIC COMMERCIAL ACTIVITIES)

         The following activities which are effected as business are called
         commercial activities: Provided, That this shall not apply to such
         activities as are effected by persons who manufacture Articles or
         render services solely for the purpose of earning wages: (Amended by
         Act No. 5053, Dec. 29, 1995)

         1.Sales of movables, immovables, valuable instruments and any other
         properties;

         2.Lease of movables, immovables, valuable instruments, and any other
         properties;

         3.Activities relating to the manufacturing, processing, or repairing;

         4.Activities relating to the supply of electricity, electric wave, gas,
         or water;

         5.Acceptance of contracts to complete works or to supply service;

         6.Activities relating to publishing, printing, or photographing;

<PAGE>

         7.Activities relating to advertisements, communications, or
         information;

         8.Receiving and giving the credit, exchange, and other financial
         transaction;

         9.Activities utilizing facilities to accomodate visitors;

         10.Acceptance of agency for commercial transactions;

         11.Activities relating to brokerage;

         12.Activities relating to commission agency and any other
         intermediation;

         13.Acceptance of carriages;

         14.Acceptance of bailments;

         15.Acceptance of trusts;

         16.Mutual savings accounts and other similar act;

         17.Insurance;

         18.Activities relating to picking of minerals or soil and stone;

         19.Act concerning financial lease of machines, equipment and other
         property;

         20.Act concerning business by a consent to the use of trade name,
         trademark, etc.; and

         21.Act concerning purchase, recovery, etc. of any business claims.


ARTICLE 47 (SUBSIDIARY COMMERCIAL ACTIVITIES)

<PAGE>

         (1) Activities effected by a merchant for the purpose of his business
         shall be deemed to be commercial activities.

         (2) The activities of a merchant shall be presumed to be effected for
         the purpose of his business.


ARTICLE 48 (METHODS OF AGENCY)

         An activity by an agent for effecting commercial activities shall be
         effective for his principal, even though the agent has not disclosed
         the fact that he is acting on behalf of the principal: Provided, That
         when the other party did not know that the transaction was effected on
         behalf of the principal, he may demand performance to the agent.


ARTICLE 49 (MANDATE)

         A person who has received a mandate for effecting commercial activities
         may effect activities for which he has not received any specific
         mandate in so far as such activities are not contrary to the essence of
         the mandate.


ARTICLE 50 (CONTINUATION OF AGENCY AUTHORITY)

         The agency authority arising from a mandate for effecting commercial
         activities shall not be extinguished for the reason of the death of the
         principal.


ARTICLE 51 (BINDING FORCE OF OFFER OF CONTRACT INTER PRESENTES)

         An offer to enter into a contract made inter presentes, shall lapse, if
         not immediately accepted by the offeree.


ARTICLE 52 (BINDING FORCE OF OFFER OF CONTRACT INTER ABSENTEES)

<PAGE>

         (1) An offer to enter into a contract in respect of which no period of
         acceptance has been fixed, when made inter absentees, shall lapse, if
         notice of its acceptance is not dispatched by the offeree within a
         reasonable period.

         (2) The provisions of Article 530 of the Civil Act shall apply mutatis
         mutandis to the case mentioned in the preceding paragraph.


ARTICLE 53 (DUTY TO DISPATCH NOTICE OF ACCEPTANCE OR REJECTION)

         When a merchant has received an offer to enter into a contract which
         falls within any of the branches of the business carried on by him from
         a person with whom he is in regular business relations, he shall
         dispatch notice of acceptance or rejection without delay. If he has
         neglected to dispatch such notice, he shall be deemed to have accepted
         the offer.


ARTICLE 54 (LEGAL RATE OF INTEREST IN COMMERCIAL ACTIVITIES)

         The legal rate of interest on obligations resulting from commercial
         activity shall be six percent per annum. (Amended by Act No. 1212, Dec.
         12, 1962)


ARTICLE 55 (DEMAND FOR LEGAL INTEREST)


         (1) If a loan for consumption has been effected between merchants, the
         lender may demand the payment of legal interest thereon.

         (2) If a merchant has made substituted donation for another person,
         within the scope of his own business, he may demand legal interest
         thereon from the day on which the substituted donation was made.

<PAGE>


ARTICLE 56 (PLACE OF PERFORMANCE OF OBLIGATION ARISING OUT OF TRANSACTION OF
BRANCH OFFICE)

         If the place of performance of an obligation arising from a activity at
         a branch office has not been specified either by the nature of the
         activity or by any declaration of intention by the parties, the place
         of performance of any obligations other than the delivery of a specific
         thing shall be deemed to be the place of such branch office.


ARTICLE 57 (JOINT AND SEVERAL OBLIGATIONS OF OBLIGORS AND GUARANTORS)


         (1) If two or more persons have assumed an obligation through a
         transaction which is a commercial activity in respect of one or all of
         them, they shall be liable jointly and severally for the obligation.

         (2) In cases where there is a guarantor, if the guaranty itself is a
         commercial activity, or if the principal obligation has arisen out of a
         commercial activity, the principal obligor and the guarantor shall
         jointly and severally be liable for the obligation.


ARTICLE 58 (MERCANTILE LIEN)

         If a claim which has arisen from a commercial activity between
         merchants has become due, the obligee may, until he has obtained
         performance thereof, retain things or valuable instruments belonging to
         the obligor which have come into his possession through a commercial
         activity with the obligor. This shall not apply, however, in cases
         where there is any specific agreement between the parties.


ARTICLE 59 (ADMISSION OF FORFEITED PLEDGE)

         The provisions of Article 339 of the Civil Act shall not apply to a
         pledge to secure an obligation arising out of a commercial activity.

<PAGE>

ARTICLE 60 (DUTY TO HOLD GOODS IN CUSTODY)

         In case a merchant has received a sample or any other goods with an
         offer to enter into a contract which falls within any of the class of
         the business carried on by him, he shall, even though he has refused
         the offer, hold such goods in his custody at the expense of the
         offeror. This shall not apply, however, in cases where the value of the
         goods is insufficient to cover the expenses of custody, or where he
         might sustain damage through such custody.


ARTICLE 61 (MERCHANT RIGHT TO DEMAND REMUNERATION)

         A merchant who has performed, on behalf of another person, an act
         within the scope of his own business may demand a reasonable
         remuneration in respect of such an act.


ARTICLE 62 (LIABILITY OF MERCHANT WHO ACCEPTED DEPOSIT OF GOODS)

         A merchant who has accepted deposit of goods within the scope of his
         own business, even though he does not receive any remuneration thereof,
         shall exercise the care of a good manager.


ARTICLE 63 (BUSINESS HOURS AND PERFORMANCE OF OBLIGATION OR DEMAND THEREOF)

         Where business hours have been fixed by Acts and subordinate statutes,
         or customs, the performance of an obligation or a demand for such
         performance shall be made only during such hours.


ARTICLE 64 (EXTINCTIVE PRESCRIPTION FOR COMMERCIAL CLAIM)

         Except as otherwise provided in this Act, a claim which has arisen
         through a

<PAGE>

         commercial activity shall be extinguished by prescription if it is not
         exercised within five years: Provided, That if a shorter period for
         prescription is provided by other Acts and subordinate statutes, such
         provision shall apply.


ARTICLE 65 (VALUABLE INSTRUMENTS AND MUTATIS MUTANDIS APPLICATION)

         The provisions of Articles 508 through 525 of the Civil Act shall apply
         to valuable instruments issued for the purpose of payment of money,
         things, or other valuable instruments, and further the provisions of
         Article 12 (1) and (2) of the Bills of Exchange and Promissory Notes
         Act shall apply mutatis mutandis to the aforesaid valuable instruments.
         (Amended by Act No. 1212, Dec. 12, 1962)


ARTICLE 66 (QUASI COMMERCIAL TRANSACTIONS)

         The provisions of this Chapter shall apply mutatis mutandis to the
         transactions effected by merchants under the provisions of Article 5.


                                 CHAPTER II SALE

ARTICLE 67 (RIGHTS OF SELLER FOR DEPOSIT AND AUCTION OF SUBJECT-MATTER)


         (1) If, in the case of a sale between merchants, the buyer refuses or
         is unable to take delivery of the subject-matter of such sale, the
         seller may deposit it or may sell it by auction after he has given
         peremptory notice to accept within a reasonable period fixed by him. In
         such case, he shall dispatch notice of that fact to the buyer without
         delay.

         (2) If, in the case mentioned in the preceding paragraph, the seller is
         unable to give peremptory notice to the buyer, or the subject-matter is
         likely to lost or injured, he may sell it by auction without giving
         peremptory notice.


<PAGE>

         (3) In cases where the seller has sold the subject-matter of the sale
         by auction in accordance with the provisions of the preceding two
         paragraphs, he shall deposit the balance after deducting cost of the
         auction from them: Provided, That he may appropriate the whole or a
         part of such proceeds to the purchase price.


ARTICLE 68 (RESCISSION OF CONTRACT OF SALE AT FIXED TIME)

         In a sale between merchants, if, according to the nature of the sale or
         any declaration of intention of the parties, the purpose of the
         contract cannot be attained unless it is performed at a fixed time or
         within a fixed period, and one of the parties has allowed the time to
         elapse without performance on his part, the other party shall be deemed
         to have rescinded the contract unless he immediately demands
         performance.


ARTICLE 69 (BUYER'S DUTY TO EXAMINE SUBJECT-MATTER AND TO NOTIFY DEFECTS
           THEREIN)


         (1) In the case of a sale between merchants, the buyer shall, upon
         taking delivery of the subject-matter, examine it without delay, and if
         he discovers any defects therein or any deficiency in quantity, he
         shall immediately dispatch notice thereof to the seller, otherwise, he
         has no right to rescind the contract, to demand a reduction in the
         price or to claim damages thereby. The same shall apply in cases where,
         within six months, the buyer discovers in the subject-matter of the
         sale a defect which was not immediately discoverable.

         (2) The provisions of the preceding paragraph shall not apply to the
         seller acting in bad faith.


ARTICLE 70 (BUYER'S DUTY OF CUSTODY OR DEPOSIT OF SUBJECT-MATTER)


         (1) In the case mentioned in the preceding Article, the buyer shall,
         even though


<PAGE>

         he has rescinded the contract, hold the subject-matter of the sale in
         his own custody or deposit it at the seller's expense: Provided, That
         if it is likely to be lost or injured, he shall, with the permission of
         the court, sell it by auction, and shall hold the proceeds thereof in
         his own custody or deposit them.

         (2) When the buyer has effected a sale by auction in accordance with
         the provisions of the preceding paragraph, he shall dispatch notice of
         the fact to the seller without delay.

         (3) If the delivery place of the goods concerned is in the same Seoul
         Special Metropolitan City, Metropolitan City or Shi/Kun as the business
         office or domicile of the seller, the provisions of paragraphs (1) and
         (2) shall not be applicable. (Amended by Act No. 5053, Dec. 29, 1995)


ARTICLE 71 (IDEM-CASE WHERE QUANTITY IS IN EXCESS)

         The provisions of the preceding Article shall apply mutatis mutandis to
         the difference or exceeded parts, if the goods delivered by the seller
         to the buyer are different from the subject-matter of the sale or the
         quantity of the goods delivered exceed that of the sale.


                           CHAPTER III MUTUAL ACCOUNT

ARTICLE 72 (DEFINITION)

         A mutual account is formed when, in cases where merchants or a merchant
         and a non-merchant regularly transact with each other, they agree to
         set off the total amounts of the claims and of the obligations arising
         from their transactions within a fixed period and to pay the balance
         thereof.


ARTICLE 73 (SPECIAL PROVISIONS CONCERNING CLAIMS AND OBLIGATIONS REPRESENTED BY
COMMERCIAL PAPERS)

<PAGE>

         In case where claims or obligations based upon a bill or any other
         commercial papers have been entered in the mutual account, and the
         obligor on such paper has failed to perform, the parties may remove the
         items relating to such obligations out of the mutual account.


ARTICLE 74 (PERIOD OF MUTUAL ACCOUNT)

         If the parties have not determined the period in respect of which the
         set-off is to be effected, such period shall be six months.


ARTICLE 75 (ACKNOWLEDGEMENT OF AND OBJECTIONS TO STATEMENT OF ACCOUNT)

         When the parties have acknowledged a statement of account containing
         the various items of claims and obligations, they may not thereafter
         raise objections regarding any such items: Provided, That this shall
         not apply where there is an error or omission therein.


ARTICLE 76 (LEGAL INTEREST IN REGARD TO RIGHT TO BALANCE)


         (1) In regard to the balance resulting from the set-off, the creditor
         may claim legal interest thereon from the day on which the account was
         closed.

         (2) Irrespective of the provisions of the preceding paragraph, the
         parties may agree to stipulate the interest on each item from the day
         on which it was entered in the mutual account.


ARTICLE 77 (TERMINATION)

         Each party may terminate the mutual account at any time. In such case,
         he may immediately close the mutual account and demand payment of the
         balance.

<PAGE>

                       CHAPTER IV UNDISCLOSED ASSOCIATION

ARTICLE 78 (DEFINITION)

         An undisclosed association is formed when the parties agree that one of
         them shall make a contribution toward the business of the other and
         they shall divide any profits accruing from such business.


ARTICLE 79 (CONTRIBUTION BY UNDISCLOSED PARTNER)

         The contribution made in terms of money or property by the undisclosed
         partner shall be regarded as the property of the proprietor of the
         business.


ARTICLE 80 (RELATION BETWEEN UNDISCLOSED PARTNER AND THIRD PERSON)

         The undisclosed partner neither acquires rights nor incurs obligations
         with regard to the third persons through the acts of the proprietor.


ARTICLE 81 (LIABILITY FOR HAVING CONSENTED TO USE NAME OR TRADE NAME)

         If the undisclosed partner has consented to the use of his name in the
         trade name of the proprietor of the business, or to the use of his own
         trade name as that of such proprietor, he shall be jointly and
         severally liable with the proprietor for any obligations subsequent to
         such use.


ARTICLE 82 (DIVIDEND OF PROFITS AND BEARING PART OF LOSS)


         (1) If the contribution of the undisclosed partner has been diminished
         by losses,

<PAGE>

         he may not demand any dividend of profits until such loss has been
         compensated.

         (2) Even if the loss has exceeded the amount of the contribution, the
         undisclosed partner shall not be bound to return the profits which he
         has taken or to increase the capital.

         (3) The provisions of the preceding two paragraphs shall not apply in
         cases where there is an agreement between the parties.


ARTICLE 83 (TERMINATION OF CONTRACT)


         (1) If the duration of an undisclosed association has not been fixed by
         the contract of association, or if it has been agreed thereby that such
         association shall continue to exist during the life of one of the
         parties, either party may terminate the contract at the end of any
         business year: Provided, That the termination shall be notified to the
         other party six months prior to the termination.

         (2) Where unavoidable reasons exist, either party may terminate the
         contract at any time, irrespective of whether the duration of the
         association has been fixed or not.


ARTICLE 84 (TERMINATION OF CONTRACT)

         A contract of undisclosed association shall be terminated by any of the
         following reasons:

         1.Cessation or transfer of the business;

         2.Death of, or adjudication of incompetency against, the proprietor of
         the business; and

         3.Bankruptcy of the proprietor of the business or of the undisclosed
         party.

<PAGE>

ARTICLE 85 (EFFECT OF TERMINATION OF CONTRACT)

         Upon the termination of a contract of undisclosed association, the
         proprietor of the business shall return to the undisclosed partner the
         value of his contribution. In case, however, the contribution has been
         diminished by losses, only the balance need to be returned.


ARTICLE 86 (APPLICABLE PROVISIONS)

         The provisions of Articles 272, 277 and 278 shall apply mutatis
         mutandis to the undisclosed partner.


                           CHAPTER V COMMERCIAL AGENTS

ARTICLE 87 (DEFINITION)

         A person who makes it his business to act on behalf of a particular
         merchant not as an employee of any person but as agent or broker in
         transactions falling within the class of business carried on by
         principal, is called a commercial agent.


ARTICLE 88 (DUTY TO NOTIFY)

         When a commercial agent has acted as agent or broker in any
         transactions, he shall dispatch a notice thereof to the principal
         without delay.


ARTICLE 89 (PROHIBITION OF COMPETITIVE BUSINESS)


         (1) Without the permission of the principal, a commercial agent shall
         not effect,


<PAGE>

         for his own account or for the account of a third person, any
         transaction which falls within the class of business performed by the
         principal, or become a member with unlimited liability or a director of
         a company whose purpose is to engage in the same kind of business of
         the principal.

         (2) The provisions of Article 17 (2) through (4) shall apply mutatis
         mutandis if a commercial agent has been in contravention of the
         provisions of the preceding paragraph.


ARTICLE 90 (POWER TO RECEIVE NOTICES)

         A commercial agent entrusted with the sale of goods or with the
         brokerage relating thereto shall be entitled to receive notice of
         defects in the subjectmatter of the sale or deficiencies in their
         quantity, and any other notice relating to the performance of the
         contract for sale.


ARTICLE 91 (LIEN OF COMMERCIAL AGENT)

         A commercial agent may retain things or valuable instrument which he
         holds in his possession on behalf of the principal, in respect of any
         claim which has arisen from his agency or brokerage in a transaction
         and which has become due, until he has obtained performance thereof:
         Provided, That this shall not apply if there is any different agreement
         between the parties.


ARTICLE 92 (TERMINATION OF CONTRACT)


         (1) If the parties have not fixed the duration of the contract, either
         of them may terminate the contract by giving notice two-month prior to
         it.

         (2) The provisions of Article 83 (2) shall apply mutatis mutandis to
         the commercial agents.

<PAGE>

ARTICLE 92-2 (CLAIM FOR COMPENSATION BY COMMERCIAL AGENT)


         (1) If the principal obtains new customers or his business transaction
         has increased remarkably through his commercial agent's activities, and
         he gains thereby any profits even after the contract is terminated, the
         agent may claim a reasonable compensation to the principal, except when
         the contract is terminated by any reason attributable to him.

         (2) The amount of the compensation as referred to in paragraph (1) may
         not exceed the average yearly remuneration in respect of the period of
         the last five years before the contract is terminated. If the duration
         of the contract is less than five years, it shall be based on the
         average yearly remuneration for such period.

         (3) The claim for compensation as referred to in paragraph (1) shall be
         extinguished upon the expiration of the period of six months after the
         contract is terminated.
         [This Article Newly Inserted by Act No. 5053, Dec. 29, 1995]


ARTICLE 92-3 (DUTY OF COMMERCIAL AGENT TO KEEP TRADE SECRET)

         The commercial agent shall keep any trade secret of the principal which
         he has learned in connection with the contract, even after the contract
         is terminated. [This Article Newly Inserted by Act No. 5053, Dec. 29,
         1995]


                              CHAPTER VI BROKERAGE

ARTICLE 93 (DEFINITION)

         A person who makes it his business to act as intermediary in commercial
         activities between other persons is called a broker.

<PAGE>

ARTICLE 94 (BROKER'S POWER TO ACCEPT PERFORMANCE ON BEHALF OF PARTIES)

         A broker may not accept, on behalf of the parties, either payment or
         any other performance in connection with the transaction in which he
         has acted as intermediary: Provided, That this shall not apply if there
         is any special agreement or custom.


ARTICLE 95 (DUTY TO KEEP SAMPLE)

         If a broker has received a sample in connection with an activity in
         which he has acted as intermediary, he shall keep it in his custody
         until the activity has been completed.


ARTICLE 96 (DUTY TO DELIVER CONTRACT DOCUMENTS)


         (1) When a transaction has been effected between the parties, the
         broker shall, without delay, prepare documents containing the name or
         trade name of each party, the date and a summary of such contract, and
         after writing his name and affixing his seal or signing thereon, shall
         deliver such documents to each party. (Amended by Act No. 5053, Dec.
         29, 1995)

         (2) Except in cases where performance is to be effected by the parties
         immediately, the broker shall, after having caused each party to write
         their names and affix their seals or sign on the documents mentioned in
         the preceding paragraph, deliver it to the other party. (Amended by Act
         No. 5053, Dec. 29, 1995)

         (3) If, in cases mentioned in paragraphs (1) and (2), one of the
         parties does not accept, write his name and affix his seal or sign on
         the document, the broker shall dispatch notice thereof to the other
         party without delay. (Amended by Act No. 5053, Dec. 29, 1995)

<PAGE>

ARTICLE 97 (DUTY TO MAINTAIN BOOKS)


         (1) The broker shall enter in his books the particulars mentioned in
         the preceding Article.

         (2) Either party may at any time demand of the broker the delivery of a
         copy of his books in connection with the activity in which the broker
         has acted as intermediary for him.


ARTICLE 98 (DUTY NOT TO DISCLOSE NAME OR TRADE NAME)

         If either party has demanded the broker not to disclose his full name
         or his trade name to the other party, the broker shall not enter such
         full name or trade name in the document mentioned in Article 96 (1) and
         in the copy mentioned in paragraph (2) of the preceding Article which
         are to be delivered to the other party.


ARTICLE 99 (RESPONSIBILITY OF BROKER)

         If the broker has not disclosed voluntarily, or in accordance with the
         provisions of the preceding Article, the full name or trade name of one
         of the parties to the other party, the latter may demand the broker to
         perform the terms of contract.


ARTICLE 100 (RIGHT TO DEMAND REMUNERATION)


         (1) The broker shall not demand remuneration unless he has complied
         with the formalities prescribed in Article 96.

         (2) The broker's remuneration shall be borne by both parties in equal

<PAGE>

         proportions.


                          CHAPTER VII COMMISSION AGENCY

ARTICLE 101 (DEFINITION)

         A person who makes it his business to effect sales and purchases of
         goods or of valuable instruments in his own name for the account of
         other person is called a commission agent.


ARTICLE 102 (STATUS OF COMMISSION AGENT)

         By a sale and purchase effected for his principal, the commission agent
         directly acquires rights and incurs obligations with regard to the
         other party to the transaction.


ARTICLE 103 (OWNERSHIP OF GOODS CONSIGNED)

         Goods or valuable instruments which have been received by the
         commission agent from his principal, or goods, valuable instruments or
         claims acquired through sales and purchases by the commission agent,
         are deemed to belong to the principal so far as the principal and the
         commission agent or the principal and the commission agent's creditor
         are concerned.


ARTICLE 104 (DUTY TO NOTIFY SALE OR PURCHASE AND TO SUBMIT STATEMENT OF ACCOUNT)

         If a commission agent has effected the sales or purchases consigned to
         him, he shall dispatch notice of a summary of the contract and of
         domicile and full name of the other partner, and he shall submit the
         statement of account thereof to his principal without delay.

<PAGE>

ARTICLE 105 (LIABILITY OF COMMISSION AGENT TO SECURE PERFORMANCE)

         If the other party does not perform his obligation arising from sales
         or purchases which a commission agent has effected for his principal,
         the commission agent himself shall be liable for performance thereof:
         Provided, That this shall not apply where any special agreement or
         custom exists.


ARTICLE 106 (DUTY TO OBSERVE DESIGNATED PRICE)


         (1) If a commission agent has sold at a lower price or bought at a
         higher price than the price designated by his principal and the
         commission agent bears the difference, the sales or purchase shall be
         binding upon the principal.

         (2) When a commission agent has sold at a higher price or bought at a
         lower price than the price designated by his principal, the difference
         shall be deemed to be the profits of the principal unless otherwise
         agreed by the parties.


ARTICLE 107 (RIGHT TO INTERVENTION)


         (1) When a commission agent has received a commission to sell or
         purchase goods having the exchange quotation, he may directly become
         the buyer or seller. In such case, the price shall be determined by
         exchange quotation at the time when notice of sale or purchase was
         dispatched by the commission agent.

         (2) Even in the case mentioned in the preceding paragraph, the
         commission agent may demand remuneration from the principal.


ARTICLE 108 (EFFECT OF DAMAGE OR DEFECTS, ETC. IN CONSIGNED GOODS)

<PAGE>

         (1) When the commission agent becomes aware of, after having taken over
         the subject-matter of sale through a commission agency, the fact that
         there is damage or defect in the goods, or there is a fear of
         decomposition or decay of the goods, or commercial circumstances which
         show decline of commodity prices, he shall without delay dispatch a
         notice thereof to his principal.

         (2) If, in the case of the preceding paragraph, the commission agent is
         unable to receive the instruction of his principal or such instruction
         is delayed, the commission agent may take an adequate measure for the
         benefit of his principal.


ARTICLE 109 (RIGHT TO PLACE GOODS IN PUBLIC DEPOSITORY OR ON AUCTION)

         The provisions of Article 67 shall apply mutatis mutandis, if, in cases
         where the commission agent has received a consignment to buy the goods,
         the principal refuses or is unable to accept delivery of goods so
         purchased.


ARTICLE 110 (IN CASE CONSIGNOR OF PURCHASE IS MERCHANT)

         If the principal who is a merchant consigned the purchase in connection
         with business, the provisions of Articles 68 through 71 shall apply
         mutatis mutandis to the relation between a principal and commission
         agent.


ARTICLE 111 (APPLICABLE PROVISIONS)

         The provisions of Article 91 shall apply mutatis mutandis to a
         commission agent.


ARTICLE 112 (APPLICATION OF PROVISIONS CONCERNING MANDATE)

         In addition to the provisions of this Chapter, the provisions relating
         to mandate shall apply to the relations between a principal and a
         commission agent.

<PAGE>

ARTICLE 113 (QUASI-COMMISSION AGENT)

         The provisions of this Chapter shall apply mutatis mutandis to persons
         who make it their business to effect, in their own name, for the
         account of the other person, activities other than sales or purchases.


                         CHAPTER VIII FORWARDING AGENCY

ARTICLE 114 (DEFINITION)

         A person who makes it his business to act in his own name as
         intermediation for the carriage of goods is called a forwarding agent.


ARTICLE 115 (LIABILITY FOR DAMAGES)

         A forwarding agent shall not be relieved of liability for damages
         caused by any loss of, injury to, or delay in arrival of the goods
         unless he proves that neither he nor any of his employee has neglected
         care in connection with the receipt, delivery and custody of the goods,
         the selection of a carrier or a forwarding agent other than himself,
         and other matters relating to the carriage.


ARTICLE 116 (RIGHT TO INTERVENTION)


         (1) A forwarding agent may himself undertake the carriage, unless
         otherwise agreed by the parties. In such cases, the forwarding agent
         shall have the same rights and duties as a carrier.

         (2) When a forwarding agent has produced a land bill of lading upon
         demand of the principal, he shall be deemed to have undertaken the
         carriage of the goods for himself.

<PAGE>

ARTICLE 117 (SUBROGATION OF SUCCESSIVE FORWARDING AGENTS)


         (1) In cases where two or more persons successively act as forwarding
         agents in the carriage of goods, each succeeding agent is liable to
         exercise the rights of his predecessors in lieu of them.

         (2) If, in the case mentioned in the preceding paragraph, a succeeding
         agent makes payment to his predecessor, he shall acquire the rights of
         such predecessor.


ARTICLE 118 (ACQUISITION OF CARRIER'S RIGHTS)

         In the case mentioned in the preceding Article, when a forwarding agent
         has made payment to a carrier, he shall acquire the rights of such
         carrier.


ARTICLE 119 (RIGHT TO DEMAND REMUNERATION)


         (1) A forwarding agent may demand remuneration immediately after he has
         delivered the goods to the carrier.

         (2) Where the amount of the freight has been fixed by the contract of a
         forwarding agency, a forwarding agent shall not demand any other
         remuneration unless otherwise agreed by the parties.


ARTICLE 120 (LIEN)

         A forwarding agent may retain the goods only in respect of the
         remuneration, freight and other substituted donations for another
         person or advances made for his principal in connection with such
         goods.

<PAGE>


ARTICLE 121 (PRESCRIPTION FOR LIABILITY OF FORWARDING AGENT)


         (1) The liability of a forwarding agent shall be extinguished by
         prescription upon the lapse of one year from the day on which the
         consignee of the goods has received the goods.

         (2) In case the goods have been totally lost, the period mentioned in
         the preceding paragraph shall be computed from the date on which such
         goods should have been delivered. (Amended by Act No. 1212, Dec. 12,
         1962)

         (3) The provisions of the preceding two paragraphs shall not apply as
         to the cases where the forwarding agent or his employee has acted in
         bad faith.


ARTICLE 122 (PRESCRIPTION FOR CLAIM OF FORWARDING AGENT)

         The claim of a forwarding agent against the principal or consignee
         shall be extinguished by prescription if it is not exercised for one
         year.


ARTICLE 123 (APPLICABLE PROVISIONS)

         In addition to the provisions of this Chapter, the provisions relating
         to the commission agent shall apply mutatis mutandis to the forwarding
         agent.


ARTICLE 124 (IDEM)

         The provisions of Articles 136, 140 and 141 shall apply mutatis
         mutandis to the forwarding agency.


                               CHAPTER IX CARRIAGE

<PAGE>

ARTICLE 125 (DEFINITION)

         For the purpose of this Act, "carrier" means a person who makes it his
         business to carry goods or passengers by land or on lakes and rivers,
         and in ports and bays.


                           SECTION 1 CARRIAGE OF GOODS

ARTICLE 126 (WAY-BILL)


         (1) The consignor shall, upon demand by the carrier, furnish him with a
         way-bill.

         (2) A way-bill shall contain the following particulars and the
         consignor shall write his name and affix his seal or sign thereon:
         (Amended by Act No. 5053, Dec. 29, 1995)

         1.The kind and weight or bulk of the goods, and the description, number
         and marks of the packages;

         2.The destination;

         3.The name or trade name, place of the business or domicile of the
         consignee and the carrier;

         4.The freight and the distinction between advance payment and payment
         after arrival; and

         5.The place where and the date on which the way-bill is made.


ARTICLE 127 (LIABILITY FOR FALSE ENTRY IN WAY-BILL)

<PAGE>

         (1) In case the consignor has entered a false or inaccurate statement
         in a way-bill, he shall be liable for the damages arising therefrom to
         the carrier.

         (2) The provision of the preceding paragraph shall not apply in cases
         where the carrier has acted in bad faith.


ARTICLE 128 (ISSUANCE OF LAND BILL OF LADING)


         (1) The carrier shall, upon demand by the consignor, deliver to him a
         land bill of lading.

         (2) A land bill of lading shall contain the following particulars and
         the carrier shall write his name and affix his seal or sign on it:
         (Amended by Act No. 5053, Dec. 29, 1995)

         1.The particulars mentioned in subparagraphs 1 through 3 of Article 126
         (2);

         2.The name or trade name, place of business or domicile of the
         consignor;

         3.The freight and any other expenses relating to goods, and the
         distinction between advance payment or payment after arrival; and

         4.The place where and the date on which the land bill of lading is made


ARTICLE 129 (EXCHANGE ABILITY OF LAND BILL OF LADING)

         If a land bill of lading has been made, no demand for delivery of the
         goods shall be permitted unless the land bill of lading is exchanged
         with the goods.


ARTICLE 130 (LAND BILL OF LADING AS INSTRUMENT TO ORDER)

<PAGE>

         Even in cases where a land bill of lading is an instrument to a
         specified person, it may be transferred by endorsement: Provided, That
         this shall not apply if the land bill of lading itself contains a
         stipulation forbidding endorsement.


ARTICLE 131 (LAND BILL OF LADING-EFFECT OF STIPULATIONS OF BILL)

         When a land bill of lading has been drawn, matters relating to the
         carriage shall, as between the carrier and the holder of the land bill
         of lading, be governed by the stipulations of the land bill of lading.


ARTICLE 132 (LAND BILL OF LADING-DISPOSITION OF GOODS)

         Where a land bill of lading has been made, disposition of the goods
         shall be effected only by means of using the land bill of lading.


ARTICLE 133 (LAND BILL OF LADING ACQUISITION OF RIGHTS)

         If a land bill of lading has been delivered to a person who is entitled
         thereby to receive the goods, such delivery shall have the same effect
         as delivery of the goods themselves in respect of the acquisition of
         rights over the goods.


ARTICLE 134 (LOSS OF GOODS AND FREIGHT)


         (1) If the whole or a part of the goods have been lost by reason for
         which the consignor is not liable, the carrier may not demand freight
         thereof. If the carrier has already received the whole or a part of
         such freight, he shall refund it.

         (2) If the whole or a part of the goods have been lost by reasons of
         their own nature or inherent defects or by the negligence of the
         consignor, the carrier may demand the full amount of the freight.

<PAGE>

ARTICLE 135 (LIABILITY FOR DAMAGES)

         A carrier shall not be relieved of liability for damages which have
         resulted from any loss of, injury to or delay in arrival of the goods
         unless he proves that neither he, the forwarding agent, any of his
         employees nor any other person employed in respect of the carriage has
         neglected care in connection with the receipt, delivery, custody and
         carriage of the goods.


ARTICLE 136 (LIABILITY FOR VALUABLES)

         With respect to money, valuable instruments and other valuables, a
         carrier shall be liable for damages only if the consignor has expressly
         stated their description and value when entrusting him with the
         carriage.


ARTICLE 137 (AMOUNT OF DAMAGES)


         (1) If the goods have been lost totally or have been delayed in
         arrival, the amount of damages shall be determined by the price
         prevailing at the destination on the day on which they should have been
         delivered.

         (2) In case of a partial loss of or injury to the goods, the amount of
         damages shall be determined by the price prevailing at the destination
         on the day on which they have been delivered.

         (3) Where the loss of, injury to and delay in arrival of the goods have
         arisen from the willfulness of or gross negligence of the carrier, he
         shall be liable for all damages.

         (4) Any freight and other expenses, the payment of which has been
         obviated by any loss of or injury to the goods, shall be deducted from
         the amount of the damages mentioned in the preceding three paragraphs.

<PAGE>

ARTICLE 138 (JOINT AND SEVERAL LIABILITY AND RIGHT OF INDEMNIFICATION OF
SUCCESSIVE CARRIER)


         (1) If two or more persons successively participate in the carriage,
         they shall jointly and severally be liable for damages arising from any
         loss of, injury to, or delay in arrival of the goods.

         (2) Where the damages were paid by one of the carriers in accordance
         with the provisions of the preceding paragraph, such carrier shall have
         the right of indemnification against the carrier who has committed an
         act which was the cause of the damage.

         (3) If, in the case of the preceding paragraph, the carrier who has
         committed an act which was the cause of the damage cannot be
         ascertained, each carrier shall compensate for damages in proportion to
         the amount of the freight of goods: Provided, That he is not bound to
         bear share of the damages if he has proved that such damages have not
         occurred in his part of the carriage.


ARTICLE 139 (RIGHT TO DEMAND DISPOSITION OF GOODS)


         (1) The consignor, or the holder of the land bill of lading in case the
         land bill of lading is issued, may demand of the carrier the
         discontinuance of the carriage, the return of the goods or any other
         disposition thereof. In such case the carrier may demand payment of
         freight in proportion to the carriage already effected as well as of
         any substituted donation for another person and other expenses due to
         such disposition.

         (2) Deleted. (by Act No. 5053, Dec 29, 1995)


ARTICLE 140 (STATUS OF CONSIGNEE)

<PAGE>

         (1) When the goods have arrived at the destination, the consignee shall
         acquire the same right as that of the consignor.

         (2) When the consignee requests the delivery of the goods after it
         arrives at the destination, the right of the consignee shall have the
         preference to that of the consignor. (Newly Inserted by Act No. 5053,
         Dec. 29, 1995)


ARTICLE 141 (DUTY OF CONSIGNEE)

         When the consignee has received the goods, he is obligated to pay the
         freight and any other expenses in respect of carriage, as well as any
         substituted donation for another person, to the carrier.


ARTICLE 142 (RIGHT TO DEPOSIT OR TO REFER TO AUCTION IN CASE CONSIGNEE IS
UNKNOWN)


         (1) If the consignee cannot be ascertained, the carrier may deposit the
         goods to the public depository.

         (2) In the case as referred to in paragraph (1), if the carrier give a
         peremptory notice to the consignor demanding instruction for the
         disposal of the goods, with a reasonable period fixed, but the
         consignor fails to give any instruction within such period, the carrier
         may sell the goods by auction. (Amended by Act No. 5053, Dec 29, 1995)

         (3) If the carrier deposits or sells by auction the goods under
         paragraph (1) and (2), he shall dispatch notice thereof without delay
         to the consignor (Amended by Act No. 5053, Dec 29, 1995)


ARTICLE 143 (IN CASE OF REFUSAL OF RECEIVING GOODS OR WHERE RECEIVING IS
IMPOSSIBLE)

<PAGE>

         (1) The provisions mentioned in the preceding Article shall apply
         mutatis mutandis in cases where the consignee refuses to receive the
         goods or he is unable to receive them.

         (2) For selling the goods by auction, the carrier shall give a
         peremptory notice to the consignee demanding him to receive the goods
         with a reasonable period fixed, before giving a peremptory notice to
         the consignor. (Amended by Act No. 5053, Dec. 29, 1995)


ARTICLE 144 (PUBLIC NOTIFICATION)


         (1) If the consignor, the holder of land bill of lading, or the
         consignee can not be ascertained, the carrier shall, for the benefit of
         the holder of the right over the goods, publicly notify, by fixing a
         period of six months or more, that holder of the right should assert
         his right within such period.

         (2) The public notification mentioned in the preceding paragraph shall
         be made twice or more through Gazette or daily newspaper. (Amended by
         Act No. 3724, Apr. 10, 1984)

         (3) If, even after the public notification under paragraphs (1) and (2)
         has been made by the carrier, no person asserts his right within the
         prescribed period, the carrier may sell the goods by auction.


ARTICLE 145 (APPLICABLE PROVISIONS)

         The provisions of Article 67 (2) and (3) shall apply mutatis mutandis
         to sales by auction mentioned in the preceding three Articles.


ARTICLE 146 (EXTINGUISHMENT OF CARRIER'S LIABILITY)

<PAGE>

         (1) The liability of the carrier shall be extinguished when the
         consignee or the holder of a land bill of lading has received the
         goods without any reservation and has paid the freight and other
         expenses. This, however, shall not apply as to the case where there is
         injury to or partial loss of goods which are not immediately
         discoverable and the consignee dispatches notice thereof to the
         carrier within two weeks from the date of delivery.

         (2) The provisions mentioned in the preceding paragraph shall not apply
         if the carrier or his employee has acted in bad faith.

ARTICLE 147 (APPLICABLE PROVISIONS)

         The provisions of Articles 117, and 120 through 122 shall apply mutatis
mutandis to the carrier.

              SECTION 2 CARRIAGE OF PASSENGERS

ARTICLE 148 (LIABILITY FOR DAMAGES SUSTAINED BY PASSENGER)

         (1) A carrier shall not be relieved of liability for damages from any
         injury sustained by a passenger arising from the carriage unless the
         carrier proves that neither he nor any of his employees has neglected
         care in connection with the carriage.

         (2) In determining the amount of damages, the court shall take into
         account the circumstances of the injured party and of his family.

ARTICLE 149 (LIABILITY FOR LUGGAGE DEPOSITED TO CARRIER)

         (1) A carrier of passengers shall, as regards any luggage deposited
         from a

<PAGE>

         passenger, incur the same liability as that of a carrier of goods, even
         though he has not taken freight in respect thereto.

         (2) If the passenger does not demand delivery of his luggage within ten
         days from the date on which the luggage has arrived at the destination,
         the provisions of Article 67 shall apply mutatis mutandis: Provided,
         That neither a notice nor a peremptory notice need to be given to a
         passenger whose domicile or temporary domicile is not known.

ARTICLE 150 (LIABILITY FOR LUGGAGE NOT DEPOSITED TO CARRIER)

         A carrier shall not be liable for damages from any loss of or injury to
         such luggage which has not been deposited to him by a passenger if the
         negligence of a carrier, or of any of his employees does not exist.

            CHAPTER X PUBLIC ENTERTAINMENT BUSINESS

ARTICLE 151 (DEFINITION)

         Any person who makes it his business to make transactions by facilities
         to which guests come together such as a theater, hotel, restaurants, or
         others is called a public entertainment businessman.

ARTICLE 152 (LIABILITY OF PUBLIC ENTERTAINMENT BUSINESSMAN)

         (1) A public entertainment businessman shall not be relieved of
         liability for damages which have resulted from the loss of or injury to
         the Articles kept in his custody through bailment by the guest unless
         he proves that such loss or injury was caused by force majeure.

<PAGE>

         (2) A public entertainment businessman shall be liable, even if any
         thing has not been bailed to him by a guest, for damages of the
         personal effects of a guest in the facility, if such personal effects
         were lost or injured due to negligence of the public entertainment
         businessman or any of his employees.

         (3) The public entertainment businessman shall not be relieved of the
         liability mentioned in the preceding two paragraphs, even if a notice
         is posted to the effect that the public entertainment businessman is
         not liable for loss of or injury to the guest's personal effects.

ARTICLE 153 (LIABILITY FOR VALUABLES)

         With respect to money, valuable instruments and other valuables, a
         public entertainment businessman shall not be liable for damages from
         any loss or injury if a guest does not expressly state the description
         and value of his personal effects when he bails them into such
         businessman.

ARTICLE 154 (PRESCRIPTION OF LIABILITY OF PUBLIC ENTERTAINMENT BUSINESSMAN)

         (1) The liabilities mentioned in the preceding two Articles shall be
         extinguished by prescription if six months have elapsed after the
         public entertainment businessman has returned the bailed articles to
         the guest, or personal effects has been taken back by the guests.

         (2) The period mentioned in the preceding paragraph shall be computed
         from the date on which the guest has left the facility, if an entire
         Article was lost.

         (3) The provisions of the preceding two paragraphs shall not apply as
         to the case a public entertainment businessman or his employee has
         acted in bad faith.

<PAGE>

            CHAPTER XI WAREHOUSING

ARTICLE 155 (DEFINITION)

         A person who makes it his business to keep goods in custody in a
         warehouse for another person is called a warehouseman.


ARTICLE 156 (ISSUANCE OF WAREHOUSE RECEIPT)


         (1) A warehouseman shall, upon demand by the bailor, deliver a
         warehouse receipt to him.

         (2) A warehouse receipt shall contain the followings and a warehouseman
         shall write his name and affix his seal or sign thereon: (Amended by
         Act No. 5053, Dec. 29, 1995)

         1.The description, quality, quantity of the goods bailed, and the
         description, number and marks of the packages;

         2.The name or trade name, place of the business or domicile of the
         bailor;

         3.The place of storage;

         4.The charges for storage;

         5.The period for storage, if such has been fixed;

         6.The insured amount, the duration of insurance, the name or trade
         name, and place of business or domicile of the insurer, in case the
         goods bailed have been insured; and

         7.The place where and the date on which a warehouse receipt has been
         made.



<PAGE>

ARTICLE 157 (APPLICABLE PROVISIONS)

         The provisions of Articles 129 through 133 shall apply mutatis mutandis
         to warehouse receipts.


ARTICLE 158 (DEMAND OF WAREHOUSE RECEIPT CONCERNING PORTION OF GOODS DIVIDED)


         (1) The holder of a warehouse receipt may return such instrument and
         may demand of the warehouseman to divide the goods bailed and deliver
         him with a warehouse receipts in respect of each portion of the goods
         thus divided.

         (2) The expenses relating to the division of the goods bailed and the
         delivery of the instruments, in accordance with the provisions of the
         preceding paragraph, shall be borne by the holder of the instruments.


ARTICLE 159 (PLEDGE BY WAREHOUSE RECEIPT AND TAKING PART OF GOODS OUT OF
WAREHOUSE)

         If, in case the goods bailed have been pledged with a warehouse
         receipt, the pledgee has given his consent, the bailor may demand the
         return of a part of the goods bailed even prior to the time for
         performance of obligation. In such cases the warehouseman shall enter
         the description, quality and quantity of the goods thus returned in the
         warehouse receipt.


ARTICLE 160 (LIABILITY FOR DAMAGES)

         A warehouseman shall not be relieved of liability for damages from any
         loss of or injury to the goods bailed unless he proves that neither he
         nor any of his employees has neglected care in connection with the
         custody thereof.


ARTICLE 161 (RIGHT OF EXAMINATION OF GOODS BAILED, TAKING AWAY SAMPLES AND

<PAGE>

DISPOSITION FOR PRESERVATION)

         A bailor or the holder of a warehouse receipt may, at any time during
         business hours, demand of the warehouseman that he be allowed to
         examine the goods bailed, to take away samples thereof, or to take any
         measures necessary for the preservation thereof.


ARTICLE 162 (RIGHT TO DEMAND STORAGE CHARGES FOR STORAGE)


         (1) A warehouseman shall not demand payment of charges for storage, or
         any other expenses and substituted donation for another person except
         at the time when the goods bailed are taken out of the warehouse:
         Provided, That he may demand such payment, even prior to the taking out
         of the warehouse, with the lapse of the period for storage.

         (2) In case a part of the goods is taken out, he may demand payment of
         charges for storage, other expenses and substituted donation for
         another person in proportion thereto.


ARTICLE 163 (PERIOD OF BAILMENT)


         (1) If the period of bailment has not been fixed by the parties, the
         warehouseman may return the goods bailed any time after six months has
         elapsed from the date on which he received them.

         (2) In the case mentioned in the preceding paragraph, in order to
         return the goods bailed, an advance notice shall be given two weeks
         prior to their return.


ARTICLE 164 (PERIOD OF BAILMENT-UNAVOIDABLE CIRCUMSTANCES)

         If unavoidable reasons exist, the warehouseman may return the goods
         bailed at

<PAGE>

         any time irrespective of the provisions of the preceding Article.


ARTICLE 165 (APPLICABLE PROVISIONS)

         The provisions of Article 67 (1) and (2), shall apply mutatis mutandis
         in cases where the bailor or the holder of a warehouse receipt refuses
         the receipt of the goods bailed, or is unable to receive them.


ARTICLE 166 (PRESCRIPTION FOR LIABILITY OF WAREHOUSEMAN)


         (1) The liability of a warehouseman, which has arisen from any loss of
         or injury to the goods bailed, shall be extinguished by prescription
         after one year has elapsed from the date on which the goods have been
         taken out of the warehouse.

         (2) The period mentioned in the preceding paragraphs shall, in case of
         a total loss of the goods bailed, be computed from the date on which
         the warehouseman dispatches notice of such loss to the bailor and the
         holder of a warehouse receipt who is known to him.

         (3) The provisions mentioned in the preceding two paragraphs shall not
         apply in cases where a warehouseman or any of his employees has acted
         in bad faith.


ARTICLE 167 (PRESCRIPTION FOR CLAIM OF WAREHOUSEMAN)

         The claim of a warehouseman against the bailor or the holder of a
         warehouse receipt shall be extinguished by prescription unless it is
         exercised for one year from the date on which the goods have been taken
         out of the warehouse.


ARTICLE 168 (APPLICABLE PROVISIONS)

         The provisions of Articles 108 and 146 shall apply mutatis mutandis to
         a

<PAGE>

         warehouseman. (Amended by Act No. 1212, Dec. 12, 1962)


         PART III COMPANIES

         CHAPTER I COMMON PROVISIONS

ARTICLE 169 (DEFINITION)

         The term "company" as used in this Act means an association
         incorporated for the purpose of engaging in commercial activities
         and/or any other profitmaking activities.


ARTICLE 170 (KINDS OF COMPANIES)

         Companies are categorized into four kinds, namely, partnership
         companies, limited partnership companies, stock companies and limited
         liability companies.


ARTICLE 171 (COMPANY AS JURISTIC PERSON AND DOMICILE OF COMPANY)


         (1) A company shall be a juristic person.

         (2) The domicile of a company shall be at the place of its principal
         office.


ARTICLE 172 (INCORPORATION OF COMPANY)

         A company shall come into existence upon the registration of its
         incorporation at the place of its principal office.



<PAGE>

ARTICLE 173 (RESTRICTION ON LEGAL CAPACITY)

         A company shall not become a member with unlimited liability of another
         company.


ARTICLE 174 (MERGER OF COMPANIES)


         (1) A merger of companies shall be permissible.

         (2) In case where one side of the constituent companies of a merger is
         a stock company or a limited liability company or both sides of them
         are stock companies or limited liability companies, the surviving
         company or the newly incorporated company in consequence of the merger
         shall be a stock company or a limited liability company.

         (3) A company after its dissolution may be involved only in a merger
         whereby it is merged into an existing company and the latter company
         survives after merger.


ARTICLE 175 (IDEM-INCORPORATORS)


         (1) In case where a new company is to be incorporated in consequence of
         a merger, the execution of its articles of incorporation and the
         performance of any other activities relating to its incorporation shall
         be effected jointly by incorporators appointed by each of constituent
         companies.

         (2) Articles 230, 434 and 585 shall apply mutatis mutandis to the
         appointment under paragraph (1).


ARTICLE 176 (DISSOLUTION ORDER AGAINST COMPANY)

<PAGE>

         (1) The court may, upon the application by an interested person or by
         the public prosecutor or ex officio, order that a company be dissolved,
         in any of the following cases:

         1.Where the company was incorporated for an illegal purpose;

         2.Where a company, without justifiable reasons, failed to commence its
         business within one year after its establishment or discontinued its
         business for a period of at least one year; or

         3.Where a director or a member managing the affairs of the company
         violated Acts or subordinate statutes or the articles of incorporation
         of the company, as a result of which it is deemed impermissible for the
         company to continue its existence.

         (2) In case where an application mentioned in paragraph (1) has been
         filed, the court may, at the request of an interested party or of the
         public prosecutor or ex officio, appoint an administrator or take any
         other necessary measures for the preservation of the company's
         properties, even before issuing the dissolution order.

         (3) In case where an application mentioned in paragraph (1) has been
         filed by an interested person, the court may, upon the request of the
         company, order the applicant to furnish adequate security.

         (4) In order to make the request mentioned in paragraph (3), the
         company shall meet the minimal showing with respect to the fact that
         the application was filed in bad faith.


ARTICLE 177 (STARTING POINT OF RECKONING OF REGISTRATION PERIOD)

         If any matter to be registered in accordance with this Part requires
         permission or authorization of government authorities, the period
         within which the registration should be made shall commence to run from
         the date of the arrival

<PAGE>

         of the document of such permission or authorization.


         CHAPTER II PARTNERSHIP COMPANY

         SECTION 1 INCORPORATION

ARTICLE 178 (EXECUTION OF ARTICLES OF INCORPORATION)

         In order to incorporate a partnership company, articles of
         incorporation shall be executed jointly by at least two members of the
         company.


ARTICLE 179 (ABSOLUTE PARTICULARS TO BE ENTERED IN ARTICLES OF INCORPORATION)

         The articles of incorporation of a partnership company shall contain
         the following items and all members shall write their names and affix
         their seals or shall sign thereon: (Amended by Act No. 5053, Dec. 29,
         1995)

         1.Purposes;

         2.Trade name;

         3.Name, resident registration number and domicile of each member;

         4.Subject-matter, value, or the basis for valuation of the contribution
         to be made by each member;

         5.Place of the principal office; and

         6.Date of execution of the articles of incorporation.


ARTICLE 180 (REGISTRATION OF INCORPORATION)


<PAGE>

         The registration of incorporation of a partnership company shall
         contain the following particulars: (Amended by Act No. 5053, Dec. 29,
         1995)

         1.Matters set forth in subparagraphs 1 through 3 and 5 of Article 179
         and the place of a branch office, if any: Provided, That if a member
         representing the company was designated, the domicile of other members
         shall be excluded;

         2.Subject-matter of the contribution of each member and, in case of a
         contribution in kind, its value and the part already effected;

         3.Period of duration or the reasons for dissolution, if such period or
         such reasons were determined;

         4.Name of the member representing the company, if such member was
         designated; and

         5.A provision, if any, to the effect that the company are represented
         jointly by two or more members.


ARTICLE 181 (REGISTRATION OF ESTABLISHMENT OF BRANCH OFFICE)


         (1) If a branch office is established simultaneously with the
         incorporation of the company, matters set forth in Article 180
         (excluding the places of other branch offices) shall be registered at
         the place of such branch office within two weeks after the registration
         of incorporation was effected. (Amended by Act No. 5053, Dec. 29, 1995)

         (2) If a branch office is established after the incorporation of the
         company, the place and establishment date of such branch office shall
         be registered within two weeks at the place of the principal office,
         and the matters set forth in Article 180 (excluding the places of other
         branch offices) shall be registered within three weeks at the place of
         such branch office. (Amended by Act No. 5053, Dec. 29, 1995)


<PAGE>

         (3) Deleted. (by Act No. 5053, Dec. 29, 1995)


ARTICLE 182 (REGISTRATION OF TRANSFER OF PRINCIPAL OFFICE AND BRANCH OFFICE)


         (1) If a company transfers its principal office, the new place and the
         transfer date shall be registered within two weeks at the previous
         place and the matters set forth in Article 180 (excluding the places of
         other branch offices) shall be registered within two weeks at the new
         place. (Amended by Act No. 5053, Dec. 29, 1995)

         (2) If a company transfers its branch office, the new place and the
         transfer date shall be registered within two weeks at the place of the
         principal office and at the previous place of such branch office and
         the matters set fort in Article 180 (excluding the places of other
         branch offices) shall be registered within two weeks at the new place.
         (Amended by Act No.
         5053, Dec. 29, 1995)

         (3) Deleted. (by Act No. 5053, Dec. 29, 1995)


ARTICLE 183 (REGISTRATION OF ALTERATIONS)

         If a change occurred in any of the matters mentioned in Article 180,
         such alteration shall be registered within two weeks at the place of
         the principal office and within three weeks at the place of each branch
         office, respectively.


ARTICLE 183-2 (REGISTRATION OF TEMPORARY DISPOSITION, ETC. FOR BUSINESS
MANAGEMENT)

         Where the employees' business management is suspended, a temporary
         disposition for appointing the agent for business management is made,
         or such temporary disposition is altered or canceled, the registration
         thereof shall be made at the registry in the place where the head and
         branch offices are located.

         [This Article Newly Inserted by Act No. 6545, Dec. 29, 2001]

<PAGE>


ARTICLE 184 (ACTION FOR NULLIFICATION OR REVOCATION OF INCORPORATION)


         (1) The nullity of the incorporation of a company may be asserted only
         by a member of the company and the revocation of the incorporation of a
         company may be asserted only by a person who has the right to revoke
         the incorporation, in both cases only by means of an action to be filed
         within two years after the date of the incorporation.

         (2) Article 140 of the Civil Act shall apply mutatis mutandis to the
         revocation of the incorporation mentioned in paragraph (1).


ARTICLE 185 (ACTION FOR REVOCATION OF INCORPORATION BY CREDITORS)

         If a member has incorporated a company with the knowledge that he would
         thereby prejudice his creditors, the creditors may demand the
         revocation of the incorporation of the company by means of an action
         filed against the member and the company.


ARTICLE 186 (EXCLUSIVE JURISDICTION)

         The actions mentioned in Articles 184 and 185 shall be subject to the
         exclusive jurisdiction of the district court governing the place of the
         principal office of the company.


ARTICLE 187 (PUBLIC NOTICE OF FILING OF ACTION)

         If an action was filed for nullification or revocation of the
         incorporation of a company, the company concerned shall give public
         notice thereof without delay.



<PAGE>

ARTICLE 188 (COMBINED HEARING OF ACTIONS)

         If two or more actions were filed for nullification or revocation of
         the incorporation of a company, the court shall hear the actions
         jointly.


ARTICLE 189 (CORRECTION OF DEFECTS AND DISMISSAL OF ACTION)

         The court may dismiss an action for nullification or revocation of the
         incorporation of a company, if the defects which were the cause for
         such action have been remedied in the course of the hearing and the
         court considers it improper to nullify or revoke the incorporation of
         the company in light of the present condition of the company and all
         other circumstances.


ARTICLE 190 (EFFECT OF JUDGMENT)

         A judgment affirming the nullification or revocation of the
         incorporation of a company shall be effective against any third person:
         Provided, That it shall not affect the rights and duties which have
         arisen between the company and its members as well as third persons
         before the judgment becomes final and conclusive.


ARTICLE 191 (LIABILITY OF PLAINTIFF WHO LOST)

         If the plaintiffs in an action for nullification or revocation of the
         incorporation of a company have lost in such action and it is found
         that they wilfully or by gross negligence filed such action, they shall
         be jointly and severally liable for damages against the company.


ARTICLE 192 (REGISTRATION OF NULLIFICATION OR REVOCATION OF INCORPORATION)

         Where a judgment affirming the nullification or revocation of the
         incorporation of a company has become final and conclusive, such fact
         shall be registered at the

<PAGE>

         place of the principal office and branch offices of the company.


ARTICLE 193 (EFFECT OF JUDGMENT AFFIRMING NULLIFICATION OR REVOCATION OF
INCORPORATION)


         (1) Where a judgment affirming the nullification or revocation of the
         incorporation of a company has become final and conclusive, the company
         shall be liquidated as if the company had been dissolved.

         (2) In case of paragraph (1), the court may appoint a liquidator upon
         the application by any member of the company and by any other
         interested person.


ARTICLE 194 (NULLIFICATION OR REVOCATION OF INCORPORATION AND CONTINUANCE OF
COMPANY)


         (1) If a judgment affirming the nullification or revocation of the
         incorporation of a company has become final and conclusive and the
         cause of such nullification or revocation exists only with a particular
         member, the company may continue to exist with the unanimous consent of
         all the other members.

         (2) In case of paragraph (1), the member in respect of whom the cause
         of the nullification or revocation exists shall be deemed to have
         retired from the company.

         (3) The provisions of Article 229 (2) and (3) shall apply mutatis
         mutandis to the cases under paragraphs (1) and (2) above.


         SECTION 2 INTERNAL RELATIONSHIP OF A COMPANY

ARTICLE 195 (APPLICABLE PROVISIONS)


<PAGE>

         Unless otherwise provided by the articles of incorporation or by this
         Act, the provisions concerning partnerships of the Civil Act shall
         apply mutatis mutandis to the internal relationship of a partnership
         company.


ARTICLE 196 (CONTRIBUTION OF CLAIM RIGHTS)

         A member who has transferred a claim right to the company as his
         contribution shall be responsible for payment of the amount of such
         claim, if the obligor fails to pay for such claim by the time for
         performance. In this case, the member shall not only pay for the
         interests but also shall be liable for any damages sustained thereby.


ARTICLE 197 (TRANSFER OF SHARE)

         No member shall, without the consent of all the other members, transfer
         all or a part of his share in the company to other persons.


ARTICLE 198 (PROHIBITION OF COMPETITIVE BUSINESS BY MEMBERS)


         (1) No member shall, without the consent of all the other members,
         effect for his own account or for the account of a third person any
         transaction which falls within the class of business carried on by the
         company or become a member with unlimited liability or a director of
         another company whose business purpose is the same kind of business as
         the company.

         (2) In case where any member has effected a transaction violating
         paragraph (1), the company may regard such transaction as effected for
         the account of the company if such transaction was effected for that
         member's own account, and the company may demand that member to
         transfer any profit accrued therefrom if such transaction was effected
         for the account of a third person. (Amended by Act No. 1212, Dec. 12,
         1962)


<PAGE>

         (3) Paragraph (2) shall not affect any claim for damages by the company
         against the member concerned.

         (4) The claim rights mentioned in paragraphs (2) and (3) shall be
         exercised by a resolution adopted by affirmative votes of a majority of
         other members of the company and shall lapse by the passage of two
         weeks from the day on which any one of other members has become aware
         of such transaction or by the passage of one year from the day on which
         such transaction was effected.


ARTICLE 199 (SELF-TRANSACTIONS OF MEMBERS)

         A member may effect a transaction with the company for his own account
         or for the account of a third person only if a resolution approving
         such has been adopted by affirmative votes of a majority of other
         members of the company. In this case, Article 124 of the Civil Act
         shall not apply.


ARTICLE 200 (RIGHT AND DUTY OF MANAGEMENT OF AFFAIRS)


         (1) Unless otherwise provided by the articles of incorporation, each
         member has the right and duty to manage the affairs of the company.

         (2) If other members raise an objection in respect to a management of
         affairs by respective member, that member shall immediately cease such
         act and follow a decision of a majority of all the members.


ARTICLE 200-2 (AUTHORITY OF AGENT FOR BUSINESS MANAGEMENT)


         (1) An agent for business management under Article 183-2 shall, unless
         otherwise stipulated in the temporary disposition order, not perform
         any act which does not fall under regular businesses of a corporation:
         Provided, That

<PAGE>

         the same shall not apply to the case where a permit has been obtained
         from the court.

         (2) Where an agent for business management has committed an act in
         contravention of the provisions of paragraph (1), the company shall be
         responsible for bona fide third person.
         [This Article Newly Inserted by Act No. 6545, Dec. 29, 2001]


ARTICLE 201 (MANAGING MEMBERS)


         (1) If one or more members are designated by the articles of
         incorporation as managing members, those members shall have the right
         and duty to manage the affairs of a company.

         (2) If other managing members raise an objection in respect to an act
         of management by an managing member, that member shall immediately
         cease such act and follow a decision of a majority of all the managing
         members.


ARTICLE 202 (JOINT MANAGING MEMBERS)

         Where several members are designated by the articles of incorporation
         to jointly manage the affairs of the company, any act of management
         shall not be taken without the consent of all such joint managing
         members: Provided, That this shall not apply if there is a fear of
         delay.


ARTICLE 203 (APPOINTMENT AND REMOVAL OF MANAGER)

         Unless otherwise provided by the articles of incorporation, the
         appointment and dismissal of a manager shall be decided by a majority
         of all the members, even where managing members were designated.



<PAGE>

ARTICLE 204 (AMENDMENT OF ARTICLES OF INCORPORATION)

         The consent of all the members shall be required in order to amend the
         articles of incorporation.


ARTICLE 205 (ADJUDICATION OF FORFEITURE OF POWER AGAINST MANAGING MEMBER)


         (1) If a managing member is clearly unfit for management of the company
         or he has breached his material duties, the court may, upon the
         application of a member, adjudicate the forfeiture of the power against
         such managing member.

         (2) When a judgment mentioned in paragraph (1) has become final and
         conclusive, such fact shall be registered at the place of the principal
         office and branch offices of the company.


ARTICLE 206 (APPLICABLE PROVISIONS)

         Article 186 shall apply mutatis mutandis to an action mentioned in
         Article 205.


         SECTION 3 EXTERNAL RELATIONSHIP OF A COMPANY

ARTICLE 207 (REPRESENTATION OF COMPANY)

         If a company has not designated managing members in charge of the
         management of affairs by the articles of incorporation, each of the
         members shall represent the company. If several executive members were
         designated to take charge of the management, each of them shall
         represent the company: Provided, That the company may specifically
         designate a person who shall represent the company from among such
         managing members, by the articles of

<PAGE>

         incorporation or with the unanimous consent of all the members.


ARTICLE 208 (JOINT REPRESENTATION)


         (1) A company may, either by the articles of incorporation or with the
         unanimous consent of all the members, provide that two or more members
         shall jointly represent the company.

         (2) Even in case of paragraph (1), any declaration of intention made by
         a third person to the company shall be effective by giving such
         declaration of the intention to any one of the joint representative
         members.


ARTICLE 209 (AUTHORITIES OF REPRESENTATIVE MEMBER)


         (1) The representative member shall be authorized to do all judicial or
         extra-judicial acts relating to the business of the company.

         (2) Any restriction placed on the authorities mentioned in paragraph
         (1) may not be asserted against a third person acting in good faith.


ARTICLE 210 (LIABILITY FOR DAMAGES)

         In case where the representative member has caused damages to another
         person by his act of the business administration of the company, the
         company and such representative member shall be jointly and severally
         liable for such damages.


ARTICLE 211 (REPRESENTATION IN LEGAL ACTIONS BETWEEN COMPANY AND MEMBERS)

         If no representative member exists in case of an action filed by a
         company

<PAGE>

         against its member or an action filed by a member of a company against
         the company, a member who shall represent the company on such action
         shall be selected by a resolution of a majority of all the other
         members.


ARTICLE 212 (LIABILITY OF MEMBERS)


         (1) If the assets of a company are insufficient to fully satisfy all
         its obligations, all the members shall be jointly and severally liable
         for the performance of the obligations.

         (2) Paragraph (1) shall also apply if a compulsory execution on the
         company's assets has proved ineffective.

         (3) Paragraph (2) shall not apply if any member proves that the company
         is capable of performing its obligations and that the execution can
         easily be effected.


ARTICLE 213 (LIABILITY OF INCOMING MEMBER)

         A member admitted to a company after its establishment shall assume the
         same liability as other members with respect to the obligations of the
         company incurred prior to his admission.


ARTICLE 214 (DEFENSES OF MEMBERS)


         (1) In case where a claim is raised against members with respect to the
         company's obligations, they may oppose to the claimant by any defense
         which the company might have asserted.

         (2) If the company has a right of set-off, cancellation or rescission
         against the claimant, members may refuse performance in respect of a
         claim under

<PAGE>

         paragraph (1).


ARTICLE 215 (LIABILITY OF MEMBER BY ESTOPPEL)

         Where a person who is not a member of a company has acted in a manner
         to induce others to misconceive him of a true member, he shall assume
         the same liability as true members against any person who has effected
         a transaction with the company on the basis of such misconception.


ARTICLE 216 (APPLICABLE PROVISIONS)

         Articles 205 and 206 shall apply mutatis mutandis to the representative
         members of a company.


         SECTION 4 RETIREMENT OF MEMBERS

ARTICLE 217 (MEMBER'S RIGHT TO RETIRE FROM COMPANY)


         (1) Where the articles of incorporation of a company do not fix the
         duration of the company or they provide that the company shall continue
         to exist during the life of a particular member, any member may retire
         at the end of any business year: Provided, That he shall give an
         advance notice six months prior to the retirement.

         (2) Where unavoidable reasons exist, any member may retire at any time.


ARTICLE 218 (REASONS FOR RETIREMENT OF MEMBERS)

         In addition to Article 217, a member shall retire from the company for
         any of the following reasons:


<PAGE>

         1.Occurrence of any event specified in the articles of incorporation;

         2.Consent of all the members;

         3.Death;

         4.Incompetency;

         5.Bankruptcy; or

         6.Expulsion.


ARTICLE 219 (NOTICE OF SUCCESSION OF RIGHTS AT DEATH OF MEMBER)


         (1) Where the articles of incorporation provide that if a member dies,
         his successors may succeed to the deceased member's rights and duties
         against the company to become a member, the successors shall dispatch a
         notice of either succession or renunciation to the company within three
         months from the day on which he has become aware of the commencement of
         succession.

         (2) If three months have elapsed without the successors's notice
         mentioned in paragraph (1), the successors shall be deemed to have
         renounced the right to become a member.


ARTICLE 220 (ADJUDICATION OF EXPULSION)


         (1) Where any of the following reasons exists in respect of a member,
         the company may, by a resolution of a majority of all the other
         members, demand that the court adjudicate the expulsion of such member:

         1.Where such member failed to perform a duty to contribute;


<PAGE>

         2.Where such member acted in violation of Article 198 (1);

         3.Where such member committed a dishonest act with respect to the
         management of the affairs or the representation of the company, or
         where such member managed the affairs of the company or represented the
         company without authority; or

         4.Where there is any other important reason.

         (2) Articles 205 (2) and 206 shall apply mutatis mutandis to the cases
         under paragraph (1).


ARTICLE 221 (SETTLEMENT OF ACCOUNTS BETWEEN EXPELLED MEMBER AND COMPANY)

         The settlement of accounts between the expelled member and the company
         shall be effected according to the status of the company's property
         when an action for expulsion was filed, and legal interest shall accrue
         therefrom.


ARTICLE 222 (REFUNDMENT OF SHARE)

         A retired member shall be entitled to refundment of his share even
         where his contribution was in the form of personal services or credit:
         Provided, That it shall not be the case if it is provided otherwise by
         the articles of incorporation.


ARTICLE 223 (SEIZURE ON SHARE)

         A seizure upon a member's share on the company shall be effective with
         regard to his right to demand a dividend and a refundment on the share
         for the future.


ARTICLE 224 (DEMAND OF RETIREMENT OF MEMBER BY CREDITOR WHO SEIZED MEMBER'S
SHARE)

<PAGE>

         (1) A creditor who seized a member's share in the company may cause the
         member to retire at the end of a business year: Provided, That he shall
         give an advance notice to the company and the member concerned six
         months prior to the retirement.

         (2) The advance notice mentioned in the proviso of paragraph (1) shall
         lose its effect when the member concerned performs his obligations or
         furnishes an adequate security.


ARTICLE 225 (LIABILITY OF RETIRED MEMBER)


         (1) A retired member shall be liable, as if he continued to be a
         member, for the obligations of the company incurred before the
         registration of his retirement has been effected at the place of the
         principal office, for the period of two years subsequent to the above
         registration.

         (2) The provision of paragraph (1) shall apply mutatis mutandis to a
         member who has transferred his share in the company to other persons.


ARTICLE 226 (RETIRED MEMBER'S RIGHT TO DEMAND CHANGE IN CORPORATE NAME)

         In case where the name of a retired member has been used in the
         company's trade name, such member may demand of the company the
         cessation of such name.


         SECTION 5 DISSOLUTION OF COMPANY

ARTICLE 227 (REASONS FOR DISSOLUTION)

         A company shall be dissolved for any of the following reasons:


<PAGE>

         1.Expiration of the duration of the company or occurrence of any events
         specified in the articles of incorporation;

         2.Consent of all the members;

         3.Where there is only one member left;

         4.Merger;

         5.Bankruptcy; or

         6.Order or judgment of the court.


ARTICLE 228 (REGISTRATION OF DISSOLUTION)

         In case of the dissolution of a company for reasons other than merger
         or bankruptcy, such fact shall be registered within two weeks at the
         place of the principal office and within three weeks at the place of
         each branch office, both period starting from the day on which the
         reason for dissolution comes into existence.


ARTICLE 229 (CONTINUANCE OF COMPANY)


         (1) In cases of subparagraphs 1 and 2 of Article 227, the company may
         continue to exist with the consent of all or some of the members:
         Provided, That the dissenting members shall be deemed to have retired.

         (2) In case of subparagraph 3 of Article 227, the company may continue
         to exist by admitting a new member.

         (3) In case of paragraphs (1) and (2), if the registration of
         dissolution was already effected, the continuance of existence of a
         company shall be registered

<PAGE>

         within two weeks at the place of the principal office and within three
         weeks at the place of each branch office.

         (4) Article 213 shall apply mutatis mutandis to the liabilities of a
         incoming member pursuant to paragraph (2).


ARTICLE 230 (RESOLUTION OF MERGER)

         The consent of all the members shall be required for a merger of a
         company.


ARTICLE 231

         Deleted. (by Act No. 3724, Apr. 10, 1984)


ARTICLE 232 (OBJECTIONS BY CREDITORS)


         (1) Within two weeks from the date of the resolution on a merger, the
         company shall give to its creditors a public notice demanding the
         submission of an objection, if any, against the merger within a
         specified period of time and shall give a peremptory notice to the
         respective creditors known to the company. In this case, the said
         period shall be no less than one month. (Amended by Act No. 3724, Apr.
         10, 1984; Act No. 5591, Dec. 28, 1998)

         (2) A creditor who fails to raise an objection within the period set
         forth in paragraph (1) shall be deemed to have approved the merger.

         (3) If a creditor has raised an objection, the company shall perform
         his obligations to the creditor or furnish adequate security, or
         entrust a property of reasonable value to a trust company to the same
         purpose.


ARTICLE 233 (REGISTRATION OF MERGER)


<PAGE>

         In case of a merger, the registration of alteration by the surviving
         company, the registration of dissolution by the merged company and the
         registration of newly incorporated company in consequence of a merger
         shall be effected within two weeks at the place of the principal office
         and within three weeks at the place of each branch office.


ARTICLE 234 (TAKING EFFECT OF MERGER)

         A merger of companies shall take effect when the surviving company or
         the newly company incorporated in consequence of a merger has effected
         registration set forth in Article 233 at the place of its principal
         office.


ARTICLE 235 (EFFECT OF MERGER)

         The surviving company or the newly incorporated company in consequence
         of a merger shall succeed to the rights and duties of the merged
         company.


ARTICLE 236 (FILING OF ACTION FOR NULLIFICATION OF MERGER)


         (1) The nullification of a merger of companies shall be asserted only
         by an action, the plaintiff of which is limited to the members,
         liquidators, trustee in bankruptcy of respective company or by those
         creditors who do not approve such merger.

         (2) The action under paragraph (1) shall be filed within six months
         from the date of the registration under Article 233.


ARTICLE 237 (APPLICABLE PROVISIONS)

         Article 176 (3) and (4) shall apply mutatis mutandis where the
         creditors of a company have filed an action under Article 236.



<PAGE>

ARTICLE 238 (REGISTRATION OF NULLIFICATION OF MERGER)

         When a judgment affirming the nullification of merger has become final
         and conclusive, the registration of alteration by the surviving
         company, the registration of restitution by the merged company and the
         registration of dissolution by the newly incorporated company in
         consequence of the merger shall be effected at the place of the
         principal office and each branch office.


ARTICLE 239 (FINAL JUDGMENT OF NULLIFICATION AND REVERSION OF RIGHTS AND DUTIES
OF COMPANIES)


         (1) When a judgment affirming the nullification of merger has become
         final and conclusive, the companies which have effected a merger shall
         be jointly and severally liable to discharge any obligation that the
         surviving company or the newly incorporated company in consequence of
         the merger has incurred after the merger.

         (2) Any property which has been acquired after the merger by the
         surviving company or the newly incorporated company in consequence of
         the merger shall be co-owned in common by the companies which have
         effected the merger.

         (3) If, in case of paragraphs (2) and (3), the companies have failed to
         determine the proportions of assuming the liabilities or the
         proportions of the common ownership, the court shall, upon the
         application of such companies, determine those proportions, by taking
         into account the status of the property of each company as of the time
         of the merger and all other circumstances.


ARTICLE 240 (APPLICABLE PROVISIONS)

         Articles 186 through 191 shall apply mutatis mutandis to the action for
         nullification of merger.



<PAGE>

ARTICLE 241 (DEMAND FOR DISSOLUTION BY MEMBERS)


         (1) Where unavoidable reasons exist, any member may apply to the court
         for dissolution of the company.

         (2) Articles 186 and 191 shall apply mutatis mutandis to the case under
         paragraph (1).


ARTICLE 242 (CHANGE OF ORGANIZATION)


         (1) With the consent of all the members a partnership company may be
         transformed into a limited partnership company either by making a
         particular member become a member with limited liability or by
         admitting a new member with limited liability.

         (2) paragraph (1) shall apply mutatis mutandis to the continuance of
         existence of a company pursuant to Article 229 (2).


ARTICLE 243 (REGISTRATION OF CHANGE OF ORGANIZATION)

         When a partnership company has been transformed into a limited
         partnership company, the registration of dissolution by the partnership
         company and the registration of incorporation by the limited
         partnership company shall be effected within two weeks at the place of
         the principal office and within three weeks at the place of each branch
         office.


ARTICLE 244 (LIABILITY OF PERSON WHO HAS BECOME MEMBER WITH LIMITED LIABILITY IN
CONSEQUENCE OF CHANGE OF ORGANIZATION)


<PAGE>

         A person who has been a member of a partnership company but now becomes
         a member with limited liability in accordance with Article 242,
         paragraph (1) shall not be relieved of the unlimited liability with
         respect to the obligations of the company which had been incurred
         before the registration under Article 243 was effected at the place of
         the principal office, for the period of two years subsequent to the
         said registration.


         SECTION 6 LIQUIDATION

ARTICLE 245 (COMPANY IN PROCESS OF LIQUIDATION)

         To the extent of the objectives of the liquidation, a company shall be
         deemed to continue to exist even after its dissolution.


ARTICLE 246 (WHERE SEVERAL SUCCESSORS OF SHARE EXIST)

         Where there are two or more successors upon the death of a member after
         dissolution of a company, they shall designate one person from among
         themselves to exercise the rights of a member in connection with the
         liquidation. If there is no such designation, the company's notice or
         peremptory notice made upon any one of the successors shall be
         effective upon all the successors.


ARTICLE 247 (VOLUNTARY LIQUIDATION)


         (1) The method of disposal of the properties of a dissolved company may
         be determined by the articles of incorporation or with the consent of
         all the members. In this case, an inventory and a balance sheet shall
         be prepared within two weeks from the day on which the reason for
         dissolution occurred.

         (2) Paragraph (1) shall not apply in case of the dissolution of a
         company pursuant to subparagraph 3 or 6 of Article 227.


<PAGE>

         (3) Article 232 shall apply mutatis mutandis to the case under
         paragraph (1).

         (4) If, in case of paragraph (1), there is any person who has seized a
         member's share in the company, the consent of such person shall be
         obtained.

         (5) The company under paragraph (1) shall register the completion of
         liquidation within two weeks at the place of its principal office and
         within three weeks at the place of its branch office after the disposal
         of properties is completed.
         (Newly Inserted by Act No. 5053, Dec. 29, 1995)


ARTICLE 248 (VOLUNTARY LIQUIDATION AND PROTECTION OF CREDITORS)


         (1) If a company has harmed its creditors by disposing of its
         properties in violation of Article 247 (3), the creditors may apply to
         the court for the revocation of such disposal

         (2) Article 186 of this Act and the proviso of Article 406 (1), (2) and
         407 of the Civil Act shall apply mutatis mutandis to the application
         for the revocation mentioned in paragraph (1).


ARTICLE 249 (PROTECTION OF CREDITORS WHO HAVE SEIZED SHARE)

         If a company has disposed of its properties in violation of Article 247
         (4), the creditor who has seized a member's share in the company may
         demand that the company pay an amount equivalent to the value of such
         share. In this case, Article 248 shall apply mutatis mutandis.


ARTICLE 250 (LEGAL LIQUIDATION)

         If the method of disposal of the properties of a dissolved company has
         not been determined pursuant to Article 247 (1), liquidation shall be
         carried out in

<PAGE>

         accordance with Articles 251 through 265 except for the cases of a
         merger and a bankruptcy.


ARTICLE 251 (LIQUIDATOR)


         (1) In case of the dissolution of a company, a liquidator shall be
         appointed by a majority vote of all the members.

         (2) When a liquidator has not been appointed, the managing member shall
         become a liquidator.


ARTICLE 252 (LIQUIDATOR APPOINTED BY COURT)

         In case of the dissolution of a company pursuant to subparagraph 3 or 6
         of Article 227, the court shall appoint a liquidator on the application
         of members, any interested person or the public prosecutor or ex
         officio.


ARTICLE 253 (REGISTRATION OF LIQUIDATORS)


         (1) The following particulars shall be registered within two weeks at
         the place of the principal office and within three weeks at the place
         of each branch office, which periods shall commence to run from the day
         of appointment of a liquidator if a liquidator has been appointed or
         from the day of the dissolution if the managing member has become a
         liquidator: (Amended by Act, No. 5053, Dec. 29, 1995)

         1.Name, resident registration number and address of the liquidator:
         Provided, That if a representative liquidator has been appointed from
         among several liquidators, addresses of liquidators other than the
         representative liquidators shall be excluded;


<PAGE>

         2.Name of the representative liquidator if such has been appointed; and

         3.Provisions to the effect that two or more liquidators shall jointly
         represent the company, if so determined.

         (2) Article 183 shall apply mutatis mutandis to the registration under
         paragraph (1). (Amended by Act No. 5053, Dec. 29, 1995)


ARTICLE 254 (DUTIES AND POWERS OF LIQUIDATORS)


         (1) A liquidator shall have the following duties:

         1.To wind up pending affairs;

         2.To collect claims and to perform obligations;

         3.To dispose of assets for realization; and

         4.To distribute surplus assets.

         (2) Where there are two or more liquidators, acts of conduct in
         connection with the duties of liquidation shall be determined by a
         resolution of a majority vote of them.

         (3) The representative liquidator is authorized to do all judicial or
         extrajudicial acts in connection with the duties mentioned in paragraph
         (1).

         (4) Article 93 of the Civil Act shall apply mutatis mutandis to a
         partnership company.


ARTICLE 255 (REPRESENTATION OF COMPANY BY LIQUIDATOR)

<PAGE>

         (1) In case where the managing member has become a liquidator, he shall
         represent the company as heretofore provided.

         (2) In case the court appoints two or more liquidators, the court may
         designate one who is to represent the company or may decide joint
         representation by several of them.


ARTICLE 256 (DUTIES OF LIQUIDATOR)


         (1) A liquidator shall, without delay after his inauguration,
         investigate the status of the company's properties, prepare an
         inventory list and a balance sheet and deliver copies thereof to
         respective members.

         (2) A liquidator shall report on the progress of the liquidation at any
         time that any member requests him to do so.


ARTICLE 257 (TRANSFER OF BUSINESS)

         In case where a liquidator intends to transfer whole or part of the
         business of the company, a resolution of a majority vote of all the
         members shall be required.


ARTICLE 258 (IMPOSSIBILITY OF FULL SATISFACTION OF OBLIGATIONS AND DEMAND FOR
CONTRIBUTION)


         (1) If the existing properties of a company are insufficient to fully
         satisfy its obligations, a liquidator may demand the members to make
         their contributions irrespective of the time for performance.

         (2) The amount of contribution in paragraph (1) shall be determined in
         proportion to the ratio of contribution by respective members.



<PAGE>

ARTICLE 259 (PERFORMANCE OF OBLIGATIONS)


         (1) A liquidator may perform the obligations of the company which have
         not yet come due.

         (2) In case of paragraph (1), an obligation in respect of which no
         interest was stipulated, the amount of the obligation deducted by the
         legal interest up to the time for performance shall be paid.

         (3) Paragraph (2) shall apply mutatis mutandis to an obligation in
         respect of which the stipulated interest is less than the legal
         interest rate.

         (4) In case of paragraph (1), conditional obligations, obligations with
         uncertain duration and any other claims against the company whose value
         is uncertain shall be discharged according to the valuation of an
         expert appointed by the court.


ARTICLE 260 (DISTRIBUTION OF SURPLUS ASSETS)

         A liquidator shall not distribute the properties of the company to its
         members until all the obligations of the company have been discharged
         completely: Provided, That he may distribute the surplus assets after
         reserving the properties necessary for the discharge of such obligation
         in dispute.


ARTICLE 261 (REMOVAL OF LIQUIDATOR)

         A liquidator appointed by the members may be dismissed by a resolution
         of a majority vote of all the members.


ARTICLE 262 (IDEM)


<PAGE>

         If a liquidator is clearly unfit for performing his duties or he has
         breached his material duties, the court may, upon the application of a
         member or any interested person, dismiss such liquidator.


ARTICLE 263 (TERMINATION OF DUTIES OF LIQUIDATOR)


         (1) When the duties of a liquidator have completed, he shall without
         delay prepare a statement of account and deliver a copy thereof to each
         member for approval.

         (2) If a member who received the statement of account in paragraph (1)
         has failed to raise an objection thereto within one month, he shall be
         deemed to have approved it: Provided, That it shall not be the case
         where a liquidator has committed some dishonest act.


ARTICLE 264 (REGISTRATION OF COMPLETION OF LIQUIDATION)

         Upon the completion of liquidation, a liquidator shall register such
         fact within two weeks at the place of the principal office and within
         three weeks at the place of each branch office from the day by the
         approval of all the members in accordance with Article 263.


ARTICLE 265 (MUTATIS MUTANDIS APPLICABLE PROVISIONS)

         Articles 183-2, 199, 200-2, 207, 208, 209 (2), 210, 382 (2), 399 and
         401 shall apply mutatis mutandis to liquidators. [This Article Wholly
         Amended by Act No. 6545, Dec. 29, 2001]


ARTICLE 266 (PRESERVATION OF BOOKS AND DOCUMENTS)

<PAGE>

         (1) The books and records as well as important documents relating to
         the business and liquidation of a company shall be preserved for ten
         years after the completion of liquidation is registered at the place of
         the principal office: Provided, That the slips or similar documents
         shall be preserved for five years. (Amended by Act No. 5053, Dec. 29,
         1995)

         (2) In case of paragraph (1), the custodian and the method of
         preservation shall be determined by a resolution of a majority vote of
         all the members. (Amended by Act No. 5053, Dec. 29, 1995)


ARTICLE 267 (EXTINCTIVE PRESCRIPTION FOR MEMBER'S LIABILITY)


         (1) A member's liability under Article 212 shall extinguish when five
         years have elapsed from the day of the registration of dissolution at
         the place of the principal office.

         (2) Even after the lapse of the period mentioned in paragraph (1) if
         there remains surplus assets which have not been distributed, creditors
         of a company may demand the performance of obligations in respect of
         such surplus assets.


         CHAPTER III LIMITED PARTNERSHIP COMPANY

ARTICLE 268 (ORGANIZATION OF COMPANY)

         A limited partnership company shall be composed of members with
         unlimited liability and members with limited liability.


ARTICLE 269 (APPLICABLE PROVISIONS)


<PAGE>

         Unless otherwise provided in this Chapter, the provisions governing
         partnership companies shall apply mutatis mutandis to limited
         partnership companies.


ARTICLE 270 (ABSOLUTE PARTICULARS TO BE ENTERED IN ARTICLES OF INCORPORATION)

         The articles of incorporation of a limited partnership company shall
         state all the particulars mentioned in Article 179 and shall
         additionally specify whether the liability of each member is limited or
         unlimited.


ARTICLE 271 (MATTERS TO BE REGISTERED)

         With respect to the registration of incorporation of a limited
         partnership company, it shall be registered whether each partner's
         responsibility is limited or not, in addition to the matters as set
         forth in Article 180.

         [This Article Wholly Amended by Act No. 5053, Dec. 29, 1995]


ARTICLE 272 (CONTRIBUTION BY MEMBER WITH LIMITED LIABILITY)

         Members with limited liability shall not contribute personal services
         or credits.


ARTICLE 273 (RIGHT AND DUTY OF MANAGEMENT OF AFFAIRS)

         Unless otherwise provided in the articles of incorporation, every
         member with unlimited liability shall have the right and duty to manage
         the affairs of the company.


ARTICLE 274 (APPOINTMENT AND DISMISSAL OF MANAGER)

         The appointment and removal of a manager shall be decided by a
         resolution of a majority vote of members with unlimited liability even
         where managing members

<PAGE>

         were designated.


ARTICLE 275 (FREEDOM OF ENGAGING IN COMPETITIVE BUSINESS BY MEMBER WITH LIMITED
LIABILITY)

         A member with limited liability may, without the consent of the other
         members, effect for his own account or for the account of a third
         person any transaction which falls within the class of business carried
         on by the company or become a member with unlimited liability or a
         director of another company whose business purpose is the same kind of
         business as the company.


ARTICLE 276 (TRANSFER OF SHARE OF MEMBER WITH LIMITED LIABILITY)

         With the consent of all the members with unlimited liability, a member
         with limited liability may transfer to another person the whole or a
         part of his share in the company. The same shall apply even where such
         transfer is to be accompanied by an amendment of the articles of
         incorporation.


ARTICLE 277 (RIGHT OF MONITORING OF MEMBER WITH LIMITED LIABILITY)


         (1) A member with limited liability may, at the end of each business
         year but only during business hours, inspect the account books, a
         balance sheet and other documents of the company and may investigate
         its business and the state of its property. (Amended by Act No. 3724,
         Apr. 10, 1984)

         (2) Where any material reason exists, a member with limited liability
         may, with the permission of the court, conduct the inspection and
         investigation mentioned in paragraph (1) at any time.


ARTICLE 278 (PROHIBITION ON MANAGEMENT AND REPRESENTATION BY MEMBER WITH LIMITED
LIABILITY)


<PAGE>

         A member with limited liability shall neither manage the affairs of the
         company nor represent the company.


ARTICLE 279 (LIABILITY OF MEMBER WITH LIMITED LIABILITY)


         (1) A member with limited liability shall be liable to perform the
         obligations of the company to the extent of the amount of his
         contribution deducting the amount which has been paid already.

         (2) If any dividends were distributed notwithstanding that no profit
         has accrued to the company, such amount shall be added in determining
         the liability for performance.


ARTICLE 280 (LIABILITY IN CASE OF DECREASE IN CONTRIBUTION)

         In case where a member with limited liability reduces his
         contributions, he shall not be relieved of the liabilities under
         Articles 278 and 279 with regard to any obligation of the company which
         has been incurred prior to the registration of such reduction at the
         place of the principal office, for the period of two years after such
         registration has been effected.


ARTICLE 281 (LIABILITY OF MEMBER WITH UNLIMITED LIABILITY BY ESTOPPEL)


         (1) Where a member with limited liability has acted in a manner to
         induce others to misconceive him of a member with unlimited liability,
         he shall assume the same liability as a member with unlimited liability
         against any person who has effected a transaction with the company due
         to such misconception.

         (2) Paragraph (1) shall apply mutatis mutandis where a member with
         limited liability has acted in a manner to mislead others as to the
         extent of his liability.

<PAGE>

ARTICLE 282 (LIABILITY OF MEMBER WHOSE LIABILITY HAS BEEN CHANGED)

         Article 213 shall apply mutatis mutandis where a member with limited
         liability has become a member with unlimited liability and Article 225
         shall apply mutatis mutandis where a member with unlimited liability
         has become a member with limited liability.


ARTICLE 283 (DEATH OF MEMBER WITH LIMITED LIABILITY)


         (1) Upon the death of a member with limited liability, his successor
         shall succeed to the share of the deceased in the company and shall
         become a member.

         (2) Where, in case of paragraph (1), there are two or more successors,
         they shall appoint from among themselves one person who shall exercise
         the right of the member. If there is no such appointment, the company's
         notice or peremptory notice made upon any one of the successors shall
         be effective upon all the successors.


ARTICLE 284 (INCOMPETENCY OF MEMBER WITH LIMITED LIABILITY)

         A member with limited liability shall not be subject to retirement,
         even if he is adjudged incompetent.


ARTICLE 285 (DISSOLUTION AND CONTINUANCE OF COMPANY)


         (1) A limited partnership company shall be dissolved if either all the
         members with unlimited liability or all the members with limited
         liability have retired from the company.


<PAGE>

         (2) The members, either with unlimited liability or with limited
         liability, remaining in case of paragraph (1), may, with the unanimous
         consent among themselves, continue the company by admitting a member
         with limited liability or a member with unlimited liability.

         (3) Articles 213 and 229 (3) shall apply mutatis mutandis to the cases
         under paragraph (2).


ARTICLE 286 (CHANGE OF ORGANIZATION)


         (1) With the consent of all the members, a limited partnership company
         may transform its organization to a partnership company and continue to
         exist.

         (2) In case where all the members with limited liability have retired
         from the company, the members with unlimited liability may, with the
         unanimous consent among themselves, transform its organization to a
         partnership company and continue to exist.

         (3) In cases of paragraphs (2) and (3), the registration of dissolution
         shall be effected by the limited partnership company, and the
         registration of incorporation shall be effected by the partnership
         company, within two weeks at the place of the principal office and
         within three weeks at the place of each branch office.


ARTICLE 287 (LIQUIDATOR)

         A liquidator of a limited partnership company shall be appointed by a
         majority vote of the members with unlimited liability. If there is no
         such appointment, the managing member who has been in charge of the
         management shall become a liquidator.



<PAGE>

         CHAPTER IV STOCK COMPANY

         SECTION 1 INCORPORATION

ARTICLE 288 (PROMOTERS)

         In order to incorporate a stock company, the promoters shall prepare
         the articles of incorporation. [This Article Wholly Amended by Act No.
         6488, Jul. 24, 2001]


ARTICLE 289 (PREPARATION OF ARTICLES OF INCORPORATION, ABSOLUTE PARTICULARS TO
BE ENTERED THEREIN)


         (1) The promoters shall prepare the articles of incorporation and enter
         the following particulars therein, and each of them shall write his
         name and affix his seal or sign on it: (Amended by Act No. 3724, Apr.
         10, 1984; Act No. 5053, Dec. 29, 1995; Act No. 6488, Jul. 24, 2001)

         1.Purpose;

         2.Trade name;

         3.Total number of shares authorized to be issued;

         4.Par value per share;

         5.Number of shares to be issued at the time of incorporation;

         6.Place of principal office;

         7.Method of public notice;


<PAGE>

         8.Name, residence registration number and address of each promoter; and

         9.Deleted. (by Act No. 3724, Apr. 10, 1984)

         (2) The number of shares to be issued at the time of incorporation
         shall be no less than a fourth of the total number of shares authorized
         to be issued by the company. (Amended by Act No. 3724, Apr. 10, 1984)

         (3) Public notices by a company shall be given by inserting them in the
         Gazette or in a daily newspaper in which matters relating to current
         events are published.


ARTICLE 290 (PARTICULARS OF ABNORMAL INCORPORATION)

         The following matters shall be effective by being stated in the
         articles of incorporation:

         1.Any special benefits to be received by promoters and names of such
         promoters;

         2.Name of the person who is to make a contribution in kind, the type
         quantity and value of the subject-matter of such contribution in kind
         and the class and number of shares to be given in consideration
         thereof;

         3.The class, number and value of the property which was agreed to be
         transferred to the company after its incorporation and the name of the
         transferor; and

         4.The expenses for incorporation which are to be borne by the company
         and the amount of promoter's compensation.


ARTICLE 291 (DETERMINATION OF MATTERS CONCERNING ISSUANCE OF SHARES AT TIME OF
INCORPORATION)

         In connection with the shares to be issued at the time of
         incorporation, unless

<PAGE>

         otherwise provided in the articles of incorporation, the following
         matters shall be determined with the unanimous agreement among the
         promoters:

         1.Class and number of shares; and

         2.If the company is to issue shares at the price higher than the par
         value, the number of such shares and the price.


ARTICLE 292 (AUTHENTICATION OF ARTICLES OF INCORPORATION)

         The articles of incorporation shall take effect upon the authentication
         by a notary public.


ARTICLE 293 (SUBSCRIPTION OF SHARES BY PROMOTERS)

         Each promoter shall subscribe for shares in writing.


ARTICLE 294

         Deleted. (by Act No. 5053, Dec. 29, 1995)


ARTICLE 295 (PAYMENT OF SUBSCRIPTION PRICE AND PERFORMANCE OF CONTRIBUTION IN
KIND IN PROMOTION OF INCORPORATION)


         (1) In case where the promoters have subscribed for all of the shares
         to be issued at the time of incorporation, they shall without delay
         make full payment of the subscription price. In this case, they shall
         designate the bank or other financial institution at which the
         subscription price is to be paid and the place of payment. (Amended by
         Act No. 5053, Dec. 29, 1995)

         (2) A promoter who is to make a contribution in kind shall deliver the
         pertinent property, without delay, on the date fixed for the payment of
         the subscription

<PAGE>

         price, and if registration, recording or the creation or transfer of a
         right is required, he shall prepare completely the documents thereon
         and deliver them to the company.


ARTICLE 296 (APPOINTMENT OF OFFICERS IN PROMOTION OF INCORPORATION)


         (1) When the payment of subscription price and the performance of
         contribution in kind are completed in accordance with Article 295, the
         promoters shall without delay appoint the directors and auditors by a
         majority vote.

         (2) The promoters shall have one vote for each share which they have
         subscribed for.


ARTICLE 297 (PREPARATION OF MINUTES BY PROMOTERS)

         The promoters shall prepare and write their names and affix their seals
         or sign on the minutes of their meeting, in which the proceedings of
         deliberation and the results thereof shall be entered. (Amended by Act
         No. 5053, Dec. 29, 1995)


ARTICLE 298 (INVESTIGATION AND REPORTING BY DIRECTORS AND AUDITORS, AND REQUEST
FOR APPOINTMENT OF INSPECTOR)


         (1) The directors and auditors shall, without delay after their
         appointment, investigate whether or not all matters concerning the
         incorporation of the company have complied with the Acts, subordinate
         statutes and the articles of incorporation, and report the results
         thereof to the promoters.

         (2) Any director and auditor who was a promoter, contributor in kind or
         party to a contract whereby the company is to take over a property
         after its incorporation shall not participate in the investigation and
         reporting mentioned in paragraph (1).


<PAGE>

         (3) If all of the directors and auditors are subject to paragraph (2),
         the directors shall have a notary public make the investigation and
         reporting mentioned in paragraph (1).

         (4) In case where the articles of incorporation provide for any matter
         set forth in Article 290, the directors shall request the court to
         appoint an inspector for the purpose of conducting the investigation on
         such matter: Provided, That this shall not apply to the case of Article
         299-2.
         [This Article Wholly Amended by Act No. 5053, Dec. 29, 1995]


ARTICLE 299 (INVESTIGATION AND REPORTING BY INSPECTOR)


         (1) The inspector shall investigate any matter set forth in Article 290
         and whether or not the contribution in kind pursuant to Article 295 has
         been fulfilled and shall report the results thereof to the court.
         (Amended by Act No. 5053, Dec. 29, 1995)

         (2) The inspector shall, without delay after he has prepared a report
         of investigation under paragraph (1), deliver a copy of it to each
         promoter.

         (3) Where any statement in the report of investigation is contrary to
         the true fact, the promoters may produce an explanatory note thereon to
         the court.


ARTICLE 299-2 (CERTIFICATION OF CONTRIBUTION IN KIND, ETC.)

         With respect to the matters set forth in subparagraphs 1 and 4 of
         Article 290 the investigation and reporting by a notary public may
         substitute for the investigation of the inspector mentioned in Article
         299 (1) and with respect to the matters set forth in subparagraphs 2
         and 3 of Article 290 and the fulfillment of contribution in kind
         pursuant to Article 295, the appraisal by a certified appraiser may
         substitute for the investigation of the inspector mentioned in Article
         299 (1). In this case, the notary public or appraiser shall report on
         the

<PAGE>

         results of the investigation or appraisal to a court. (Amended by Act
         No. 5591, Dec. 28, 1998)
         [This Article Newly Inserted by Act No. 5053, Dec. 29, 1995]


ARTICLE 300 (DISPOSITION OF ALTERATION BY COURT)


         (1) If the court has found any of the matters falling with Article 290
         to be improper after examining the reports on investigation by an
         inspector or notary public or the results of appraisal by an appraiser
         and an explanatory note of the promoters, it may alter the same and
         notify each promoter thereof. (Amended by Act No. 5591, Dec. 28, 1998)

         (2) A promoter who disagrees to an alteration under paragraph (1) may
         revoke the subscription of his shares. In this case, the procedures for
         the incorporation may be continued through amending the articles of
         incorporation. (Amended by Act No. 5591, Dec. 28, 1998)

         (3) If no promoter revokes the subscription of his shares within two
         weeks after receiving the notification from the court, the articles of
         incorporation shall be deemed to have been amended in accordance with
         the notification. (Amended by Act No. 5591, Dec. 28, 1998)


ARTICLE 301 (OFFERING OF SHARES IN CASE OF SUBSCRIPTIVE INCORPORATION)

         Where the promoters do not subscribe for all the shares issued at the
         time of incorporation, they shall offer shares for subscription.


ARTICLE 302 (OFFER OF SHARE SUBSCRIPTION AND PARTICULARS TO BE ENTERED IN
SUBSCRIPTION FORM)


         (1) A person who intends to subscribe for shares shall complete two
         copies of

<PAGE>

         subscription form, in which the class and number of shares for which he
         is to subscribe and his address are stated, and shall write his name
         and affix his seal or shall sign thereon. (Amended by Act No. 5053,
         Dec. 29, 1995)

         (2) The promoters shall prepare the subscription form, in which the
         following particulars shall be stated: (Amended by Act No. 1212, Dec.
         12, 1962; Act No. 3724, Apr. 10, 1984; Act No. 5053, Dec. 29, 1995)

         1.Date on which the articles of incorporation were authenticated, and
         the name of the notary public;

         2.Matters set forth in Articles 289 (1) and 290;

         3.Duration or reasons for dissolution of the company, if determined;

         4.Class and number of shares subscribed by promoters;

         5.Matters mentioned in Article 291;

         5-2.A provision that transfer of shares shall be subject to the
         approval of the board of directors, if so determined;

         6.Distribution of interest prior to the commencement of business, if so
         determined;

         7.Redemption of shares out of profits to be distributed to
         shareholders, if so determined;

         8.A statement to the effect that the subscription of shares may be
         cancelled if the inaugural general meeting is not closed by a fixed
         date;

         9.Bank and any other financial institution in charge of the payment of
         the subscription price and the place of payment; and

         10.Name, address and business office of a transfer agent, if any.


<PAGE>

         (3) The proviso of Article 107 (1) of the Civil Act shall not apply to
         the offer of share subscription. (Amended by Act No. 1212, Dec. 12,
         1962)


ARTICLE 303 (DUTIES OF SUBSCRIBERS)

         A person who has subscribed for shares shall be responsible for the
         payment of the subscription price in accordance with the number of
         shares allotted to him by the promoters.


ARTICLE 304 (NOTICE OR PEREMPTORY NOTICE TO SUBSCRIBERS, ETC.)


         (1) Any notice or peremptory notice against a person who has subscribed
         for shares or who has applied for subscription for shares may be
         delivered to his address stated in the certificate of the share
         subscription or the subscription form for shares or to the address
         notified to the company by such person.

         (2) The notice or peremptory notice under paragraph (1) shall be deemed
         to have delivered at the time when it would normally have arrived.


ARTICLE 305 (PAYMENT OF SUBSCRIPTION PRICE FOR SHARES)


         (1) When all the shares to be issued at the time of incorporation have
         been subscribed for, the promoters shall without delay have the
         subscription price be paid fully by the subscribers.

         (2) The payment under paragraph (1) shall be made at the place as
         prescribed in the subscription form for shares.

         (3) Article 295 (2) shall apply mutatis mutandis to the cases under
         paragraph (1).

<PAGE>

ARTICLE 306 (CHANGE OF DEPOSITORY, ETC. OF PAYMENT)

         The change of the depository at which the subscription price shall be
         paid in and of the place of payment shall be subject to approval of the
         court.


ARTICLE 307 (PROCEDURES FOR FORFEITURE OF SUBSCRIBER'S RIGHTS)


         (1) In case where a person who has subscribed for shares fails to make
         the payment in accordance with Article 305, the promoters shall fix a
         certain date and shall, before two weeks prior to such date, give such
         person a notice to the effect that such person's right shall be
         forfeited if he fails to make the payment by such date.

         (2) If the person who received the notice under paragraph (1) fails to
         perform the payment by such date, his rights shall be forfeited. In
         this case, the promoters may again offer such shares for subscription.

         (3) Paragraphs (2) and (3) shall not affect any claim for damages
         against the person concerned who has subscribed for shares.


ARTICLE 308 (INAUGURAL GENERAL MEETING)


         (1) Where the payment pursuant to Article 305 and the performance of
         the contribution in kind have been completed, the promoters shall
         without delay convene an inaugural general meeting.

         (2) Articles 363 (1) and (2), 364, 368 (3) and (4), 368-2, 369 (1), 371
         (2), 372, 373, 376 through 381 and 435 shall apply mutatis mutandis to
         the inaugural general meeting. (Amended by Act No. 3724, Apr. 10, 1984)


ARTICLE 309 (RESOLUTIONS AT INAUGURAL GENERAL MEETING)


<PAGE>

         At the inaugural general meeting, resolutions shall be adopted by
         affirmative votes of at least two-thirds of the total votes of
         attending subscribers and also by affirmative votes representing a
         majority of the total number of shares which have been subscribed.


ARTICLE 310 (INVESTIGATION IN CASE OF ABNORMAL INCORPORATION)


         (1) If any matter set forth in Article 290 has been determined by the
         articles of incorporation, the promoters shall request the court for
         the appointment of an inspector to investigate such matters.

         (2) A written report of the inspector mentioned in paragraph (1) shall
         be submitted to the inaugural general meeting.

         (3) The proviso of Article 298 (4) and Article 299-2 shall apply
         mutatis mutandis to the investigation under paragraph (1). (Newly
         Inserted by Act No. 5053, Dec. 29, 1995)


ARTICLE 311 (REPORTING BY PROMOTERS)


         (1) The promoters shall report in writing on the matters relating to
         the incorporation of the company, at the inaugural general meeting.

         (2) The written report under paragraph (1) shall specify the following:

         1.General circumstances concerning subscription of shares and payment
         of subscription price; and

         2.Actual conditions regarding matters mentioned in Article 290.

<PAGE>
ARTICLE 312 (ELECTION OF OFFICERS)

         At the inaugural general meeting, directors and auditors shall be
         elected.


ARTICLE 313 (INVESTIGATION AND REPORTING BY DIRECTORS AND AUDITORS)


         (1) The directors and auditors shall, without delay after their
         inauguration, investigate whether all matters concerning the
         incorporation of the company have complied with Acts, subordinate
         statutes and the article of incorporation and shall report the results
         thereof to the inaugural general meeting. (Amended by Act No. 5053,
         Dec. 29, 1995)

         (2) Article 298 (2) and (3) shall apply mutatis mutandis to the
         investigation and reporting under paragraph (1). (Amended by Act No.
         5053, Dec. 29, 1995)

         (3) Deleted. (by Act No. 5053, Dec. 29, 1995)


ARTICLE 314 (ALTERATION OF MATTERS CONCERNING ABNORMAL INCORPORATION)


         (1) If the inaugural general meeting finds any of the matters falling
         under Article 290 to be improper, it may alter them.

         (2) Article 300 (2) and (3) shall apply mutatis mutandis to the cases
         under paragraph (1).


ARTICLE 315 (CLAIM FOR DAMAGES AGAINST PROMOTERS)

         Article 314 shall not affect any claim for damages against the
         promoters.


ARTICLE 316 (RESOLUTIONS OF AMENDING ARTICLES OF INCORPORATION AND ABANDONING

<PAGE>

INCORPORATION)


         (1) At the inaugural general meeting, a resolution calling for amending
         the Articles of incorporation or abandoning the incorporation of the
         company may be adopted.

         (2) A resolution under paragraph (1) may be adopted even where such
         matter has not been stated in the convocation notice for the meeting.


ARTICLE 317 (REGISTRATION OF INCORPORATION)


         (1) The registration of incorporation of a stock company shall be
         effected within two weeks from the day on which the procedures in
         accordance with Articles 299 and 300 have been completed in cases where
         the promoters subscribed for all the shares issued at the time of
         incorporation, and within two weeks from the day on which the inaugural
         general meeting has been closed or from the day on which the procedures
         in accordance with Article 314 has been completed in cases where the
         promoters have offered shares for subscription.

         (2) For the registration under paragraph (1), the following matters
         shall be registered: (Amended by Act No. 3724, Apr. 10, 1984; Act No.
         5053, Dec. 29, 1995; Act No. 6086, Dec. 31, 1999)

         1.Matters set forth in Article 289 (1) 1 through 4, 6 and 7;

         2.Total amount of the capital;

         3.Total number and class of the issued and outstanding shares and
         contents and number of each class of shares;

         3-2.Provision that the transfer of shares shall be subject to the
         approval of the board of director, if so determined;


<PAGE>

         3-3.Provision under which stock option is granted, if so decided;

         3-4.Places of branch offices;

         4.Duration or reasons for dissolution of the company, if determined;

         5.Dividend of interest prior to the commencement of business, if so
         determined;

         6.Redemption of shares out of profits to be distributed to
         shareholders, if so determined;

         7.Matters set forth in Article 347, if convertible shares are issued;

         8.Name and residence registration number of each director and auditor;

         9.Name, residence registration number and address of the representative
         director;

         10.Provision that two or more representing directors shall jointly
         represent the company, if so determined;

         11.Trade name and the principal office of a transfer agent, if any; and

         12.Name and resident registration number of each auditor of the audit
         committee, if such committee has been set up.

         (3) Matters set forth in paragraph (2) 1, 4, 9 and 10 shall be
         registered for the registration to be made in case of establishing a
         new branch or transferring a branch, at the place of such newly
         established branch or the changed place of such transferred branch, as
         the case may be. (Newly Inserted by Act No. 5053, Dec. 29, 1995)

         (4) Articles 181 through 183 shall apply mutatis mutandis to the
         registration of a stock company.

<PAGE>

ARTICLE 318 (CERTIFICATION AND LIABILITY BY DEPOSITORY FOR SUBSCRIPTION PRICE
            PAID IN)


         (1) A bank and other financial institution which have had the custody
         of the subscription price paid shall deliver the certification as to
         the amount of money which are in its custody on demand by a promoter or
         a director.

         (2) The bank and other financial institution under paragraph (1) may
         not assert, in respect of the amount of money duly certified to be in
         its custody, non-performance, in whole or in part, of such payment or
         any restriction upon the return of such amount against the company.


ARTICLE 319 (TRANSFER OF RIGHTS DERIVING FROM SHARE SUBSCRIPTION)

         The transfer of any right deriving from the subscription of shares
         shall not be effective against the company.


ARTICLE 320 (RESTRICTIONS ON ASSERTING NULLITY OR REVOCATION OF SHARE
            SUBSCRIPTION)


         (1) Once the company comes into existence, no subscriber may assert the
         nullity of his subscription by reason of defects in any requirement as
         to the subscription form for shares, nor may revoke his subscription on
         the ground of fraud, duress or mistake.

         (2) The same shall apply even before the company comes into existence,
         if the subscriber has attended, and has exercised his rights at, the
         inaugural general meeting.


ARTICLE 321 (PROMOTER'S WARRANTY LIABILITY FOR SUBSCRIPTION AND PAYMENT)


         (1) In case where, after the company comes into existence, any shares
         issued at

<PAGE>

         the time of incorporation of the company are found to have not been
         subscribed or the subscription for certain shares has been revoked, the
         promoters shall be deemed to have subscribed for such shares jointly.

         (2) In case where, after the company comes into existence, shares upon
         which payment of the subscription price in accordance with Article 295
         (1) or 305 (1) has not been completed, the promoters shall make such
         payment jointly and severally.

         (3) Article 315 shall apply mutatis mutandis to the cases under
         paragraphs (2) and (3).


ARTICLE 322 (PROMOTER'S LIABILITY FOR DAMAGES)


         (1) If promoters have neglected to perform their duties in connection
         with the incorporation of the company, they shall be jointly and
         severally liable for damages to the company.

         (2) If promoters have failed to perform their duties wilfully or by
         gross negligence, they shall be jointly and severally liable for
         damages to third persons.


ARTICLE 323 (JOINT AND SEVERAL LIABILITY OF PROMOTERS AND OFFICERS)

         If the directors or auditors have neglected to perform their duties
         under Article 313 (1) and are thereby liable for damages to the company
         or to third persons and if the promoters are also liable therefor, the
         directors, auditors and promoters shall be liable for such damages
         jointly and severally.


ARTICLE 324 (RELEASE OF PROMOTER'S LIABILITY AND DERIVATIVE SUITS BY
            SHAREHOLDERS)

         Articles 400, and 403 through 406 shall apply mutatis mutandis to the
         promoters.

<PAGE>

ARTICLE 325 (INSPECTOR'S LIABILITY FOR DAMAGE)

         If an inspector appointed by the court has failed to perform his duties
         wilfully or by gross negligence, he shall be liable for damages to the
         company or to third persons.


ARTICLE 326 (PROMOTER'S LIABILITY WHERE COMPANY FAILS TO COME INTO EXISTENCE)


         (1) If the company fails to come into existence, the promoters shall be
         jointly and severally liable for all acts conducted in connection with
         the incorporation of the company.

         (2) In case of paragraph (1), the promoters shall assume any
         expenditures incurred in connection with the incorporation of the
         company.


ARTICLE 327 (LIABILITY OF SELF-STYLED PROMOTER)

         A person who has consented to have his name and any statement
         indicating his participation in the incorporation of the company
         entered in the application form for subscription and/or in any other
         documents which has been issued in connection with the offering of
         shares for subscription shall assume the same liability as that of a
         promoter.


ARTICLE 328 (ACTION FOR NULLITY OF INCORPORATION)


         (1) The nullity of the incorporation of a company may be contended only
         by the shareholders, directors or auditors and only by means of an
         action which shall be filed within two years from the day on which the
         company comes into existence. (Amended by Act No. 3724, Apr. 10, 1984)


<PAGE>

         (2) Articles 186 through 193 shall apply mutatis mutandis to the action
         mentioned in paragraph (1).


         SECTION 2 SHARES

         SUB-SECTION 1 SHARES AND SHARE CERTIFICATES

ARTICLE 329 (FORMATION OF CAPITAL AND PAR VALUE PER SHARE)


         (1) The capital of a stock company shall be no less than fifty million
         won. (Newly Inserted by Act No. 3724, Apr. 10, 1984)

         (2) The capital of a stock company shall be divided into shares.

         (3) The par value per share shall be equal.

         (4) The par value per share shall be at least one hundred won. (Amended
         by Act No. 5591, Dec. 28, 1998)


ARTICLE 329-2 (SHARE SPLIT)


         (1) A company may split shares by a resolution by a general meeting of
         shareholders under Article 434.

         (2) In case of paragraph (1), the par value per share after the split
         shall not be less than the amount under Article 329 (4).


<PAGE>

         (3) The provisions of Articles 440 through 444 shall apply mutatis
         mutandis to a share split under paragraph (1).
         [This Article Newly Inserted by Act No. 5591, Dec. 28, 1998]


ARTICLE 330 (RESTRICTIONS ON ISSUANCE OF SHARE BELOW PAR)

         Shares may not be issued at a price less than the par value: Provided,
         That this shall not apply to the case of Article 417. (Amended by Act
         No. 1212, Dec. 12, 1962)


ARTICLE 331 (LIABILITY OF SHAREHOLDER)

         The liability of a shareholder shall be limited to the subscription
         price which he has paid for his shares.


ARTICLE 332 (LIABILITY OF PERSON WHO SUBSCRIBED FOR SHARES IN FICTITIOUS NAME OR
            IN OTHER PERSON'S NAME)


         (1) A person who has subscribed for shares either in the name of a
         fictitious person or in the name of other person without such other
         person's consent shall assume the same liability as the subscriber.

         (2) A person who has subscribed for shares in the name of other person
         with such other person's consent shall take a joint and several
         liability with such other person for the payment of subscription price
         for shares.


ARTICLE 333 (CO-OWNERSHIP OF SHARES)


         (1) Persons who have subscribed for shares jointly shall be jointly and
         severally liable for the payment of the subscription price.


<PAGE>

         (2) Where a share belongs to a co-ownership of two or more persons,
         they shall designate one from among themselves who is to exercise the
         rights of a shareholder.

         (3) Where no one is designated to exercise the rights of a shareholder,
         a notice or peremptory notice required to be given to the co-owners may
         be given to any one of them.


ARTICLE 334 (PROHIBITION OF SET-OFF BY SHAREHOLDER AGAINST COMPANY)

         A shareholder may not assert a set-off against the company as regards
         to payment of the subscription price for shares.


ARTICLE 335 (TRANSFERABILITY OF SHARES)


         (1) Shares shall be transferable to other persons: Provided, That the
         articles of incorporation may subject the transfer of shares to the
         requirement of an approval of the board of directors. (Amended by Act
         No. 5053, Dec. 29, 1995)

         (2) The transfer of shares which is not approved by the board of
         directors in contravention of the proviso of paragraph (1) shall have
         no effect against the company. (Newly Inserted by Act No. 5053, Dec.
         29, 1995)

         (3) The transfer of shares made before the issuance of share
         certificates shall have no effect against the company: Provided, That
         it shall not be the case if six months have passed since the date of
         the formation of the company or the date of the payment of the
         subscription price for new shares. (Amended by Act No. 3724, Apr. 10,
         1984)


ARTICLE 335-2 (REQUEST FOR APPROVAL OF TRANSFER)

<PAGE>

         (1) In case where the transfer of shares requires the approval of the
         board of directors, the shareholder intending to transfer his shares
         may request in writing the company to approve the transfer, by
         specifying the contemplated transferee and the class and number of the
         shares to be transferred.

         (2) The company shall notify in writing the shareholder of whether or
         not it approves the transfer, within one month after the request under
         paragraph (1) is made.

         (3) If the company fails to notify the shareholder of its refusal
         within the period set forth in paragraph (2), the board of directors
         shall be deemed to have approved the transfer of shares.

         (4) The shareholder who received the notification of the refusal to
         approve the transfer as referred to in paragraph (2) may request the
         company to designate the alternative transferee or to purchase the
         shares, within twenty days after receiving the notification.
         [This Article Newly Inserted by Act No. 5053, Dec. 29, 1995]


ARTICLE 335-3 (REQUEST FOR DESIGNATION OF ALTERNATIVE TRANSFEREE)


         (1) If a shareholder requests the company to designate an alternative
         transferee, the board of directors shall designate one and notify in
         writing the shareholder and the designated person thereof, within two
         weeks after the request is made.

         (2) If the board of directors fails to notify the shareholder of the
         designation of the alternative transferee within the period set forth
         in paragraph (1), the board of directors shall be deemed to have
         approved the transfer of shares.
         [This Article Newly Inserted by Act No. 5053, Dec. 29, 1995]


ARTICLE 335-4 (CLAIM FOR SALE BY DESIGNATED TRANSFEREE)

<PAGE>

         (1) Any person designated as the alternative transferee in accordance
         with Article 335-3 (1) may request in writing the shareholder who made
         the request for such designation to sell the shares to him within ten
         days after he receives the notification of such designation.

         (2) Article 335-3 (2) shall apply mutatis mutandis to the cases where
         the person designated as the alternative transferee fails to make the
         request for sale within the period set forth in paragraph (1).
         [This Article Newly Inserted by Act No. 5053, Dec. 29, 1995]


ARTICLE 335-5 (DETERMINATION OF SALE PRICE)


         (1) In case of Article 335-4, the sale price of the shares concerned
         shall be determined through a negotiation between the shareholder and
         the person requesting for sale. (Amended by Act No. 6488, Jul. 24,
         2001)

         (2) In case where a negotiation under paragraph (1) is not effected
         within 30 days from the date of receiving the request under Article
         335-4 (1), the provisions of Article 374-2 (4) and (5) shall apply
         mutatis mutandis. (Amended by Act No. 6488, Jul. 24, 2001)
         [This Article Newly Inserted by Act No. 5053, Dec. 29, 1995]


ARTICLE 335-6 (APPRAISAL RIGHTS OF SHAREHOLDERS)

         Article 374-2 (2) through (5) shall apply mutatis mutandis where the
         shareholder requests the company to purchase the shares in accordance
         with Article 335-2 (4). (Amended by Act No. 6488, Jul. 24, 2001)
         [This Article Newly Inserted by Act No. 5053, Dec. 29, 1995]


ARTICLE 335-7 (REQUEST FOR APPROVAL BY TRANSFEREE OF SHARES)

<PAGE>

         (1) In case where the transfer of shares is subject to the approval of
         the board of directors, any person who has acquired the shares may
         request in writing the company to approve such acquisition, by
         specifying the class and number of the acquired shares.

         (2) Articles 335-2 (2) through (4), and 335-3 through 335-6 shall apply
         mutatis mutandis to the cases under paragraph (1).
         [This Article Newly Inserted by Act No. 5053, Dec. 29, 1995]


ARTICLE 336 (METHOD OF TRANSFER OF SHARES)


         (1) Share certificates shall be delivered for the transfer of shares.

         (2) A possessor of a share certificate shall be presumed as a due
         holder thereof.
         [This Article Wholly Amended by Act No. 3724, Apr. 10, 1984]


ARTICLE 337 (REQUIREMENTS FOR SETTING UP OF TRANSFER OF REGISTERED SHARES
            AGAINST COMPANY)


         (1) The transfer of a registered share shall not be asserted against
         the company, unless the name and address of the transferee have been
         entered in the register of shareholders.

         (2) A company may designate a transfer agent in accordance with the
         articles of incorporation. In this case, if the transfer agent has
         entered the name and address of the transferee in the part of a set of
         the register of shareholders, the entry of a change of holders under
         paragraph (1) shall be deemed to have been duly effected. (Newly
         Inserted by Act No. 3724, Apr. 10, 1984)


ARTICLE 338 (PLEDGING OF REGISTERED SHARES)

<PAGE>

         (1) In order to have a registered share pledged, the share certificate
         shall be delivered to the pledgee.

         (2) Without being in possession of the share certificate, a pledgee
         shall not assert his pledge right against third persons.


ARTICLE 339 (SUBROGATION OF PLEDGE)

         In case of redemption, consolidation, split or conversion of shares, a
         pledge over the original shares may be extended to the money or shares
         which the original shareholder is to receive in consequence thereof.
         (Amended by Act No. 5591, Dec. 28, 1998)


ARTICLE 340 (REGISTERED PLEDGE ON REGISTERED SHARES)


         (1) If, in case of a pledge created over a registered share, the
         company has, at the request of the pledgee, enter the name and address
         of the pledgee in the register of shareholders and enter his name in
         the share certificate, the pledgee may receive from the company the
         dividends of profits or interest, the distribution of surplus assets or
         money mentioned in Article 339, and may apply them to the discharge of
         claims due to him in preference to other creditors.

         (2) Article 353 (3) of the Civil Act shall apply mutatis mutandis to
         the cases under paragraph (1) above.

         (3) A pledgee under paragraph (1) may demand that the company deliver
         the share certificate of the share mentioned in Article 340.


ARTICLE 340-2 (STOCK OPTION)

<PAGE>

         (1) The company may, under the conditions as prescribed by the articles
         of incorporation, grant by the resolution of the general shareholders'
         meeting as provided in Article 434 the option of purchasing new shares
         or shares it owns (hereafter referred to as "stock option") at a fixed
         price established in advance (hereafter referred to as "exercising
         price for stock option") to its directors, auditors or other employees
         who will, or will be able to contribute to the promotion of its
         incorporation and management, technological innovation, etc.: Provided,
         That, in case the exercising price for stock option is lower than
         substantial price of the stock concerned, the company may compensate
         for the relevant difference by cash or transfer its own shares
         equivalent to the relevant difference. In this case, the substantial
         stock price shall be appraised as of the date of exercising the stock
         option.

         (2) The stock option as referred to in paragraph (1) shall not be
         granted to the persons who fall under any of the following
         subparagraphs:

         1.A stockholder who holds 10/100 or more of the total outstanding
         shares of the company excluding the nonvoting shares;

         2.A person who actually exercises an influence over such major
         management matters of the company as the appointment or dismissal of
         directors and auditors, etc.; and

         3.Spouse and lineal ascendents or descendents of the person falling
         under subparagraphs 1 and 2.

         (3) The number of new shares to be issued or the company's own shares
         to be transferred under paragraph (1) shall not exceed 10/100 of the
         total outstanding shares of the company.

         (4) The exercising price for stock option as referred to in paragraph
         (1) shall be in excess of the prices falling under any of the following
         subparagraphs:

         1.In the case of issuing new shares, the higher amount between their
         substantial price as of the date of granting the stock option and their
         face value; and


<PAGE>

         2.In the case of transferring the company's own shares, their
         substantial price as of the date of granting the stock option.
         [This Article Newly Inserted by Act No. 6086, Dec. 31, 1999]


ARTICLE 340-3 (GRANTING STOCK OPTION)


         (1) The following particulars shall be entered in the provisions of the
         articles of incorporation concerning the stock option as referred to in
         Article 340-2 (1):

         1.An intention that a stock option may be granted in specified cases;

         2.Categories and the number of shares to be issued or transferred in
         the case of exercising the stock option;

         3.Qualifications of a person to whom a stock option is to be granted;

         4.Exercising period of the stock option; and

         5.An intention that the granting of the stock option may be revoked by
         a resolution of the board of directors in specified cases.

         (2) In adopting at the general shareholders' meeting a resolution
         concerning the granting of stock option as referred to in Article 340-2
         (1), the following matters shall be determined:

         1.Names of the persons who are to be granted the stock option;

         2.Method of granting the stock option;

         3.Matters concerning the exercising price for stock option and an
         assessment thereof;

         4.Exercising period of the stock option; and


<PAGE>

         5.Categories and the number of shares to be issued or transferred, in
         the case of exercising the stock option, to each of the persons to be
         granted the stock option.

         (3) The company shall enter into contract with the optionee who has
         been granted the stock option under a resolution by the general
         shareholders' meeting as referred to in paragraph (2), and prepare a
         written contract thereon within a reasonable period of time.

         (4) The company shall keep the written contract under paragraph (3) in
         its principal office until the expiration of exercising period of the
         stock option so as to ensure that the shareholders are able to peruse
         it during the office hours.
         [This Article Newly Inserted by Act No. 6086, Dec. 31, 1999]


ARTICLE 340-4 (EXERCISE OF STOCK OPTION)


         (1) The stock option under Article 340-2 (1) may be exercised only when
         the stock optionee holds office or post in the company for more than
         two years since the date when the matters as referred to in
         subparagraphs of Article 340-3 (2) are determined by a resolution of
         the general shareholders' meeting.

         (2) The stock option as referred to in Article 340-2 (1) shall not be
         transferable: Provided, That, in the case of the death of optionee
         entitled to exercise the stock option, his heir thereto may exercise
         it.

         [This Article Newly Inserted by Act No. 6086, Dec. 31, 1999]


ARTICLE 340-5 (APPLICABLE PROVISIONS)

         Article 350 (2), the latter part of Article 350 (3), Articles 351 and
         516-8 (1), (3) and (4), and the former part of Article 516-9 shall
         apply mutatis mutandis to the case of issuing new shares upon
         exercising the stock option.
         [This Article Newly Inserted by Act No. 6086, Dec. 31, 1999]



<PAGE>

ARTICLE 341 (ACQUISITION OF COMPANY'S OWN SHARES)

         A company may not acquire its own shares on its own account, except in
         the following cases: (Amended by Act No. 3724, Apr. 10, 1984; Act No.
         5053, Dec. 29, 1995)

         1.In case of the retirement of shares;

         2.In case of the merger of companies or of the acquisition of the
         entire business of another company;

         3.Where it is necessary to do so for achieving the objective in the
         course of exercising the rights of the company;

         4.Where it is necessary to deal with the fractional shares; and

         5.In case of the exercise of appraisal rights by the shareholder.


ARTICLE 341-2 (ACQUISITION OF COMPANY'S OWN SHARES FOR GRANTING STOCK OPTION)


         (1) In the case of acquiring its own shares for the purpose of
         transferring them under Article 340-2 (1) or of acquiring them by
         transfer from outgoing directors, auditors or other employees, the
         company may, on its own account, acquire its own shares within the
         limit not exceeding 10/100 of the total outstanding shares: Provided,
         That the total amount for these acquisitions shall be within the limit
         whereby the dividends under Article 462 (1) may be paid.

         (2) In case where the company acquires its own shares as referred to in
         paragraph (1) for value from a shareholder who holds shares exceeding
         10/100 of the total outstanding shares, a resolution under Article 434
         shall be adopted by the general shareholders' meeting with respect to
         matters falling under any of the following subparagraphs. In this case,
         the company shall acquire the

<PAGE>

         relevant shares within six months after the resolution by the general
         shareholders' meeting:

         1.Name of the shareholder intending to transfer his shares;

         2.Categories and numbers of the shares to be acquired; and

         3.Values of the shares to be acquired.

         (3) In case of acquiring its own shares pursuant to paragraph (1), the
         company shall dispose of the shares in a reasonable period of time.

         (4) The provision of Article 433 (2) shall apply mutatis mutandis to
         the general shareholders' meeting under paragraph (2).
         [This Article Newly Inserted by Act No. 6068, Dec. 31, 1999]


ARTICLE 341-3 (CREATION OF PLEDGE ON COMPANY'S OWN SHARES)

         A company may not create a pledge on its own shares in excess of a
         twentieth of the total number of issued and outstanding shares:
         Provided, That such ceiling shall not apply in case of subparagraphs 2
         and 3 of Article 341.
         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 342 (DISPOSITION OF COMPANY'S OWN SHARES)

         In case of subparagraph 1 of Article 341, the company shall, without
         delay, proceed to the cancellation of the shares, and in the cases of
         subparagraphs 2 through 5 of Article 341, and the proviso of Article
         341-3, it shall dispose of the shares or the pledge within a reasonable
         period of time. (Amended by Act No. 3724, Apr. 10, 1984; Act No. 5053,
         Dec. 29, 1995; Act No. 6068, Dec. 31, 1999)


ARTICLE 342-2 (ACQUISITION OF PARENT COMPANY'S SHARES BY SUBSIDIARY COMPANY)

<PAGE>

         (1) In case where a company (hereafter referred to as the "parent
         company") holds more than 50/100 of the total issued and outstanding
         shares in another company (hereafter referred to as the "subsidiary
         company"), the subsidiary company may not acquire shares in the parent
         company, except in the following cases: (Amended by Act No. 6488, Jul.
         24, 2001)

         1.In case of the all-inclusive exchange and all-inclusive transfer of
         stocks, the merger of companies or the acquisition of the entire
         business of another company; and

         2.Where it is necessary to do so for achieving the objective in the
         course of exercising the rights of the company.

         (2) In case of paragraph (1), the subsidiary company shall dispose of
         the shares of the parent company within six months after it has
         acquired them.

         (3) If a parent company and its subsidiary company in aggregate hold,
         or a subsidiary company by itself holds, more than 50/100 of the total
         issued and outstanding shares in another company, such another company
         shall be deemed as a subsidiary company of the parent company for the
         purpose of the application of this Act. (Amended by Act No. 6488, Jul.
         24, 2001)
         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 342-3 (ACQUISITION OF ANOTHER COMPANY'S SHARES)

         If a company acquires more than 10/100 of the total issued and
         outstanding shares in another company, it shall without delay notify
         such another company thereof.
         [This Article Newly Inserted by Act No. 5053, Dec. 29, 1995]


ARTICLE 343 (RETIREMENT OF SHARES)



<PAGE>

         (1) Shares may be retired only in accordance with the provisions
         relating to the reduction of capital: Provided, That this shall not
         apply to the case of the retirement of shares effected out of profits
         to be distributed to shareholders in accordance with the articles of
         incorporation.

         (2) Articles 440 and 441 shall apply mutatis mutandis in case of the
         retirement of shares.


ARTICLE 343-2 (RETIREMENT OF SHARES BY RESOLUTION OF GENERAL MEETING)


         (1) A company may retire the shares after purchasing them under a
         resolution of the regular general meeting pursuant to Article 434, in
         addition to a case under Article 343.

         (2) The kind and total number of shares to be purchased, the total sum
         of acquired values and the available period for share purchases shall
         be determined by a resolution at the general meeting under paragraph
         (1).

         (3) In case of paragraph (2), the total sum of acquired values of
         shares to be purchased shall not exceed the amount obtained by
         subtracting the amount under each subparagraph of Article 462 (1) from
         the net assets value on the balance sheet.

         (4) In case of paragraph (2), the available period for share purchase
         shall not pass the closing date of the general meeting in a settlement
         term, which comes first after the resolution under paragraph (1).

         (5) A company shall not make the share purchase under paragraph (1) in
         case where it is feared that the net assets value on the balance sheet
         for the settlement term of relevant business year falls short of the
         total sum of each subparagraph of Article 462 (1).

         (6) Notwithstanding the net assets value on the balance sheet for the
         settlement term of relevant business year falls short of the total sum
         of each subparagraph

<PAGE>

         of Article 462 (1), if a company retires the shares after purchasing
         them under paragraph (1), the directors are jointly and severally
         liable to indemnify the company against the relevant insufficient
         amount. In such case, the provisions of Article 462-3 (4) (proviso)
         shall apply mutatis mutandis.

         [This Article Newly Inserted by Act No. 6488, Jul. 24, 2001]


ARTICLE 344 (DIFFERENT CLASSES OF SHARES)


         (1) A company may issue two or more classes of shares which are
         different in respect of their particulars as to the dividends of
         profits or interest or the distribution of the surplus assets.

         (2) In case of paragraph (1), the articles of incorporation shall
         provide for the contents and number of each class of shares and shall
         also provide the minimum dividend rate with respect to a class of
         shares having any preferential right as to the dividend of profits.
         (Amended by Act No. 5053, Dec. 29, 1995)

         (3) If the company issues different classes of shares, special
         provisions may be made from class to class with respect to the
         subscription for new shares, the consolidation, split, or retirement of
         shares or the allotment of shares in consequence of a merger or split
         of companies, even where no such matters have been provided in the
         articles of incorporation. (Amended by Act No. 5591, Dec. 28, 1998)


ARTICLE 345 (REDEEMABLE SHARES)


         (1) In case of Article 344, the company may provide that a class of
         shares, having preferential right as to a dividend may be retired out
         of profits.

         (2) In case of paragraph (1), the price, time and method of the
         redemption of shares and the number of redeemable shares shall be
         stated in the articles of incorporation.



<PAGE>

ARTICLE 346 (ISSUANCE OF CONVERTIBLE SHARES)


         (1) If a company issues different classes of shares, the articles of
         incorporation may provide that a shareholder may demand the shares
         subscribed by the shareholder to be converted into shares of another
         class. In this case, the conditions of conversion, the period within
         which the conversion may be demanded, and the number and particulars as
         to shares to be issued in consequence of the conversion shall be
         prescribed.

         (2) The number of shares to be issued in consequence of the conversion
         shall be reserved in each class of shares under Article 344 (2) within
         the period mentioned in paragraph (1).


ARTICLE 347 (PROCEDURES OF ISSUANCE OF CONVERTIBLE SHARES)

         In case of Article 346 (1), the following particulars shall be stated
         in the subscription form for shares or the certificate of preemptive
         rights to new shares: (Amended by Act No. 3724, Apr. 10, 1984)

         1.A statement to the effect that the shares concerned may be converted
         into shares of another class;

         2.Conditions of conversion;

         3.Contents of the shares to be issued in consequence of the conversion;
         and

         4.Period within which the conversion may be demanded.


ARTICLE 348 (ISSUE PRICE OF SHARES TO BE ISSUED IN CONSEQUENCE OF CONVERSION)

         If shares are to be issued in consequence of the conversion, the issue
         price of

<PAGE>

         such new shares shall be that of the shares which existed before the
         conversion.


ARTICLE 349 (DEMAND OF CONVERSION)


         (1) A person demanding the conversion shall submit to the company two
         copies of written demand form together with the share certificates.

         (2) The written demand form mentioned in paragraph (1) shall contain
         the class and number of shares to be converted and the date of the
         demand and the shareholder demanding conversion shall write his name
         and affix his seal or sign on it. (Amended by Act No. 5053, Dec. 29,
         1995)

         (3) Deleted. (by Act No. 5053, Dec. 29, 1995)


ARTICLE 350 (TAKING EFFECT OF CONVERSION)


         (1) Conversion of shares shall take effect at the time when it is
         demanded.

         (2) Any shareholder of the shares converted during the period mentioned
         in Article 354 (1) may not exercise the voting right to such shares at
         the general shareholders' meeting held during such period.

         (3) With regard to a dividend of profit or interest to the shares
         converted pursuant to paragraph (1), the conversion shall be deemed to
         have been effected at the end of the business year in which the
         convertsion is demanded. In this case, the articles of incorporation
         may provide that with respect to a dividend of profit or interest to
         the new shares, the conversion shall be deemed to have been effected at
         the end of the business year immediately before the business year in
         which the conversion is demanded.

         [This Article Wholly Amended by Act No. 5053, Dec. 29, 1995]



<PAGE>

ARTICLE 351 (REGISTRATION OF CONVERSION)

         The registration for changes caused by the conversion of shares shall
         be made at the place of the principal office, within two weeks from the
         last day of the month in which the conversion is demanded.
         [This Article Wholly Amended by Act No. 5053, Dec. 29, 1995]


ARTICLE 352 (PARTICULARS TO BE ENTERED IN REGISTER OF SHAREHOLDERS)


         (1) In case where registered shares are issued, the following
         particulars shall be entered in the register of shareholders: (Amended
         by Act No. 3724, Apr. 10, 1984)

         1.Name and address of each shareholder;

         2.Class and number of shares held by each shareholders;

         2-2.The serial number of such share certificates when the share
         certificates have been issued for shares held by each shareholder; and

         3.Date of acquisition of each share.

         (2) If bearer share certificates are issued, the register of
         shareholders shall state the class, number, serial number and issuance
         date of such certificate.

         (3) If, in case of paragraphs (1) and (2), convertible shares are
         issued, the register of shareholder shall also contain the particulars
         set forth in Article 347.


ARTICLE 353 (EFFECT OF REGISTER OF SHAREHOLDERS)


         (1) Any notice or peremptory notice to a shareholder or a pledgee may
         be effective if sent to the address entered in the register of
         shareholders or other

<PAGE>

         address notified to the company by such person.

         (2) Article 304 (2) shall apply mutatis mutandis to the notice or
         peremptory notice under paragraph (1).


ARTICLE 354 (CLOSURE OF REGISTER OF SHAREHOLDERS AND RECORD DATE)


         (1) In order to fix the person who shall exercise the voting right,
         receive dividends or exercise other rights as a shareholder or a
         pledgee, the company may suspend the alteration of entry in the
         register of shareholders for a specified period or it may deem any
         shareholder or pledgee whose name appears in the register of
         shareholders on a specified date to be the shareholder or pledgee who
         shall be entitled to exercise such rights. (Amended by Act No. 3724,
         Apr. 10, 1984)

         (2) The period mentioned in paragraph (1) shall not exceed three
         months. (Amended by Act No. 3724, Apr. 10, 1984)

         (3) The date mentioned in paragraph (1) shall be determined to be a day
         within three months before the date on which the person may exercise
         the rights as a shareholder or pledgee. (Amended by Act No. 3724, Apr.
         10, 1984)

         (4) If a company has determined the period or the date mentioned in
         paragraph (1), it shall give public notice thereof two weeks in
         advance: Provided, That it shall not be the case where such period or
         date has been designated by the articles of incorporation.


ARTICLE 355 (TIME TO ISSUE SHARE CERTIFICATES)


         (1) A company shall without delay issue share certificates after its
         incorporation or after the date of payment on new shares.


<PAGE>

         (2) No share certificate may be issued before the incorporation or the
         date of payment on new shares.

         (3) Share certificates issued in contravention of paragraph (2) shall
         be null and void: Provided, That this shall not affect any claim for
         damages against those who have issued them.


ARTICLE 356 (PARTICULARS TO BE ENTERED IN SHARE CERTIFICATES)

         Each share certificate shall contain the following particulars and a
         serial number and the representative director shall write his name and
         affix his seal or shall sign thereon: (Amended by Act No. 5053, Dec.
         29, 1995)

         1.Trade name of the company;

         2.Date of incorporation;

         3.Total number of shares authorized to be issued by the company;

         4.Par value per share;

         5.Date of issuance of such certificates, if the shares are issued after
         the incorporation of the company;

         6.Particulars and class of shares, if there are different classes of
         shares;

         6-2.Provision that the transfer of shares shall be subject to the
         approval of the board of directors, if so determined;

         7.Particulars set forth in Article 345 (2), if there are redeemable
         share; and

         8.Particulars set forth in Article 347, if there are convertible
         shares.


ARTICLE 357 (ISSUANCE OF BEARER SHARE CERTIFICATES)

<PAGE>

         (1) A bearer share certificate may be issued only if it is so provided
         in the articles of incorporation.

         (2) A shareholder may at any time demand of the company that a bearer
         share certificate be converted into a registered share certificate.


ARTICLE 358 (EXERCISE OF RIGHTS BY SHAREHOLDERS HOLDING BEARER SHARE
CERTIFICATES)

         The owner of a bearer share certificate may not exercise his rights as
         a shareholder unless he deposits his share certificate with the
         company.


ARTICLE 358-2 (NON-BEARING OF SHARE CERTIFICATES)


         (1) Unless otherwise provided in the articles of incorporation, any
         shareholder may declare to the company that he will not bear share
         certificates as to his registered shares.

         (2) Upon receiving the declaration mentioned in paragraph (1), the
         company shall without delay enter in the register of shareholders and
         part of a set thereof its intention that it will not issue the share
         certificates and notify the shareholder thereof. In this case, the
         company may not issue the share certificates concerned.

         (3) In case of paragraph (1), any share certificates issued previously
         shall be submitted to the company and the company shall invalidate them
         or deposit them with a transfer agent.

         (4) Notwithstanding paragraphs (1) through (3), a shareholder may
         demand at any time that the company issue or return the share
         certificates.

         [This Article Wholly Amended by Act No. 5053, Dec. 29, 1995]



<PAGE>

ARTICLE 359 (BONA FIDE ACQUISITION OF SHARE CERTIFICATES)

         Article 21 of the Check Act shall apply mutatis mutandis to share
         certificates. [This Article Wholly Amended by Act No. 3724, Apr. 10,
         1984]


ARTICLE 360 (JUDGMENT OF NULLIFICATION AND RE-ISSUANCE OF SHARE CERTIFICATES)


         (1) A share certificate may be invalidated by undergoing the procedures
         of public summons.

         (2) A person who has lost his share certificates shall not request the
         company to re-issue them, unless he has obtained a judgment of
         nullification with respect thereto.


         SUB-SECTION 2 ALL-INCLUSIVE SHARE SWAP

ARTICLE 360-2 (INCORPORATION OF COMPLETE PARENT COMPANY BY ALL-INCLUSIVE
TRANSFER OF SHARES)


         (1) A company may become the company possessing the total number of
         issued shares of another company (hereinafter referred to as the
         "complete parent company") by an all-inclusive share swap under the
         provisions of this Sub-Section. In such case, the said another company
         shall be called the "complete subsidiary".

         (2) The shares owned by the shareholders of the company becoming the
         complete subsidiary by an all-inclusive share swap (hereafter in this
         Sub-Section, referred to as the "share swap") shall be transferred to
         the company becoming the complete parent company by the share swap on
         the day of share swap; and the shareholders of the company becoming the
         said complete
<PAGE>
         subsidiary shall become the shareholders of the company becoming the
         said complete parent company by receiving the allocation of new shares
         to be issued by the company becoming the said complete parent company
         for the share swap.
         [This Article Newly Inserted by Act No. 6488, Jul. 24, 2001]

ARTICLE 360-3 (PREPARATION OF CONTRACT FOR SHARE SWAP AND APPROVAL OF
              SHAREHOLDERS' GENERAL MEETING)


         (1) A company which intends to make a share swap shall prepare a
         contract for share swap and obtain an approval of the shareholders'
         general meeting.

         (2) The resolution for an approval under paragraph (1) shall be
         governed by the provisions of Article 434.

         (3) Matters falling under any of the following subparagraphs shall be
         entered on the share swap contract:

         1.Where the company becoming a complete parent company alters the
         articles of incorporation due to the share swap, the relevant
         provisions;

         2.Matters on the total number and kinds of new shares to be issued by
         the company becoming a complete parent company, and the number of such
         shares by kind, and on the allocation of new shares to the shareholders
         of the company becoming a complete subsidiary;

         3.Matters on the amount of capital to be increased for the company
         becoming a complete parent company, and on the capital reserves;

         4.Where the amount to be paid to the shareholders of the company
         becoming a complete subsidiary is determined, the relevant provisions;

         5.Date of the shareholders' general meeting of each company to make a
         resolution under paragraph (1);


<PAGE>

         6.Date to make a share swap;

         7.Where each company pays a dividend not later than the date of share
         swap or makes a payment of dividend in cash under Article 462-3, the
         relevant limit amount;

         8.Where a company transfers its own stocks under Article 360-6, the
         total number and kinds of stocks to be transferred, and the number of
         such stocks by kind; and

         9.Where the directors, auditors or members of audit committee who are
         to be appointed by the company becoming a complete parent company are
         determined, their names and resident registration numbers.

         (4) A company shall enter the matters falling under any of the
         following subparagraphs on the notification and public notice under
         Article 363:

         1.Major details of a share swap contract;

         2.Details and exercising methods of the appraisal right under Article
         360-5 (1); and

         3.Where one company has a regulation in its articles of incorporation
         to the effect that a share transfer requires an approval of the board
         of directors, and the articles of incorporation of other company does
         not carry such regulations, the purport thereof.
         [This Article Newly Inserted by Act No. 6488, Jul. 24, 2001]


ARTICLE 360-4 (PUBLIC NOTIFICATION OF SHARE SWAP CONTRACT)


         (1) The directors shall keep the documents falling under any of the
         following subparagraphs at the head office from two weeks prior to the
         meeting day of the shareholders' general meeting under Article 360-3
         (1) to the date on which six months elapse since the date of share
         swap:


<PAGE>

         1.Contract for share swap;

         2.Documents carrying the reasons for an allocation of stocks to the
         shareholders of the company becoming a complete subsidiary; and

         3.Final balance sheets and profit and loss statements of each company
         making a share swap prepared on a certain date within six months prior
         to the meeting day of the shareholders' general meeting under Article
         360-3 (1) (in a case of simplified share swap under Article 360-9, the
         date on which the public notice or notification is made under paragraph
         (2) of the same Article).

         (2) The provisions of Article 391-3 (3) shall apply mutatis mutandis to
         the documents under paragraph (1).
         [This Article Newly Inserted by Act No. 6488, Jul. 24, 2001]


ARTICLE 360-5 (APPRAISAL RIGHT OF OPPOSING SHAREHOLDERS)


         (1) The shareholders opposed to a resolution of the board of directors
         on the matter to be approved under Article 360-3 (1) may, if they
         informed in writing the company of their intents to oppose to the said
         resolution prior to the shareholders' general meeting, claim to the
         company for the purchase of shares owned by them in writing, indicating
         the kind and number of such shares, within 20 days since the date of
         resolution of such general meeting.

         (2) The shareholders informed the company in writing of their intents
         to be opposed to the share swap within two weeks since the date of
         public notice or notification under Article 360-9 (2) may claim to the
         company for the purchase of shares owned by them in writing, indicating
         the kind and number of such shares, within 20 days since the expiration
         of such period.

         (3) The provisions of Article 374-2 (2) through (5) shall apply mutatis
         mutandis to the claims for purchase under paragraphs (1) and (2).

         [This Article Newly Inserted by Act No. 6488, Jul. 24, 2001]



<PAGE>

ARTICLE 360-6 (TRANSFER OF TREASURY SHARES SUBSTITUTING ISSUE OF NEW SHARES)

         The company becoming a complete parent company may transfer the
         treasury shares owned by it substituting an issue of new shares in
         making a share swap, which are to be disposed of in a considerable
         period under Article 342, to the shareholders of the company becoming a
         complete subsidiary.

         [This Article Newly Inserted by Act No. 6488, Jul. 24, 2001]


ARTICLE 360-7 (MAXIMUM LIMIT OF CAPITAL INCREASE OF COMPLETE PARENT COMPANY)


         (1) The capital of the company becoming a complete parent company shall
         not be increased in excess of the amount obtained by subtracting the
         amount falling under any of the following subparagraphs from the
         current net assets amount of the company becoming a complete subsidiary
         on the date of share swap:

         1.Amount to be paid to the shareholders of the company becoming a
         complete subsidiary; and

         2.Total sum of book values of the shares to be transferred to the
         shareholders of the company becoming a complete subsidiary under
         Article 360-6.

         (2) In case where the company becoming a complete parent company
         already owns the shares of the company becoming a complete subsidiary
         prior to share swap, the capital of the company becoming the complete
         parent company shall not be increased in excess of the limit of amount
         obtained by subtracting the amount falling under each subparagraph of
         paragraph (1) from the amount derived from multiplying the current net
         assets value of the company becoming the complete subsidiary on the
         date of share swap by the rate of the number of shares to be
         transferred to the company becoming the complete parent company due to
         a share swap with the total number of shares issued by the relevant
         company.

         [This Article Newly Inserted by Act No. 6488, Jul. 24, 2001]
<PAGE>


ARTICLE 360-8 (PROCEDURES FOR INVALIDATION OF SHARE CERTIFICATES)


         (1) The company becoming a complete subsidiary due to a share swap
         shall, where its shareholders' general meeting has made an approval
         under Article 360-3 (1), make a public notice on the matters falling
         under any of the following subparagraphs one month before the date of
         share swap, and notify the shareholders listed in the share register
         and the pledgees respectively:

         1.Purport of an approval under Article 360-3 (1);

         2.Purport that the share certificates shall be submitted to the company
         not later than the day preceding the date of share swap; and

         3.Purport that the share certificates shall become invalid on the date
         of share swap.

         (2) The provisions of Articles 442 and 444 shall apply mutatis mutandis
         to the case where an approval is made under Article 360-3 (1),

         [This Article Newly Inserted by Act No. 6488, Jul. 24, 2001]


ARTICLE 360-9 (SIMPLIFIED SHARE SWAP)


         (1) In case where there exists a consent by all shareholders of the
         company becoming a complete subsidiary or where the company becoming a
         complete parent company owns 90/100 or more of the total number of
         shares issued by the company becoming the complete subsidiary, an
         approval of the shareholder's general meeting of the company becoming
         the complete subsidiary may substitute for an approval of the board of
         directors.

         (2) The company becoming a complete subsidiary shall, in the case of
         paragraph (1), make a public notice to the effect that a share swap is
         to be made without

<PAGE>

         obtaining an approval of the shareholders' general meeting within two
         weeks since the preparation of a share swap contract, or notify the
         shareholders thereof: Provided, That this shall not apply to the case
         where there exists a consent of all shareholders.

         [This Article Newly Inserted by Act No. 6488, Jul. 24, 2001]


ARTICLE 360-10 (SMALL-SCALE SHARE SWAP)


         (1) In case where total number of new shares issued for a share swap by
         the company becoming a complete parent company is not in excess of
         5/100 of total number of shares issued by the relevant company, an
         approval of the shareholders' general meeting under Article 360-3 (1)
         of the relevant company may substitute for an approval of the board of
         directors: Provided, That this shall not apply to the case where the
         amount to be paid to the shareholders of the company becoming a
         complete subsidiary, if so determined, is in excess of 2/100 of the
         current net assets value of the company becoming the complete parent
         company on its final balance sheet as provided in Article 360-4 (1) 3.

         (2) The shares to be transferred to the shareholders of the company
         becoming a complete subsidiary under Article 360-6 shall be deemed the
         new shares to be issued for a share swap, in applying the provisions of
         paragraph (1).

         (3) In a case of the text of paragraph (1), the share swap contract
         shall include the purport that the company becoming a complete parent
         company may make a share swap without obtaining an approval of the
         shareholders' general meeting under Article 360-3 (1), and shall not
         include the matters listed in paragraph (3) 1 of the said Article.

         (4) The company becoming a complete parent company shall make a public
         notice on the business title and head office of the company becoming a
         complete subsidiary, the date of share swap and the purport that a
         share swap is to be made without obtaining an approval under Article
         360-3 (1), or notify the shareholders thereof, within two weeks since
         the preparation of a share swap contract.


<PAGE>

         (5) In case where the shareholder possessing the shares equivalent to
         20/100 or more of the total number of shares issued by the company
         becoming a complete parent company notifies of his intent to be opposed
         to the share swap under the text of paragraph (1), the share swap under
         this Article shall not be made.

         (6) In a case of the text of paragraph (1), where the provisions of
         Article 360-4 (1) is applicable to the company becoming a complete
         parent company, the term "two weeks prior to the meeting days of
         shareholders' general meeting under Article 360-3 (1)" in other
         portions than each subparagraph of the same paragraph of the same
         Article, and "the meeting days of shareholders' general meeting under
         Article 360-3 (1)" in subparagraph 3 of the same paragraph of the same
         Article shall be "the date of a public notice or notification under
         paragraph (4) of this Article", respectively.

         (7) In a case of the text of paragraph (1), the provisions of Article
         360-5 shall not be applicable.
         [This Article Newly Inserted by Act No. 6488, Jul. 24, 2001]


ARTICLE 360-11 (MUTATIS MUTANDIS APPLICATION OF REGULATIONS FOR FRACTIONAL
               SHARES)


         (1) The provisions of Article 443 shall apply mutatis mutandis to the
         case of share swap of a company.

         (2) The provisions of Articles 339 and 340 (3) shall apply mutatis
         mutandis to the pledge for the shares of the company becoming a
         complete subsidiary in a case of share swap.

         [This Article Newly Inserted by Act No. 6488, Jul. 24, 2001]


ARTICLE 360-12 (POST PUBLIC NOTICE OF DOCUMENTS CARRYING MATTERS ON SHARE SWAP)


         (1) The directors shall keep the documents carrying the matters falling
         under

<PAGE>

         any of the following subparagraphs at the head office for six weeks
         from the date of share swap:

         1.Date of share swap;

         2.Current net assets value of the company becoming a complete
         subsidiary on the date of share swap;

         3.Number of shares of a complete subsidiary transferred to a complete
         parent company due to a share swap; and

         4.Other matters on the share swap.

         (2) The provisions of Article 391-3 (3) shall apply mutatis mutandis to
         the documents under paragraph (1).

         [This Article Newly Inserted by Act No. 6488, Jul. 24, 2001]


ARTICLE 360-13 (TENURE OF DIRECTOR AND AUDITOR OF COMPLETE PARENT COMPANY)

         The directors and auditors of the company becoming a complete parent
         company due to a share swap who have taken office before the share swap
         shall retire from office on the closing date of the general meeting in
         a settlement term, which comes first after the date of the share swap.

         [This Article Newly Inserted by Act No. 6488, Jul. 24, 2001]


ARTICLE 360-14 (LITIGATION OVER INVALIDITY OF SHARE SWAP)


         (1) Any shareholder, director, auditor, member of audit committee or
         liquidator of each company may claim the invalidity of share swap by
         only a litigation within six months since the date of such share swap.

         (2) The litigation under paragraph (1) shall be under an exclusive
         jurisdiction of the district court having jurisdiction over the
         location of head office of the

<PAGE>

         company becoming a complete parent company.

         (3) When the judgment invalidating a share swap becomes final, the
         company becoming a complete parent company shall transfer the shares of
         the company becoming a complete subsidiary, which have been owned by
         it, to the shareholders of new shares issued for a share swap or those
         transferred under Article 360-6.

         (4) The provisions of Articles 187 through 189, 190 (text), 191, 192,
         377 and 431 shall apply mutatis mutandis to the litigation under
         paragraph (1), and those of Articles 339 and 340 (3) to the case of
         paragraph (3), respectively.

         [This Article Newly Inserted by Act No. 6488, Jul. 24, 2001]


         SUB-SECTION 3 ALL-INCLUSIVE TRANSFER OF SHARES

ARTICLE 360-15 (ESTABLISHMENT OF COMPLETE PARENT COMPANY DUE TO ALL-INCLUSIVE
SHARE TRANSFER)


         (1) A company may establish a complete parent company due to an
         all-inclusive share transfer under this Sub-Section (hereafter in this
         Sub-Section, referred to as the "share transfer"), and become a
         complete sub-sidiary.

         (2) The shares of a company becoming a complete subsidiary due to the
         share transfer, which are owned by its shareholders, shall be
         transferred to a complete parent company established due to the share
         transfer, and the shareholders of the relevant complete subsidiary
         shall become the shareholders of the relevant complete parent company
         by receiving an allocation of shares issued by the relevant complete
         parent company for the share transfer.

         [This Article Newly Inserted by Act No. 6488, Jul. 24, 2001]

<PAGE>


ARTICLE 360-16 (APPROVAL OF SHARE TRANSFER BY SHAREHOLDERS' GENERAL MEETING)


         (1) A company intending to transfer the shares shall prepare a plan for
         share transfer stating matters falling under any of the following
         subparagraphs, and obtain an approval of the shareholders' general
         meeting:

         1.Provisions of the articles of incorporation of a complete parent
         company to be established;

         2.Kind and number of the shares issued for a share transfer by a
         complete parent company to be established, and matters on the share
         allocation to the shareholders of a company becoming a complete
         subsidiary;

         3.Matters on the equity capital value and capital reserves of a
         complete parent company to be established;

         4.Where the amount to be paid to the shareholders of a company becoming
         a complete subsidiary is determined, the provisions therefor;

         5.Time of the share transfer;

         6.Where a company becoming a complete subsidiary distributes profits
         not later than the date of share transfer, or makes the profit
         distribution by cash under Article 462-3, the relevant limit;

         7.Names and resident registration numbers of the directors, auditors or
         the members of the audit committee of a complete parent company to be
         established; and

         8.Where a company jointly establish a complete parent company due to
         the share transfer, the purport thereof.

         (2) The resolution for an approval under paragraph (1) shall be
         governed by Article 434.


<PAGE>

         (3) The provisions of Article 360-3 (4) shall apply mutatis mutandis to
         the approval of shareholders' general meeting in the case of paragraph
         (1).

         [This Article Newly Inserted by Act No. 6488, Jul. 24, 2001]


ARTICLE 360-17 (PUBLIC NOTICE OF DOCUMENTS SUCH AS PLANS FOR SHARE TRANSFER,
               ETC.)


         (1) The directors shall keep the documents falling under any of the
         following subparagraphs at the main office from two weeks prior to the
         meeting days of shareholders' general meeting under Article 360-16 (1)
         to the date on which six months elapse since the date of share
         transfer:

         1.Plans for share transfer under Article 360-16 (1);

         2.Documents stating the reasons for share allocation to the
         shareholders of a company becoming a complete subsidiary; and

         3.Final balance sheet and profit and loss statement of a company
         becoming a complete subsidiary which are prepared on a certain date
         within six months prior to the meeting days of shareholders' general
         meeting under Article 360-16 (1).

         (2) The provisions of Article 391-3 (3) shall apply mutatis mutandis to
         the documents under paragraph (1).

         [This Article Newly Inserted by Act No. 6488, Jul. 24, 2001]


ARTICLE 360-18 (LIMIT OF EQUITY CAPITAL OF COMPLETE PARENT COMPANY)

         The equity capital of a complete parent company to be established shall
         not exceed the amount obtained by subtracting the amount to be paid to
         the shareholders of a company becoming a complete subsidiary on the
         date of share transfer from the current net assets value of the said
         company.

         [This Article Newly Inserted by Act No. 6488, Jul. 24, 2001]

<PAGE>

ARTICLE 360-19 (PROCEDURES FOR INVALIDATION OF SHARE CERTIFICATES)


         (1) The company becoming a complete subsidiary due to share transfer
         shall, where it has made a resolution under Article 360-16 (1),
         publicly notify the matters falling under any of the following
         subparagraphs, and notify the shareholders and pledgees listed in the
         share registry, respectively:

         1.Purport that a resolution has been made under Article 360-16 (1);

         2.Purport that the share certificates shall be submitted to a company
         within the period specified for over one month; and

         3.Purport that the shares shall become invalid on the date of share
         transfer.

         (2) The provisions of Articles 442 and 444 shall apply mutatis mutandis
         to the case where a resolution under Article 360-16 (1) has been made.

         [This Article Newly Inserted by Act No. 6488, Jul. 24, 2001]


ARTICLE 360-20 (REGISTRATION DUE TO SHARE TRANSFER)

         Where a share transfer is made, the matters provided in Article 317 (2)
         shall be registered within two weeks at the location of main office of
         the established complete parent company, and within three weeks at the
         location of its branch offices.

         [This Article Newly Inserted by Act No. 6488, Jul. 24, 2001]

ARTICLE 360-21 (EFFECTIVE PERIOD OF SHARE TRANSFER)

         Any transfer of shares shall become effective by a registration under
         Article 360-20 by the complete parent company established due to such
         transfer at the location of its main office.

         [This Article Newly Inserted by Act No. 6488, Jul. 24, 2001]
<PAGE>


ARTICLE 360-22 (MUTATIS MUTANDIS APPLICATION OF SHARE TRANSFER PROVISIONS)

         The provisions of Articles 360-5, 360-11 and 360-12 shall apply mutatis
         mutandis to the case of share transfer.

         [This Article Newly Inserted by Act No. 6488, Jul. 24, 2001]


ARTICLE 360-23 (LITIGATION OVER INVALIDITY OF SHARE TRANSFER)


         (1) Any shareholder, director, auditor, member of audit committee or
         liquidator of each company may claim the invalidity of share transfer
         by only a litigation within six months since the date of share
         transfer.

         (2) The litigation under paragraph (1) shall be under an exclusive
         jurisdiction of the district court having jurisdiction over the
         location of head office of the company becoming a complete parent
         company.

         (3) When the judgment invalidating a share transfer becomes final, the
         company becoming a complete parent company shall transfer the shares of
         the company becoming a complete subsidiary, which have been owned by
         it, to the shareholders of new shares issued for a share transfer.

         (4) The provisions of Articles 187 through 193 and 377 shall apply
         mutatis mutandis to the litigation under paragraph (1), and those of
         Articles 339 and 340 (3) to the case of paragraph (3), respectively.

         [This Article Newly Inserted by Act No. 6488, Jul. 24, 2001]


         SECTION 3 ORGANS OF COMPANY

         SUB-SECTION 1 GENERAL SHAREHOLDERS'

<PAGE>

         MEETING

ARTICLE 361 (POWER OF GENERAL SHAREHOLDERS' MEETING)

         At general shareholders' meetings, resolutions may be adopted as to
         matters provided by this Act or the articles of incorporation.


ARTICLE 362 (DECISION OF CONVOCATION)

         The convocation of a general meeting shall be determined by the board
         of directors unless otherwise provided by this Act.


ARTICLE 363 (NOTICE AND PUBLIC NOTICE OF CONVOCATION)


         (1) The notice for convocation of a general meeting shall be dispatched
         in writing or by an electronic data to each shareholder at least two
         weeks prior to the day set for such meeting: Provided, That if such
         notice has not arrived at the address of a shareholder entered on the
         register of shareholders for three consecutive years, the company shall
         not be required to give such notice to that shareholder. (Amended by
         Act No. 5053, Dec. 29, 1995; Act No. 6488, Jul. 24, 2001)

         (2) The written notice under paragraph (1) shall state the
         subject-matters of the meeting.

         (3) If the company has issued bearer share certificate, it shall give
         public notice stating its intention that the general meeting is to be
         held and the subject-matters of the meeting, at least three weeks prior
         to the day set for such meeting.

         (4) Paragraphs (1) through (3) shall not apply with respect to the
         shareholders who are not entitled to vote.



<PAGE>

ARTICLE 363-2 (SHAREHOLDERS' RIGHT TO MAKE PROPOSAL)


         (1) Shareholders who hold no less than 3/100 of the total issued shares
         other than nonvoting shares may make a proposal to make a matter an
         object of a general shareholders meeting (hereafter referred to as a
         "shareholders' proposal") to directors in writing at least six weeks
         prior to the day set for such meeting.

         (2) Shareholders under paragraph (1) may request that directors record
         the summary of the proposal submitted by the shareholders in addition
         to the subject-matters of the meeting in a notice and public notice
         under Article 363 in writing at least six weeks prior to the day set
         for such meeting.

         (3) Where there is a shareholders' proposal under paragraph (1),
         directors shall report to the board of directors, which shall accept
         the proposal as the subject-matters of the general meeting of
         shareholders, unless its contents are in breach of Acts, subordinate
         statutes, or the articles of incorporation. In this case, the
         shareholders who made the proposal shall, on their request, be given an
         opportunity to explain the proposal at the general meeting.

         [This Article Newly Inserted by Act No. 5591, Dec. 28, 1998]


ARTICLE 364 (PLACE OF CONVOCATION)

         Unless otherwise provided in the articles of incorporation, a general
         meeting shall be convened at the place of the principal office or at
         some place adjacent thereto.


ARTICLE 365 (CONVOCATION OF GENERAL MEETING)


         (1) An ordinary general meeting shall be convened at least once a year
         at a


<PAGE>
         fixed time.

         (2) In case where a company has determined the settlement of accounts
         to take place more than two times in a year, a general meeting shall be
         convened with respect to each of such period for the settlement of
         accounts.

         (3) An extraordinary general meeting shall be convened from time to
         time whenever necessary.


ARTICLE 366 (DEMAND FOR CONVOCATION BY MINORITY SHAREHOLDERS)


         (1) Shareholders who hold no less than 3/100 of the total issued and
         outstanding shares may demand the convocation of an extraordinary
         general meeting, by filing with the board of directors a written
         statement of the proposed subject-matters of the meeting together with
         the reasons for the proposed convocation. (Amended by Act No. 5591,
         Dec. 28, 1998)

         (2) If the steps for the convocation of a general meeting are not taken
         promptly after the demand mentioned in paragraph (1), the shareholder
         who made such demand may convene such meeting with the permission of
         the court. (Amended by Act No.
         5591, Dec. 28, 1998)

         (3) At a general meeting held in accordance with paragraphs (1) and
         (2), an inspector may be appointed to investigate the affairs of the
         company and the status of its property. (Amended by Act No. 5591, Dec.
         28, 1998)


ARTICLE 366-2 (MAINTENANCE OF ORDER AT GENERAL MEETING)


         (1) The president of the general meeting shall be elected at the
         general meeting unless otherwise provided by the articles of
         incorporation.

         (2) The president of the general meeting shall have control over the

<PAGE>

         maintenance of order and the proceedings at the general meeting.

         (3) The president of the general meeting may order anyone, who notably
         disturbs the order by intentionally speaking or acting for a
         filibuster, to stop speaking or to retire from the meeting room.

         [This Article Newly Inserted by Act No. 6086, Dec. 31, 1999]


ARTICLE 367 (APPOINTMENT OF INSPECTOR)

         At a general meeting, an inspector may be appointed to examine the
         documents submitted by the directors and the report of the auditors.


ARTICLE 368 (METHOD OF ADOPTING RESOLUTIONS AND EXERCISE OF VOTING RIGHTS)


         (1) Unless otherwise provided by this Act or articles of incorporation,
         resolutions shall be adopted at the general meetings by affirmative
         votes of a majority of the voting rights of shareholders present
         thereat and representing at least 1/4 of the total issued and
         outstanding shares. (Amended by Act No. 5053, Dec. 29, 1995)

         (2) Persons holding bearer share certificates shall deposit them with
         the company one week prior to the date set for the meeting.

         (3) A shareholder may have a proxy exercise the voting rights on his
         behalf. In this case, the proxy shall submit a document proving his
         power of representation at the general meeting.

         (4) A person who has special interest in the resolution of a general
         meeting may not exercise his voting rights thereupon.


ARTICLE 368-2 (EXERCISE OF VOTE IN DISUNITY)


<PAGE>

         (1) If a shareholder has two or more votes, he may exercise them in
         disunity. In this case, he shall notify the company in writing of his
         intention of so doing and the reasons therefor three days before the
         meeting is to be held.

         (2) The company may reject such exercise of vote in disunity by a
         shareholder, unless he has accepted a trust of shares or he holds the
         shares in behalf of another person.

         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 368-3 (EXERCISE OF VOTING RIGHT IN WRITING)


         (1) Shareholders may exercise their voting rights in writing, without
         attending the general meeting, pursuant to the provisions of the
         articles of incorporation.

         (2) Notice of the convocation of the general meeting shall be
         accompanied by the reference data and the documents necessary for
         shareholders to exercise their voting rights under paragraph (1).

         [This Article Newly Inserted by Act No. 6086, Dec. 31, 1999]


ARTICLE 369 (VOTES)


         (1) A shareholder shall have one vote for each share.

         (2) The company shall not be entitled to vote in respect of its own
         shares.

         (3) In case a company, its parent company and its subsidiary company
         together or its subsidiary company alone holds more than 1/10 of the
         total issued and outstanding shares in another company, the shares of
         the company or of the parent company held by such another company shall
         not be entitled to vote. (Newly Inserted by Act No. 3724, Apr. 10,
         1984)

<PAGE>

ARTICLE 370 (NON-VOTING SHARES)


         (1) In case where a company issues different classes of shares, the
         articles of incorporation may a shareholder of a certain class of
         shares having preferential rights as to the dividend of profits shall
         not be entitled to vote: Provided, That such shareholder shall be
         entitled to vote from the general meeting subsequent to the general
         meeting where a resolution of disallowing the preferred dividend as
         provided in the articles of incorporation is adopted until the time of
         closing of the general meeting where a resolution of allowing such
         dividend is adopted.

         (2) The total number of the shares having no voting rights as mentioned
         in paragraph (1) shall not exceed 1/4 of the total issued and
         outstanding shares.


ARTICLE 371 (COMPUTATION OF QUORUM AND NUMBER OF VOTES)


         (1) In the computation with respect to resolutions of a general
         meeting, the number of non-voting shares shall be excluded from the
         total number of the issued and outstanding shares.

         (2) In the computation with respect to resolutions of a general
         meeting, the number of votes which cannot be exercised in accordance
         with Article 368 (4) shall be excluded from the number of votes of the
         shareholders present at the meeting.


ARTICLE 372 (RESOLUTION TO POSTPONE OR CONTINUE GENERAL MEETING)


         (1) A general meeting may adopt a resolution for postponement or
         continuation of the meeting.

         (2) In case of Article 363 (1), the provisions of paragraph above shall
         not apply.



<PAGE>

ARTICLE 373 (MINUTES OF GENERAL MEETING)


         (1) Minutes shall be prepared for the proceedings of a general meeting.

         (2) The minutes shall record the summary of proceedings of the meeting
         and the results thereof and the chairman as well as the directors who
         were present at the meeting shall write their names and affix their
         seals or shall sign thereon. (Amended by Act No. 5053, Dec. 29, 1995)


ARTICLE 374 (RESOLUTION FOR TRANSFER, TAKEOVER OR LEASE OF BUSINESS)


         (1) A resolution as provided for in Article 434 shall be required for a
         company to effect the following Acts: (Amended by Act No. 6488, Jul.
         24, 2001)

         1.Transfer of the whole or an important part of the business of the
         company;

         2.Conclusion, alteration or rescission of a contract for leasing the
         whole business for giving a mandate to manage such business or for
         sharing with another person the entire profits and losses from the
         business or of a similar contract;

         3.Takeover of the whole business of another company; and

         4.Takeover of parts of business of another company which significantly
         affect the company's business.

         (2) In a notice or public notice of the convocation of the general
         shareholders' meeting for any act under paragraph (1), the contents and
         exercising method of appraisal rights as set forth in Article 374-2 (1)
         and (2) shall be specified. (Newly Inserted Act No. 5053, Dec. 29,
         1995)



<PAGE>

ARTICLE 374-2 (APPRAISAL RIGHTS OF DISSENTING SHAREHOLDERS)


         (1) If a shareholder who dissent from the subject-matters of resolution
         set forth in Article 374 has notified in writing the company of his
         intention of such dissenting before the general shareholders' meeting
         is held, he may request in writing the company to purchase the shares
         owned by him, which request shall be made within twenty days after the
         resolution is adopted at the general meeting and shall specify the
         class and number of such shares.

         (2) The company shall purchase the shares within two months after
         receiving the request under paragraph (1).

         (3) The purchase price of the shares pursuant to paragraph (2) shall be
         determined through a negotiation between the shareholder and the
         company. (Amended by Act No. 6488, Jul. 24, 2001)

         (4) Where the negotiation under paragraph (3) has not been attained
         within 30 days since the receipt of a request under paragraph (1), the
         company or the shareholder requesting for the purchase of shares may
         request the court to determine the purchase price. (Amended by Act No.
         6488, Jul. 24, 2001)

         (5) Where a court makes a decision on the purchase price of shares
         under paragraph (4), the said court shall compute it by a fair value in
         view of the assets status of the company and other situations. (Newly
         Inserted by Act No. 6488, Jul. 24, 2001) [This Article Newly Inserted
         by Act No. 5053, Dec. 29, 1995]


ARTICLE 375 (EX POST FACTO INCORPORATION)

         Article 374 shall apply mutatis mutandis to a contract whereby a
         company acquires, within two years from its existence, a certain
         property which existed prior to its incorporation and are to be
         continuously used for purposes of its business, for value of no less
         than 5/100 of the capital. (Amended by Act No.

<PAGE>

         5591, Dec. 28, 1998)


ARTICLE 376 (ACTION FOR REVOCATION OF RESOLUTION)


         (1) If the procedures for the convocation of a general meeting or the
         manner of a resolution are in violation of any Acts, subordinate
         statutes or the articles of incorporation or are remarkably unfair or
         the substantive contents of a resolution are contrary to the articles
         of incorporation, the shareholders, directors or auditors may file an
         action for revocation of the resolution, within two months from the
         date of such resolution. (Amended by Act No. 3724, Apr. 10, 1984; Act
         No. 5053, Dec. 29, 1995)

         (2) Articles 186 through 188, the main text of Article 190 and Article
         191 shall apply mutatis mutandis to the actions under paragraph (1).
         (Amended by Act No. 5053, Dec. 29, 1995)


ARTICLE 377 (DUTY TO FURNISH SECURITY OF SHAREHOLDER FILING ACTION)


         (1) In case of a shareholder filing an action for revocation of a
         resolution, the court may, upon request of the company, order him to
         furnish an appropriate security, unless he is a director or auditor of
         the company. (Amended by Act No. 3724, Apr. 10, 1984)

         (2) Article 176 (4) shall apply mutatis mutandis to the request
         mentioned in paragraph (1).


ARTICLE 378 (REGISTRATION OF REVOCATION OF RESOLUTION)

         If the matters with respect to which a resolution was adopted have been
         registered and a judgment revoking such resolution has become final and
         conclusive, registration thereof shall be effected at the place of the
         principal

<PAGE>

         office and each branch office.


ARTICLE 379 (DISMISSAL OF ACTION BY COURT AT DISCRETION)

         The court may dismiss an action for revocation of a resolution if it
         considers the revocation would be improper by taking into consideration
         the contents of the resolution, the current status of the company and
         all other circumstances.


ARTICLE 380 (ACTION FOR AFFIRMING NULLITY AND NON-EXISTENCE OF RESOLUTION)

         Articles 186 through 188, 190 (the main sentence), 191, 377, and 378
         shall apply mutatis mutandis to an action for affirming the nullity of
         a resolution on the grounds that the contents of the resolution adopted
         at a general meeting are contrary to Acts and subordinate statutes and
         to an action for affirming the non-existence of a resolution on the
         grounds that such material defects exist in the procedures for the
         convocation of a general meeting or in the method of resolution that no
         resolution of the general meeting is deemed to have been existed.
         (Amended by Act No. 3724, Apr. 10, 1984; Act No. 5053, Dec. 29, 1995)


ARTICLE 381 (ACTION FOR REVOCATION OR ALTERATION OF IMPROPER RESOLUTION)


         (1) In case where a remarkably improper resolution is adopted at a
         general meeting where a certain shareholder is unable to vote in
         accordance with Article 368 (4) and the adoption of such resolution
         could have been avoided if he had exercised the voting right, that
         shareholder may file an action for the revocation or alteration of such
         resolution within two months from the date of such resolution.

         (2) Articles 186 through 188, 190 (the main sentence), 191, 377 and 378
         shall apply mutatis mutandis to the action under paragraph (1).
         (Amended by Act No. 5591, Dec. 28, 1998)

<PAGE>

         SUB-SECTION 2 DIRECTORS AND BOARD OF DIRECTORS

ARTICLE 382 (ELECTION, RELATIONSHIP WITH COMPANY)


         (1) Directors shall be elected at a general shareholders' meeting.

         (2) Provisions relating to mandates shall apply mutatis mutandis to the
         relationship between the company and the directors.


ARTICLE 382-2 (CONCENTRATED VOTE)


         (1) Where a general meeting of a company is convened to elect two
         directors or more, shareholders who hold no less than 3/100 of the
         total issued shares other than nonvoting shares may request that the
         company elect directors by means of a concentrated vote, except as
         otherwise prescribed by the articles of incorporation.

         (2) A request under paragraph (1) shall be made in a written statement
         at least seven days prior to the day set for the meeting.

         (3) Where there is a request under paragraph (1), each shareholder
         shall have voting rights per share of the same number as 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 for directors.

         (4) Where directors are to be elected by a vote under paragraph (3),
         the directors shall be elected among and in order of candidates who
         obtain the most

<PAGE>

         votes.

         (5) Where there is a request under paragraph (1), the chairman of the
         meeting shall inform the members.

         (6) A written statement under paragraph (2) shall be kept at the
         principal office until the general meeting is completed and offered for
         the inspection of the shareholders during the business hours.

         [This Article Newly Inserted by Act No. 5591, Dec. 28, 1998]


ARTICLE 382-3 (DUTIES OF DIRECTORS TO BE FAITHFUL)

         Directors shall perform their duties faithfully for the good of the
         company in accordance with Acts, subordinate statutes, and the articles
         of incorporation.

         [This Article Newly Inserted by Act No. 5591, Dec. 28, 1998]


ARTICLE 382-4 (DUTIES OF DIRECTORS TO KEEP SECRET)

         Directors shall not divulge the business secret of the company, which
         has come to his knowledge during his duties, not only while in the
         office but also after the retirement.

         [This Article Newly Inserted by Act No. 6488, Jul. 24, 2001]


ARTICLE 383 (NUMBER, TERM OF OFFICE)


         (1) Directors shall be at least three in number: Provided, That in case
         of a company of which the total of capital is less than five hundred
         million won, the number of the directors may be one or two. (Amended by
         Act No. 5591, Dec. 28, 1998)

         (2) The terms of office of directors may not exceed three years.
         (Amended by Act No. 3724, Apr. 10, 1984)


<PAGE>

         (3) The terms of office under paragraph (2) may be extended by the
         articles of incorporation up to the closing of the ordinary general
         shareholders' meeting convened in respect of the last period for the
         settlement of accounts within their terms of office. (Amended by Act
         No. 3724, Apr. 10, 1984)

         (4) Where the number of a director is turned into one under the proviso
         of paragraph (1), the term "board of directors" shall be read as
         "general meeting of shareholders" from among the provisions of Articles
         302 (2) 5-2, 317 (2) 3-2, 335 (1) (proviso) and (2), 335-2 (1) and (3),
         335-3 (1) and (2), and 335-7 (1), Article 340-3 (1) 5, subparagraph 6-2
         of Article 356, and Articles 397 (1) and (2), 398, 416 (text), 461 (1)
         (text) and (3), 462-3 (1), 464-2 (1), 469, 513 (2) (text), and 516-2
         (2) (text) (including where this provision shall apply mutatis
         mutandis), respectively, and the term "where the board of directors has
         made a resolution" from the provisions of Article 522-3 (1) shall be
         read as "where the notice for convocation of a general meeting has been
         made under Article 363 (1)". (Newly Inserted by Act No. 5591, Dec. 28,
         1998; Act No. 6086, Dec. 31, 1999)

         (5) Where the number of a director is turned into one under the proviso
         of paragraph (1), the provisions of Articles 390 through 392, 393 (2),
         399 (2), 526 (3), 527 (4), 527-2, 527-3 (1), and 527-5 (2) shall not
         apply. (Newly Inserted by Act No.
         5591, Dec. 28, 1998)

         (6) Where the number of a director is turned into one under the proviso
         of paragraph (1), the director shall represent the company and perform
         the functions of the board of directors under Articles 362, 363-2 (3),
         366 (1), 393 (1), and 412-3 (1).
         (Newly Inserted by Act No. 5591, Dec. 28, 1998)


ARTICLE 384

         Deleted. (by Act No. 5053, Dec. 29, 1995)


ARTICLE 385 (REMOVAL)

<PAGE>

         (1) A director may be removed from office at any time by a resolution
         adopted at a general shareholders' meeting under Article 434: Provided,
         That in case where the term of office of a director was fixed and he is
         removed without cause before the expiration of such term, he may claim
         for damages caused thereby.

         (2) If the removal of a director is rejected at a general shareholders'
         meeting notwithstanding the existence of dishonest acts or any grave
         fact in violation of Acts, subordinate statutes or the articles of
         incorporation in connection with his duties, any shareholder who hold
         no less than 3/100 of the total issued and outstanding shares may
         demand the court to remove the director, within one month from the date
         on which the above resolution of the general meeting was made. (Amended
         by Act No. 5591, Dec. 28, 1998)

         (3) Article 186 shall apply mutatis mutandis in case of paragraph (1).


ARTICLE 386 (VACANCY)


         (1) A director retiring from office due to the expiration of his term
         of office or because of resignation shall continue to have the rights
         and duties of a director until newly elected director inaugurates
         office, if the directors remaining in office would otherwise become
         fewer than the minimum number prescribed by Acts or by the articles of
         incorporation,

         (2) The court may, if it deems it necessary in case of paragraph (1),
         appoint a person who is to temporarily perform the duties of a
         director, upon application by a director, auditor or any other
         interested person. In this case, registration thereof shall be effected
         at the place of the principal office. (Amended by Act No. 5053, Dec.
         29, 1995)


ARTICLE 387 (QUALIFICATION SHARES)


<PAGE>

         If the articles of incorporation provide that any director shall have a
         certain number of shares, the directors shall deposit such number of
         share certificates with the auditors, unless otherwise provided by the
         articles of incorporation.


ARTICLE 388 (REMUNERATION FOR DIRECTOR)

         If the amount of remuneration to be received by directors has not been
         fixed by the articles of incorporation, it shall be determined by the
         resolution at a general shareholders' meeting.


ARTICLE 389 (REPRESENTATIVE DIRECTOR)


         (1) A company shall appoint, by the resolution of the board of
         directors, a director who shall represent the company: Provided, That
         the articles of incorporation may provide that such representative
         director shall be elected at a general shareholders' meeting.

         (2) In the event of paragraph (1), it may be provided that two or more
         representative directors shall jointly represent the company.

         (3) Articles 208 (2), 209, 210 and 386 shall apply mutatis mutandis to
         the representative directors. (Amended by Act No. 1212, Dec. 12, 1962)


ARTICLE 390 (CONVOCATION OF BOARD MEETING)


         (1) A meeting of the board of directors shall be convened by each
         director: Provided, That it shall not be the case where the board of
         directors has designated the director who is to convene such meeting.

         (2) Any directors who have not been designated as eligible to convene
         the board under the proviso of paragraph (1) may request the director
         so designated to


<PAGE>


         convene it. Where the director so designated refuses the convocation of
         board meeting without any justifiable reasons, other directors may
         convene it. (Newly Inserted by Act No. 6488, Jul. 24, 2001)

         (3) In convening a meeting of the board of directors, the date of such
         meeting shall be fixed and a notice of convocation shall be dispatched
         to each director and auditor at least one week prior to such date:
         Provided, That the above period may be shortened by the articles of
         incorporation. (Amended by Act No. 3724, Apr. 10, 1984)

         (4) When all the directors and auditors agree, a meeting of the board
         of directors may be held at any time without undergoing the procedures
         set forth in paragraph (3). (Amended by Act No. 3724, Apr. 10, 1984;
         Act No. 6488, Jul. 24, 2001)


ARTICLE 391 (METHOD OF RESOLUTION BY BOARD OF DIRECTORS)


         (1) A resolution of the board of directors shall be adopted by the
         presence of a majority of directors in office and the affirmative votes
         of a majority of directors present at the meeting: Provided, That the
         voting requirement may be increased by the articles of incorporation.

         (2) The board of directors may, unless otherwise provided by the
         articles of incorporation, allow all directors to take part in the
         adoption of a resolution by means of a communication system of
         transmitting and receiving visual images and sounds simultaneously,
         without the personal attendance of all or part of them at the meeting.
         In this case, the relevant directors shall be deemed to have attended
         the meeting. (Newly Inserted by Act No. 6086, Dec. 31, 1999)

         (3) Articles 368 (4) and 371 (2) shall apply mutatis mutandis to the
         cases under paragraph (1) above. [This Article Wholly Amended by Act
         No. 3724, Apr. 10, 1984]

<PAGE>

ARTICLE 391-2 (AUDITOR'S POWER TO ATTEND BOARD OF DIRECTORS AND STATE OPINION)


         (1) Auditors may attend meetings of the board of directors and state
         his opinion thereat.

         (2) When any auditor deems that a director acts or is likely to act in
         contravention of Acts, subordinate statutes or the articles of
         incorporation, the auditor shall report such to the board of directors.
         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 391-3 (MINUTES OF BOARD OF DIRECTORS)


         (1) Minutes shall be prepared with regard to the proceedings of a
         meeting of the board of directors.

         (2) The agenda, gist of the progress, results thereof, dissenters and
         reasons for their dissention shall be entered in the minutes, and the
         directors and auditors present at the meeting shall write their names
         and affix seals, or sign thereon.
         (Amended by Act No. 5053, Dec. 29, 1995; Act No. 6086, Dec. 31, 1999)

         (3) Shareholders may, during office hours, make a request either for
         their perusal of the minutes of the board of directors, or for the copy
         thereof. (Newly Inserted by Act No. 6086, Dec. 31, 1999)

         (4) The company may reject the request under paragraph (3) with an
         explanation of reasons therefor. In this case, shareholders may peruse
         or copy the minutes of the board of directors, by obtaining a permit
         from the court. (Newly Inserted by Act No. 6086, Dec. 31, 1999) [This
         Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 392 (POSTPONEMENT AND CONTINUATION OF BOARD OF DIRECTORS)


<PAGE>

         Article 373 shall apply mutatis mutandis to meetings of the board of
         directors. [This Article Wholly Amended by Act No. 3724, Apr. 10, 1984]


ARTICLE 393 (AUTHORITIES OF BOARD OF DIRECTORS)


         (1) Disposal and transfer of important properties, borrowings of
         large-scale assets, appointment or dismissal of managers, and
         management of affairs such as establishment, transfer or abolition,
         etc. of branch offices shall be made by the resolution of the board of
         directors. (Amended by Act No. 6488, Jul. 24, 2001)

         (2) The board of directors shall supervise the performance of duties by
         the directors.

         (3) Directors may request that the representative director file a
         report on the affairs of other directors or employees with the board of
         directors. (Newly Inserted by Act No. 6488, Jul. 24, 2001)

         (4) Directors shall file a report on the progress of his duties with
         the board of directors more than once in every three months. (Newly
         Inserted by Act No. 6488, Jul. 24, 2001) [This Article Wholly Amended
         by Act No. 3724, Apr. 10, 1984]


ARTICLE 393-2 (COMMITTEES OF BOARD OF DIRECTORS)


         (1) The board of directors may, under the conditions as prescribed in
         the articles of incorporation, establish committees within the board.

         (2) The board of directors may delegate to the committees its power
         other than the matters set forth in the following subparagraphs:

         1.Proposal of matters subject to an approval of the general
         shareholders'

<PAGE>

         meeting;

         2.Appointment or dismissal of the representative director;

         3.Establishment of committees and appointment or dismissal of their
         members; and

         4.Any other matters as prescribed by the articles of incorporation.

         (3) The committee shall be composed of not less than two directors.

         (4) The committee shall notify each of directors of the resolutions it
         has adopted. In this case, any of the directors may, upon receipt of
         the notification, request the convocation of a meeting of the board of
         directors, and the resolutions of the committee may, again, be subject
         to the decision of the board of directors.

         (5) The provisions of Articles 386 (1), 390, 391, 391-3, and 392 shall
         apply mutatis mutandis with respect to the committees.
         [This Article Newly Inserted by Act No. 6086, Dec. 31, 1999]


ARTICLE 394 (REPRESENTATION IN ACTION BETWEEN COMPANY AND DIRECTORS)


         (1) When a company files an action against a director and vice versa,
         the auditors shall represent the company in connection with such
         action. The same shall apply where a company is in receipt of a demand
         under Article 403 (1).

         (2) In case where a member of the audit committee under Article 415-2
         is a party to an action, the audit committee or a director shall
         request the court to elect a person to represent the company. (Newly
         Inserted by Act No. 6086, Dec. 31, 1999) [This Article Wholly Amended
         by Act No. 3724, Apr. 10, 1984]


ARTICLE 395 (ACTS OF APPARENT REPRESENTATIVE DIRECTOR AND LIABILITY OF COMPANY)


<PAGE>

         A company shall be liable to a third person acting in good faith for
         any act done by a director who has used any title such as president,
         vicepresident, executive director, managing director, etc. from which
         it may be assumed that he has an authority to represent the company
         even where such person has no such authority.


ARTICLE 396 (OBLIGATION TO KEEP ARTICLES OF INCORPORATION, ETC. AND OPEN TO
PUBLIC ACCESS)


         (1) Directors shall keep the articles of incorporation and the minutes
         of the general shareholders' meetings at the principal office and each
         branch office, and shall keep the register of shareholders and the
         register of bonds at the principal office. In this case, if there is a
         transfer agent, the register of shareholders or the register of bonds
         or the duplicates thereof may be kept in the business office of the
         transfer agent. (Amended by Act No. 3724, Apr. 10, 1984; Act No. 6086,
         Dec. 31, 1999)

         (2) Any shareholder or any creditor of the company may demand, at any
         time during business hours, the inspection or the copying of the
         documents set forth in paragraph (1).


ARTICLE 397 (PROHIBITION OF COMPETITIVE BUSINESS)


         (1) No director shall, without the approval of the board of directors,
         effectuate for his own account or for the account of a third person any
         transaction which falls within the class of businesses of the company
         or become a member with unlimited liability or a director of any other
         company whose business purposes are the same as those of the company.
         (Amended by Act No. 5053, Dec. 29, 1995)

         (2) If any director has effectuated a transaction for his own account
         in

<PAGE>

         contravention of paragraph (1), the company may, by the resolution of
         the board of directors, deem such transaction as effectuated for
         account of the company and if he has effectuated a transaction for
         account of a third person, the company may demand the pertinent
         director to transfer any interest accrued therefrom. (Amended by Act
         No. 1212, Dec. 12, 1962; Act No. 5053, Dec. 29, 1995)

         (3) The rights under paragraph (2) shall be extinct with the lapse of
         one year after the day on which such transaction has been effectuated.
         (Amended by Act No. 5053, Dec. 29, 1995)


ARTICLE 398 (TRANSACTION BETWEEN DIRECTOR AND COMPANY)

         A director may effectuate a transaction with the company for his own
         account or for account of a third person only if he has obtained the
         approval of the board of directors. In this case, Article 124 of the
         Civil Act shall not apply.


ARTICLE 399 (LIABILITY TO COMPANY)


         (1) If directors have acted in violation of any Acts and subordinate
         statutes or of the articles of incorporation or has neglected to
         perform their duties, they shall be jointly and severally liable for
         damages to the company.

         (2) If any act mentioned in paragraph (1) has been done in accordance
         with the resolution of the board of directors, the directors who have
         assented to such resolution shall take the same liability.

         (3) The directors who have participated in the resolution mentioned in
         paragraph (2) and whose dissenting opinion has not been entered in the
         minutes shall be presumed to have assented to such resolution.


ARTICLE 400 (RELEASE OF LIABILITY TO COMPANY)


<PAGE>

         The liability of directors under Article 399 may be released by the
         consent of all shareholders.


ARTICLE 401 (LIABILITY TO THIRD PERSONS)


         (1) If directors have neglected to perform their duties wilfully or by
         gross negligence, they shall be jointly and severally liable for
         damages to third person.

         (2) Article 399 (2) and (3) shall apply mutatis mutandis in case of
         paragraph (1).


ARTICLE 401-2 (LIABILITY OF PERSON WHO INSTRUCTS ANOTHER PERSON TO CONDUCT
BUSINESS)


         (1) A person who falls under any of the following subparagraphs shall
         be deemed to be a director in the application of Articles 399, 401, and
         403 to the duties which he instructs or conducts:

         1.A person who instructs a director to conduct business by using his
         influence over the company;

         2.A person who conducts business in person under the name of a
         director; and

         3.A person other than a director who conducts the business of the
         company by using a title which may be recognized as authorized to
         conduct the business of the company, such as honorary chairman,
         chairman, president, vice-president, executive director, managing
         director, director, or others.

         (2) In case of paragraph (1), a director who is liable for damages to a
         company or third party shall be jointly and severally liable therefor
         with a person under paragraph (1).
         [This Article Newly Inserted by Act No. 5591, Dec. 28, 1998]



<PAGE>

ARTICLE 402 (RIGHT TO INJUNCTION)

         If a director commits an act in contravention of Acts and subordinate
         statutes or the articles of incorporation and such an act is likely to
         cause irreparable damage to the company, the auditor or a shareholder
         who holds no less than 1/100 of the total issued and outstanding shares
         may demand on behalf of the company that the relevant director stop
         such an act.
         (Amended by Act No. 3724, Apr. 10, 1984; Act No. 5591, Dec. 28, 1998)


ARTICLE 403 (DERIVATIVE SUIT BY SHAREHOLDERS)


         (1) Any shareholder who holds no less than 1/100 of the total issued
         and outstanding shares may demand that the company file an action
         against directors to enforce their liability. (Amended by Act No. 5591,
         Dec. 28, 1998)

         (2) The demand under paragraph (1) shall be made in writing, stating
         the reasons thereof. (Amended by Act No. 5591, Dec. 28, 1998)

         (3) If the company has failed to file such action within 30 days from
         the date on which the demand under paragraph (2) was received, the
         shareholder mentioned in paragraph (1) may immediately file such action
         on behalf of the company.

         (4) If irreparable damage may be caused to the company with the lapse
         of the period set forth in paragraph (3), the shareholder mentioned in
         paragraph (1) may immediately file such action, notwithstanding
         paragraph (3). (Amended by Act No.
         5591, Dec. 28, 1998)

         (5) The effect of institution of an action shall not be prejudiced even
         where the number of shares held by a shareholder who files an action
         under paragraphs (3) and (4) comes to be under 1/100 of the total
         issued shares after the institution of the action (excluding where he
         no longer holds the issued shares). (Amended by Act No. 5591, Dec. 28,
         1998)


<PAGE>

         (6) Where an action is filed under paragraphs (3) and (4), the parties
         concerned shall not render the nonsuit, renunciation or admission of
         the claim, or compromise, without permission from a court. (Amended by
         Act No. 5591, Dec. 28, 1998)

         (7) The provisions of Articles 176 (3) and (4), and 186 shall apply
         mutatis mutandis to the action under this Article.


ARTICLE 404 (DERIVATIVE SUIT AND INTERVENTION, NOTICE OF ACTION)


         (1) The company may intervene in the actions under Article 403 (3)
         and (4).

         (2) The shareholder who has filed an action under Article 403 (3) and

         (4) shall immediately effect a notice of an action to the company.


ARTICLE 405 (RIGHTS AND DUTIES OF SHAREHOLDER FILING ACTION)


         (1) If the shareholder who has filed an action pursuant to Article 403
         (3) and (4) wins the case, he may demand the reimbursement by the
         company for the action cost and a reasonable amount of other expenses
         disbursed for the action. In such case, the company which has paid the
         expenses for action shall have a right to indemnity against the
         directors or auditors.
         (Amended by Act No. 1212, Dec. 12, 1962; Act No. 6488, Jul. 24, 2001)

         (2) If the shareholder who has filed an action pursuant to Article 403
         (3) and (4) loses the case, he shall not be liable for damages to the
         company, except for the malicious intent.


ARTICLE 406 (DERIVATIVE SUIT AND ACTION FOR RETRIAL)

<PAGE>

         (1) In case where the plaintiff and defendant in an action under
         Article 403 have caused a judgment to be rendered by their collusion
         for the purpose of fraudulently injuring the rights of the company,
         which is the subject-matter of the case, the company or shareholders
         may institute an action for retrial against the final and conclusive
         judgment.

         (2) The provision of Article 405 shall apply mutatis mutandis to the
         action under paragraph (1).


ARTICLE 407 (SUSPENSION OF EXERCISE OF DUTIES AND APPOINTMENT OF ACTING
DIRECTORS)


         (1) In case where an action for nullifying or revoking a resolution of
         electing a director or for removing a director is filed, the court may,
         upon the application of the parties concerned, render a provisional
         disposition suspending the exercise of duties of such director or
         appointing an acting director. Such disposition may be taken even
         before the institution of merits, if urgent circumstances exist.

         (2) The court may, upon the application by the parties concerned, alter
         or revoke the provisional disposition mentioned in paragraph (1).

         (3) If any disposition set forth in paragraphs (2) and (3) has been
         made, registration thereof shall be effected at the place of the
         principal office and each branch office.


ARTICLE 408 (POWERS OF ACTING DIRECTOR)


         (1) Acting directors under Article 407 may not perform any act falling
         outside the ordinary course of business of the company, unless
         otherwise provided in the order of provisional disposition: Provided,
         That it shall not be the case where permission has been obtained from
         the court.


<PAGE>

         (2) The company shall be liable to a third person acting in good faith,
         even if acting directors have violated paragraph (1).


         SUB-SECTION 3 AUDITORS AND AUDIT COMMITTEE

ARTICLE 409 (ELECTION)


         (1) Auditors shall be elected at a general shareholders' meeting.

         (2) Any shareholder who holds more than 3/100 of the total issued and
         outstanding shares, exclusive of non-voting shares, may not exercise
         his vote in respect of such excess shares beyond the above limit, in
         the election of auditors under paragraph (1). (Amended by Act No. 3724,
         Apr. 10, 1984)

         (3) The articles of incorporation may provide for a lower ratio than
         that referred to in paragraph (2). (Newly Inserted by Act No. 3724,
         Apr. 10, 1984)


ARTICLE 409-2 (RIGHT TO STATE OPINION IN REMOVAL OF AUDITOR)

         The auditor may state his opinion on the removal of the auditor at a
         general shareholders' meeting. [This Article Newly Inserted by Act No.
         5053, Dec. 29, 1995]


ARTICLE 410 (TERM OF OFFICE)

         The term of office of an auditor shall expire upon the closing of the
         ordinary general shareholders' meeting convened in respect of the last
         period for the settlement of accounts within three years after his
         inauguration. (Amended by Act No.
         5053, Dec. 29, 1995)


<PAGE>

         [This Article Wholly Amended by Act No. 3724, Apr. 10, 1984]


ARTICLE 411 (PROHIBITION OF CONCURRENTLY ASSUMING OFFICES)

         An auditor may not concurrently assume the office of a director, a
         manager or an employee of the company and its subsidiary company.
         (Amended by Act No. 5053, Dec. 29, 1995)


ARTICLE 412 (DUTY AND AUTHORITY TO DEMAND REPORTING AND TO INVESTIGATE)


         (1) Auditors shall audit directors' performance of duties.

         (2) Auditors may at any time demand the directors to report on the
         business and may investigate the affairs and the financial conditions
         of the company.

         [This Article Wholly Amended by Act No. 3724, Apr. 10, 1984]


ARTICLE 412-2 (DIRECTOR'S DUTY OF REPORTING)

         If a director finds any fact that is likely to inflict a substantial
         loss on the company, he shall immediately report such to auditors.
         [This Article Newly Inserted Act No. 5053, Dec. 29, 1995]


ARTICLE 412-3 (REQUEST FOR CONVOCATION OF GENERAL MEETING)


         (1) An auditor may request the board of directors to convene an
         extraordinary general shareholders' meeting by presenting a written
         statement specifying the proposed subject-matters of the meeting and
         the reason of the convocation.

         (2) Article 336 (2) shall apply mutatis mutandis where an auditor
         convenes a general shareholders' meeting.

<PAGE>

         [This Article Newly Inserted by Act No. 5053, Dec. 29, 1995]


ARTICLE 412-4 (AUTHORITY TO INVESTIGATE SUBSIDIARY COMPANY)


         (1) An auditor of the parent company may demand the subsidiary company
         to report on its business, if it is necessary for carrying out his
         duties.

         (2) If, in case of paragraph (1), the subsidiary company fails to make
         a demanded reporting without delay or it is required to verify the
         contents of such reporting, an auditor of the parent company may
         investigate the affairs of the subsidiary company and the status of its
         property.

         (3) The subsidiary company may not refuse the reporting set forth in
         paragraph (1) or the investigation pursuant to paragraph (2), unless
         there is any justifiable reason.
         [This Article Newly Inserted by Act No. 5053, Dec. 29, 1995]


ARTICLE 413 (DUTY TO EXAMINE AND REPORT)

         Auditors shall examine the agenda and documents to be submitted by
         directors to a general shareholders' meeting and shall at the general
         shareholders' meeting state his opinion as to whether such agenda or
         documents include any matter contrary to Acts, subordinate statutes or
         the articles of incorporation or any remarkably unfair matter.
         [This Article Wholly Amended by Act No. 3724, Apr. 10, 1984]


ARTICLE 413-2 (PREPARATION OF AUDIT RECORD)


         (1) Auditors shall prepare a record pertaining to the audit.

         (2) The summary of audit process and the results thereof shall be
         recorded in

<PAGE>

         the audit record and the auditors who have carried out such audit shall
         write their names and affix their seals or shall sign thereon. (Amended
         by Act No. 5053, Dec. 29, 1995)

         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 414 (LIABILITY OF AUDITOR)


         (1) If auditors have neglected any of their duties, they shall be
         jointly and severally liable for damages to the company.

         (2) If auditors have neglected their duties wilfully or by gross
         negligence, they shall be jointly and severally liable for damages to
         third persons.

         (3) In case where auditors are liable for damages either to the company
         or to a third person, if directors are likewise liable therefor, the
         auditors and the directors shall be jointly and severally liable for
         the damages.


ARTICLE 415 (PROVISIONS APPLICABLE MUTATIS MUTANDIS)

         The provisions of Articles 382 (2), 382 (4), 385, 386, 388, 400, 401,
         and 403 through 407 shall apply mutatis mutandis to auditors. (Amended
         by Act No. 3724, Apr. 10, 1984; Act No. 6488, Jul. 24, 2001)


ARTICLE 415-2 (AUDIT COMMITTEE)


         (1) The company may, under the conditions as prescribed by the articles
         of incorporation, establish an audit committee constituted by the
         committee under Article 393-2, in lieu of auditors. In the case of the
         establishment of an audit committee, there shall not coexist any
         auditors.

         (2) Notwithstanding Article 393-2 (3), the audit committee shall
         consist of not

<PAGE>

         less than three directors: Provided, That persons falling under any of
         the following subparagraphs shall not exceed 1/3 of the total members
         of the committee:

         1.Any director or employee in the active service of the company, or any
         person who was director or employee thereof within two years from the
         date of appointment as a member of the committee;

         2.In case where the largest shareholder of the company is an
         individual, the individual himself, his spouse and lineal ascendants or
         descendants;

         3.In case where the largest shareholder is a corporation, any director,
         auditor and employee of the corporation;

         4.Spouse and lineal ascendants or descendants of any director of the
         company;

         5.Any director, auditor and employee in the service of the parent or a
         subsidiary company with which the company is affiliated;

         6.Any director, auditor and employee of a corporation which has an
         important interest in the company, such as the mutual relations of
         business dealings; and

         7.Any director, auditor and employee of other company wherein a
         director or an employee of the company serves concurrently as a
         director thereof.

         (3) A resolution of the board of directors on the dismissal of a member
         of the audit committee shall require the concurrent vote of two thirds
         or more of the total number of directors.

         (4) The audit committee shall, from among its members, elect a member
         to represent the committee. In this case, a plural number of members
         may be elected to jointly represent the committee.

         (5) The committee may take professional assistance at the expense of
         the company.


<PAGE>

         (6) The provisions of Articles 296, 312, 367, 387, 391-2 (2), 394 (1),
         400, 402 through 407, 412 through 414, 447-3, 447-4, 450, 527-4, 530-5
         (1) 9, 530-6 (1) 10, and 534 shall be applicable mutatis mutandis with
         respect to the audit committee. In this case, the term "auditor" as
         prescribed in Articles 530-5 (1) 9 and 530-6 (1) 10 shall be read as
         "member of audit committee".
         [This Article Newly Inserted by Act No. 6086, Dec. 31, 1999]


         SECTION 4 ISSUANCE OF NEW SHARES

ARTICLE 416 (DETERMINATION OF PARTICULARS FOR ISSUANCE)

         In case where a company issues shares after its incorporation, the
         following matters, which are not provided in the articles of
         incorporation, shall be determined by the board of directors: Provided,
         That this shall not apply if it is otherwise provided by this Act, or
         the articles of incorporation provide that they shall be determined at
         a general shareholders's meeting: (Amended by Act No. 3724, Apr. 10,
         1984)

         1.Class and number of new shares;

         2.Issue-price of new shares and the date set for the payment thereon;

         3.Method of subscribing for new shares;

         4.Name of the persons who are to make a contribution in kind and the
         class, quantity, value of such property and the class and number of
         shares to be given therefor;

         5.Matters related to transferability of the shareholder's preemptive
         right to new shares; and

         6.An intent that a certificate for preemptive right to new shares is to
         be issued only upon request of the shareholder and the period wherein
         such request may be made.



<PAGE>

ARTICLE 417 (ISSUANCE OF SHARES AT PRICE BELOW PAR)


         (1) In case where a company issues shares after two years have elapsed
         since its incorporation, the company may issue shares at a price less
         than the par value with a resolution of the general shareholders'
         meeting under Article 434 and with the authorization of the court.

         (2) The minimum issue-price of shares shall be determined by the
         resolution of the general shareholders' meeting mentioned in paragraph
         (1).

         (3) The court may render the authorization after altering the minimum
         issue-price by taking into account the present conditions of the
         company and all the circumstances. In this connection, the court may
         appoint an inspector to investigate the status of the company's
         property and any other necessary matters.

         (4) The shares mentioned in paragraph (1) shall be issued within one
         month from the day on which the authorization of the court has been
         obtained. The court may extend the above period in its authorization.


ARTICLE 418 (CONTENTS OF PREEMPTIVE RIGHTS, DESIGNATION AND PUBLIC NOTICE OF
RECORD DATE FOR ALLOTMENT)


         (1) Each shareholder shall be entitled to the allotment of new shares
         in proportion to the number of shares which he holds. (Amended by Act
         No. 6488, Jul. 24, 2001)

         (2) The company may make an allotment of new shares to other persons
         than the shareholders under the provisions of articles of
         incorporation, notwithstanding the provisons of paragraph (1):
         Provided, That in such case, it shall be limited to the case necessary
         for the achievement of the company's

<PAGE>

         operational objectives, such as an introduction of new technology,
         improvement of financial structures, etc. (Newly Inserted by Act No.
         6488, Jul. 24, 2001)

         (3) The company shall fix a certain record date and shall, at least two
         weeks before such record date, give public notice to the effect that
         shareholders entered on the register of shareholders as of such record
         date shall be entitled to the rights under paragraph (1) and to the
         effect that such preemptive rights are transferable, if applicable:
         Provided, That if the above record date is within the period set forth
         in Article 354 (1), the public notice shall be given at least two weeks
         before the first day of such period. (Newly Inserted by Act No. 3724,
         Apr. 10, 1984)


ARTICLE 419 (PEREMPTORY NOTICE TO HOLDERS OF PREEMPTIVE RIGHTS)


         (1) The company shall notify the holders of preemptive rights of the
         class and number of shares subject to such preemptive rights and that
         their rights shall be forfeited if they fail to apply for the
         subscription for new shares on or before a fixed date. In this case, if
         the matters as set forth in subparagraphs 5 and 6 of Article 416 have
         been determined, the contents thereof shall also be notified.

         (2) If the company has issued bearer share certificates, a public
         notice on matters set forth in paragraph (1) shall be given.

         (3) The notification under paragraph (1) and the public notice under
         paragraph (2) shall be given at least two weeks before the date set
         forth in paragraph (1).

         (4) In case where a holder of preemptive rights fails to apply for the
         subscription for new shares on or before the specified date
         notwithstanding the notification under paragraph (1) or the public
         notice under paragraph (2), his rights shall be forfeited.
         [This Article Wholly Amended by Act No. 3724, Apr. 10, 1984]


ARTICLE 420 (SUBSCRIPTION FORM FOR SHARES)


<PAGE>

         Directors shall prepare a subscription form for shares, in which the
         following matters shall be contained: (Amended by Act No. 3724, Apr.
         10, 1984)

         1.Particulars set forth in Article 289 (1) 2 through 4;

         2.Matters set forth in Article 302 (2) 7, 9 and 10;

         3.Matters set forth in subparagraphs 1 through 4 of Article 416;

         4.If the company issues shares in accordance with Article 417, the
         conditions of such issuance and the amount yet to be amortized pursuant
         to Article 455;

         5.Restrictions on the preemptive rights of shareholders or a provision
         that the preemptive rights are to be given to a particular third
         person, if applicable; and

         6.Date of the resolution on the issuance of shares.


ARTICLE 420-2 (ISSUANCE OF CERTIFICATES OF PREEMPTIVE RIGHTS)


         (1) In case where a company has provided for the matters set forth in
         subparagraph 5 of Article 416, the company shall issue certificates of
         preemptive rights in accordance with subparagraph 6 of Article 416, if
         applicable or issue them at least two weeks before the date under
         Article 419 (1), as the case may be.

         (2) Certificates of preemptive rights shall contain the serial number
         in addition to the following and the directors shall write their names
         and affix their seals or shall sign thereon: (Amended by Act No. 5053,
         Dec. 29, 1995)

         1.Manifestation of certificates of preemptive rights;

         2.Matters set forth in Article 420;


<PAGE>

         3.Class and number of shares subject to the preemptive rights; and

         4.A statement to the effect that the rights shall be forfeited if the
         subscription for shares is not applied for on or before the specified
         date.
         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 420-3 (TRANSFER OF PREEMPTIVE RIGHTS)


         (1) Preemptive rights shall be transferred only by the delivery of
         certificates thereof.

         (2) Article 336 (2) of this Act and Article 21 of the Check Act shall
         apply mutatis mutandis to certificates of preemptive rights.
         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 420-4 (APPLICATION FOR SUBSCRIPTION BY CERTIFICATES OF PREEMPTIVE
              RIGHTS)


         (1) If certificates of preemptive rights have been issued, the
         subscription for shares shall be applied for by the certificates. In
         this case, Article 302 (1) shall be apply mutatis mutandis.

         (2) A person who has lost certificates of preemptive rights may apply
         for the subscription for shares by the subscription form for shares:
         Provided, That such offer shall become ineffective if the application
         for subscription for shares is made by certificates of preemptive
         rights.
         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 421 (PAYMENT FOR NEW SHARES)

         Directors shall procure the person who has subscribed for new shares to
         pay the full subscription price with respect to each share allotted to
         him on or before

<PAGE>

         the date set for such payment.


ARTICLE 422 (INVESTIGATION ON CONTRIBUTION IN KIND)


         (1) In case of a contribution in kind, directors shall request the
         court for the appointment of an inspector who is to investigate the
         particulars set forth in subparagraph 4 of Article 416. In this case,
         an appraisal by a certified appraiser may substitute for the
         investigation by an inspector. (Amended by Act No. 5591, Dec. 28, 1998)

         (2) If the court considers the particulars set forth in paragraph (1)
         to be improper after examining the report on investigation prepared by
         the inspector or the results of appraisal conducted by an appraiser, it
         may give necessary alteration and inform directors and the person who
         has made the contribution in kind of such alteration. (Amended by Act
         No. 5591, Dec. 28, 1998)

         (3) If the person who has made the contribution in kind has an
         objection to the alteration mentioned in paragraph (2), he may cancel
         his subscription for shares.

         (4) If the person who has made the contribution in kind does not cancel
         his subscription for shares within two weeks after the court informed
         him of alteration, the particulars set forth in paragraph (1) shall be
         deemed to have been altered accordingly. (Amended by Act No. 5591, Dec.
         28, 1998)


ARTICLE 423 (TIME TO BECOME SHAREHOLDER, EFFECT OF FAILURE OF PAYMENT)


         (1) If a person who has subscribed for new shares pays for the
         subscription price or performs the contribution in kind, he shall have
         the rights and duties of a shareholder from the next day after the date
         set for the payment. In this case, the second sentence of Article 350
         (3) shall apply mutatis mutandis. (Amended by Act No. 3724, Apr. 10,
         1984; Act No. 5053, Dec. 29, 1995)


<PAGE>

         (2) If a person who has subscribed for new shares fails to pay for the
         subscription price or to perform the contribution in kind on or before
         the date set for the payment, his right shall be forfeited.

         (3) Paragraph (2) shall not affect any claim for damages against the
         person who has subscribed for new shares.


ARTICLE 424 (RIGHT TO INJUNCTION)

         If a company is to issue shares in violation of Acts, subordinate
         statutes or the articles of incorporation or in a remarkably unfair
         manner and shareholders are likely to suffer disadvantages thereby,
         such shareholders may demand that the company stop such issuance.


ARTICLE 424-2 (LIABILITY OF SUBSCRIBER OF SHARES AT UNFAIR PRICE)


         (1) A person who has subscribed for shares at a remarkably unfair issue
         price in collusion with the directors shall be liable to pay to the
         company the amount equivalent to the difference between such issue
         price and the fair price.

         (2) Article 403 through 406 shall apply mutatis mutandis to an action
         for payment pursuant to paragraph (1).

         (3) Paragraphs (1) and (2) shall not affect the directors' liability to
         compensate for damage to the company or shareholders.
         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 425 (APPLICABLE PROVISIONS)


         (1) Article 302 (1) and (3), 303, 305 (2) and (3), 306, 318, and 319
         shall apply mutatis mutandis to the issuance of new shares.


<PAGE>

         (2) Article 305 (2) shall apply mutatis mutandis where certificates of
         preemptive rights are issued. (Newly Inserted by Act No. 3724, Apr. 10,
         1984)


ARTICLE 426 (REGISTRATION OF AMOUNT YET TO BE AMORTIZED)

         If shares were issued in accordance with Article 417, the registration
         of alteration thereby shall contain the amount yet to be amortized
         pursuant to Article 455.


ARTICLE 427 (RESTRICTIONS ON ASSERTION OF NULLIFICATION OR REVOCATION OF
SUBSCRIPTION)

         After one year has elapsed from the date of the registration of
         alteration due to the issuance of new shares, no person who subscribed
         for new shares may assert the nullity of his subscription by reason of
         defects in the requirements as to the subscription form for shares or
         certificates of preemptive rights or revoke his subscription on the
         ground of fraud, duress or mistake. The same shall apply where he has
         exercised his rights in respect to such shares. (Amended by Act No.
         1212, Dec. 12, 1962; Act No. 3724, Apr. 10, 1984)


ARTICLE 428 (DIRECTOR'S WARRANTY LIABILITY FOR SUBSCRIPTION)


         (1) In case that shares have not yet been subscribed or the
         subscription of shares has been revoked after the registration of
         alteration due to the issuance of new shares was effected, directors
         shall be deemed to have jointly subscribed for such shares.

         (2) Paragraph (1) shall not affect any claim for damages against
         directors.


ARTICLE 429 (ACTION FOR NULLIFICATION OF ISSUANCE OF NEW SHARE)


<PAGE>

         The nullity of the issuance of new shares may be asserted only by means
         of an action which shall be brought only by shareholders, directors or
         auditors within six months from the date of the issuance of such new
         shares. (Amended by Act No. 3724, Apr. 10, 1984)


ARTICLE 430 (APPLICABLE PROVISIONS)

         Articles 186 through 189, the main text of Article 190, Articles 191,
         192 and 377 shall apply mutatis mutandis to the action under Article
         429.
         [This Article Wholly Amended by Act No. 5053, Dec, 29, 1995]


ARTICLE 431 (EFFECT OF JUDGMENT NULLIFYING ISSUANCE OF NEW SHARES)


         (1) When a judgment nullifying the issuance of new shares becomes final
         and conclusive, such new shares shall be invalidated for the future.

         (2) In case of paragraph (1), the company shall without delay give
         public notice to that effect that the new share certificates shall be
         surrendered to the company within a fixed period and shall separately
         notify each shareholder and pledgee entered in the register of
         shareholders of the same: Provided, That such period shall be at least
         three months.


ARTICLE 432 (JUDGMENT OF NULLIFICATION AND REFUND TO SHAREHOLDERS)


         (1) When a judgment nullifying the issuance of new shares becomes final
         and conclusive, the company shall refund to each shareholder the amount
         paid by him for new shares.

         (2) If the amount mentioned in paragraph (1) is remarkably unreasonable
         in view of the status of the company's property as of the time when the
         judgment mentioned in Article 431 (1) becomes final and conclusive, the
         court may order

<PAGE>

         either the increase or decrease in such amount, upon the application of
         the company or of such shareholder mentioned in paragraph (1).

         (3) Articles 339 and 340 (1) and (2) shall apply mutatis mutandis in
         case of paragraph (1).


         SECTION 5 AMENDMENT OF THE ARTICLES OF INCORPORATION

ARTICLE 433 (METHOD OF AMENDMENT OF ARTICLES OF INCORPORATION)


         (1) The articles of incorporation shall be amended by a resolution of
         the general shareholders' meeting.

         (2) The summary of agenda relating to the amendment of the articles of
         incorporation shall be stated in the notice and public notice under
         Article 363.


ARTICLE 434 (SPECIAL RESOLUTION FOR AMENDMENT OF ARTICLES OF INCORPORATION)

         The resolution set forth in Article 433 (1) shall be adopted by the
         affirmative votes of no less than 2/3 of the voting rights of the
         shareholders present at the general meeting and of at least 1/3 of the
         total issued and outstanding shares.
         [This Article Wholly Amended by Act No. 5053, Dec. 29, 1995]


ARTICLE 435 (GENERAL MEETING OF SHAREHOLDERS OF CERTAIN CLASS OF SHARES)


         (1) If a company has issued two or more classes of shares and a certain
         class of shareholders is to be prejudiced by the amendment of the
         articles of incorporation, the resolution of a general meeting of such
         specific class of

<PAGE>

         shareholders shall be required for effecting such amendment in addition
         to that of a general shareholders meeting.

         (2) The resolution under paragraph (1) shall be adopted by the
         affirmative votes of no less than 2/3 of the voting rights of the
         shareholders present at the general meeting and of at least 1/3 of the
         total issued and outstanding shares of such class. (Amended by Act No.
         5053, Dec. 29, 1995)

         (3) The provisions relating to a general shareholders' meeting shall
         apply mutatis mutandis to the general meeting mentioned in paragraph
         (1), except for those provisions relating to non-voting shares.


ARTICLE 436 (IDEM-GENERAL MEETING OF SHAREHOLDERS OF CERTAIN CLASS OF SHARES)

         Article 435 shall apply mutatis mutandis where special provisions are
         to be made with regard to each class of shares in accordance with
         Article 344 (3) and where the shareholders of certain classes are to be
         prejudiced by the swap or transfer of shares or the merger of the
         company. (Amended by Act No. 6488, Jul. 24, 2001)


ARTICLE 437

         Deleted. (by Act No. 5053, Dec. 29, 1995)


         SECTION 6 REDUCTION OF CAPITAL

ARTICLE 438 (RESOLUTION FOR REDUCTION OF CAPITAL)


         (1) In order to reduce capital, the resolution in accordance with
         Article 434 shall be required.

         (2) The summary of agenda relating to the reduction of capital shall be
         stated in

<PAGE>

         notices and public notices under Article 363.


ARTICLE 439 (METHOD OF REDUCTION OF CAPITAL, ITS PROCEDURES)


         (1) In the resolution for reduction of capital, the method of effecting
         such reduction shall be determined.

         (2) Article 232 shall apply mutatis mutandis to the reduction of
         capital. (Amended by Act No. 3724, Apr. 10, 1984)

         (3) Any objection by bondholders may be raised according to the
         resolution of a meeting of bondholders. In this case, the court may,
         upon the application of any interested person, extend in favor of the
         bondholders the period within which such objection shall be raised.


ARTICLE 440 (PROCEDURES OF CONSOLIDATION OF SHARES)

         If shares are to be consolidated, the company shall determine a period
         of not less than one month and shall give public notice to the effect
         that shares shall be consolidated and that share certificates must be
         submitted to the company within such period and shall separately give
         notice to such effect to each of the shareholders and the pledgees who
         are entered in the register of shareholders. (Amended by Act No. 5053,
         Dec. 29, 1995)


ARTICLE 441 (IDEM-PROCEDURES OF CONSOLIDATION OF SHARES)

         The consolidation of shares shall take effect upon the expiration of
         the period mentioned in Article 440: Provided, That if the procedures
         set forth in Article 232 have not been completed, it shall take effect
         upon the completion of such procedures.



<PAGE>

ARTICLE 442 (DELIVERY OF NEW SHARE CERTIFICATES)


         (1) If, in case of the consolidation of share, there is any person who
         cannot submit his old share certificates, the company may, upon the
         application of such person, determine the period of not less than three
         months and give public notice to the effect that any interested person
         shall raise his objection, if any, on such certificates within such
         period, after the lapse of which the company may deliver new share
         certificates to such person.

         (2) Expenses of the public notice mentioned in paragraph (1) shall be
         borne by the applicant.


ARTICLE 443 (DISPOSITION OF FRACTIONAL SHARES)


         (1) If there are shares the number of which is unfit for the
         consolidation, the new share issued for that portion unfit for the
         consolidation shall be sold by means of auction and the proceeds from
         which shall be delivered to the former shareholders in proportion to
         the number of their shares: Provided, That the shares which are
         transacted on an exchange at the price quoted thereat may be sold
         through such exchange and shares without an exchange quotation may be
         sold in a manner other than auction with the permission of the court.
         (Amended by Act No. 3724, Apr. 10, 1984)

         (2) Article 442 shall apply mutatis mutandis to the case of paragraph
         (1).


ARTICLE 444 (IDEM-DISPOSITION OF FRACTIONAL SHARES)

         Article 443 shall apply mutatis mutandis to bearer share certificates
         which have not been submitted in accordance with Article 440.


ARTICLE 445 (ACTION FOR NULLIFYING REDUCTION OF CAPITAL)


<PAGE>

         The nullity of reduction of capital may be asserted only by means of an
         action which shall be brought only by a shareholder, director, auditor,
         liquidator, bankruptcy trustee or creditor disapproving such reduction
         of capital, within six months from the day on which the registration of
         alteration due to such reduction of capital has been effected. (Amended
         by Act No. Apr. 10, 1984)


ARTICLE 446 (APPLICABLE PROVISIONS)

         Articles 186 through 189, the main text of Article 190, Articles 191,
         192 and 377 shall apply mutatis mutandis to the action under Article
         445.
         [This Article Wholly Amended by Act No. 5053, Dec. 29, 1995]


         SECTION 7 ACCOUNTING OF COMPANY

ARTICLE 447 (PREPARATION OF FINANCIAL STATEMENTS)

         Directors shall prepare, at each period for the settlement of accounts,
         the following documents and supplementary schedules and obtain the
         approval of the board of directors:

         1.Balance sheet;

         2.Income statement; and

         3.Statements of appropriation of retained earnings or statements of
         disposition of deficit.

         [This Article Wholly Amended by Act No. 3724, Apr. 10, 1984]


ARTICLE 447-2 (PREPARATION OF BUSINESS REPORT)



<PAGE>

         (1) Directors shall prepare, at each period for the settlement of
         accounts, a business report and shall obtain the approval of the board
         of directors.

         (2) The business report shall include important matters concerning the
         business as set forth in the Presidential Decree.

         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 447-3 (SUBMISSION OF FINANCIAL STATEMENT)

         Directors shall submits to auditors the documents set forth in Articles
         447 and 447-2 six weeks before the day of the ordinary general meeting.
         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 447-4 (AUDIT REPORT)

         (1) Auditors shall submit to directors an audit report within four
         weeks from the date on which he receives the documents under Article
         447-3.

         (2) The audit report under paragraph (1) shall include the followings:

         1.Outline of audit method;

         2.If the matters required to be entered in the account books are not
         recorded or are recorded falsely or the entry of the balance sheet or
         income statement does not coincide with that of the account books, a
         statement to such effect;

         3.If the balance sheet and the income statement show exactly the
         situation of the company's financial conditions and the company's
         profits and losses according to the Acts, subordinate statutes and the
         articles of incorporation, a statement to such effect;

         4.If the balance sheet or the income statement fails to show exactly
         the situation of the company's property holding and the company's
         profits and losses, in

<PAGE>

         contravention of according to the Acts, subordinate statutes and the
         articles of incorporation, a statement to such effect and the reasons
         thereof;

         5. Whether it is proper or not to change the accounting method relating
         to the preparation of the balance sheet or the income statement and, if
         so, the reasons thereof;

         6. Whether or not the business report shows exactly the situation of
         the company in accordance with the Acts, subordinate statutes or the
         articles of incorporation;

         7. Whether or not the statements of appropriation of retained earnings
         or the statements of disposition of deficit are prepared in conformity
         with the Acts, subordinate statutes and the articles of incorporation;

         8. If the statements of appropriation of retained earnings or the
         statements of disposition of deficit are obviously improper in the
         light of the company's financial conditions are and other
         circumstances, a statement to such effect;

         9. If the supplementary schedules mentioned in Article 447 does not
         include the matters required to be prescribed or includes incorrect
         record therein or includes what does not conform with the account
         books, the balance sheet, the income statement or the business report,
         a statement to such effect;

         10. If a dishonest act or an act of conduct which is in material
         contravention of Acts, subordinate statutes or the articles of
         incorporation is found with regard to the performance of a director's
         duties, a statement to such effect; and

         11. If an investigation necessary for the audit could not be carried
         out, a statement to such effect and the reasons thereof.
         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 448 (KEEPING AND PUBLIC INSPECTION OF FINANCIAL STATEMENTS, ETC.)



<PAGE>

         (1) Directors shall keep the documents set forth in Articles 447 and
         447-2 as well as the audit report at the principal office of the
         company for five years from one week prior to the day of the ordinary
         general meeting and shall keep copies thereof at the branch offices for
         three years. (Amended by Act No. 1212, Dec. 12, 1962; Act No. 3724,
         Apr. 10, 1984)

         (2) Any shareholder or creditor of the company may, at any time during
         business hours, inspect the documents set forth in paragraph (1) and
         may demand the copying of such documents or an abstract thereof, by
         paying such fees as fixed by the company.


ARTICLE 449 (APPROVAL AND PUBLIC NOTICE OF FINANCIAL STATEMENTS, ETC.)


         (1) Directors shall submit to the ordinary general meeting the
         documents under subparagraphs 1 through 3 of Article 447 and shall
         obtain the approval thereof. (Amended by Act No. 3724, Apr. 10, 1984)

         (2) Directors shall submit to the ordinary general meeting the
         documents set forth in Article 447-2 and shall report on the contents
         thereof. (Newly Inserted by Act No. 3724, Apr. 10, 1984)

         (3) If directors have obtained the approval of the general meeting in
         respect of documents set forth in paragraph (1), they shall give,
         without delay, public notice of the balance sheet.


ARTICLE 450 (RELEASE OF LIABILITY OF DIRECTORS AND AUDITORS)

         If a contrary resolution has not been adopted within two years after
         the ordinary general meeting at which the approval mentioned in Article
         449 (1) was given, the company shall be deemed to have released the
         directors and auditors from their liability: Provided, That it shall
         not be the case where any of the directors or auditors has committed
         some dishonest act.



<PAGE>

ARTICLE 451 (CAPITAL)

         Unless otherwise provided in this Act, the capital of a company shall
         be equal to the total sum of the par value of all the issued and
         outstanding shares.


ARTICLE 452 (METHOD FOR VALUATION OF ASSETS)

         Assets to be entered in the account books of a company shall be valued
         in the following manner, in addition to the application of subparagraph
         2 of Article 31: (Amended by Act No. 3724, Apr. 10, 1984)

         1.Current assets shall be valued by aquisition cost or on their
         manufacturing cost: Provided, That they shall be valued by the current
         price if the current price is remarkably lower than the acquisition
         price or the manufacturing cost;

         2.Deleted; (by Act No. 3724, Apr. 10, 1984)

         3.Pecuniary credits shall be valued by the amount of claim. If,
         however, the credits have been acquired by the price lower than the
         amount of claims or in any other similar case, a reasonable reduction
         may be effected. In case of credits the collection of which might be
         impossible, the estimated amount of uncollectable credits shall be
         reduced;

         4.Bonds having exchange quotations shall be valued by the average price
         during one month prior to the period for the settlement of accounts and
         bonds having no exchange quotations shall be valued by acquisition
         cost: Provided, That if the acquisition cost is different from the face
         amount of bonds, the reasonable increase or decrease may be effected.
         The latter part of subparagraph 3 shall apply mutatis mutandis to the
         bonds the collection of which might be impossible. This shall apply to
         any other things similar to bonds;

         5.Shares having exchange quotations shall be valued by the acquisition
         cost: Provided, That they shall be valued by the current price if the
         average price during one month prior to the period for the settlement
         of accounts is lower than

<PAGE>

         the acquisition cost. Shares which were acquired for the long-term
         holding because of transactional or other necessity shall be valued by
         acquisition cost, irrespective of whether or not they have exchange
         quotations: Provided, That the status of property of the issuing
         company has been remarkably deteriorated, the reasonable deduction of
         the amount shall be effected. The same shall apply to the valuation of
         contributions made into a limited liability company or any other
         entity; and

         6.In case of goodwill of business, the acquisition cost may be entered,
         only if it was acquired by succession for value. In this case, at least
         equal portion out of the above-mentioned cost shall be amortized at
         each period for the settlement of accounts within five years after the
         goodwill of business was acquired.


ARTICLE 453 (ACCOUNT OF ORGANIZATION COST)


         (1) The costs defrayed in accordance with subparagraphs 4 of Article
         290 and any amount of tax paid for the registration of incorporation
         may be accounted on the assets side of the balance sheet.

         (2) If it has been determined that interest shall be distributed after
         the incorporation of the company or before the commencement of the
         operation of a business, at least equally divided portion out of such
         accounted amount under paragraph (1) shall be amortized at each period
         for the settlement of accounts within five years after the company has
         completed the distributing of such interest.


ARTICLE 453-2 (ACCOUNT OF PRE-OPERATING COST)


         (1) Any cost disbursed for commencement of the operation of a business
         may be accounted on the assets side of the balance sheet.

         (2) At least equally divided portion out of such accounted amount under


<PAGE>

         paragraph (1) shall be amortized at each period for the settlement of
         accounts within three years after the commencement of the operation of
         business.

         [This Article Newly Inserted by Act No. 5053, Dec. 29, 1995]


ARTICLE 454 (ACCOUNT OF NEW SHARE ISSUE COST)


         (1) If new shares are issued, the cost necessary for such issuance may
         be accounted on the assets side of the balance sheet.

         (2) At least equally divided portion out of such accounted amount under
         paragraph (1) shall be amortized at each period for the settlement of
         accounts within three years after the company has issued the new
         shares.


ARTICLE 455 (ACCOUNT OF DISCOUNT ON SHARE ISSUANCE)


         (1) If shares are issued in accordance with Article 417, the discount
         from the par value may be accounted on the assets side of the balance
         sheet.

         (2) At least equally divided portion out of such accounted amount under
         paragraph (1) shall be amortized at each period for the settlement of
         accounts within three years after the company has issued the shares.


ARTICLE 456 (ACCOUNT OF DISCOUNT ON BONDS)


         (1) If, in case of the offering of bonds, the total amount which is to
         be paid on redemption exceeds the actual amount received from such
         offering, the balance may be accounted on the assets side of the
         balance sheet.

         (2) At least equally divided portion out of such accounted amount under
         paragraph (1) shall be amortized at each period for the settlement of
         accounts

<PAGE>

         within the period set for the redemption of the bonds.

         (3) Article 454 shall apply mutatis mutandis to the case of new bonds
         issue cost.


ARTICLE 457 (ACCOUNT OF ACCRUED INTEREST DIVIDEND DURING CONSTRUCTION IN
PROGRESS)


         (1) Any amount distributed in accordance with Article 463 may be
         accounted on the assets side of the balance sheet.

         (2) If the dividend is made after the commencement of the operation of
         business at the rate higher than six percent per annum, at least a sum
         equivalent to the amount in excess of six percent shall be amortized
         out of such accounted amount under paragraph (1).


ARTICLE 457-2 (ACCOUNT OF RESEARCH AND DEVELOPMENT COST)


         (1) The cost incurred specially in connection with the research on or
         development of any new products or new technology may be accounted on
         the assets side of the balance sheet.

         (2) At least equally divided portion out of such accounted amount under
         paragraph (1) shall be amortized at each period for the settlement of
         accounts within five years after disbursement thereof.
         [This Article Newly Inserted by Act No. 5053, Dec. 29, 1995]


ARTICLE 458 (EARNED SURPLUS RESERVE)

         A company shall accumulate, as the earned surplus reserve, the amount
         of at least 1/10 of the cash dividend at each period for the settlement
         of accounts until reserve reaches half of the company's capital.
         (Amended by Act No. 3724, Apr. 10, 1984)



<PAGE>

ARTICLE 459 (CAPITAL SURPLUS RESERVE)


         (1) The company shall accumulate the following, as the capital surplus
         reserve: (Amended by Act No. 3724, Apr. 10, 1984; Act No. 5591, Dec.
         28, 1998; Act No. 6488, Jul. 24, 2001)

         1.If shares are issued at the price higher than the par value, such
         amount in excess;

         1-2.If, in case of an all-inclusive share swap, the limit of capital
         increase under Article 360-7 exceeds the increased equity capital of a
         complete parent company, such amount in excess;

         1-3.If, in case of an all-inclusive transfer of shares, the limit of
         capital under Article 360-18 exceeds the increased equity capital of
         the established complete parent company, such amount in excess;

         2.If, in case of reduction of capital, the reduced amount exceeds the
         amount used for the retirement of shares, for the refund of share
         prices and/or for recovery of deficit, such amount in excess;

         3.If, in case of a merger of companies, the value of property succeeded
         to from the company which ceased to exist exceeds the amount of the
         obligation succeeded to from such company, the amount refunded to the
         shareholders of such company and the amount of the increase in the
         capital of the surviving company or the amount of the capital of the
         newly incorporated company in consequence of the merger, as the case
         may be, such amount in excess;

         3-2.If the value of property which is invested in a company newly
         incorporated due to division or merger through division under Article
         530-2 or the surviving company thereof exceeds the amount of the
         obligation inherited from the investment company, the amount refunded
         to the shareholders of such company, and the amount of the capital of
         the newly incorporated company or the amount

<PAGE>

         of the increase in the capital of the surviving company, such amount in
         excess; and

         4.Any other surplus in the transaction of capital.

         (2) Out of the surplus under paragraph (1) 3 and 3-2, the earned
         surplus reserve and other legal reserves of the company which ceased to
         exist or was divided may be succeeded to the surviving company or the
         newly incorporated company formed due to a merger, division, or merger
         after division. (Amended by Act No. 5591, Dec. 28, 1998)


ARTICLE 460 (USE OF LEGAL RESERVE)


         (1) The legal reserve set forth in Articles 458 and 459 shall not be
         disposed of, except for recovery of deficit of the capital.

         (2) The capital surplus reserve shall not be used for recovery of
         deficit of the capital, unless the earned surplus reserve are fully
         used for recovery of deficit.


ARTICLE 461 (CAPITALIZATION OF RESERVES)


         (1) A company may capitalize the whole or a part of the reserve by a
         resolution of the board of directors: Provided, That it shall not be
         the case where the articles of incorporation provide that such shall be
         determined at a general shareholders' meeting.

         (2) In case of paragraph (1), the company shall issue the shares to the
         shareholders in proportion to the number of shares which they hold. In
         this case, Article 443 (1) shall apply mutatis mutandis to fractional
         shares.

         (3) When a resolution is made by the board of directors in accordance
         with paragraph (1), the company shall fix a date and give public notice
         two weeks

<PAGE>

         before such date to the effect that new shares under paragraph (2)
         shall be alloted to the shareholders entered on the register of
         shareholders on that date: Provided, That if the above date falls
         within the period under Article 354 (1), the public notice shall be
         given two weeks before the first day of such period.

         (4) In case of the proviso of paragraph (1), the shareholders shall
         become those of new shares under paragraph (2) on the date of the
         resolution of the general shareholders' meeting.

         (5) When the shareholders become those of new shares pursuant to
         paragraph (3) or (4), directors shall immediately notify the
         shareholders to whom such new shares are alloted and the pledgees
         entered on the register of shareholders of the class and number of such
         shares. If bearer share certificates have been issued, a public notice
         of the contents of resolution under paragraph (1) shall be given.

         (6) The latter part of Article 350 (3) shall apply mutatis mutandis to
         the case of paragraph (1). (Newly Inserted by Act No. 5053, Dec. 29,
         1995)

         (7) Article 339 shall apply mutatis mutandis to the issuance of shares
         pursuant to paragraph (2).

         [This Article Wholly Amended by Act No. 3724, Apr. 10, 1984]


ARTICLE 462 (DIVIDENDS)


         (1) A company may pay dividends within the limit of the amount of net
         properties stated on the balance sheet after deducting the followings:
         (Amended by Act No. 6488, Jul. 24, 2001)

         1.Amount of the capital;

         2.Total amount of the capital surplus reserve and the earned surplus
         reserve which are accumulated till the pertinent period for the
         settlement of accounts of the company; and


<PAGE>

         3.Amount to be accumulated for the pertinent period for the settlement
         of accounts of the company.

         (2) If dividends have been paid in violation of paragraph (1), any
         creditors of the company may demand that such dividends be returned to
         the company.

         (3) Article 186 shall apply mutatis mutandis to an action relating to
         the demand under paragraph (2).


ARTICLE 462-2 (STOCK DIVIDENDS)


         (1) A company may pay dividends by means of issuing new shares, by a
         resolution of the general shareholders' meeting: Provided, That such
         stock dividends may not exceed the amount equivalent to a half of the
         total amount of dividends.

         (2) The dividends under paragraph (1) shall be made based on the par
         value of the shares and if the company have issued different classes of
         shares, it may be paid in the same classes of shares, respectively.
         (Amended by Act No. 5053, Dec. 29, 1995)

         (3) Article 443 (1) shall apply mutatis mutandis to the case where, out
         of profits to be distributed as stock dividends, there remains a
         fraction which is less than the par value of a share. (Amended by Act
         No. 5053, Dec. 29, 1995)

         (4) A shareholder who has received stock dividend shall become a
         shareholder of the new shares from the time of the closing of the
         general shareholders' meeting at which the resolution mentioned in
         paragraph (1) is made. In this case, the latter part of Article 350 (3)
         shall apply mutatis mutandis. (Amended by Act No. 5053, Dec. 29, 1995)

         (5) When the resolution under paragraph (1) has been made, directors
         shall notify, without delay, the shareholders entitled to receive the
         stock dividends

<PAGE>

         and the pledgees entered on the register of shareholders of the class
         and number of shares to be distributed to them. If bearer share
         certificates have been issued, a public notice of the contents of the
         resolution under paragraph (1) shall be given.

         (6) The right of a pledgee under Article 340 (1) shall extend to the
         shares to be distributed to a shareholder pursuant to paragraph (1). In
         this case, Article 340 (3) shall apply mutatis mutandis.
         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 462-3 (INTERIM DIVIDEND)


         (1) A company which has a settling term one time per year may determine
         in the articles of incorporation that the company may pay a dividend
         (hereinafter in this Article referred to as the "interim dividend") by
         means of money to the day's shareholder on a specified day set by a
         resolution of the board of directors only one time during the business
         year.

         (2) The interim dividend shall be made within the limit of the amount
         calculated by deducting the following amounts from the amount of net
         properties on the balance sheet in the immediately previous settling
         term: (Amended by Act No. 6488, Jul. 24, 2001)

         1.The amount of capital in the immediately previous settling term;

         2.The total amount of the capital surplus reserve and earned surplus
         reserve accumulated until the immediately previous settling term;

         3.The amount which is to be distributed as a profit or paid at the
         regular general meeting in the immediately previous settling term; and

         4.The earned surplus reserve which is to be accumulated in the relevant
         settling term for the interim dividend.


<PAGE>

         (3) If it is deemed that the amount of net properties on the balance
         sheet in the relevant settling term is unlikely to amount to the total
         sum of the amounts under subparagraphs of Article 462 (1), the company
         concerned shall not provide the interim dividend. (Amended by Act No.
         6488, Jul. 24, 2001)

         (4) Where, while the amount of net properties on the balance sheet in
         the relevant settling term fails to amount to the total sum of the
         amounts under subparagraphs of Article 462 (1), the interim dividend is
         provided, the directors shall be jointly and severally liable to
         compensate for the balance (where the dividend is less than the
         balance, the dividend) to the company: Provided, That the same shall
         not apply where it is proved that the directors did not neglect their
         care in rendering judgment under paragraph (3). (Amended by Act No.
         6488, Jul. 24, 2001)

         (5) With respect to the application of Articles 340 (1), 344 (1), 350
         (3) (including where this shall apply mutatis mutandis under Articles
         423 (1), 516 (2), and 516-9; hereinafter in this paragraph the same
         shall apply), 354 (1), 370 (1), 457 (2), 458, and 464 and subparagraph
         3 of Article 625, the interim dividend shall be deemed to be the
         dividend under Article 462 (1), and with respect to the application of
         Article 350 (3), a specified day under paragraph (1) shall be deemed to
         be the end of the business year.

         (6) The provisions of Articles 399 (2) and (3) and 400 shall apply
         mutatis mutandis with respect to the liability of directors under
         paragraph (4), and the provisions of Article 462 (2) and (3), with
         respect to the interim dividend made in breach of paragraph (3).
         [This Article Newly Inserted by Act No. 5591, Dec. 28, 1998]


ARTICLE 463 (ACCRUED INTEREST DIVIDEND DURING CONSTRUCTION IN PROGRESS)


         (1) If it is deemed impossible, in view of the nature of the
         undertaking which forms the company's purpose, to commence the whole of
         the business for more than two years after its incorporation, the
         company may provide in the articles of incorporation that a specified
         interest shall be distributed to the shareholders

<PAGE>

         of certain shares during a specified period prior to the commencement
         of the whole of business: Provided, That the rate of such interest
         shall not exceed five percent per annum.

         (2) The provisions of the articles of incorporation mentioned in
         paragraph (1) or amendment thereof shall require the authorization of
         the court.


ARTICLE 464 (STANDARD FOR DISTRIBUTION OF PROFITS, ETC.)

         The distribution of profits or interest shall be made in proportion to
         the number of shares owned by each shareholder: Provided, That this
         shall not apply to the case of Article 344, paragraph (1).


ARTICLE 464-2 (TIME FOR PAYMENT OF DIVIDENDS)


         (1) A company shall pay dividends under Article 464 no later than one
         month after the day of approval under Article 449 (1) or a resolution
         under Article 462-3 (1): Provided, That this shall not apply where the
         time for payment of dividend is fixed differently at the general
         meeting under Article 449 (1) or the board of directors under Article
         462-3 (1). (Amended by Act No. 5053, Dec. 29, 1995; Act No. 5591, Dec.
         28, 1998)

         (2) The claim for payment of dividends under paragraph (1) shall be
         extinguished by prescription, if it is not exercised for five years.
         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 465

         Deleted. (by Act No. 3724, Apr. 10, 1984)


ARTICLE 466 (SHAREHOLDER'S RIGHT TO INSPECT ACCOUNT BOOKS)



<PAGE>
         (1) Any shareholder who hold shares representing no less than 3/100 of
         the total issued and outstanding shares may demand, in writing with the
         reasons thereof specified, the inspection or copying of the account
         books and related documents.
         (Amended by Act No. 5591, Dec. 28, 1998)

         (2) A company shall not refuse the shareholder's demand mentioned in
         paragraph (1) unless it proves that such demand is improper. (Amended
         by Act No. 5591, Dec. 28, 1998)


ARTICLE 467 (INSPECTION ON AFFAIRS AND STATUS OF COMPANY'S PROPERTY)


         (1) If there is any reason to suspect of dishonest act or of material
         fact in contravention of any Acts, subordinate statutes or the articles
         of incorporation in connection with the management of affairs, any
         shareholder who holds shares representing no less than 3/100 of the
         total issued and outstanding shares may apply to the court for the
         appointment of an inspector to investigate the affairs of the company
         and the status of its property. (Amended by Act No. 5591, Dec. 28,
         1998)

         (2) The inspector shall report on the results of the investigation to
         the court.

         (3) If the court deems it necessary according to the report mentioned
         in paragraph (2), it may order the representative director to convene a
         general shareholders' meeting. In this case, Article 310 (2) shall
         apply mutatis mutandis. (Amended by Act No. 1212, Dec. 12, 1962; Act
         No. 5053, Dec. 29, 1995)

         (4) Directors and auditors shall examine without delay whether or not
         the report of the inspector mentioned in paragraph (3) is accurate and
         shall report on the results thereof to the general shareholders'
         meeting. (Newly Inserted by Act No. 5053, Dec. 29, 1995)


ARTICLE 467-2 (PROHIBITION AGAINST GRANTING PECUNIARY BENEFIT)



<PAGE>

         (1) A company may not grant to any person a pecuniary benefit in
         connection with the exercise of rights as a shareholder.

         (2) If a company has given gratuitously any pecuniary benefit to a
         specified shareholder, such pecuniary benefit shall be presumed to have
         given in connection with the exercise of a shareholder's rights. If a
         company has given for value any pecuniary benefit to a specified
         shareholder but if the benefits obtained by the company is remarkably
         less than the pecuniary benefit granted to the shareholder, the same
         shall be applicable.

         (3) If a company has granted any pecuniary benefit in contravention of
         paragraph (1), the person who has received such benefit shall return it
         to the company. In this case, if the person paid to the company
         anything in compensation for such benefit, the company may return it to
         him.

         (4) Articles 403 through 406 shall apply mutatis mutandis to an action
         for the return of benefit under paragraph (3).

         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 468 (RIGHT TO PREFERENTIAL PAYMENT OF EMPLOYEE)

         A person who has a claim to the return of money as a guarantee for
         fidelity of an employee or any other claim arising out of the relations
         of employment between a company and its employees shall be entitled to
         preferential payment from the company' whole property: Provided, That
         such right shall not satisfied prior to the pledge or mortgage.


         SECTION 8 BONDS

         SUB-SECTION 1 COMMON PROVISIONS


<PAGE>

ARTICLE 469 (OFFERING OF BONDS)

         A company may offer bonds for subscription by a resolution of the board
         of directors.


ARTICLE 470 (LIMITATION ON TOTAL AMOUNT)


         (1) The total amount of bonds shall not exceed four times the amount of
         net assets of the company as shown by the latest balance sheet.
         (Amended by Act No. 5053, Dec. 29, 1995)

         (2) Deleted. (by Act No. 5053, Dec. 29, 1995)

         (3) If the offering of bonds are made for the purpose of redeeming old
         bonds, the amount of the old bonds shall not be computed in the total
         amount of the bonds. In this case, the old bonds shall be redeemed
         within six months from the payment date of new bonds or from the first
         payment date if such payment is to be made in installments.


ARTICLE 471 (RESTRICTIONS ON OFFERING OF NEW BONDS)

         A company shall not offer new bonds for subscription until to be the
         amount of bonds previously subscribed has been fully paid.


ARTICLE 472 (FACE AMOUNT OF BOND)


         (1) The face amount of each bond shall not be less than ten thousand
         won. (Amended by Act No. 3724, Apr. 10, 1984)

         (2) The face amount of each bond shall, in respect of the same class of
         bonds, either be equal or be such as is an integral multiple of the
         minimum amount of the bond of the same class.

<PAGE>

ARTICLE 473 (RESTRICTIONS ON REDEMPTION IN EXCESS OF PAR VALUE)

         If a decision is made to repay to bondholders an amount in excess of
         the par value of the bond, such amount in excess shall be paid at an
         equal rate for each bond.


ARTICLE 474 (PUBLIC OFFERING, SUBSCRIPTION FORM FOR BONDS)


         (1) A person who intends to subscribe for bonds shall prepare two
         copies of subscription forms, stating the number of bonds for which he
         intends to subscribe and his address, and shall write his name and
         affix his seal or sign thereon. (Amended by Act No. 5053, Dec. 29,
         1995)

         (2) The subscription form for bonds shall be prepared by the directors
         and contain the following: (Amended by Act No. 3724, Apr. 10, 1984; Act
         No. 5053, Dec. 29, 1995)

         1.Trade name of the company;

         2.Total amount of the capital and the reserve;

         3.Amount of the net assets of the company as shown by the latest
         balance sheet;

         4.Total amount of the bonds;

         5.Face amount of each bond;

         6.Issue-price or minimum issue-price of each bond;


<PAGE>

         7.Rate of interest payable on each bond;

         8.Method and time of redemption of the bonds and of the payment of
         interest;

         9.Amount and time of each payment for the subscription price of bonds,
         if payments are to be made in installments;

         10.If a determination is made to restrict the bonds certificates either
         in bearer form or in registered form, such provisions;

         11.If bonds have been previously issued, the amount yet to be redeemed;

         12.If an offering of bonds for the purpose of redeeming old bonds are
         made in excess of the limits prescribed in Article 470 (1), a statement
         to that effect;

         13.If there is a company which has been commissioned to offer bonds for
         subscription, the trade name and address of such company;

         14.If the company mentioned in subparagraph 13 has undertaken to
         subscribe for any portion of the total amount of the bonds which has
         not been subscribed for through the public offering, a statement to
         that effect; and

         15.If a transfer agent is designated, his full name, address and
         business office.

         (3) In case where the minimum issue-price has been determined, the
         subscriber for bonds shall state in the subscription form the amount at
         which he intends to subscribe for.


ARTICLE 475 (SUBSCRIPTION FOR ALL BONDS)

         Article 474 shall not apply where all the bonds is subscribed for under
         a contract. The same shall apply to such part of the bonds as may be
         subscribed for by a company which has been commissioned to offer bonds
         for subscription.

<PAGE>

ARTICLE 476 (PAYMENT)


         (1) When the subscription for all the bonds has been completed, the
         directors shall, without delay, cause any person who has subscribed for
         bonds to make the full payment or the first instalment payment on each
         bond.

         (2) A company commissioned to offer bonds for subscription may in its
         own name perform the acts set forth in Article 474 (2) and 475 on
         behalf of the company.


ARTICLE 477

         Deleted. (by Act No. 3724, Apr. 10, 1984)


ARTICLE 478 (ISSUANCE OF BOND CERTIFICATES)


         (1) No certificate may be issued for a bond until its full amount has
         been paid up.

         (2) Each bond certificate shall contain the following particulars and
         the representative director shall write his name and affix his seal or
         shall sign thereon: (Amended by Act No. 1212, Dec. 12, 1962; Act No.
         5053, Dec. 29, 1995)

         1.Serial number of each bond; and

         2.Particulars set forth in Article 474 (2) 1, 4, 5, 7, 8, 10 and 13.


ARTICLE 479 (TRANSFER OF REGISTERED BONDS)


         (1) Transfer of registered bonds shall not be asserted against the
         company or a third person unless the name and address of the transferee
         have been entered in

<PAGE>

         the register of bonds and his full name is entered in the bond
         certificates.

         (2) Article 337 (2) shall apply mutatis mutandis to the transfer of
         registered bonds. (Newly Inserted by Act No. 3724, Apr. 10, 1984)


ARTICLE 480 (EXCHANGE BETWEEN REGISTERED CERTIFICATE AND BEARER CERTIFICATE)

         A bondholder may at any time request the company to change a registered
         bond certificate into a bearer certificate: Provided, That this shall
         not apply where the form of the bond certificate is restricted to
         either in registered or bearer form.


ARTICLE 481 (RESIGNATION OF COMMISSIONED COMPANY)

         A company which has been commissioned to offer bonds for subscription
         may resign with the consent of the issuing company and of a meeting of
         bondholders. It may do so with the permission of the court where there
         are unavoidable reasons therefor.


ARTICLE 482 (REMOVAL OF COMMISSIONED COMPANY)

         If a company which has been commissioned to offer bonds for
         subscription is unfit for dealing with the business or if there exists
         any other justifiable cause, the court may remove such company from
         office at the request of the issuing company or of a meeting of
         bondholders. (Amended by Act No. 1212, Dec. 12, 1962)


ARTICLE 483 (SUCCESSOR TO BUSINESS OF COMMISSIONED COMPANY)


         (1) If, in case of Articles 481 and 482, the company which has been
         commissioned to offer bonds for subscription does not exist, a
         successor to its business may be appointed by agreement between the
         issuing company and a

<PAGE>

         meeting of bondholders.

         (2) If unavoidable reasons exist, any interested person may demand the
         court to appoint such successor to the business.


ARTICLE 484 (AUTHORITY OF COMMISSIONED COMPANY)


         (1) A company which has been commissioned to offer bonds for
         subscription shall have authority to do on behalf of the bondholders
         all judicial or extra-judicial acts which are necessary for the
         redemption of bonds.

         (2) When the company under paragraph (1) is requested to redeem the
         bonds, it shall without delay give public notice thereof and give a
         separate notice to notify each bondholder known to that company.

         (3) In case of paragraph (2), bondholders may demand payment of the
         redemption price in exchange for their bond certificates.


ARTICLE 485 (AUTHORITY AND DUTY IN CASE OF TWO OR MORE COMMISSIONED COMPANY)


         (1) If two or more companies have been commissioned to offer bonds for
         subscription, all acts within the scope of their authority shall be
         jointly performed.

         (2) In case of paragraph (1), each company shall be jointly and
         severally liable to the bondholders to pay redemption price.


ARTICLE 486 (LOST COUPON)


         (1) If, in case of redemption of bearer bonds to which coupons are
         attached, any

<PAGE>

         coupon is missing, a sum equal to the amount of the coupon shall be
         deducted from the redemption.

         (2) Any holder of the coupon mentioned in paragraph (1) may at any time
         demand payment of the amount deducted in exchange for such coupon.


ARTICLE 487 (EXTINCTIVE PRESCRIPTION FOR RIGHT TO DEMAND REDEMPTION)


         (1) The right to demand redemption of the bonds shall lapse by
         prescription if it is not exercised for ten years.

         (2) The same shall apply to the right set forth in Article 484 (3).

         (3) The right to demand payment of interest of the bonds and the rights
         mentioned in Article 486 (2) shall lapse by prescription, if it is not
         exercised for five years.


ARTICLE 488 (REGISTER OF BONDS)

         The register of bonds shall be prepared by the company and the
         following particulars shall be entered in such register:

         1.Name and address of each bondholder;

         2.Serial number of each bond certificate;

         3.Particulars set forth in Article 474 (2) 4, 5, 7 through 9 and 13;

         4.Amount paid in for each bond and date of each payment;

         5.Date of issuance of the bond certificates;

         6.Date of acquisition of each bond; and


<PAGE>

         7.In case of issuance of bearer bonds, the class, number, serial number
         and date of issuance


ARTICLE 489 (APPLICABLE PROVISIONS)


         (1) Article 353 shall apply mutatis mutandis to notices and peremptory
         notices to subscribers for bonds and to bondholders.

         (2) Article 333 shall apply mutatis mutandis where bonds belong to
         coownership of two or more persons.


         SUB-SECTION 2 MEETINGS OF BONDHOLDERS

ARTICLE 490 (MATTERS SUBJECT TO RESOLUTION)

         Unless otherwise provided in this Act, a meeting of bondholders may
         adopt resolutions, with the permission of the court, in respect of any
         matter which seriously affects the interests of bondholders.


ARTICLE 491 (PERSON AUTHORIZED TO CONVENE)


         (1) A meeting of bondholders shall be convened by the company which
         issued the bonds or by a company which has been commissioned to offer
         bonds for subscription.

         (2) Bondholders representing at least 1/10 of the total amount of the
         bonds may demand the convocation of a meeting of bondholders by
         submitting to either of the companies mentioned in paragraph (1) a
         written application containing the proposed subject-matters of the
         meeting and the reasons for convening such

<PAGE>

         meeting.

         (3) Article 366 (2) shall apply mutatis mutandis in case of paragraph
         (1).

         (4) The holder of bearer bond certificates may not exercise the right
         mentioned in paragraphs (1) and (2) unless he has deposited his bond
         certificates.


ARTICLE 492 (VOTES)


         (1) Each bondholder shall have one vote for each minimum face amount of
         the bonds.

         (2) The holder of bearer bond certificates may not exercise his voting
         rights unless he has deposited his bond certificates at least one week
         prior to the date set for the meeting.


ARTICLE 493 (ATTENDANCE OF REPRESENTATIVE OF ISSUING OR COMMISSIONED COMPANY)


         (1) The issuing company or the company which has been commissioned to
         offer bonds for subscription may have its representative attend a
         meeting of bondholders or may produce its opinion in writing.

         (2) The convocation of a meeting of bondholders shall be notified to
         the companies mentioned in paragraph (1).

         (3) Article 363 (1) and (2) shall apply mutatis mutandis to the
         notification under paragraph (2).


ARTICLE 494 (RIGHT TO DEMAND ISSUING COMPANY TO MAKE ITS REPRESENTATIVE ATTEND)

         A meeting of bondholders or the person who has convened such meeting
         may, if

<PAGE>

         deemed necessary, demand the issuing company to make its representative
         attend the meeting.


ARTICLE 495 (METHOD OF RESOLUTION)


         (1) Article 434 shall apply mutatis mutandis to the resolutions of a
         meeting of bondholders.

         (2) The consent or demand mentioned in Articles 481 through 483 and 494
         may, notwithstanding paragraph (1) above, be decided by a majority of
         the votes of the bondholders present.


ARTICLE 496 (APPLICATION FOR AUTHORIZATION OF RESOLUTION)

         Persons who have convened a meeting of bondholders shall apply to the
         court for the authorization of the resolutions within one week from the
         day on which such resolutions have been adopted.


ARTICLE 497 (REASONS FOR NON-AUTHORIZATION OF RESOLUTION)


         (1) The court shall not authorize the resolution of a meeting of
         bondholders in the following cases:

         1.If the procedures for convening the meeting of bondholders or the
         manner of adopting the resolution was in contravention of any Acts and
         subordinate statutes or of any statement contained in the prospectus
         for offering of bonds;

         2.If the resolution was adopted in an improper manner;

         3.If the resolution was remarkably unfair; and


<PAGE>

         4.If the resolution was contrary to the interests of the bondholders in
         general.

         (2) In case of paragraph (1) 1 and 2,the court may authorize such a
         resolution by taking into account the details of the resolution and all
         other circumstances.


ARTICLE 498 (EFFECT OF RESOLUTION)


         (1) A resolution of a meeting of bondholders shall take effect by
         obtaining the authorization of the court.

         (2) A resolution of a meeting of bondholders shall be effective against
         all the bondholders.


ARTICLE 499 (PUBLIC NOTICE OF AUTHORIZATION OR NON-AUTHORIZATION OF RESOLUTION)

         When a decision has been made either to authorize or not to authorize a
         resolution of a meeting of bondholders, the company which issued the
         bonds shall without delay give public notice thereof.


ARTICLE 500 (REPRESENTATIVES OF MEETING OF BONDHOLDERS)


         (1) A meeting of bondholders may elect one or more representatives from
         among the holders of bonds representing no less than 1/500 of the total
         amount of the bonds and may delegate him or them to decide matters
         which are to be dealt with by its resolution.

         (2) If there are two or more representatives, the decision under
         paragraph (1) shall be made by a majority of their votes.


ARTICLE 501 (EXECUTION OF RESOLUTION)


<PAGE>

         A resolution of a meeting of bondholders shall be executed either by a
         company commissioned to offer bonds for subscription or, in the absence
         of any such company, by the representatives mentioned in Article 500:
         Provided, That it shall not be the case where a person has been
         appointed to execute the resolution by the resolution of a meeting of
         bondholders.


ARTICLE 502 (TWO OR MORE REPRESENTATIVES OF MEETING OR EXECUTORS OF RESOLUTION)

         Article 485 (1) shall apply mutatis mutandis where there are two or
         more representatives of meeting or executors resolution.


ARTICLE 503 (EXECUTION OF RESOLUTION RELATING TO REDEMPTION)

         Articles 484, 485 (2) and 487 (2) shall apply mutatis mutandis where
         either the representatives of meeting or the executors of the
         resolution execute a resolution relating to the redemption of the
         bonds.


ARTICLE 504 (REMOVAL OF REPRESENTATIVE OF MEETING OR EXECUTOR OF RESOLUTION,
ETC.)

         The meeting of bondholders may adopt a resolution at any time to remove
         from office any representative of the meeting or executor of the
         resolution and may alter details of any matter delegated to such
         person.


ARTICLE 505 (ACCELERATION)


         (1) If a company has neglected to pay interest on the bonds or has
         neglected to redeem them where a part of the bonds are to be redeemed
         at fixed periods, the bondholders may by a resolution of a meeting of
         bondholders give notice to the company to the effect that payment
         thereof must be made within a fixed period of time and that if the
         company fails to make payment within such period, it shall

<PAGE>

         accelerate payment of the whole amount of the bonds: Provided, That
         such period shall not be shorter than two months.

         (2) The notice mentioned in paragraph (1) shall be given in writing.

         (3) If a company fails to pay within the period mentioned in paragraph
         (1), it shall accelerate the payment of the whole amount of the bonds.


ARTICLE 506 (PUBLIC NOTICE AND NOTICE OF ACCELERATION)

         When a company is subject to acceleration in accordance with Article,
         505, the person who executes of a resolution under Article 505 (1)
         shall without delay give public notice to that effect and give a
         separate notice to each bondholders known to the company thereof.


ARTICLE 507 (REMUNERATION AND EXPENSES FOR COMMISSIONED COMPANY)


         (1) Unless otherwise provided in the contract made with the issuing
         company, any remuneration payable to a company commissioned to offer
         bonds for subscription, representatives of a meeting or executors of a
         resolution or any expenses necessary for the execution of their duties
         may be borne by the company, with the permission of the court. (Amended
         by Act No. 1212, Dec. 12, 1962)

         (2) Any company commissioned to offer bonds for subscription and any
         representative of a meeting or executor of a resolution may receive
         remuneration and expenses mentioned in paragraph (1) out of the
         redemption amount, in preference to bondholders.


ARTICLE 508 (EXPENSES RELATING TO MEETINGS OF BONDHOLDERS)

<PAGE>


         (1) Any expenses relating to meetings of bondholders shall be borne by
         the issuing company.

         (2) Any expenses relating to the demand under Article 496 shall be
         borne by the company. The court may, however, upon the application of
         any interested person or ex officio, specially determine a person who
         shall bear such expenses in whole or in part.


ARTICLE 509 (MEETINGS OF CERTAIN CLASSES OF BONDHOLDERS)

         If two or more classes of bonds have been issued, a meeting of
         bondholders shall be convened for each class of bonds respectively.


ARTICLE 510 (APPLICABLE PROVISIONS)


         (1) Articles 363, 368 (3) and (4), 369 (2), and 371 through 373 shall
         apply mutatis mutandis to a meeting of bondholders.

         (2) The minutes of meetings of bondholders shall be kept by the issuing
         company at its principal office.

         (3) A company commissioned to offer bonds for subscription and any
         bondholder may, at any time during business hours, demand inspection of
         the minutes mentioned in paragraph (2).


ARTICLE 511 (ACTION FOR REVOCATION BY COMMISSIONED COMPANY)


         (1) If payment, settlement or any other act effected by a company to a
         certain bondholder is remarkably unfair, a company commissioned to
         offer bonds for subscription may demand the revocation thereof, only by
         means of action to court.


<PAGE>

         (2) The action mentioned in paragraph (1) shall be brought within six
         months from the day on which the company becomes aware of the forming
         the ground for revocation and within one year from the day when such
         act becomes effective.

         (3) Article 186 of this Act and the proviso of Article 406 (1) and
         Article 407 of the Civil Act shall apply mutatis mutandis to the action
         mentioned in paragraph (1).


ARTICLE 512 (ACTION FOR REVOCATION BY REPRESENTATIVE, ETC.)

         When a resolution has been adopted by a meeting of bondholders, any
         representative of a meeting or executor of a resolution may also bring
         the action mentioned in Article 511 (1): Provided, That such action
         shall be brought within one year from the day when such act becomes
         effective.


         SUB-SECTION 3 CONVERTIBLE BONDS

ARTICLE 513 (ISSUANCE OF CONVERTIBLE BONDS)


         (1) A company may issue convertible bonds.

         (2) In case of paragraph (1), any of the following matters not provided
         for in the articles of incorporation shall be determined by the board
         of directors, unless the articles of incorporation provides that it
         shall be determined by a general meeting of shareholders' meeting:

         1.Total amount of convertible bonds;

         2.Conditions of conversion;


<PAGE>

         3.Details on shares to be issued upon conversion;

         4.Period during which a claim for conversion may be demanded;

         5.Details on the preemptive rights of shareholders to subscribe for
         convertible bonds, and the amount of convertible bonds subject to such
         rights; and

         6.Details on issuance of convertible bonds to the persons other than
         shareholders, and the amount of such convertible bonds to be issued.

         (3) If, in case where convertible bonds are issued to those who are not
         shareholders of the company, the articles of incorporation do not
         include the amount of convertible bonds to be issued, conditions of
         conversion, contents of the shares to be issued upon conversion and the
         period during which the conversion may be demanded, such matters shall
         be determined by resolution under Article 434. In such case, the
         proviso of Article 418 (3) shall apply mutatis mutandis. (Amended by
         Act No. 6488, Jul. 24, 2001)

         (4) In case of resolution under paragraph (3), the summary of agenda
         relating to the issuance of convertible bonds shall be stated in the
         notice and public notice under Article 363.
         [This Article Wholly Amended by Act No. 3724, Apr. 10, 1984]


ARTICLE 513-2 (RIGHTS OF SHAREHOLDERS ENTITLED TO SUBSCRIBE FOR CONVERTIBLE
BONDS)


         (1) Any shareholder who has a right to subscribe for convertible bonds
         shall be entitled to be alloted bonds in proportion to the number of
         shares which he holds: Provided, That this shall not apply to an
         fractional bond the amount of which is less than the minimum face
         amount of each convertible bond.

         (2) Article 418 (2) shall apply mutatis mutandis where a shareholder
         has the right to subscribe for the convertible bonds.
         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]

<PAGE>

ARTICLE 513-3 (PEREMPTORY NOTICE TO SHAREHOLDERS HAVING RIGHT TO SUBSCRIBE FOR
CONVERTIBLE BONDS)


         (1) If shareholders have the preemptive right to subscribe for
         convertible bonds, the company shall notify each shareholder of the
         amount of convertible bonds which he is entitled to subscribe for,
         issue price, conditions of conversion, the details of the shares to be
         issued upon conversion, the period within which he may demand
         conversion and a statement to the effect that if he fails to subscribe
         for the convertible bonds on or before the specified date, he shall
         lose his right.

         (2) Article 419 (2) through (4) shall apply mutatis mutandis in case of
         paragraph (1).
         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 514 (PROCEDURES FOR ISSUANCE OF CONVERTIBLE BONDS)


         (1) With regard to convertible bonds, the following particulars shall
         be stated in the subscription form for bonds, the bond certificates and
         the register of bonds: (Amended by Act No. 5053, Dec. 29, 1995)

         1.A statement to the effect that the bonds may be converted into
         shares;

         2.Conditions of conversion;

         3.Particulars as to shares to be issued upon conversion;

         4.Period during which conversion may be demanded; and

         5.Provision that the transfer of shares should be subject to the
         approval of the board of directors, if so determined.


<PAGE>

         (2) Deleted. (by Act No. 3724, Apr. 10, 1984)


ARTICLE 514-2 (REGISTRATION OF CONVERTIBLE BONDS)


         (1) When a company has issued convertible bonds, the company shall
         register them at the place of its principal office within two weeks
         from the date payment under Article 476 is completed. (Amended by Act
         No. 5053, Dec. 29, 1995)

         (2) The particulars to be registered under paragraph (1) shall be as
         follows:

         1.Total amount of convertible bonds;

         2.Face amount of each convertible bond;

         3.Amount paid for each convertible bond; and

         4.Matters set forth in subparagraphs 1 through 4 of Article 514.

         (3) Article 183 shall apply mutatis mutandis to the registration under
         paragraph (2).

         (4) If, in case where convertible bonds have been issued overseas, the
         matters to be registered take place in a foreign country, the period
         within which registration shall be made shall start to run from the
         date of arrival of notification thereof.
         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 515 (DEMAND FOR CONVERSION)


         (1) Any person who demands conversion shall submit to the company two
         copies of a written application form together with the bond
         certificates.


<PAGE>

         (2) The written application form mentioned in paragraph (1) shall state
         the bonds to be converted and the date of application and contain a
         name and a seal or signature by the person demanding conversion.
         (Amended by Act No. 5053, Dec. 29, 1995)


ARTICLE 516 (APPLICABLE PROVISIONS)


         (1) Articles 346 (2), 424 and 424-2 shall apply mutatis mutandis to the
         issuance of convertible bonds.

         (2) Articles 339, 348, 350 and 351 shall apply mutatis mutandis to the
         conversion of bonds. (Amended by Act No. 5053, Dec. 29, 1995)

         [This Article Wholly Amended by Act No. 3724, Apr. 10, 1984]


         SUB-SECTION 4 BONDS WITH WARRANTS

ARTICLE 516-2 (ISSUANCE OF BONDS WITH WARRANTS)


         (1) A company may issue bonds with warrants to subscribe for new
         shares.

         (2) In case of paragraph (1), any of the following matters which are
         not provided for in the articles of incorporation shall be determined
         by the board of directors, unless the articles of incorporation provide
         that it shall be determined by a general of shareholders' meeting:

         1.Total amount of bonds with warrants;

         2.Details of the warrants vested to such bonds;

         3.Period within which the warrants are to be exercised;


<PAGE>

         4.A statement on the transferability of only the warrants;

         5.A statement to the effect that upon request of the person who intends
         to exercise his warrant rights, the issue price of the bonds with
         warrants shall be deemed as payment under Article 516-8 (1), instead of
         the redemption of such bonds;

         6.Deleted; (by Act No. 5053, Dec. 29, 1995)

         7.Details on the preemptive rights to subscribe for bonds with warrants
         and the amount of bonds subject to such rights; and

         8.Details on issuance of bonds with warrants to persons other than
         shareholders and the amount of such bonds with warrants to be issued.

         (3) The total amount of issue price of the shares to be issued upon the
         exercise of warrant rights vested to each bonds shall not exceed the
         total amount of such bonds with warrant.

         (4) If, in case where the bonds with warrants are issued to those who
         are not shareholders, the articles of incorporation do not include the
         amount of such bonds, contents of the warrant rights and the period
         within which the warrant rights are to be exercised, these matters
         shall be determined by a resolution under Article 434. In such case,
         the proviso of Article 418 (3) shall apply mutatis mutandis. (Amended
         by Act No. 6488, Jul. 24, 2001)

         (5) Article 513 (4) shall apply mutatis mutandis to the case of
         paragraph (4).

         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 516-3 (PEREMPTORY NOTICE TO SHAREHOLDERS HAVING RIGHT TO SUBSCRIBE FOR
BONDS WITH WARRANTS)


         (1) If shareholders have the preemptive rights to subscribe for bonds
         with warrants, the company shall notify each shareholder of the amount
         of bonds with

<PAGE>

         warrants which he is entitled to subscribe for, the issue price, the
         particulars of warrant rights, the period within which he may exercise
         his warrant rights and a statement to the effect that if he fails to
         subscribe for the bonds with warrants on or before the specified date,
         he will lose his right. In this case, if the matters set forth in
         Article 516-2 (2) 4 or 5 have been determined, the details of such
         matters shall also be notified.

         (2) Article 419 (2) through (4) shall apply mutatis mutandis to the
         case of paragraph (1).

         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 516-4 (PARTICULARS TO BE ENTERED IN SUBSCRIPTION FORM FOR BONDS, BOND
CERTIFICATES AND REGISTER OF BONDS)

         The following matters shall be entered in the subscription form for
         bonds, the bond certificates and the register of bonds in case of bonds
         with warrants: Provided, That when the company issues the certificates
         of warrants set forth in Article 516-5 (1), it shall not be required to
         enter them in the bond certificates: (Amended by Act No. 5053, Dec. 29,
         1995)

         1.A statement to the effect that a bond with warrant;

         2.Particulars set forth in Article 516-2 (2) 2 through 5;

         3.The banks and other financial institutions that will be responsible
         to receive the payment under Article 516-8 and the places where such
         payments are to be made; and

         4.Provision that the transfer of shares should be subject to the
         approval of the board of directors, if so determined. [This Article
         Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 516-5 (ISSUANCE OF CERTIFICATES OF WARRANTS)

<PAGE>

         (1) If a company has determined the particulars set forth in Article
         516-2 (2) 4, it shall issue the certificates of warrants in addition to
         the bond certificates.

         (2) Certificates of warrants shall contain the following particulars in
         addition to the serial number and directors shall write their names and
         affix their seals or shall sign thereon : (Amended by Act No. 5053,
         Dec. 29, 1995)

         1.A statement to the effect that it is a certificate of warrant;

         2.Trade name of company;

         3.Matters set forth in Article 516-2 (2) 2, 3 and 5;

         4.Matters set forth in subparagraph 3 of Article 516-4; and

         5.Provision that the transfer of shares should be subject to the
         approval of the board of directors, if so determined.
         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 516-6 (TRANSFER OF WARRANT RIGHTS)


         (1) If certificates of warrants have been issued, transfer of the
         warrant rights shall be made only by the delivery of such certificates
         of warrants.

         (2) Articles 336 (2) and 360 of this Act and Article 21 of the Check
         Act shall apply mutatis mutandis to the certificates of warrants.
         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 516-7 (REGISTRATION OF BONDS WITH WARRANTS)


         (1) When a company has issued bonds with warrants, it shall register
         the

<PAGE>

         following:

         1.A statement to the effect that they are bonds with warrants;

         2.Total amount of issue price of the shares to be issued upon the
         exercise of warrant rights;

         3.Faceamount of each bond with warrants;

         4.Amount paid in for such bonds with warrants; and

         5.Matters set forth in Article 516-2 (2) 1 through 3.

         (2) Article 514-2 (1), (3) and (4) shall apply mutatis mutandis to the
         registration under paragraph (1).
         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 516-8 (EXERCISE OF WARRANT RIGHTS)


         (1) Any person who intends to exercise his warrant right shall submit
         to the company two copies of a written application form therefor and
         shall pay the total amount of issue price of the new shares.

         (2) When written application forms are submitted pursuant to paragraph
         (1), the certificates of warrants, if they have been issued, shall be
         submitted together with the application form, but if such certificates
         have not been issued, the bond certificates shall instead be presented.

         (3) The payment under paragraph (1) shall be made to the banks or other
         financial institutions named in the bond certificates or in the
         certificates of warrants.

         (4) Article 302 (1) shall apply mutatis mutandis to the written
         application forms under paragraph (1) and Articles 306 and 318 shall
         apply mutatis mutandis to the

<PAGE>

         banks and other financial institutions responsible for receipt of
         payment under paragraph (3).1
         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 516-9 (TIME OF BECOMING SHAREHOLDER)

         A person who has exercised his warrant rights pursuant to Article 516-8
         (1) shall become a shareholder at the time when he makes payment under
         that Article. In this case, Article 350 (2) and (3) shall apply mutatis
         mutandis. (Amended by Act No. 5053, Dec. 29, 1995)
         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 516-10 (APPLICABLE PROVISIONS)

         Article 351 shall apply mutatis mutandis to the exercise of warrant
         rights and Articles 513-2 and 516 (1) shall apply mutatis mutandis to
         bonds with warrants. (Amended by Act No. 5053, Dec. 29, 1995)
         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


         SECTION 9 DISSOLUTION

ARTICLE 517 (REASONS FOR DISSOLUTION)

         A stock company shall be dissolved for any of the following reasons:
         (Amended by Act No. 5591, Dec. 28, 1998)

         1.Reasons set forth in subparagraphs 1, 4 through 6 of Article 227;

         1-2.Division or merger through division of a company under Article
         530-2; and

         2.A resolution of a general shareholders' meeting.

<PAGE>

ARTICLE 518 (RESOLUTION FOR DISSOLUTION)

         The resolution for dissolution shall be adopted in accordance with
         Article 434.


ARTICLE 519 (CONTINUANCE OF COMPANY)

         Where a company has been dissolved by reason of the expiration of the
         duration or of the occurrence of any other events specified in the
         Article of incorporation as reason for dissolution or by the resolution
         of a general shareholders' meeting, the company may continue to exist
         by such resolution as provided for in Article 434.


ARTICLE 520 (JUDGMENT FOR DISSOLUTION)


         (1) If, in the cases mentioned below, there exist unavoidable reasons,
         any shareholder who holds shares representing no less than 10/100 of
         the total issued and outstanding shares may apply to the court for the
         dissolution of the company:

         1.When the company's business operation continues to be remarkably in
         deadlock and as a result irreparable injury to the company is suffered
         or threatened; and

         2.When the managing or disposing of the company's property is
         remarkably improper and the existence of the company is thereby in
         danger.

         (2) Articles 186 and 191 shall apply mutatis mutandis to the
         application under paragraph (1).


ARTICLE 520-2 (DISSOLUTION OF DORMANT COMPANY)

<PAGE>

         (1) If, in case where the administrator of the Office of Court
         Administration has given a public notice in the Gazette that any
         company whose last registration was made five years ago shall make a
         report to the effect that it has not yet closed its business to the
         court that has the jurisdiction over the place of its principal office,
         a company for which five years has already lapsed since its last
         registration as of the day of public notice fails to report within two
         months from the day of public notice in accordance with the
         Presidential Decree, the company shall be deemed to have been dissolved
         at the expiration of the period set for such a report: Provided, That
         it shall not be the case if the company has effected a registration
         during the period.

         (2)In case of a public notice under paragraph (1), the court shall also
         send to the company concerned a separate notice informing that such
         public notice has been given.

         (3) A company which is deemed to have been dissolved pursuant to
         paragraph (1) may continue to exist by a resolution under Article 434
         within three years thereafter.

         (4) If a company which is deemed to have been dissolved pursuant to
         paragraph (1) fails to continue to exist as a company in accordance
         with paragraph (3), it shall be deemed to have been liquidated when the
         period of the above three years has lapsed. [This Article Newly
         Inserted Act No. 3724, Apr. 10, 1984]


ARTICLE 521 (NOTICE AND PUBLIC NOTICE OF DISSOLUTION)

         Upon the dissolution of a company, except in the case of bankruptcy,
         the directors shall without delay dispatch notice thereof to the
         shareholders and, in cases where bearer share certificates have been
         issued, shall give public notice thereof.


ARTICLE 521-2 (PROVISIONS TO BE APPLIED MUTATIS MUTANDIS)


<PAGE>

         The provisions of Articles 228 and 229 (3) shall apply mutatis mutandis
         to the dissolution of a stock company.
         [This Article Newly Inserted by Act No. 5591, Dec. 28, 1998]


         SECTION 10 MERGER

ARTICLE 522 (WRITTEN AGREEMENT OF MERGER AND RESOLUTION OF APPROVAL)


         (1) In order to effect a merger of companies, a written agreement for
         merger shall be prepared and be approved by a general shareholders'
         meeting. (Amended by Act No. 5053, Dec. 29, 1995; Act No. 5591, Dec.
         28, 1998)

         (2) The summary of the written agreement of a merger shall be stated in
         notices and public notices under Article 363.

         (3) The resolution of approval mentioned in paragraph (1) shall be
         adopted in accordance with Article 434. (Amended by Act No. 5591, Dec.
         28, 1998)


ARTICLE 522-2 (PUBLIC NOTICE OF WRITTEN AGREEMENT OF MERGER)


         (1) Directors of a company shall keep the following documents in its
         principal office from two weeks before the day on which the general
         shareholders' meeting is held under Article 522 (1) until six months
         after the merger is effected: (Amended by Act No. 5591, Dec. 28, 1998)

         1.A written agreement of such merger;

         2.A document specifying the reasons for the allotment of shares which
         are issued to the shareholders of a company which ceases to exist in
         consequence of a merger; and


<PAGE>

         3.The final balance sheet and statement of profit and loss of each
         company.

         (2) Any shareholder or creditor of the company may, at any time during
         business hours, request the inspection of a document under any
         subparagraph of paragraph (1) or request the delivery of the copies or
         abstracts of them with payment of the cost as determined by the
         company. (Amended by Act No. 5591, Dec. 28, 1998)
         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 522-3 (APPRAISAL RIGHTS OF SHAREHOLDERS DISSENTING MERGER)


         (1) If, in case where the board of directors has made a resolution on
         the matters set forth in Article 522 (1), a shareholder dissenting from
         such resolution has notified in writing the company of his intention of
         dissenting before the general meeting is held, he may demand in writing
         that the company purchase his shares, with the class and number of such
         shares specified, within twenty days after the general meeting makes
         the resolution.

         (2) A shareholder who made a written notification of the intention of
         dissenting from a merger to the company within two weeks from the day
         on which a public notice or notification under Article 527-2 (2) was
         made may request that the company purchase his own shares in a written
         statement specifying the class and number of shares within 20 days
         after the period passed. (Newly Inserted by Act No. 5591, Dec. 28,
         1998)
         [This Article Newly Inserted by Act No. 5053, Dec. 29, 1995]


ARTICLE 523 (WRITTEN AGREEMENT OF MERGER)

         If one of the constituent companies of a merger survives after the
         merger, the written agreement of such merger shall contain the
         following particulars: (Amended by Act No. 5591, Dec. 28, 1998; Act No.
         6488, Jul. 24, 2001)

         1.If the surviving company which is to continue to exist increases, due
         to the

<PAGE>

         merger, the total number of shares authorized to be issued, the total
         number of shares authorized to be increased, the class and the number;

         2.Total amount of the capital and the reserve of the surviving company
         to be increased;

         3.Total number, class, number per class of shares to be issued at the
         time of the merger by the surviving company as well as any other
         particulars relating to the allotment of new shares to the shareholders
         of the company which is to cease to exist;

         4.The amount which is to be paid by the surviving company to the
         shareholders of the merged company, if so determined;

         5.Date set for the general members' meeting or general shareholders'
         meeting at which the resolution of the approval for the merger shall be
         adopted;

         6.Date on which the merger is to be effected;

         7.Matters on the change of the articles of incorporation which is to be
         effected by the surviving company in consequence of the merger, if so
         determined;

         8.The limit where each company makes a profit distribution due to the
         merger or the profit distribution in cash under Article 462-3 (1); and

         9.Where the directors, auditors or members of the audit committee who
         are to take offices in the company surviving after the merger are
         determined, their names and resident registration numbers.


ARTICLE 524 (WRITTEN AGREEMENT OF CONSOLIDATION)

         If a new company is to be formed by a merger, the written agreement of
         such merger shall contain the following particulars: (Amended by Act
         No. 6488, Jul. 24, 2001)


<PAGE>

         1.With regard to the company to be formed, the matters set forth in
         Article 289 (1), 1 through 4, the class and the number if different
         classes of shares are to be issued and the place of the principal
         office;

         2.Total number, class, number per class of shares which are to be
         issued by the company to be incorporated as well as any other
         particulars relating to the allotment of shares to the shareholders of
         each constituent company;

         3.Total amount of the capital and the reserve of the company to be
         formed;

         4.The amount payable to the shareholders of each constituent company,
         if so determined;

         5.Particulars set forth in subparagraphs 5 and 6 of Article 523; and

         6.Where the directors, auditors or members of the audit committee who
         are to take offices in the company formed by a merger are determined,
         their names and resident registration numbers.


ARTICLE 525 (WRITTEN AGREEMENT OF MERGER OF PARTNERSHIP COMPANY OR LIMITED
PARTNERSHIP COMPANY)


         (1) If, in case where one of the constituent companies, which survives
         after the merger, is a stock company or the company which is to be
         newly incorporated by the merger is a stock company, either or both of
         the constituent companies are a partnership company or limited
         partnership company, the written agreement of such merger shall be made
         with the consent of all the members.

         (2) Articles 523 and 524 shall apply mutatis mutandis to the written
         agreement of a merger under paragraph (1).


ARTICLE 526 (GENERAL MEETING FOR REPORTING IN CASE OF MERGER)



<PAGE>

         (1) If one of the constituent companies survives after the merger, its
         directors shall without delay convene a general shareholders' meeting
         at which they shall make a report on matters relating to the merger,
         after the procedures set forth in Article 527-5 has been completed, or
         after the consolidation of shares has taken effect if shares have been
         consolidated in consequence of the merger, or after disposal set forth
         in Article 443 has been effected by the surviving company if there are
         shares which are not fit for consolidation, or, in case of a
         small-scale merger, after the procedures under Article 527-3 (3) and
         (4) has been completed. (Amended by Act No. 5591, Dec. 28, 1998)

         (2) A person who has subscribed for the new shares issued at the time
         of merger shall have the same rights as the shareholder at the general
         shareholders' meeting under paragraph (1). (Amended by Act No. 5591,
         Dec. 28, 1998)

         (3) In case of paragraph (1), the board of directors may make a public
         notice in lieu of a report to the general shareholders' meeting. (Newly
         Inserted by Act No. 5053, Dec. 29, 1995)


ARTICLE 527 (INAUGURAL GENERAL MEETING IN CASE OF CONSOLIDATION)


         (1) If a new company is to be incorporated by a merger, members of the
         organizing committees shall without delay convene an inaugural general
         meeting after the procedures set forth in Article 527-5 have been
         completed, or after the consolidation of shares has taken effect if
         shares have been consolidated in consequence of the merger, or after
         the disposal mentioned in Article 443 has been effected if there are
         shares which are not fit for consolidation. (Amended by Act No. 5591,
         Dec. 28, 1998)

         (2) At the inaugural general meeting, a resolution for the amendment of
         the articles of incorporation may be adopted: Provided, That the
         resolution may not contradict the tenor of the agreement of such
         merger.


<PAGE>

         (3) Articles 308 (2), 309, 311, 312 and 316 (2) shall apply mutatis
         mutandis to the inaugural general meeting mentioned in paragraph (1).

         (4) In case of paragraph (1), the board of directors may make a public
         notice in lieu of a report to the general shareholders' meeting. (Newly
         Inserted by Act No. 5591, Dec. 28, 1998)


ARTICLE 527-2 (SIMPLIFIED MERGER)


         (1) Where one of the constituent companies of a merger survives, if
         there is the agreement of the total shareholders of a company to be
         extinguished due to the merger or 90/100 or more of the total issued
         and outstanding shares in such company are held by the surviving
         company, the approval of the general shareholders' meeting of the
         company to be extinguished may be replaced by the approval of the board
         of directors of such company.

         (2) In case of paragraph (1), a company to be extinguished due to a
         merger shall give public notice or make notification to the
         shareholders that the company shall be merged without approval by the
         general meeting of shareholders within two weeks after the written
         agreement of such merger was prepared: Provided, That the same shall
         not apply where the agreement of the total shareholders is obtained.
         [This Article Newly Inserted by Act No. 5591, Dec. 28, 1998]


ARTICLE 527-3 (SMALL-SCALE MERGER)


         (1) Where the total number of new shares issued by the surviving
         company of a merger does not exceed 5/100 of the total issued shares of
         the company, the approval of the general shareholders' meeting of the
         company may be replaced by the approval of the board of directors of
         such company: Provided, That where there is a fixed amount to be paid
         to shareholders of a company to be extinguished in consequence of the
         merger, if the amount exceeds 2/100 of the

<PAGE>

         amount of net assets existing on the final balance sheet of the
         surviving company, this shall not apply.

         (2) In case of paragraph (1), the written agreement of the merger of
         the surviving company shall include that the merger shall be effected
         without approval by the general meeting of shareholders.

         (3) In case of paragraph (1), the surviving company shall make a public
         notice or notification to the shareholders of the trade name and seat
         of the principal office of the company to be extinguished, the date of
         the merger, and that the merger shall be effected without approval by
         the general meeting of shareholders within two weeks after the written
         agreement of the merger was prepared.

         (4) Where shareholders who own no less than 20/100 of the total issued
         shares of a company which continues to exist after a merger notify the
         company of their intention of dissenting from the merger in writing
         under paragraph (1) within two weeks after they received a public
         notice or notification under paragraph (3), the merger shall not be
         effected under the main sentence of paragraph (1).

         (5) The provisions of Article 522-3 shall not apply to a case under the
         main sentence of paragraph (1).
         [This Article Newly Inserted by Act No. 5591, Dec. 28, 1998]


ARTICLE 527-4 (TERMS OF OFFICE OF DIRECTOR AND AUDITOR)


         (1) Where one of the constituent companies of a merger survives, a
         director or auditor of the surviving company who took office before the
         merger shall be retired when the regular general meeting, held in a
         settling term which comes first after the merger, is completed, except
         as otherwise prescribed by the written agreement of the merger.

         (2) Deleted. (by Act No. 6488, Jul. 24, 2001)
         [This Article Newly Inserted by Act No. 5591, Dec. 28, 1998]

<PAGE>

ARTICLE 527-5 (PROCEDURES FOR PROTECTION OF CREDITORS)


         (1) Within two weeks after a resolution of approval by the general
         meeting of shareholders is rendered under Article 522, a company shall
         give its creditors a public notice that an objection, if any, against
         the merger should be raised within a period of not less than one month
         and shall give a peremptory notice to the respective creditors known to
         the company.

         (2) In the application of the provisions of paragraph (1), a resolution
         of approval by the board of directors shall, in case of Articles 527-2
         and 527-3, be deemed to be that by the general meeting of shareholders.

         (3) The provisions of Article 232 (2) and (3) shall apply mutatis
         mutandis to a case under paragraphs (1) and (2).
         [This Article Newly Inserted by Act No. 5591, Dec. 28, 1998]


ARTICLE 527-6 (EX POST FACTO NOTICE OF DOCUMENTS ON MERGER)


         (1) A director shall keep in the principal office written documents
         specifying the progress of procedures under Article 527-5, the date of
         merger, the value of property and amount of debts succeeded to from a
         company which is extinguished due to the merger, and other matters
         concerning the merger, for six months from the date of the merger.

         (2) The provisions of Article 522-2 (2) shall apply mutatis mutandis to
         documents under paragraph (1).
         [This Article Newly Inserted by Act No. 5591, Dec. 28, 1998]


ARTICLE 528 (REGISTRATION OF MERGER)

<PAGE>

         (1) In case of a merger, the registration of alteration by the
         surviving company, the registration of the dissolution by the company
         which ceases to exist in consequence of the merger and the registration
         set forth in Article 317 by the company which is newly incorporated by
         consolidation shall be effected within two weeks at the place of the
         principal office and within three weeks at the place of each branch
         office from the date of the closing of the general shareholders'
         meeting or the date of a public notice in lieu of a report under
         Article 526, or from the date of the closing of the inaugural general
         meeting or the date of a public notice in lieu of a report under
         Article 527, as the case may be. (Amended by Act No. 5591, Dec. 28,
         1998)

         (2) If a surviving company or a company which is newly incorporated in
         consequence of a merger succeeds to convertible bonds or bonds with
         warrants, the registration of bonds shall be effected simultaneously
         with the registration under paragraph (1). (Amended by Act No. 3724,
         Apr. 10, 1984)


ARTICLE 529 (ACTION FOR NULLIFICATION OF MERGER)


         (1) The nullity of a merger may be asserted only through an action
         which shall be filed by each company's shareholder, director, auditor,
         liquidator or bankruptcy trustee or creditor who has opposed the
         merger. (Amended by Act No. 3724, Apr. 10, 1984)

         (2) The action under paragraph (1) shall be brought within six months
         from the day on which the registration under Article 528 has been
         effected.


ARTICLE 530 (APPLICABLE PROVISIONS)


         (1) Deleted. (by Act No. 5591, Dec. 28, 1998)

         (2) Articles 234, 235, 237 through 240, 329-2, 374 (2), 374-2 (2)
         through (5)

<PAGE>

         and 439 (3) shall apply mutatis mutandis to the merger of a stock
         company. (Amended by Act No. 5053, Dec. 29, 1995; Act No. 5591, Dec.
         28, 1998; Act No. 6488, Jul. 24, 2001)

         (3) Articles 440 through 444 shall apply mutatis mutandis to the
         consolidation or split of shares by reason of a merger of companies.
         (Amended by Act No. 5591, Dec. 28, 1998)

         (4) If shares are not consolidated, Articles 339 and 340 (3) shall
         apply mutatis mutandis to the pledges created over the shares of the
         company which ceases to exist in consequence of a merger.


         SECTION 11 DIVISION OF COMPANY

ARTICLE 530-2 (DIVISION AND MERGER THROUGH DIVISION OF COMPANY)


         (1) A company may be divided to form one or several new companies.

         (2) A company may merge with one or several existing companies through
         its division (hereinafter referred to as the "merger through
         division").

         (3) A company may be divided to form one or several new companies,
         which, in succession, may merge with other existing companies.

         (4) A company after dissolution may be divided or merged through
         division only when an existing company becomes the surviving company or
         a new company is to be incorporated by such division or merger through
         division.
         [This Article Newly Inserted by Act No. 5591, Dec. 28, 1998]


ARTICLE 530-3 (APPROVAL FOR DIVISION PLAN AND WRITTEN AGREEMENT OF MERGER
THROUGH DIVISION)



<PAGE>

         (1) A company which is to be divided or merged through division shall
         prepare a division plan or a written agreement of a merger through
         division, which shall be approved by the general meeting of
         shareholders.

         (2) A resolution of approval under paragraph (1) shall be made in
         accordance with Article 434.

         (3) With respect to a resolution under paragraph (2), a shareholder
         under Article 370 (1) shall also have a voting right.

         (4) A summary of a division plan or a written agreement of a merger
         through division shall be entered in a notice and public notice under
         Article 363.

         (5) Where a company which issued several classes of shares comes to
         inflict a loss to a class of shareholders due to division or a merger
         through division, the division or merger through division shall be
         subject to a resolution by the general meeting of such shareholders
         under Article 435.

         (6) Where the liability of shareholders of each constituent company of
         division or a merger through division is to be increased due to such
         division or merger through division, such division or merger through
         division shall be subject to an agreement from all of such shareholders
         in addition to a resolution under paragraphs (2) and (5).
         [This Article Newly Inserted by Act No. 5591, Dec. 28, 1998]


ARTICLE 530-4 (INCORPORATION OF COMPANY BY DIVISION)


         (1) The provisions of Section 1 of this Chapter concerning the
         incorporation of a company shall apply mutatis mutandis to the
         incorporation of a company under Article 530-2.

         (2) Notwithstanding paragraph (1), a company to be incorporated through
         division may be so incorporated even through investments made only by
         the

<PAGE>

         company to be divided. In this case, the provisions of Article 299
         shall not apply where the shares of the company to be incorporated are
         issued to the shareholders of the company to be divided in proportion
         to their shares.
         [This Article Newly Inserted by Act No. 5591, Dec. 28, 1998]


ARTICLE 530-5 (ENTRIES IN DIVISION PLAN)


         (1) Where a company is to be incorporated through division, the
         following matters shall be entered in the division plan:

         1.Trade name, objective, and seat of the principal office of the
         company to be incorporated, and the method of public notice;

         2.Total number of shares which are to be issued by the company to be
         incorporated, and the par value per share;

         3.Total number, classes, and number per class of shares which are to be
         issued by the company to be incorporated at the time of such division;

         4.Matters concerning the allotment of shares by the company to be
         incorporated to the shareholders of a company to be divided, and the
         merger or split of shares pursuant to such allotment, if so determined;

         5.Amount to be paid to the shareholders of a company to be divided, if
         so determined;

         6.Matters concerning the capital and reserve of the company to be
         incorporated;

         7.Property to be transferred to the company to be incorporated and the
         value thereof;

         8.Matters determined pursuant to Article 530-9 (2), if any;

         9.Name and resident registration number of the director and auditor of
         the

<PAGE>

         company to be incorporated, if so determined; and

         10.Other matters to be entered in the articles of incorporation of the
         company to be incorporated.

         (2) Where a company continues to exist after its division, the
         following matters shall be entered in the division plan with respect to
         the surviving company:

         1.Amount of the capital and reserve to be decreased;

         2.Method of the decrease of capital;

         3.Property to be transferred due to the division and the value thereof;

         4.Total number of shares issued after the division;

         5.If the total number of shares to be issued by the company is
         decreased, the total number, classes, and number per class of shares to
         be decreased; and

         6.Other matters which cause any changes in the articles of
         incorporation.
         [This Article Newly Inserted by Act No. 5591, Dec. 28, 1998]


ARTICLE 530-6 (ENTRIES IN WRITTEN AGREEMENT OF MERGER THROUGH DIVISION)


         (1) Where part of a company to be divided merges with another company
         and the other company (hereinafter referred to as the "other party to
         merger through division") survives, the following matters shall be
         entered in the written agreement of the merger through division:

         1.If the other party to merger through division increases the total
         number of shares to be issued due to the merger through division, the
         total number, classes, and number per class of such shares;

         2.The total number, classes, and number per class of new shares to be
         issued by

<PAGE>

         the other party to merger through division at the time of such merger;

         3.Matters concerning the allotment of shares by the other party to
         merger through division to the shareholders of the company to be
         divided, and the merger or split of shares pursuant to such allotment,
         if so determined;

         4.The amount to be paid by the other party to merger through division
         to the shareholders of the company to be divided, if so determined;

         5.Matters concerning the total amount of the capital and the reserve of
         the other party to merger through division to be increased;

         6.Property and the value thereof to be transferred by the company to be
         divided to the other party to merger through division;

         7.The matters determined pursuant to Article 530-9 (3), if so
         determined;

         8.The date of the general meeting of shareholders on which the
         companies concerned are to make a resolution under Article 530-3 (2);

         9.The date on which a merger through division is to be effected;

         10.Name and resident registration number of the director and auditor of
         the other party to merger through division, if so determined; and

         11.Other matters which cause the change of the articles of
         incorporation of the other party to merger through division.

         (2) Where part of a company to be divided merges with another company
         or its part through division to incorporate a company, the following
         matters shall be entered in the written agreement of the merger through
         division:

         1.Matters provided for in Article 530-5 (1) 1, 2, and 6 through 10;

         2.The total number, classes, and number per class of shares to be
         issued by the company to be incorporated at the time of the merger
         through division;


<PAGE>

         3.Matters concerning the allotment of shares by the companies concerned
         to their shareholders, and provisions concerning the merger or split of
         shares pursuant to such allotment, if so determined;

         4.Property and the value thereof to be transferred by the respective
         companies concerned to the company to be incorporated;

         5.The amount to be paid by the respective companies concerned to their
         shareholders, if so determined;

         6.The date of the general meeting of shareholders on which the
         respective companies concerned are to make a resolution under Article
         530-3 (2); and

         7.The date on which the merger through division is to be effected.

         (3) The provisions of Article 530-5 shall apply mutatis mutandis to an
         entry concerning any part for which the respective companies concerned
         fail to effect the merger through division in case of paragraphs (1)
         and (2).
         [This Article Newly Inserted by Act No. 5591, Dec. 28, 1998]


ARTICLE 530-7 (PUBLIC NOTICE OF DIVISION BALANCE SHEET)


         (1) The director of a company to be divided shall keep the following
         documents in the principal office from two weeks before the general
         meeting of shareholders is held under Article 530-3 (1), until six
         months after the registration of division or the merger through
         division is effected:

         1.A division plan or written agreement of a merger through division;

         2.A balance sheet concerning the part to be divided;

         3.In case of a merger through division, the balance sheet of the other
         party to merger through division; and


<PAGE>

         4.A document specifying reasons for the allotment of shares to be
         issued to the shareholders of a company to be divided.

         (2) The director of the other party to merger through division under
         Article 530-6 (1) shall keep the following documents in the principal
         office from two weeks before the opening day of the general meeting of
         shareholders which is to approval the merger through division, until
         six months after the registration of the merger through division is
         effected:

         1.A written agreement of the merger through division;

         2.A balance sheet concerning the divided part of a company to be
         divided; and

         3.A document specifying reasons for the allotment of shares to be
         issued to the shareholders of a company to be divided.

         (3) The provisions of Article 522-2 (2) shall apply mutatis mutandis to
         a document under paragraphs (1) and (2).

         [This Article Newly Inserted by Act No. 5591, Dec. 28, 1998]


ARTICLE 530-8 (ACCOUNT CONCERNING DIVISION AND MERGER THROUGH DIVISION)

         Where a company which is incorporated due to a division or a merger
         through division or the other party to such merger through division
         acquires a right of business, the acquisition value may be counted in
         the assets side of the balance sheet. In this case, at least an equally
         divided portion out of such amount shall be amortized in each settling
         term within five years after the registration of incorporation or
         merger through division is effected.
         [This Article Newly Inserted by Act No. 5591, Dec. 28, 1998]


ARTICLE 530-9 (LIABILITY OF COMPANY AFTER DIVISION AND MERGER THROUGH DIVISION)

<PAGE>

         (1) Companies which are incorporated or continue to exist due to a
         division or a merger through division shall be jointly and severally
         liable to satisfy the debts of the company before the division or
         merger through division.

         (2) Notwithstanding paragraph (1), where a company to be divided
         incorporates another company by means of division upon a resolution
         under Article 530-3 (2), it may be determined that the incorporated
         company bears only the debts related to property invested thereby from
         among the debts of the company to be divided. In this case, if the
         company to be divided continues to exist after the division, the
         company shall bear only the debts which the company incorporated due to
         the division fails to repay.

         (3) In case of a merger through division, a company to be divided may,
         upon a resolution under Article 530-3 (2), determine that it bears only
         the debts, from among those of the company to be divided, related to
         property which an existing company financed due to the merger through
         division invests. In this case, the provisions of the latter part of
         paragraph (2) shall apply mutatis mutandis.

         (4) The provisions of Articles 439 (3) and 527-5 shall apply mutatis
         mutandis to a case under paragraph (2).

         [This Article Newly Inserted by Act No. 5591, Dec. 28, 1998]


ARTICLE 530-10 (EFFECT OF DIVISION OR MERGER THROUGH DIVISION)

         A company which is incorporated or continues to exist due to a division
         or a merger through division shall succeed to the rights and duties of
         the company to be divided under the conditions prescribed by a division
         plan or written agreement of the merger through division.

         [This Article Newly Inserted by Act No. 5591, Dec. 28, 1998]


ARTICLE 530-11 (PROVISIONS TO BE APPLIED MUTATIS MUTANDIS)


         (1) The provisions of Articles 234, 237 through 240, 329-2, 440 through
         444,

<PAGE>

         526, 527, 528, and 529 shall apply mutatis mutandis to division or a
         merger through division: Provided, That a member of the organizing
         committee under Article 527 shall be the representative director.

         (2) The provisions of Articles 374 (2), 439 (3), 522-3, 527-2, 527-3
         and 527-5 shall apply mutatis mutandis to a merger through division.
         (Amended by Act No. 6086, Dec. 31, 1999)
         [This Article Newly Inserted by Act No. 5591, Dec. 28, 1998]


ARTICLE 530-12 (REAL DIVISION)

         The provisions of this Section shall apply mutatis mutandis where a
         company to be divided acquires the total number of shares of a company
         to be incorporated due to a division or a merger through division.
         [This Article Newly Inserted by Act No. 5591, Dec. 28, 1998]


         SECTION 12 LIQUIDATION

ARTICLE 531 (APPOINTMENT OF LIQUIDATORS)


         (1) Upon the dissolution of a company, except in the case of
         dissolution by a merger, division, merger through division, or
         bankruptcy, directors shall become the liquidators: Provided, That it
         shall not be the case if otherwise provided in the articles of
         incorporation or if other persons have been appointed at a general
         shareholders' meeting. (Amended by Act No. 5591, Dec. 28, 1998)

         (2) If there is no liquidator pursuant to paragraph (1), the court
         shall appoint a liquidator upon the application of any interested
         person.


ARTICLE 532 (LIQUIDATOR'S REPORT)


<PAGE>

         The liquidator shall make a report on the following matters to the
         court within two weeks from the date on which he has assumed office:
         (Amended by Act No. 5053, Dec. 29, 1995)

         1.Reasonand date of dissolution; and

         2.Name, residence registration number and address of the liquidator.


ARTICLE 533 (LIQUIDATOR'S DUTY TO INVESTIGATE COMPANY'S PROPERTY AND TO REPORT)


         (1) After the liquidator has assumed office, he shall without delay
         investigate the status of the company's property and shall prepare an
         inventory list and a balance sheet and submit them to a general
         shareholders' meeting for approval.

         (2) The liquidator shall without delay submit the inventory and balance
         sheet to the court after he has obtained the approval set forth in
         paragraph (1).


ARTICLE 534 (SUBMISSION, AUDIT, DISCLOSURE AND APPROVAL OF BALANCE SHEET,
BUSINESS REPORT AND SUPPLEMENTARY SCHEDULES)


         (1) The liquidator shall prepare a balance sheet, supplementary
         schedules and a business report four weeks before the day of the
         ordinary shareholders' general meeting and submit them to the auditor.

         (2) The auditor shall submit to the liquidator the audit report on the
         documents set forth in paragraph (1) one week before the day of the
         ordinary general shareholders' meeting.

         (3) The liquidator shall keep the documents set forth in paragraph (1)
         and the audit report set forth in paragraph (2) at the principal office
         of the company from a week before the day of the ordinary general
         shareholders' meeting.


<PAGE>

         (4) Article 448 (2) shall apply mutatis mutandis to the documents set
         forth in paragraph (3).

         (5) The liquidator shall submit the balance sheet and business report
         to the ordinary general shareholders' meeting for approval.
         [This Article Wholly Amended by Act No. 3724, Apr. 10, 1984]


ARTICLE 535 (PEREMPTORY NOTICE TO CREDITORS)


         (1) The liquidator shall give peremptory notice to creditors of the
         company, by means of a public notice, at least two times within two
         months after he has assumed office, to the effect that the creditors
         present their claims within a fixed period and that any creditor
         failing to do so will be excluded from the liquidation: Provided, That
         such period shall be no less than two months.

         (2) The liquidator shall give a peremptory notice demanding the
         presenting of claims individually to each creditor known to the
         company, and such creditor shall not be excluded from the liquidation,
         even if he has failed to present his claim.


ARTICLE 536 (DISCHARGE WITHIN PERIOD FOR PRESENTING CLAIMS)


         (1) The liquidator may not effect performance in favor of creditors
         during the period set for presenting their claims pursuant to Article
         535 (1): Provided, That the company shall not be relieved of any such
         liability for damages as may be caused by the delay of performance.

         (2) Notwithstanding paragraph (1), the liquidator may, with the
         permission of the court, effect performance in respect of small claims,
         secured claims or any claims the discharge of which is not likely to
         prejudice any other creditors.

<PAGE>

ARTICLE 537 (DISCHARGE TO EXCLUDED CREDITORS)


         (1) Creditors who have been excluded from the liquidation may demand
         performance only out of the surplus assets which have not yet been
         distributed.

         (2) If distribution has been made to a part of shareholders, property
         which is necessary for distribution to other shareholders in equal
         proportion thereto shall be deducted from the surplus assets mentioned
         in paragraph (1).


ARTICLE 538 (DISTRIBUTION OF SURPLUS ASSETS)

         The surplus assets shall be distributed among the shareholders in
         proportion to the number of shares held by each shareholder: Provided,
         That this shall not apply in case of Article 344 (1).


ARTICLE 539 (REMOVAL OF LIQUIDATOR)


         (1) A liquidator, except as appointed by the court, may be removed from
         office at any time by a resolution of a general shareholders' meeting.

         (2) If a liquidator is remarkably unfit for administrating the affairs
         of liquidation or has acted in contravention of his material duties,
         any shareholder who holds shares representing no less than 3/100 of the
         total issued and outstanding shares may apply to the court for removal
         of such liquidator from office. (Amended by Act No. 5591, Dec. 28,
         1998)

         (3) Article 186 shall apply mutatis mutandis to the action relating to
         the application under paragraph (2). (Amended by Act No. 5591, Dec. 28,
         1998)


ARTICLE 540 (COMPLETION OF LIQUIDATION)

<PAGE>

         (1) When the affairs of liquidation have been completed, the liquidator
         shall without delay prepare a statement of the settlement of accounts
         and submit it to a general shareholders' meeting for approval.

         (2) When the approval under paragraph (1) has been given, the company
         shall be deemed to have relieved the liquidator of his responsibility:
         Provided, That it shall not be the case where the liquidator have
         committed any dishonest act.


ARTICLE 541 (PRESERVATION OF DOCUMENTS)


         (1) The books of a company and all important documents relating to its
         business and liquidation shall be preserved for a period of ten years
         from the time when the registration of the completion of liquidation is
         effected at the place of the principal office: Provided, That the slips
         and similar documents shall be kept for five years. (Amended by Act No.
         5053, Dec. 29, 1995)

         (2) With regard to the preservation set forth in paragraph (1), the
         court shall appoint the custodian and shall determine the method of
         preservation, upon the application of the liquidator or any other
         interested person.


ARTICLE 542 (APPLICABLE PROVISIONS)


         (1) Articles 245, 252 through 255, 259, 260 and 264 shall apply mutatis
         mutandis to a stock company.

         (2) Articles 362, 363-2, 366, 367, 373, 376 and 377, 382 (2), 386, 388
         through 394, 396, 398 through 408, 411 through 413, 414 (3), 449 (3),
         450 and 466 shall apply mutatis mutandis to the liquidator. (Amended by
         Act No. 1212, Dec. 12, 1962; Act No. 3724, Apr. 10, 1984; Act No. 5591,
         Dec. 28, 1998)



<PAGE>

         CHAPTER V LIMITED LIABILITY COMPANY

         SECTION 1 INCORPORATION

ARTICLE 543 (PREPARATION OF ARTICLES OF INCORPORATION AND ABSOLUTE PARTICULARS
TO BE ENTERED THEREIN)


         (1) Members shall prepare the articles of incorporation for the
         incorporation of a limited liability company. (Amended by Act No. 6488,
         Jul. 24, 2001)

         (2) The articles of incorporation shall contain the following
         particulars and each member shall write his name and affix his seal or
         shall sign thereon: (Amended by Act No. 3724, Apr. 10, 1984; Act No.
         5053, Dec. 29, 1995; Act No. 6488, Jul. 24, 2001)

         1.Matters set forth in subparagraphs 1 through 3 of Article 179;

         2.Total amount of capital;

         3.Amount of each contribution unit;

         4.Number of contribution units by each member; and

         5.Place of the principal office.

         (3) Article 292 shall apply mutatis mutandis to a limited liability
         company.


ARTICLE 544 (PARTICULARS CONCERNING ABNORMAL INCORPORATION)

         The following particulars shall be effective upon being stated in the
         articles of incorporation:


<PAGE>

         1.Name of the persons who is to make a contribution in kind and the
         type, quantity and value of the subject-matter of the contribution and
         the number of contribution units to be given in consideration thereof;

         2.Type, quantity and value of the property which was agreed to be
         transferred to the company after its incorporation and name of the
         transferor; and

         3.Expenses of incorporation which are to be borne by the company.


ARTICLE 545 (LIMIT ACTION ON TOTAL NUMBER OF MEMBERS)


         (1) The total number of members of a company shall not exceed fifty:
         Provided, That it shall not be the case if the authorization of the
         court has been obtained where any special circumstances exist.

         (2) Paragraph (1) shall not apply where the number of members is
         altered by succession or testamentary gift.


ARTICLE 546 (LIMIT ACTION ON TOTAL AMOUNT OF CAPITAL AND AMOUNT OF EACH
CONTRIBUTION UNIT)


         (1) The total amount of capital of a company shall be at least ten
         million won. (Amended by Act No. 3724, Apr. 10, 1984)

         (2) The amount of each contribution unit shall be no less than five
         thousand won and shall be equal. (Amended by Act No. 3724, Apr. 10,
         1984)


ARTICLE 547 (APPOINTMENT OF FIRST DIRECTORS)


         (1) Where the directors have not been designated by the articles of


<PAGE>

         incorporation, a general members' meeting shall be convened before the
         incorporation of the company and such directors shall be elected at
         such meeting.

         (2) Each member may convene a general meeting mentioned in paragraph
         (1).


ARTICLE 548 (PAYMENT FOR CONTRIBUTION)


         (1) Directors shall have the members pay the full amount of
         contributions or furnish the whole of the property which is the
         subject-matter of the contributions in kind.

         (2) Article 295 (2) shall apply mutatis mutandis to the contributions
         in kind made by members.


ARTICLE 549 (REGISTRATION OF INCORPORATION)


         (1) The registration of incorporation of a limited liability company
         shall be effected within two weeks from the day on which payment for
         contribution or performance of the contribution in kind set forth in
         the Article 548 has been performed.
         (Amended by Act No. 5053, Dec. 29, 1995)

         (2) In connection with the registration under paragraph (1), the
         following particulars shall be registered: (Amended by Act No. 5053,
         Dec. 29, 1995)

         1.Particulars set forth in subparagraphs 1, 2 and 5 of Article 179 and
         the place of branch office, if any;

         2.Particulars set forth in Article 543 (2) 2 and 3;

         3.Name, residence registration number and address of each director:
         Provided, That if the director representing the company is appointed,
         addresses of other

<PAGE>

         directors shall be excluded;

         4.Name of the representative director, if any;

         5.Provisions pertaining to the joint representation of the company by
         two or more directors, if applicable;

         6.Duration or any other reason of dissolution of the company if any;
         and

         7.Name and residence registration number of auditors, if any.

         (3) In connection with the registration to be made at the place of the
         branch office or new branch office in the event that a limited
         liability company establishes or transfers a branch office, the matters
         as prescribed in paragraph (2) 1 and 3 through 6 shall be registered.
         (Newly Inserted by Act No. 5053, Dec. 29, 1995)

         (4) Articles 181 through 183 shall apply mutatis mutandis to the
         registration of a limited liability company. (Amended by Act No. 1212,
         Dec. 12, 1962)


ARTICLE 550 (LIABILITY OF MEMBERS AS OF INCORPORATION CONCERNING CONTRIBUTION IN
KIND)


         (1) If the actual value of the property mentioned in subparagraphs 1
         and 2 of Article 544 as at the time of the incorporation of a company
         is substantially short of the value stated by the articles of
         incorporation, members as of incorporation shall be jointly and
         severally liable to pay such shortage to the company.

         (2) The liability of members set forth in paragraph (1) may not be
         exempted. (Newly Inserted by Act No. 1212, Dec. 12, 1962)


ARTICLE 551 (LIABILITY OF MEMBERS AS OF INCORPORATION CONCERNING UNPAID AMOUNT
OF CONTRIBUTION)



<PAGE>

         (1) If it is found after the formation of the company that the payment
         of the amount of contributions and the performance of contributions in
         kind has not been completed, the members, directors and auditors as of
         incorporation shall be jointly and severally liable to pay the amount
         unpaid or the value of property which has not been contributed to the
         company. (Amended by Act No. 1212, Dec. 12, 1962)

         (2) The liability of members set forth in paragraph (1) may not be
         exempted. (Newly Inserted by Act No. 1212, Dec. 12, 1962)

         (3) The liability of directors and auditors set forth in paragraph (1)
         may not be exempted without the consent of all members. (Newly Inserted
         by Act No. 1212, Dec. 12, 1962)


ARTICLE 552 (ACTION FOR NULLIFICATION OR REVOCATION OF INCORPORATION)


         (1) The nullity of incorporation of a company may be asserted only by
         means of an action which shall be brought only by the members,
         directors or auditors and the revocation of incorporation of a company
         may be asserted only by means of an action which may be brought only by
         the persons having the right of revocation, within two years from the
         date on which the company has come into existence.

         (2) Articles 184 (2) and 185 through 193 shall apply mutatis mutandis
         to the action under paragraph (1).

         [This Article Wholly Amended by Act No. 1212, Dec. 12, 1962]


         SECTION 2 RIGHTS AND DUTIES OF MEMBERS

ARTICLE 553 (LIABILITY OF MEMBER)


<PAGE>

         Unless otherwise provided in this Act, the liability of a member shall
         be limited to the amount of his contribution to the company.


ARTICLE 554 (SHARE OF MEMBER)

         Each member shall have share in the company in proportion to the number
         of his contribution units.


ARTICLE 555 (INSTRUMENTS OF SHARE)

         A limited liability company may not issue instruments to order or
         bearer instruments with regard to the respective share of members.


ARTICLE 556 (TRANSFER OF SHARE)


         (1) A member may transfer the whole or a part of his share to any other
         person only if a resolution of a general members' meeting is made
         pursuant to Article 585: Provided, That the restriction on transfer may
         be aggravated by the articles of incorporation.

         (2) If the total number of members exceeds the limit mentioned in
         Article 545, such transfer shall not be effective except in case of
         testamentary gift.

         (3) Notwithstanding paragraph (1), the articles of incorporation may
         provide otherwise with regard to the transfer of share between members.
         (Amended by Act No. 1212, Dec. 12, 1962)


ARTICLE 557 (REQUIREMENT FOR ASSERTING TRANSFER OF SHARE AGAINST COMPANY AND
THIRD PERSON)


<PAGE>

         The transfer of share shall not be set up against the company and third
         persons unless the full name and address of the transferee and the
         number of contribution units subject to the transfer have been entered
         in the register of members.


ARTICLE 558 (COMMON OWNERSHIP OF SHARE)

         Article 333 shall apply mutatis mutandis where share belongs to two or
         more persons in common.


ARTICLE 559 (PLEDGING OF SHARE)


         (1) Share may be pledged.

         (2) Articles 556 and 557 shall apply mutatis mutandis to the pledge of
         share.


ARTICLE 560 (PROVISIONS APPLICABLE MUTATIS MUTANDIS)


         (1) The provisions of Articles 339, 340 (1) and (2), 341, 341-3, 342
         and 343 (1) shall apply mutatis mutandis to the share of members.
         (Amended by Act No. 3724, Apr. 10, 1984; Act No. 6086, Dec. 31, 1999)

         (2) The provision of Article 353 shall apply mutatis mutandis to the
         notice or peremptory notice to members.


         SECTION 3 MANAGEMENT OF COMPANY

ARTICLE 561 (DIRECTORS)


<PAGE>

         A limited liability company shall have one or more directors.


ARTICLE 562 (REPRESENTATION OF COMPANY)


         (1) A director shall represent the company.

         (2) If there are two or more directors, the director who are to
         represent the company shall be elected at a general members' meeting
         unless otherwise provided in the articles of incorporation.

         (3) It may be determined by the articles of incorporation or a general
         members' meeting that two or more directors shall jointly represent the
         company.

         (4) Article 208 (2) shall apply mutatis mutandis to the cases under
         paragraph (3).


ARTICLE 563 (REPRESENTATIVE IN ACTION BETWEEN DIRECTOR AND COMPANY)

         If a company files an action against any of its directors or where a
         director files an action against the company, a person who shall
         represent the company with regard to such action shall be elected at a
         general members' meeting.


ARTICLE 564 (DETERMINATION ON MANAGEMENT OF BUSINESS, TRANSACTIONS BETWEEN
DIRECTOR AND COMPANY)


         (1) If there are several directors, management of the company's
         business, appointment or dismissal of a manager and establishment,
         transfer or closure of branch offices shall be determined by a majority
         vote of the directors, unless otherwise provided by the articles of
         incorporation. (Amended by Act No. 3724, Apr. 10, 1984)

         (2) Manager may be elected or removed at a general members' meeting,


<PAGE>

         notwithstanding paragraph (1). (Amended by Act No. 3724, Apr. 10, 1984)

         (3) A director may enter into transactions with the company for his
         account or for the account of a third person only if he has obtained
         approval from the auditor or from the general members' meeting in case
         of absence of the auditor. In this case, Article 124 of the Civil Act
         shall not apply. (Newly Inserted by Act No. 1212, Dec. 12, 1962)


ARTICLE 564-2 (RIGHT TO INJUNCTION)

         In case where a director acts in violation of Acts and subordinate
         statutes or the articles of incorporation and thereby an irreparable
         damage is likely to be caused to the company, the auditor or any member
         who holds contribution units representing not less than 3/100 of the
         total amount of capital may demand on behalf of the company that the
         director stop such an act.
         [This Article Newly Inserted by Act No. 6086, Dec. 31, 1999]


ARTICLE 565 (DERIVATE SUITS BY MEMBERS)


         (1) Any member who holds contribution units representing not less than
         3/100 of the total amount of the capital may demand that the company
         institute an action to enforce the liability of a director. (Amended by
         Act No. 6086, Dec. 31, 1999)

         (2) The provisions of Articles 403 (2) through (7) and 404 through 406
         shall apply mutatis mutandis to the case under paragraph (1). (Amended
         by Act No. 5591, Dec. 28, 1998)


ARTICLE 566 (KEEPING AND PERUSAL OF DOCUMENTS)


         (1) Directors shall keep at the principal office and at each branch
         office copies of the articles of incorporation and the minutes of the
         general members'

<PAGE>

         meetings and shall keep the register of members at the principal
         office.

         (2) The full name, address and number of contributions unit shall be
         entered in the register of members.

         (3) Any member or creditor of the company may demand, at any time
         during business hours, the perusal or copying of the documents set
         forth in paragraph (1).


ARTICLE 567 (PROVISIONS APPLICABLE MUTATIS MUTANDIS)

         The provisions of Articles 209, 210, 382, 385, 386, 388, 395, 397, 399
         through 401, 407 and 408 shall apply mutatis mutandis to directors of a
         limited liability company. In this case, the term "board of directors"
         in Article 397 shall be read as the "general members' meeting".
         (Amended by Act No. 1212, Dec. 12, 1962; Act No. 5591, Dec. 28, 1998;
         Act No. 6086, Dec. 31, 1999)


ARTICLE 568 (AUDITORS)


         (1) A limited liability company may have one or more auditors in
         accordance with the articles of incorporation.

         (2) Article 547 shall apply mutatis mutandis where the articles of
         incorporation provide that the company shall have auditors.


ARTICLE 569 (AUDITOR'S AUTHORITY)

         An auditors may at any time investigate the status of property and the
         affairs of the company and may request directors to report on the
         business operation.


ARTICLE 570 (PROVISIONS APPLICABLE MUTATIS MUTANDIS)


<PAGE>

         The provisions of Articles 382, 385 (1), 386, 388, 400, 407, 411, 413,
         414 and 565 shall apply mutatis mutandis to auditors.


ARTICLE 571 (CONVOCATION OF GENERAL MEMBERS' MEETING)


         (1) A general members' meeting shall be convened by directors unless
         otherwise provided in this Act: Provided, That a extraordinary general
         members' meeting may be convened by auditor. (Amended by Act No. 1212,
         Dec. 12, 1962)

         (2) In convening a general meeting, a notice in writing shall be
         dispatched to each member at least one week prior to the date set for
         such meeting: Provided, That this period may be shortened by the
         articles of incorporation.

         (3) Articles 363 (2) and 364 shall apply mutatis mutandis to the
         convocation of a general members' meeting.


ARTICLE 572 (DEMAND FOR CONVOCATION OF GENERAL MEETING BY MINORITY MEMBERS)


         (1) Any member who holds contribution units representing no less than
         3/100 of the total amount of the capital may demand the convocation of
         a general meeting by filing with directors a written application which
         states the proposed subject-matters of such meeting and the reasons for
         which it is to be convened. (Amended by Act No. 6086, Dec. 31, 1999)

         (2) Paragraph (1) may be provided otherwise by the articles of
         incorporation.

         (3) The provisions of Article 366 (2) and (3) shall apply mutatis
         mutandis in case of paragraph (1).

<PAGE>

ARTICLE 573 (OMISSION OF CONVOCATION PROCEDURES)

         A general meeting may be convened without the procedures set forth in
         Article 572, with the consent of all the members.


ARTICLE 574 (QUORUM OF GENERAL MEETING AND METHOD OF RESOLUTION)

         Unless otherwise provided by the articles of incorporation or this Act,
         all resolutions of a general members' meeting shall be adopted by the
         presence of members holding a majority of votes and by a majority of
         affirmative votes of the members present.


ARTICLE 575 (MEMBER'S RIGHT TO VOTE)

         Each member shall have one vote for each contribution unit: Provided,
         That the articles of incorporation may provide otherwise with regard to
         the number of votes.


ARTICLE 576 (TRANSFER OF BUSINESS AND EX POST FACTO INCORPORATION)


         (1) A resolution of a general meeting under Article 585 shall be
         required for a limited liability company to effect the matters set
         forth in subparagraphs 1 through 3 of Article 374.

         (2) Paragraph (1) shall apply mutatis mutandis where a limited
         liability company enters, within two years from its coming into
         existence, into an agreement to acquire, for value equivalent to not
         less than 1/20 of the capital, a property existing prior to its
         incorporation, which is purported to be continuously used for purposes
         of its business.


ARTICLE 577 (RESOLUTION IN WRITING)

<PAGE>

         (1) If a resolution of a general meeting is required, resolution in
         writing may be adopted, with the consent of all the members.

         (2) If all the members have consented in writing to the matters
         constituting the subject-matter of a resolution, such resolution shall
         be deemed to have been adopted in writing.

         (3) A resolution in writing shall have the same effect as a resolution
         of a general meeting.

         (4) The provisions regarding the general meeting shall apply mutatis
         mutandis to the resolutions in writing.


ARTICLE 578 (PROVISIONS APPLICABLE MUTATIS MUTANDIS)

         The provisions of Articles 365, 367, 368 (3) and (4), 369 (2), 371 (2),
         372, 373 and 376 through 381 shall apply mutatis mutandis to general
         members' meeting.


ARTICLE 579 (PREPARATION OF FINANCIAL STATEMENTS)


         (1) Directors shall, at each period for the settlement of accounts,
         prepare the following documents and annexed statements thereto:

         1.Balance sheet;

         2.Income statement; and

         3.Statement of appropriation of retained earnings of statements of
         disposition of deficit.

         (2) If there are auditors, directors shall submit to auditors the
         documents under

<PAGE>

         paragraph (1) four weeks before the day set for the ordinary general
         meeting.

         (3) Auditors shall submit a audit report to directors within three
         weeks from the day on which they receive the documents under paragraph
         (2).
         [This Article Wholly Amended by Act No. 3724, Apr. 10, 1984]


ARTICLE 579-2 (PREPARATION OF BUSINESS REPORT)


         (1) Directors shall prepare a business report at each period for the
         settlement of accounts.

         (2) Article 579 (2) and (3) shall apply mutatis mutandis to the
         business report under paragraph (1).
         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 579-3 (KEEPING AND PUBLIC NOTICE OF FINANCIAL STATEMENTS)


         (1) Directors shall keep the documents under Articles 579 and 579-2 and
         the business report at the principal office of the company for five
         years from a week before the day set for the ordinary general meeting.

         (2) Article 448 (2) shall apply mutatis mutandis to the documents under
         paragraph (1).
         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 580 (STANDARD FOR DIVIDEND)

         Unless otherwise provided in the articles of incorporation, a dividend
         shall be made in proportion to the number of contribution units of each
         member.

<PAGE>

ARTICLE 581 (MEMBER'S RIGHT TO PERUSE ACCOUNT BOOKS)


         (1) Any member who hold contribution units representing no less than
         3/100 of the total amount of the capital may demand the perusal or
         copying of the account books and related documents. (Amended by Act No.
         6086, Dec. 31, 1999)

         (2) A company may provide in the articles of incorporation that any
         member may make the demand under paragraph (1). In this case, the
         supplementary schedules need not be prepared, regardless of Article 579
         (1). (Amended by Act No. 3724, Apr. 10, 1984)


ARTICLE 582 (INSPECTION OF BUSINESS AFFAIRS AND STATUS OF PROPERTY)


         (1) If there is any dishonest act or any material fact in contravention
         of any Acts, subordinate statutes or the articles of incorporation in
         connection with the management of the company's affairs, any member who
         holds contribution units representing no less than 3/100 of the total
         amount of the capital may apply to the court for the appointment of an
         inspector to investigate the affairs of the company and the status of
         its property. (Amended by Act No. 6086, Dec. 31, 1999)

         (2) The inspector shall report in writing on the results of the
         investigation to the court.

         (3) The court may, if it deems it necessary after examining the report
         mentioned in paragraph (2), order auditors, or directors in the absence
         of auditors, to convene a general members' meeting. In this case,
         Article 310 (2) shall apply mutatis mutandis. (Amended by Act No. 1212,
         Dec. 12, 1962)


ARTICLE 583 (PROVISIONS APPLICABLE MUTATIS AND MUTANDIS)

<PAGE>

         (1) The provisions of Articles 449 (1) and (2), 450, 452, 453, 453-2,
         457-2, 458 through 460, 462, 462-3 and 466 shall apply mutatis mutandis
         to the accounting of a limited liability company. (Amended by Act No.
         3724, Apr. 10, 1984; Act No. 5053, Dec. 29, 1995; Act No. 6086, Dec.
         31, 1999)

         (2) The provision of Article 468 shall apply mutatis mutandis to the
         claims arising out of the relations of employment between a limited
         liability company and its employees. (Amended by Act No. 6086, Dec. 31,
         1999)


         SECTION 4 AMENDMENT OF ARTICLES OF INCORPORATION

ARTICLE 584 (METHOD OF AMENDMENT OF ARTICLES OF INCORPORATION)

         In order to amend the articles of incorporation, a resolution of a
         general members' meeting is required.


ARTICLE 585 (SPECIAL RESOLUTION FOR AMENDMENT OF ARTICLES OF INCORPORATION)


         (1) The resolution mentioned in Articles 584 shall be adopted by the
         affirmative votes of a majority of all the members and of 3/4 of the
         total votes.

         (2) In the application of paragraph (1), a member who is not allowed to
         exercise his vote shall not be added to the number of all the members
         and the vote which may not be exercised shall not be added to the
         number of the total votes.


ARTICLE 586 (RESOLUTION FOR CAPITAL INCREASE)

         Even where the articles of incorporation does not provide for, the
         following

<PAGE>

         matters, they may be determined by a resolution for capital increase:

         1.Name of the persons who is to make contribution type and the class,
         quantity and value of the subject-matter of such contribution in kind
         and the number of contribution units to be given in consideration
         thereof;

         2.Type, quantity and value of the property which was agreed to be
         transferred to the company after the capital increase is effected and
         the name of the transferor; and

         3.Name of the persons to whom the preemptive right to the capital
         contribution is granted and the substance of such right.


ARTICLE 587 (GRANTING OF PREEMPTIVE RIGHT IN CASE OF CAPITAL INCREASE)

         If a limited liability company promises to give a specified person the
         preemptive right to the capital contribution in case of the capital
         increase in the future, the resolution set forth in Article 585 shall
         be required.


ARTICLE 588 (MEMBER'S PREEMPTIVE RIGHT TO CAPITAL CONTRIBUTION)

         A member is entitled to subscribe for capital contribution with respect
         to the capital increase, in proportion to his share: Provided, That it
         shall not be the case where certain persons who shall subscribe for the
         capital contribution have been determined by the resolutions mentioned
         in Articles 586 and 587.


ARTICLE 589 (METHOD OF SUBSCRIPTION FOR CAPITAL CONTRIBUTION)


         (1) In case of the capital increase, any person who intends to
         subscribe for the capital contribution shall enter the number of
         contribution units to be subscribed for and his address on an
         instrument certifying such subscription and he shall write his name and
         affix his seal or shall sign. (Amended by Act No. 5053, Dec.

<PAGE>

         29, 1995)

         (2) A limited liability company shall not offer subscription for the
         capital contributions by means of advertisement or otherwise.


ARTICLE 590 (STATUS OF NEW SUBSCRIBER OF CONTRIBUTION)

         In case of the capital increase, the person who has subscribed for the
         capital contribution shall have the same rights as the existing member
         with regard to the dividend from the time of payment for the capital
         contribution and of the transfer of property which is the
         subject-matter of the contribution in kind.


ARTICLE 591 (REGISTRATION OF CAPITAL INCREASE)

         A limited liability company shall effect the registration of alteration
         due to the capital increase within two weeks at the place of the
         principal office, from the day on which the payment for the capital
         contribution or the performance of the contributions in kind in
         connection with such capital increase has been completed. (Amended by
         Act No. 5053, Dec. 29, 1995)


ARTICLE 592 (EFFECTUATION OF CAPITAL INCREASE)

         The increase in the capital shall take effect when the registration
         under Article 591 is effected at the place of the principal office.


ARTICLE 593 (MEMBER'S LIABILITY CONCERNING CONTRIBUTION IN KIND)


         (1) If the actual value of the property mentioned in subparagraphs 1
         and 2 of Article 586 as of the capital increase is substantially short
         of the value determined by the resolution for the capital increase, the
         members who have agreed to the resolution shall be jointly and
         severally liable to pay such deficit

<PAGE>

         to the company.

         (2) Articles 550 (2) and 551 (2) shall apply mutatis mutandis in case
         of paragraph (1). (Amended by Act No. 1212, Dec. 12, 1962)


ARTICLE 594 (LIABILITY OF DIRECTORS, ETC. CONCERNING UNSUBSCRIBED CAPITAL
CONTRIBUTIONS, ETC.)


         (1) If there are contributions which have not yet been subscribed for
         after the capital increase, directors and auditors shall be deemed to
         have subscribed for such contributions jointly. (Amended by Act No.
         1212, Dec. 12, 1962)

         (2) If full payment of the capital contributions or the transfer of
         property which is the subject-matter of contribution in kind has not
         been completed after the capital increase, directors and auditors are
         jointly and severally liable to pay such incomplete payment or the
         value of property yet to be transferred. (Amended by Act No. 1212, Dec.
         12, 1962)

         (3) Article 551 (3) shall apply mutatis mutandis in case of paragraph
         (1). (Amended by Act No. 1212, Dec. 12, 1962)


ARTICLE 595 (ACTION FOR NULLIFYING CAPITAL INCREASE)


         (1) The nullity of an capital increase may be asserted only by means of
         an action which shall be brought only by members, directors or auditors
         within six months from the day on which the registration under Article
         591 has been effected at the place of the principal office. (Amended by
         Act No. 1212, Dec. 12, 1962)

         (2) Articles 430 through 432 shall apply mutatis mutandis in case of
         paragraph (1).



<PAGE>

ARTICLE 596 (APPLICABLE PROVISIONS)

         Articles 334, 548, and 576 (2) shall apply mutatis mutandis to the
         increase in the capital. (Amended by Act No. 1212, Dec. 12, 1962)


ARTICLE 597 (APPLICABLE PROVISIONS)

         Articles 439 (1) and (2), 443, 445 and 446 shall apply mutatis mutandis
         to the reduction of the capital.


         SECTION 5 MERGER AND CHANGE OF ORGANIZATION

ARTICLE 598 (METHOD OF MERGER)

         A resolution of the general members' meeting pursuant to Article 585
         shall be required for a merger involving a limited liability company.


ARTICLE 599 (APPOINTMENT OF MEMBERS OF ORGANIZING COMMITTEE)

         The members of the organizing committee pursuant to Article 175 shall
         be appointed by a resolution of a general members' meeting set forth in
         Article 585.


ARTICLE 600 (MERGER OF LIMITED LIABILITY COMPANY AND STOCK COMPANY)


         (1) A merger between a limited liability company and a stock company,
         as a result of which a stock company survives or is newly incorporated,
         shall not take effect unless it has obtained the authorization of the
         court.


<PAGE>

         (2) In case of a merger between a limited liability company and a stock
         company which has not completed the redemption of the bonds, the
         surviving company or the company which is to be newly incorporated
         shall not be a limited liability company.


ARTICLE 601 (SUBROGATION)


         (1) In case of a merger between a limited liability company and a stock
         company as a result of which a limited liability company survives or is
         newly incorporated, Article 339 shall apply mutatis mutandis to the
         pledge over the pre-existing shares of the stock company.

         (2) In case of paragraph (1), a pledge over share shall not be asserted
         against the company or any other third person unless the number of
         contribution units and the name and address of the pledgee have been
         entered in the register of members.


ARTICLE 602 (REGISTRATION OF MERGER)

         In case of a merger involving a limited liability company, the
         registration of alteration by the limited liability company surviving
         after the merger, the registration of dissolution by the limited
         liability company which ceases to exist in consequence of the merger
         and/or the registration under Article 549 (2) by the limited liability
         company which is newly incorporated by the merger shall be effected
         within two weeks at the place of the principal office and within three
         weeks at the place of each branch office, from the date of the closing
         of the general members' meeting held pursuant to Article 526 or 527,
         which are applied mutatis mutandis pursuant to Article 603.


ARTICLE 603 (APPLICABLE PROVISIONS)

         Articles 232, 234, 235, 237 through 240, 443, 522 (1) and (2), 522-2,
         523, 524,

<PAGE>

         526 (1) and (2), 527 (1) through (3), and 529 shall apply mutatis
         mutandis to the merger of a limited liability company. (Amended by Act
         No. 1212, Dec. 12, 1962; Act No. 3724, Apr. 10, 1984; Act No. 5591,
         Dec. 28, 1998)


ARTICLE 604 (CHANGE OF ORGANIZATION OF STOCK COMPANY TO LIMITED LIABILITY
COMPANY)


         (1) By a resolution adopted at a general meeting by the unanimous
         consent of all the shareholders, a stock company may change its
         organization into a limited liability company: Provided, That it shall
         not be the case where the redemption of the bonds has not been
         completed.

         (2) In case of the change of organization mentioned in paragraph (1),
         the total amount of capital shall not exceed the amount of net assets
         existing in the company.

         (3) The articles of incorporation and any other particulars necessary
         for the change of organization shall be determined by the resolution
         mentioned in paragraph (1).

         (4) Article 601 shall apply mutatis mutandis to the change of the
         organization under paragraph (1).


ARTICLE 605 (LIABILITY OF DIRECTORS AND SHAREHOLDERS FOR SHORTAGE IN AMOUNT OF
NET ASSETS)


         (1) If, in case of change of the organization under Article 604, the
         amount of net assets which exists in the company is short of the total
         amount of the capital, directors and shareholders at the time of the
         resolution mentioned in Article 604 (1) shall be liable to pay jointly
         and severally such amount of shortage to the company.

         (2) Articles 550 (2), and 551 (2) and (3) shall apply mutatis mutandis
         in case of

<PAGE>

         paragraph (1). (Amended by Act No. 1212, Dec. 12, 1962)


ARTICLE 606 (REGISTRATION OF CHANGE OF ORGANIZATION)

         When a stock company has changed its organization in accordance with
         Article 604, the registration of the dissolution by the stock company
         and the registration under Article 549 (2) by the limited liability
         company shall be effected within two weeks at the place of the
         principal office and within three weeks at the place of each branch
         office.


ARTICLE 607 (CHANGE OF ORGANIZATION OF LIMITED LIABILITY COMPANY TO STOCK
COMPANY)


         (1) By a resolution adopted at a general meeting by the unanimous
         consent of all the members, a limited liability company may change its
         organization into a stock company.

         (2) In case of paragraph (1), the total amount of the issue price of
         shares which are to be issued at the time of change of the organization
         shall not exceed the amount of net assets existing in the company.

         (3) The change of organization under paragraph (1) shall not take
         effect unless it obtains the authorization of the court.

         (4) If, in the case of a change of organization mentioned in paragraph
         (1), the amount of net assets which exists in the company is short of
         the total amount of the issue-price of shares which are issued at the
         time of the change of organization, directors, auditors and members of
         the company at the time of the resolution under paragraph (1) shall be
         jointly and severally liable to pay such amount of shortage to the
         company. In this case, Article 550 (2), and 551 (2) and (3) shall apply
         mutatis mutandis. (Amended by Act No. 1212, Dec. 12, 1962)

         (5) Articles 340 (3), 601 (1), 604 (3) and 606 shall apply mutatis
         mutandis to the change of organization under paragraph (1).



<PAGE>

ARTICLE 608 (APPLICABLE PROVISIONS)

         Article 232 shall apply mutatis mutandis to the change of organization
         under Articles 604 and 607. (Amended by Act No. 3724, Apr. 10, 1984)


         SECTION 6 DISSOLUTION AND LIQUIDATION

ARTICLE 609 (REASONS FOR DISSOLUTION)


         (1) A limited liability company shall be dissolved for any of the
         following reasons: (Amended by Act No. 6488, Jul. 24, 2001)

         1.Reasons set forth in subparagraphs 1, and 4 through 6 of Article 227;
         and

         2.A resolution of a general members' meeting.

         (2) A resolution mentioned in paragraph (1) 2 shall be adopted
         according to Article 585.


ARTICLE 610 (CONTINUANCE OF COMPANY)


         (1) Where a company has been dissolved by any of the reasons mentioned
         in subparagraph 1 of Article 227 or Article 609 (1) 2, the company may
         continue to exist by such resolution of the general members' meeting as
         set forth in Article 585.

         (2) Deleted. (by Act No. 6488, Jul. 24, 2001)

<PAGE>

ARTICLE 611 (APPLICABLE PROVISIONS)

         Article 229 (3) shall apply mutatis mutandis to the continuance of
         existence of a company under Article 610.


ARTICLE 612 (DISTRIBUTION OF SURPLUS ASSETS)

         Unless otherwise provided in the articles of incorporation, the surplus
         assets shall be distributed among the members in proportion to the
         number of contribution units of each member.


ARTICLE 613 (APPLICABLE PROVISIONS)


         (1) Articles 228, 245, 252 through 255, 259, 260, 264, 520, 531 through
         537, 540 and 541 shall apply mutatis mutandis to a limited liability
         company. (Amended by Act No. 1212, Dec. 12, 1962)

         (2) Articles 209, 210, 366 (2) and (3), 367, 373 (2), 376, 377, 382
         (2), 386, 388, 399 through 402, 407, 408, 411 through 413, 414 (3),
         450, 466 (2), 539, 562 and 563, 564 (3), 565, 566, 571, 572 (1) and 581
         shall apply mutatis mutandis to the liquidator of a limited liability
         company. (Amended by Act No. 1212, Dec. 12, 1962; Act No. 3724, Apr.
         10, 1984)


         CHAPTER VI FOREIGN COMPANIES

ARTICLE 614 (APPOINTMENT OF REPRESENTATIVE, ESTABLISHMENT OF BUSINESS OFFICE AND
REGISTRATIONS THEREOF)


         (1) A foreign company intending to engage in business in the Republic
         of Korea shall appoint a representative in the Republic of Korea and
         shall establish a

<PAGE>

         business office.

         (2) In case of paragraph (1), such foreign company shall, in respect of
         the establishment of its business office, effect the same registration
         as that of a branch office of a company incorporated in the Republic of
         Korea either of the same kind or of the kind which it most closely
         resembles.

         (3) For the registration under paragraph (2), such foreign company
         shall register the governing law under which it was incorporated and
         the name and address of its representative in the Republic of Korea.

         (4) Articles 209 and 210 shall apply mutatis mutandis to such
         representative of a foreign company. (Amended by Act No. 1212, Dec. 12,
         1962)


ARTICLE 615 (STARTING POINT OF RECKONING OF REGISTRATION PERIOD)

         If the matters required to be registered in accordance with Article 614
         (2) and (3) took place in a foreign country, the period for
         registration shall be reckoned from the day on which a notice thereof
         arrived.


ARTICLE 616 (PROHIBITION OF CONDUCTING CONTINUOUS TRANSACTIONS BEFORE
REGISTRATION)


         (1) A foreign company shall not engage in continuous transactions at
         the place of its business office before it has effected the
         registration set forth in Article 614.

         (2) A person who has engaged in transactions in contravention of
         paragraph (1) shall be jointly and severally liable with the company
         for such transactions.


ARTICLE 617 (APPLICABLE LAWS)

         A company incorporated in a foreign country shall, if it has
         established its

<PAGE>

         principal office in the Republic of Korea or its main purpose is to
         engage in business in the Republic of Korea, be subject to the same
         provisions as a company incorporated in the Republic of Korea.


ARTICLE 618 (APPLICABLE PROVISIONS)


         (1) Articles 335 through 338, 340 (1), 355 through 357, 478 (1), 479
         and 480 shall apply mutatis mutandis to the issuance of share
         certificates or certificates of bonds and to the transfer or pledging
         of such shares or the transfer of bonds conducted in the Republic of
         Korea by a foreign company.

         (2) In case of paragraph (1), the first business office established in
         the Republic of Korea by a foreign company shall be deemed as its
         principal office.


ARTICLE 619 (ORDER TO CLOSE BUSINESS OFFICE)


         (1) In case where a foreign company has established its business
         office, the court may order such business office to be closed, on the
         application of any interested person or public prosecutor, for any of
         the following reasons:
         (Amended by Act No. 1212, Dec. 12, 1962)

         1.If the objective of establishment of such business office is illegal;

         2.If such business office has, without justifiable reasons, failed to
         commence business within one year after the registration of
         establishment thereof was effected, discontinued business for a period
         of not less than one year or suspended payment without justifiable
         reasons; or

         3.If the representative of such foreign company or any other person
         managing the affairs thereof has violated Acts and subordinate statutes
         or good morals and other social orders.


<PAGE>

         (2) Article 176 (2) through (4) shall apply mutatis mutandis in case of
         paragraph (1).


ARTICLE 620 (LIQUIDATION OF PROPERTIES EXISTING IN REPUBLIC OF KOREA)


         (1) If the court has ordered a business office of a foreign company to
         be closed in accordance with Article 619 (1), it may order the
         institution of proceedings for liquidation in respect of the whole of
         the company's property existing in the Republic of Korea, upon the
         application of any interested person or ex officio. In this case, the
         court shall appoint a liquidator.

         (2) Articles 535 through 537 and 542, except for those which are by
         nature inapplicable, shall apply mutatis mutandis to the liquidation
         under paragraph (1).

         (3) Paragraphs (1) and (2) shall apply mutatis mutandis where a foreign
         company has voluntarily closed its business office.


ARTICLE 621 (STATUS OF FOREIGN COMPANY)

         In connection with the application of other Acts, a foreign company
         shall be deemed to be a company incorporated in the Republic of Korea
         either of the same kind or of the kind which it most closely resembles,
         unless otherwise provided by Acts.


         CHAPTER VII PENAL PROVISIONS

ARTICLE 622 (CRIMES OF SPECIAL MISAPPROPRIATION BY PROMOTERS, DIRECTORS, AND
OTHER OFFICERS, ETC.)


         (1) If a promoter, managing member, director, member of audit
         committee,

<PAGE>

         auditor or acting director under Articles 386 (2), 407 (1), 415 or 567,
         manager or other employee commissioned to undertake a certain class of
         matters or specified matters related to the business affairs of the
         company has obtained, or made a third party obtain, any pecuniary
         benefit by acting in breach of his duty and has thereby inflicted loss
         on the company, he shall be punished by an imprisonment not exceeding
         ten years or to a fine not exceeding thirty million won. (Amended by
         Act No. 3724, Apr. 10, 1984; Act No. 5053, Dec. 29, 1995; Act No. 6086,
         Dec. 31, 1999; Act No. 6086, Dec. 31, 1999)

         (2) The same shall apply where a liquidator, acting liquidator under
         Article 542 (2) and incorporator under Article 175 have committed an
         act mentioned in paragraph (1).


ARTICLE 623 (CRIMES OF SPECIAL MISAPPROPRIATION BY REPRESENTATIVES OF MEETING OF
BONDHOLDERS, ETC.)

         If a representative of a meeting of bondholders or a person who was
         authorized to execute the resolutions thereof has obtained, or made
         another person obtain, any pecuniary benefit by acting in breach of his
         duty and has thereby inflicted loss on the bondholders, he shall be
         subject to an imprisonment not exceeding seven years or to a fine not
         exceeding twenty million won. (Amended by Act No. 3724, Apr. 10, 1984;
         Act No. 5053, Dec. 29, 1995)


ARTICLE 624 (ATTEMPTED CRIMES OF SPECIAL MISAPPROPRIATION)

         An attempt to commit any of the acts set forth in Articles 622 and 623
         shall be punishable.


ARTICLE 625 (CRIMES OF ENDANGERING COMPANY'S PROPERTY)

         If any person set forth in Article 622 (1), inspector, notary public
         mentioned in Article 298 (3), 299-2, 310 (3) or 313 (2) (including
         managing attorney of an incorporated law firm and of a joint law &
         notary office; the same shall apply

<PAGE>

         hereinafter in this Chapter) or appraiser mentioned in Article 299-2,
         310 (3), or 422 (1) has committed any of the following offenses, he
         shall be subject to an imprisonment not exceeding five years or to a
         fine not exceeding fifteen million won: (Amended by Act No. 3724, Apr.
         10, 1984; Act No. 5053, Dec. 29, 1995; Act No. 5591, Dec. 28, 1998)

         1.Making of a false report to, or concealing facts from, the court, the
         general meeting or promoters in respect of the subscription for shares
         or capital contribution, payment therefor, performance of contributions
         in kind, or any matter set forth in Article 290, subparagraph 4 of
         Article 416, or Article 544;

         2.Wrongful acquisition of the ownership of share or shares in the
         company or of the pledge right with respect thereto, for the account of
         the company, irrespective of the name they have used in doing so;

         3.Distribution of profits or interests in contravention of Acts,
         subordinate statutes or the articles of incorporation; and

         4.Disposal of the company's property for speculative transactions,
         outside the ordinary course of the company's business.


ARTICLE 625-2 (CRIMES OF VIOLATING SHARE ACQUISITION RESTRICTION, ETC.)

         If a person set forth in Article 635 (1) has violated Article 342-2 (1)
         or (2), he shall be subject to a fine not exceeding twenty million won.
         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 626 (CRIMES OF FALSE REPORTING)

         If a director, member of audit committee, auditor or acting director
         under Articles 386 (2), 407 (1), 415 or 567 has made a false reporting
         to, or has concealed facts from, the court or the general meeting with
         respect to the amount of net assets under Article 604 (2) or 607 (2) in
         case of a change of organization pursuant to Article 604 or 607, he
         shall be punished by an

<PAGE>

         imprisonment not exceeding five years or to a fine not exceeding
         fifteen million won. (Amended by Act No. 3724, Apr. 10, 1984; Act No.
         5053, Dec. 29, 1995; Act No. 6086, Dec. 31, 1999)


ARTICLE 627 (CRIMES OF USING DOCUMENTS CONTAINING MISSTATEMENTS)


         (1) If a person set forth in Article 622 (1), representative of a
         foreign company or person who is commissioned to offer shares or bonds
         has used the subscription forms for shares or bonds, prospectus,
         advertisements or any other documents relating to an offering of shares
         or bonds, which contained misstatements as to material facts in
         connection with such offering, he shall be punished by an imprisonment
         not exceeding five years or to a fine not exceeding fifteen million
         won.
         (Amended by Act No. 3724, Apr. 10, 1984; Act No. 5053, Dec. 29, 1995)

         (2) The same shall apply where a person who offers shares or bonds for
         sale has used documents related to such sale containing misstatements
         as to material facts pertaining to such sale.


ARTICLE 628 (CRIMES OF DISGUISED PAYMENT)


         (1) If a person set forth in Article 622 (1) has committed an act of
         disguising the payment for the subscription price or the fulfillment of
         the contribution in kind, he shall be subject to an imprisonment not
         exceeding five years or to a fine not exceeding fifteen million won.
         (Amended by Act No. 3724, Apr. 10, 1984; Act No. 5053, Dec. 29, 1995)

         (2) The same shall apply to a person who have consented to or has
         mediated an act mentioned in paragraph (1).


ARTICLE 629 (CRIMES OF EXCESSIVE ISSUANCE)


<PAGE>

         If promoters, directors or acting directors under Article 386 (2) or
         407 (1) have issued shares in excess of the total number of shares
         authorized to be issued by the company, they shall be subject to an
         imprisonment not exceeding five years or to a fine not exceeding
         fifteen million won. (Amended by Act No. 3724, Apr. 10, 1984; Act No.
         5053, Dec. 29, 1995)


ARTICLE 630 (CRIMES OF CORRUPTION IN OFFICE BY PROMOTERS, DIRECTORS OR OTHER
OFFICERS)


         (1) If a person set forth in Articles 622 and 623, inspector or notary
         public under Article 298 (3), 299-2, 310 (3) or 313 (2) or appraiser
         under Article 299-2, 310 (3), or 422 (1) has received, demanded or
         promised any pecuniary benefit, in response to unlawful solicitation in
         connection with their duties, he shall be subject to an imprisonment
         not exceeding five years or to a fine not exceeding fifteen million
         won. (Amended by Act No. 3724, Apr. 10, 1984; Act No. 5053, Dec. 29,
         1995; Act No. 5591, Dec. 28, 1998)

         (2) The same shall apply to a person who has promised, delivered or
         manifested an intention for delivery of pecuniary benefits mentioned in
         paragraph (1).


ARTICLE 631 (CRIMES OF BRIBERY IN RELATION TO DISTURBING EXERCISE OF RIGHTS,
ETC.)


         (1) If any person has received, demanded or promised pecuniary benefits
         in response to unlawful solicitations in connection with the following
         matters, he shall be subject to an imprisonment not exceeding one year
         or to a fine not exceeding three million won: (Amended by Act No. 1212,
         Dec. 12, 1962; Act No. 3724, Apr. 10, 1984; Act No. 5053, Dec. 29,
         1995; Act No. 5591, Dec. 28, 1998; Act No. 6086, Dec. 31, 1999)

         1.Making a statement or exercising voting rights at the inaugural
         general meeting, general members' meetings, general shareholders'
         meetings or meetings of bondholders;


<PAGE>

         2.Bringing an action set forth in Part 3 or exercising the rights of
         shareholders representing no less than 1/100 or 3/100 of the total
         issued and outstanding shares, the rights of bondholders representing
         no less than 10/100 of the total amount of the bonds or the rights of
         members having contribution units representing no less than 3/100 of
         the capital; and

         3.Exercising any right set forth in Article 402 or 424.

         (2) The same shall apply to a person who has promised, delivered or
         manifested an intention for delivery of pecuniary benefits mentioned in
         paragraph (1).


ARTICLE 632 (CONCURRENT IMPOSITION OF IMPRISONMENT AND FINE)

         Punishments of Imprisonment and fine set forth in Articles 622 through
         631 may be concurrently imposed.


ARTICLE 633 (CONFISCATION AND ADDITIONAL COLLECTION)

         In case of Article 630 (1) or 631 (1), the benefits received by the
         offender shall be confiscated. If it is wholly or partly impossible to
         confiscate such, the value thereof shall be collected from the
         offender.


ARTICLE 634 (CRIMES OF EVADING LIABILITY FOR PAYMENT ON SHARES)

         If a person who has subscribed for shares or contribution units by
         using another person's name or a fictitious name in order to evade the
         liability for payment of the subscription price, he shall be subject to
         an imprisonment not exceeding one year or to a fine not exceeding three
         million won. (Amended by Act No. 3724. Apr. 10, 1984; Act No. 5053,
         Dec. 29, 1995)


ARTICLE 634-2 (CRIMES OF GRANTING BENEFITS IN CONNECTION WITH EXERCISE OF


<PAGE>

SHAREHOLDER'S RIGHTS)


         (1) If a director, member of audit committee, auditor, acting director
         under Article 386 (2), 407 (1) or 415, manager or other employee has
         granted pecuniary benefits on the company's account in connection with
         the exercise of shareholder's rights, he shall be subject to an
         imprisonment not exceeding one year or to a fine not exceeding three
         million won. (Amended by Act No. 5053, Dec. 29, 1995; Act No. 6086,
         Dec. 31, 1999)

         (2) The same shall apply to a person who has received, or made another
         person deliver, the benefits under paragraph (1).

         [This Article Newly Inserted by Act No. 3724, Apr. 10, 1984]


ARTICLE 635 (OFFENCES SUBJECT TO FINE FOR NEGLIGENCE)


         (1) If a promoter, incorporator, managing member, director, auditor,
         member of audit committee, representative of a foreign company,
         inspector, notary public under Article 298 (3), 299-2, 310 (3) or 313
         (2), appraiser under Article 299-2, 310 (3), or 422 (1), manager,
         liquidator, transfer agent, company which was commissioned to offer
         bonds for subscription, its successor or acting director under Article
         386 (2), 407 (1), 415, 542 (2) or 567 has committed any of the
         following offenses, he shall be subject to a fine for negligence not
         exceeding five million: Provided, That this shall not apply where a
         criminal penalty is imposed against such an act: (Amended by Act No.
         1212, Dec. 12, 1962; Act No. 3724, Dec, 1984; Act No. 5053, Dec. 29,
         1995; Act No. 5591, Dec. 28, 1998; Act No. 6086, Dec. 31, 1999)

         1.Neglecting to effect any of the registrations set forth in this Part;

         2.Neglecting to give any public notices or any other notices prescribed
         in this Part or making a dishonest public or other notices;

         3.Disturbing any inspection or investigation pursuant to this Part;


<PAGE>

         4.Refusal to permit the inspection or copying of documents or to
         deliver a transcript or an abstract thereof in contravention of this
         Part, without justifiable reason;

         5.Making a false reporting to, or concealing facts from, the government
         authorities, general meetings or meetings of bondholders;

         6.Failure to state in share certificates, certificates of bonds or
         certificates for preemptive rights any of the required particulars or
         making a misstatement therein;

         7.Failure to effect entry of a change of holders in the register of
         shareholders, without justifiable reason;

         8.Neglecting to take procedure for the appointment of directors and
         auditors, if the remaining directors or auditors in office become fewer
         than the minimum number prescribed in the Acts or in the articles of
         incorporation;

         9.Failure to state any particulars required to be stated in the
         articles of incorporation, the register of shareholders or the part of
         a set thereof, the register of members, the register of bonds or the
         part of a set thereof, the minutes, the property list, the balance
         sheet, the business report, the operation report, the income
         statements, the statements of appropriation of retained earnings or the
         statements of disposition of deficits, the reports on the settlement of
         accounts, account books, the supplementary schedules mentioned in
         Articles 447, 534, 579 (1) or 613 (1) or the audit report or making mis
         statements therein;

         10.Neglecting or refusing to hand over the business undertaking to a
         liquidator appointed by the court;

         11.Fixing the unduly prolonged period set forth in Article 247 (3), 535
         (1) or 613 (1), for the purpose of delaying the completion of
         liquidation;

         12.Neglecting to apply for an adjudication of bankruptcy in
         contravention of

<PAGE>

         Article 254 (4), 542 (1) or 613 (1);

         13.Inviting public subscriptions for contribution in contravention of
         Article 589 (2);

         14.Merger, division, or merger through division of companies, change of
         organization, disposal of the company's property or reduction of its
         capital, in contravention of Article 232, 247 (3), 439 (2), 527-5, 530
         (2), 530-9 (4), 530-11 (2), 597, 603 or 608;

         15.Distribution of the properties of a company in contravention of
         Article 260, 542 (1) or 613 (1);

         16.Failure to prepare subscription forms for shares or bonds,
         certificates of preemptive rights or to state therein the required
         particulars or making misstatements therein, in contravention of
         Article 302 (2), 347, 420, 420-2, 474 (2) or 514 (1);

         17.Neglecting to take the procedures for cancellation of shares or
         contribution units or to effect the disposition of pledge rights over
         the shares or contribution units, in contravention of Article 342 or
         560 (1);

         18.Retirement of shares or contribution units in contravention of
         Article 343 (1) or 560 (1);

         19.Issuance of share certificates in contravention of Article 355 (1)
         and (2) or 618;

         19-2.Failure to enter in the register of shareholders, in contravention
         of Article 358-2 (2);

         19-3.Failure to make a subject-matter of the general meeting of
         shareholders the matters which shareholders propose, in contravention
         of Article 363-2 (1) or 542 (2);

         20.Failure to convene a general meeting in contravention of an order of
         the

<PAGE>

         court rendered in accordance with Article 365 (1) and (2), 578, 467 (3)
         or 582 (3) or convening a general meeting at a place other than that
         set forth in the articles of incorporation or convening such meeting in
         contravention of Article 363, 364 or 571 (2) and (3);

         20-2.Failure to give the notice or public notice on the contents and
         method of exercise of the appraisal right or giving a false notice or
         public notice, in contravention of Article 374 (2), 530 (2), or 530-11
         (2);

         21.Failure to keep books or documents in contravention of Article 396
         (1), 448 (1), 510 (2), 522-2 (1), 527-6 (1), 530-7, 534 (3), 542 (2),
         566 (1), 579 (3), 603 or 613;

         21-2.Refusal of the investigation of the auditor or the member of audit
         committee without any justifiable reason, in contravention of Article
         412-4 (3);

         22.Failure to set aside a reserve or misuse thereof, in contravention
         of Articles 458 through 460 or 583;

         22-2.Failure to pay the dividend within the period set forth in Article
         464-2 (1);

         23.Offeringbonds or failure to redeem old bonds, in contravention of
         Article 470;

         24.Issuance of bond certificates in contravention of Article 478 (1) or
         618;

         25.Discharge of any obligation in contravention of Article 536 or 613
         (1);

         26.Failure to comply with an order of the court rendered pursuant to
         Article 619 (1); and

         27.Issuance of instruments in bearer or non-bearer form with respect to
         contribution units, in contravention of Article 555.

         (2) The same shall apply where a promoter or director has transferred
         any right deriving from the subscription of shares.



<PAGE>

ARTICLE 636 (BUSINESS IN NAME OF COMPANY PRIOR TO ITS REGISTRATION, ETC.)


         (1) A person who has engaged in business in the name of a company
         before its incorporation shall be subject to a fine for negligence
         equivalent to two times the sum of the registration tax for the
         registration of incorporation of the company.

         (2) Paragraph (1) shall apply mutatis mutandis where a person has
         violated Article 616 (1).


ARTICLE 637 (APPLICATION OF PENAL PROVISIONS TO JURISTIC PERSON)

         If any person set forth in Article 622, 623, 625, 627, 628 or 630 (1)
         is a juristic person, the penal provisions under this Chapter shall
         apply to the directors or auditors who have committed such acts or
         other members or managers who has managed the affairs of the company.


         PART IV INSURANCE

         CHAPTER I COMMON PROVISIONS

ARTICLE 638 (DEFINITION)

         A contract of insurance shall take effect when the parties agree that
         one shall pay the premium as agreed, and that the other shall provide a
         certain sum of money or its equivalent in kind upon the occurrence of
         uncertain events against the property, life or body of the former.


ARTICLE 638-2 (EFFECTUATION OF INSURANCE CONTRACT)

<PAGE>

         (1) When an insurer receives from a policyholder a payment of the whole
         or a part of the amount equivalent to the premium, as well as an
         application for an insurance contract, it shall dispatch to him a
         notice on whether it accepts the application or not within thirty days
         unless otherwise stipulated. If the insured of a personal insurance
         contract is to undergo a physical examination, however, the period
         shall run from the day on which he does it.

         (2) If the insurer neglects to dispatch a notice on whether or not it
         accepts such an application within the period in the paragraph (1), it
         shall be considered to have accepted the application.

         (3) Where the insurer receives from a policyholder the whole or a part
         of the amount equivalent to the premium, as well as an application for
         an insurance contract, if any event specified in the insurance contract
         has taken place before it accepts the application, it shall assume
         contractual obligations unless it has any reason to refuse the
         application: Provided, That this shall not apply where the insured of a
         personal insurance contract is to undergo a physical examination, but
         fails to do so.
         [This Article Newly Inserted by Act No. 4470, Dec. 31, 1991]


ARTICLE 638-3 (OBLIGATION TO DELIVER AND SPECIFY STANDARD INSURANCE TERMS)


         (1) When an insurer enters into an insurance contract, it shall deliver
         the standard insurance terms to the policyholder, and inform him of
         their important contents.

         (2) If the insurer violates the provisions of paragraph (1), the
         policyholder may cancel the contract within one month after the
         contract is made.
         [This Article Newly Inserted by Act No. 4470, Dec. 31, 1991]


ARTICLE 639 (INSURANCE FOR BENEFIT OF THIRD PARTY)



<PAGE>

         (1) The policyholder may effect a contract of insurance for the benefit
         of a third party with or without a mandate of, specified or
         unspecified, the third party: Provided, That in the case of the
         non-life insurance contract, if there is no mandate of a third party,
         the policyholder shall inform the insurer thereof, and if he fails to
         do so, he may not stand against the insurer by the reason that the
         third party does not know the fact that the insurance contract was
         made. (Amended by Act No. 4470, Dec. 31, 1991)

         (2) In the case of paragraph (1), the third party shall be necessarily
         entitled to the benefits of the contract: Provided, That in case of the
         non-life insurance contract, if the policyholder has compensated the
         third party for the loss caused by the occurrence of the insured event,
         he may claim from the insurer the payment of the insured amount to the
         extent that it does not infringe upon the third party's right. (Newly
         Inserted by Act No. 4470, Dec. 31, 1991)

         (3) In the case of paragraph (1), the policyholder is liable for paying
         the premium to the insurer: Provided, That if the policyholder has been
         adjudged bankrupt or has delayed the payment of the premium, the third
         person is also liable for paying the premium in so far as the third
         party does not waive his rights. (Amended by Act No. 4470, Dec. 31,
         1991)


ARTICLE 640 (DELIVERY OF INSURANCE POLICY)


         (1) When the insurance contract is made the insurer shall prepare an
         insurance certificate and deliver it to the policyholder without delay,
         except in case where the policyholder fails to pay the whole premium or
         its first installment.
         (Amended by Act No. 4470, Dec. 31, 1991)

         (2) Where the existing insurance contract is extended or altered, the
         insurer may be exempt from the delivery of a insurance certificate by
         writing down the extension or alteration on the existing insurance
         certificate. (Newly Inserted by Act No.
         4470, Dec. 31, 1991)

<PAGE>

ARTICLE 641 (EFFECT OF OBJECTION AGREEMENT IN RESPECT OF INSURANCE CERTIFICATE)

         The parties to a contract of insurance may agree that they may raise
         any objection to the correctness of the contents of the insurance
         certificate within a certain period from the day of the delivery of the
         insurance certificate. The period shall not be less than one month.


ARTICLE 642 (DEMAND FOR REISSUANCE OF INSURANCE CERTIFICATE)

         If the policyholder has lost or has grossly damaged the insurance
         certificate, he may demand the insurer to reissue the insurance
         certificate. The expenses arising out of making the insurance
         certificate shall be borne by the policyholder.


ARTICLE 643 (RETROACTIVE INSURANCE)

         The parties to the insurance contract may agree that the commencement
         of cover shall be a certain time prior to the conclusion of the
         insurance contract.


ARTICLE 644 (EFFECT OF PREEXISTING INSURED EVENTS)

         If, at the time when a contract of insurance is made, the insured
         events has already occurred or will never occur, such a contract shall
         be null and void: Provided, That this shall not apply when both parties
         and the insured are not aware of it.


ARTICLE 645

         Deleted. (by Act No. 4470, Dec. 31, 1991)


ARTICLE 646 (EFFECT OF FACTS KNOWN TO AGENT)


<PAGE>

         If the contract of insurance was concluded through an agent, the
         principal is deemed as having been aware of the facts which the agent
         knew.


ARTICLE 647 (REQUEST FOR REDUCTION OF PREMIUM UPON CESSATION OF CERTAIN RISKS)

         Where the parties to a insurance contract agreed on the premium in
         consideration of certain risks, if such risks have ceased to exist
         during the period of insurance, the policyholder may demand that the
         premium be reduced for the future.


ARTICLE 648 (REQUEST FOR RETURN OF PREMIUM UPON NULLIFYING OF INSURANCE
CONTRACT)

         Where the whole or a part of a insurance contract is null and void, if
         the policyholder and the insured have acted in good faith and without
         gross negligence, the insurer may be demanded to return the whole or a
         part of the premium. The same shall apply where the policyholder and
         the beneficiary have acted in good faith and without gross negligence.


ARTICLE 649 (VOLUNTARY TERMINATION OF CONTRACT PRIOR TO OCCURRENCE OF INSURED
EVENTS)


         (1) The policyholder may in the future terminate the whole or a part of
         the contract at any time before the insured events occur: Provided,
         That in the case of an insurance contract as prescribed in Article 639,
         the policyholder shall not terminate the contract without obtaining the
         consent of the third party or carrying the insurance certificate.
         (Amended by Act No. 4470, Dec. 31, 1991)

         (2) In the case of an insurance policy by which the insured amount is
         not reduced despite the fact that the insurer has paid out insured
         event, the policyholder may terminate the insurance contract even after
         the occurrence of the insured event. (Newly Inserted by Act No. 4470,
         Dec. 31, 1991)


<PAGE>

         (3) In the case of paragraph (1), unless otherwise agreed by the
         parties, the policyholder may demand the return of any unearned
         premium. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 650 (EFFECT OF PAYMENT AND DELAY OF PREMIUM)


         (1) The policyholder shall pay the whole premium or its first
         installment without delay after the conclusion of the contract, and if
         the policyholder fails to pay it, the contract shall be considered to
         have been rescinded at the time of the lapse of two months after the
         contract is made, unless otherwise agreed.

         (2) If premium installments are not paid at an agreed time, the insurer
         may demand the policyholder to pay them within a reasonable period
         specified, and if he fails to do so, the insurer may rescinded the
         contract.

         (3) In the case of a policy effected on behalf of a specified third
         party, if the policyholder delays the payment of the premium, the
         insurer shall not rescind or terminate the contract without demanding
         also the third party to pay it within a reasonable time specified.
         [This Article Wholly Amended by Act No. 4470, Dec. 31, 1991]


ARTICLE 650-2 (REINSTATEMENT OF INSURANCE CONTRACT)

         Where an insurance contract is terminated under Article 650 (2), and no
         refund for termination is paid, the policyholder may demand a
         reinstatement of the contract by paying to the insurer delayed premium
         together with the agreed interest within a specified period. The
         provisions of Article 638-2 shall be applicable mutatis mutandis to
         this case.
         [This Article Newly Inserted by Act No. 4470, Dec. 31, 1991]


ARTICLE 651 (TERMINATION OF CONTRACT DUE TO BREACH OF DUTY OF DISCLOSURE)


<PAGE>

         If, at the time of making the insurance contract the policyholder or
         the insured, by fraud or gross negligence, fails to disclose or not to
         misrepresent material facts, the insurer may terminate the contract
         within one month after it knew the non-disclosure or misrepresentation
         or within three years after the contract was made: Provided, That this
         shall not apply where at the time of making the insurance contract the
         insurer knew the nondisclosure or misrepresentation or by gross
         negligence failed to do so. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 651-2 (EFFECT OF QUESTION IN WRITING)

         Any fact about which the insurer makes written questions shall be
         presumed to material.
         [This Article Newly Inserted by Act No. 4470, Dec. 31, 1991]


ARTICLE 652 (NOTICE ON ALTERATION OR INCREASE OF RISKS AND TERMINATION OF
CONTRACT)


         (1) If, during the cover period, the policyholder or the insured
         becomes aware of the fact that the possibility of the occurrence of the
         insured events has been substantially altered or increased, he shall
         give notice thereof to the insurer without delay. If the policyholder
         or the insured has neglected to do so, the insurer may terminate the
         contract within one month after it becomes aware of the fact.

         (2) When the insurer is informed of an alteration or increase of the
         risks insured under paragraph (1), within one month it may demand an
         increase in the premium or rescind the contract. (Newly Inserted by Act
         No. 4470, Dec. 31, 1991)


ARTICLE 653 (INCREASES OF RISKS DUE TO INTENTION OR GROSS NEGLIGENCE OF
POLICYHOLDER, ETC. AND TERMINATION OF CONTRACT)

         If, during the cover period, the possibility of the occurrence of
         insured events

<PAGE>

         has been substantially altered or increased by intention or gross
         negligence of the policyholder, of the insured, or of the beneficiary,
         the insurer may request an increase in the premium or terminate the
         contract within one month after it becomes aware of the fact. (Amended
         by Act No. 4470, Dec. 31, 1991)


ARTICLE 654 (ADJUDICATION OF INSURER'S BANKRUPTCY AND PROSPECTIVE TERMINATION OF
CONTRACT)


         (1) If the insurer has been adjudged bankrupt, the policyholder may
         terminate the contract.

         (2) The contract of insurance which has not been terminated under the
         provisions of paragraph (1) shall lose its effect upon the lapse of
         three months after the adjudgment of bankruptcy. (Amended by Act No.
         4470, Dec. 31, 1991)


ARTICLE 655 (TERMINATION OF CONTRACT AND RIGHT TO DEMAND INSURED AMOUNT)

         Even after the insured events have occurred, if the insurer has
         terminated the contract under the provisions of Articles 650, 651, 652
         and 653, it is not liable for paying the insured amount and may demand
         the return of the insured amount which has been already paid: Provided,
         That this shall not apply when it was proved that the occurrence of the
         insured events was not affected by the non-disclosure or
         misrepresentation or by a substantial alteration or increase of the
         risks insured. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 656 (PAYMENT OF PREMIUM AND COMMENCEMENT OF LIABILITY OF INSURER)

         Unless otherwise agreed by the parties, the insurer's liability
         commences from the time when the initial premium has been paid.


ARTICLE 657 (DUTY TO NOTIFY OCCURRENCE OF INSURED EVENTS)

<PAGE>

         (1) When the policyholder, the insured or the beneficiary becomes aware
         of the occurrence of insured events, he shall without delay dispatch
         the notice thereof to the insurer.

         (2) If the loss is insured by the policyholder, the insured or the
         beneficiary's neglects of the duty to notify as referred to in
         paragraph (1), the insurer shall not be liable for indemnification of
         the increased loss. (Newly Inserted by Act No. 4470, Dec. 31, 1991)


ARTICLE 658 (PAYMENT OF INSURED AMOUNT)

         The insurer shall pay the insured amount to the insured or the
         beneficiary, if there is an agreed period for such a payment, within
         the agreed period, or if not, within ten days after determining the
         insured amount payable without delay on receiving the notification
         under Article 657 (1).
         [This Article Wholly Amended by Act No. 4470, Dec. 31, 1991]


ARTICLE 659 (REASONS FOR EXEMPTION OF LIABILITY)


         (1) If the insured events have occurred due to intention or gross
         negligence of the policyholder, of the insured, or of the beneficiary,
         the insurer is not liable for paying the insured amount.

         (2) Deleted. (by Act No. 4470, Dec. 31, 1991)


ARTICLE 660 (EXEMPTION OF LIABILITY FOR LOSS CAUSED BY WAR, ETC.)

         If the insured events have been caused by war or other public
         disturbances, the insurer is not liable for paying the insured amount,
         unless otherwise agreed by the parties.



<PAGE>

ARTICLE 661 (REINSURANCE)

         The insurer may make a contract of reinsurance with another insurer in
         regard to the liability which the former shall bear by the occurrence
         of the insured events. The contract of reinsurance shall not affect the
         validity of the original contract of insurance.


ARTICLE 662 (EXTINCTIVE PRESCRIPTION)

         Two years' absence of the exercise of the rights to demand the payment
         of the insured amount or the return of the premium or the reserve, or
         one year's absence of the exercise of the right to demand the payment
         of the premium, shall make those rights extinguished.


ARTICLE 663 (PROHIBITION OF ENTERING SPECIAL AGREEMENT WHICH IS DISADVANTAGEOUS
TO POLICYHOLDER, ETC.)

         The provisions of this Part shall not be changed as being
         disadvantageous to the policyholder, the insured or the beneficiary
         through an agreement by the parties: Provided, That this shall not
         apply in the case of reinsurance, marine insurance and other similar
         types of insurance. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 664 (APPLICABLE PROVISIONS)

         The provisions of this Part shall apply mutatis mutandis to mutual
         insurance to the extent that its nature is compatible with those
         provisions. (Amended by Act No. 4470, Dec. 31, 1991)

<PAGE>

         CHAPTER II NON-LIFE INSURANCE

         SECTION 1 COMMON PROVISIONS

ARTICLE 665 (LIABILITY OF INSURER OF NON-LIFE INSURANCE)

         The insurer of a contract of non-life insurance is liable for
         indemnifying the insured for the loss against his property caused by
         the occurrence of the insured events.


ARTICLE 666 (NON-LIFE INSURANCE CERTIFICATE)

         The non-life insurance certificate shall contain the following
         particulars and the insurer shall write it's name and affix his seal or
         shall sign thereon: (Amended by Act No. 4470, Dec. 31, 1991)

         1.The subject-matter insured;

         2.The nature of the insured events;

         3.The insured amount;

         4.The amount of the premium and the method of its payment;

         5.The time of commencement and termination of the cover period if there
         is an agreement thereupon;

         6.The reasons for nullity of the contract and forfeiture of the right;

         7.The domicile and full name or trade name of the policyholder;

         8.The date of the contract of insurance; and


<PAGE>
         9.The place in, and the date on, which the insurance certificate was
         made.


ARTICLE 667 (NON-INCLUSION OF LOST PROFITS, ETC.)

         The profit or remuneration which was expected by the insurer but lost
         by reason of the occurrence of the insured events shall not be included
         in the amount of loss for which the insurer should indemnify, unless
         otherwise agreed by the parties.


ARTICLE 668 (SUBJECT-MATTERS OF INSURANCE CONTRACT)

         Only such interests as can be estimated in a monetary sum may be a
         subject-matter insured contract.


ARTICLE 669 (OVER-INSURANCE)


         (1) If the insured amount substantially exceeds the value of the
         subject-matter of a insurance contract, the insurer or the policyholder
         may demand a reduction of the premium and of the insured amount:
         Provided, That the reduction of the premium shall be effective for the
         future.

         (2) The value mentioned in paragraph (1) shall be determined by
         reference to the value when a contract is made. (Amended by Act No.
         4470, Dec. 31, 1991)

         (3) The provisions of paragraph (1) shall apply where the insurable
         value has substantially decreased during the cover period.

         (4) In the case of paragraph (1), if the conclusion of the contract was
         due to a fraud of the policyholder, such a contract shall be null and
         void: Provided, That the insurer may demand the premium due until it
         becomes aware of that fact.

<PAGE>

ARTICLE 670 (AGREED UPON VALUED POLICY)

         If the insurable value has been determined by the parties, it shall be
         presumed to have been determined as the value of the insured property
         at the time of the occurrence of the insured events: Provided, That if
         the insurable value determined substantially exceeds the value of the
         insured property at the time of the occurrence of the insured events,
         the latter shall be the insurable value.


ARTICLE 671 (UNVALUED POLICY)

         If the insurable value has not been determined by the parties, the
         value of the insured property at the time of the occurrence of the
         insured events shall be the insurable value.


ARTICLE 672 (DOUBLE INSURANCE)


         (1) Where several insurance contracts have been made simultaneously or
         successively with regard to the same subject-matter insured contract
         and the same events, if the total of the insured amounts exceeds the
         insurable value, the individual insurer has a joint and several
         liability up to the amount insured by each one. In this case, each
         insurer's liability for indemnification is subject to the ratio that
         the amount insured by each one has to the total insured amounts.
         (Amended by Act No. 4470, Dec. 31, 1991)

         (2) Where several insurance contracts are made with regard to the same
         subject-matter insured contract and the same events, the policyholder
         shall notify each insurer of the contents of each insurance contract.
         (Amended by Act No. 4470, Dec. 31, 1991)

         (3) The provision of Article 669 (4) shall apply mutatis mutandis to
         the contract of insurance under paragraph (1).

<PAGE>

ARTICLE 673 (DOUBLE INSURANCE AND WAIVER OF RIGHT AGAINST ONE OF DOUBLE
INSURERS)

         If several contracts of insurance have been made in accordance with
         Article 672, the waiver of the rights against one insurer shall not
         affect the rights and duties of the other insurers. (Amended by Act No.
         4470, Dec. 31, 1991)


ARTICLE 674 (PARTIAL INSURANCE)

         If only a part of the insurable value has been insured, the insurer
         shall be liable for indemnification in proportion to the ratio of the
         insured amount to the insurable value: Provided, That if the parties
         agreed otherwise, the insurer shall be liable for indemnifying for such
         loss within the limit of the insured amount. (Amended by Act No. 4470,
         Dec. 31, 1991)


ARTICLE 675 (LIABILITY FOR INDEMNIFICATION IN CASE OF DESTRUCTION OF
SUBJECT-MATTER AFTER OCCURRENCE OF INSURED EVENTS)

         Where a loss to be borne by the insurer occurred against the
         subject-matter insured, the insurer shall not be relieved of its
         liability to indemnify for the loss already occurred, even though the
         subject-matter may have been subsequently destroyed by the occurrence
         of a event which was not insured by the insurer. (Amended by Act No.
         1212, Dec. 12, 1962)


ARTICLE 676 (BASIS FOR DETERMINATION OF AMOUNT OF LOSS)


         (1) The amount of a loss for which an insurer is to indemnify shall be
         determined according to the value when and where the loss occurred:
         Provided, That if there is an agreement as otherwise determined by
         parties, the amount of a loss may be calculated on the basis of the
         value of a new Article of the subject-matter of insurance. (Amended by
         Act No. 4470, Dec. 31, 1991)

         (2) The expenses required for determining the amount of loss as
         referred to in

<PAGE>

         paragraph (1) shall be borne by the insurer. (Amended by Act No. 4470,
         Dec. 31, 1991)


ARTICLE 677 (DEDUCTION OF UNPAID PREMIUM FROM INDEMNITY)

         If there is premium still to be paid, the insurer which is to indemnify
         for the loss may deduct the unpaid premium from the indemnity amount
         even if the date of the payment has not arrived.


ARTICLE 678 (EXEMPTION OF LIABILITY FOR INDEMNIFICATION)

         The insurer is not subject to indemnify for any loss caused by the
         nature, defects or natural wear of the subject-matter of insurance.


ARTICLE 679 (ASSIGNMENT OF SUBJECT-MATTER OF INSURANCE)


         (1) When the insured has assigned the subject-matter of insurance, the
         assignee shall be presumed to have succeeded to the right and
         obligation under the contract of insurance. (Amended by Act No. 4470,
         Dec. 31, 1991)

         (2) In the case as referred to in paragraph (1), the assignor or
         assignee of the subject-matter of insurance shall without delay notify
         the insurer of that fact. (Newly Inserted by Act No. 4470, Dec. 31,
         1991)


ARTICLE 680 (DUTY TO PREVENT LOSS)


         (1) The policyholder and the insured shall endeavor to prevent and
         reduce loss: Provided, That the insurer shall be liable for paying the
         necessary or beneficial expenses incurred for that purpose and the
         amount of indemnity even though they exceed the insured amount.
         (Amended by Act No. 4470, Dec. 31, 1991)


<PAGE>

         (2) Deleted. (by Act No. 4470, Dec. 31, 1991)


ARTICLE 681 (SUBROGATION BY INSURER CONCERNING SUBJECT-MATTER OF INSURANCE)

         If the subject-matter of insurance has been totally destroyed, the
         insurer which has paid the whole insured amount shall acquire the
         rights of the insured to the subject-matter: Provided, That in case
         where only a part of the insurable value has been insured, the rights
         which are to be acquired by the insurer shall be determined according
         to the ratio of the insured amount to the insurable value.


ARTICLE 682 (SUBROGATION BY INSURER REGARDING THIRD PERSON)

         If the loss has been caused by the act of a third person, the insurer
         which has paid the insured amount shall acquire, to the extent of the
         amount paid, the rights of the policyholder or the insured against the
         third person: Provided, That if the insurer has provided a part of the
         insured amount payable, it may exercise such rights in so far as the
         rights of the insured are not prejudiced.


         SECTION 2 FIRE INSURANCE

ARTICLE 683 (LIABILITY OF INSURER OF FIRE INSURANCE)

         The insurer of a contract of fire insurance shall be bound to indemnify
         for any loss arising from fire.


ARTICLE 684 (INDEMNIFICATION FOR LOSS CAUSED BY MEASURES SUCH AS FIRE
EXTINGUISHING, ETC.)

         The insurer shall be bound to indemnify for any loss caused by the
         measures necessary for extinguishing fire or for decreasing loss.



<PAGE>

ARTICLE 685 (FIRE INSURANCE CERTIFICATE)

         A fire insurance certificate shall, in addition to the particulars
         mentioned in Article 666, contain the following ones:

         1.If a building is the subject-matter of insurance, the location,
         structure and purpose of the building;

         2.If movables are the subject-matter of insurance, the condition and
         purpose of the place where they exist; and

         3.If the insurable value, if determined.


ARTICLE 686 (SUBJECT-MATTER OF AGGREGATE GOODS INSURANCE)

         Where aggregate goods are collectively the subject-matter insured,
         goods of the insured's family and employees shall be also included in
         the subject-matter insured. In this case, the insurance is deemed as
         concluded also for the benefit of the insured's family and employee.


ARTICLE 687 (IDEM)

         Where aggregate goods are collectively the subject-matter insured, even
         if they are frequently replaced during the cover period, the goods
         existing at the time of the occurrence of the insured events shall be
         included in the subject-matter insured.


         SECTION 3 TRANSPORT INSURANCE

ARTICLE 688 (LIABILITY OF INSURER OF TRANSPORT INSURANCE)


<PAGE>

         Unless otherwise agreed, the insurer of a contract of transport
         insurance shall be bound to indemnify for any loss which may arise
         between when the carrier receives the goods and when he delivers them
         to the consignee.


ARTICLE 689 (INSURABLE VALUE OF TRANSPORT INSURANCE)


         (1) In the insurance of the goods carried, the value of the goods when
         and where they were dispatched, the freight up to their destination,
         and other expenses involved shall constitute the insurable value.

         (2) Profits to be expected through the arrival of the goods carried may
         be included in the insurable value only if there is an agreement to
         that effect.


ARTICLE 690 (TRANSPORT INSURANCE CERTIFICATE)

         A transport insurance certificate shall, besides the particulars
         mentioned in Article 666, contain the following ones:

         1.The route and method of the carriage;

         2.The domicile and the name or trade name of the carrier;

         3.The place where the goods are to be received and delivered;

         4.The period allowed for the carriage, if determined; and

         5.The insurable value, if determined.


ARTICLE 691 (INTERRUPTION OR ALTERATION OF CARRIAGE AND EFFECT OF CONTRACT)

         Unless otherwise agreed a contract of transport insurance shall not
         lose its

<PAGE>

         effect, even though the carriage has been temporarily interrupted, or
         the route or method of the carriage has been altered, for the purpose
         of the carriage.


ARTICLE 692 (INTENTION OR GROSS NEGLIGENCE OF CARRIAGE ASSISTANT AND EXEMPTION
OF INSURER'S LIABILITY)

         If the insured events have occurred by intention or gross negligence of
         the consignor or the consignee, the insurer shall not be bound to
         indemnify for the loss caused by such events.


         SECTION 4 MARINE INSURANCE

ARTICLE 693 (LIABILITY OF INSURER OF MARINE INSURANCE)

         The insurer of a contract of marine insurance shall be bound to
         indemnify for loss which may be caused by the events connected with sea
         business. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 694 (INDEMNIFICATION OF GENERAL AVERAGE CONTRIBUTION)

         The insurer shall be liable to compensate the insured for the amount to
         be contributed by the latter to the general average: Provided, That if
         the amount of the general average contribution relating to the
         subject-matter of insurance, exceeds the insurable value, the amount of
         the surplus contribution shall not be indemnified for. (Amended by Act
         No. 4470, Dec. 31, 1991)


ARTICLE 694-2 (INDEMNIFICATION FOR SALVAGE)

         The insurer shall be bound to indemnify for salvage charges incurred by
         the insured in preventing any loss caused by the insured events:
         Provided, That if the salvage contribution of the object of the
         insurance exceeds the insurable

<PAGE>

         value, the amount of the surplus contribution shall not be compensated.
         [This Article Newly Inserted by Act No. 4470, Dec. 31, 1991]


ARTICLE 694-3 (INDEMNIFICATION FOR SPECIAL EXPENSES)

         The insurer shall be bound to indemnify for extraordinary expenses
         incurred for the safety or preservation of the subject-matter of
         insurance within the limit of the insured amount.
         [This Article Newly Inserted by Act No. 4470, Dec. 31, 1991]


ARTICLE 695 (MARINE INSURANCE CERTIFICATE)

         A marine insurance certificate shall, besides the particulars mentioned
         in Article 666, contain the following ones: (Amended by Act No. 4470,
         Dec. 31, 1991)

         1.In case where a ship is insured, the name, nationality, type of the
         ship, and the scope of navigation;

         2.In case where a cargo is insured, the name, nationality and type of
         the ship, ports of loading and unloading, and the places of sending and
         arrival if determined; and

         3.The insurable value, if determined.


ARTICLE 696 (INSURABLE VALUE AND SUBJECT-MATTER OF SHIP INSURANCE)


         (1) In the insurance of a ship, the insurable value shall be the value
         of the ship at the time when the liability of the insurer commences.

         (2) In the case mentioned in paragraph (1), a ship's appurtenances,
         fuel, food, and all other things necessary for the navigation of a ship
         shall be deemed as included in the subject-matter insured. (Amended by
         Act No. 4470, Dec. 31,

<PAGE>

         1991)


ARTICLE 697 (INSURABLE VALUE OF CARGO INSURANCE)

         In the insurance of a cargo, the insurable value shall be the value of
         the cargo at the time and place of loading together with the expenses
         incurred for loading and insurance. (Amended by Act No. 1212, Dec. 12,
         1962)


ARTICLE 698 (INSURABLE VALUE OF PROSPECTIVE PROFIT INSURANCE)

         In the insurance of prospective profit or remuneration to be earned
         upon the arrival of the cargo, if the insurable value has not been
         determined by the contract, the insured amount shall be presumed to be
         the insurable value.


ARTICLE 699 (COMMENCEMENT OF COVER PERIOD OF MARINE INSURANCE)


         (1) If a ship is insured for each voyage, the cover period shall
         commence at the time the shipment of goods or ballast starts.

         (2) If the cargo is insured, the cover period shall commence at the
         time the loading of goods starts: Provided, That if the place of
         sending the cargo is determined, the cover period commences at the time
         the transport starts therefrom.

         (3) If the insurance contract is concluded under paragraph (1) or (2)
         after the loading of goods or ballast starts, the cover period shall
         commence at the time of the conclusion of the contract.
         [This Article Wholly Amended by Act No. 4470, Dec. 31, 1991]


ARTICLE 700 (TERMINATION OF COVER PERIOD OF MARINE INSURANCE)

<PAGE>

         In the case of paragraph (1) of Article 699, the cover period shall
         terminate at the time of the unloading of the goods and ballast at the
         port of arrival, and in case of paragraph (2) of the said Article, it
         shall terminate upon the delivery of the goods at the port of unloading
         or the place of arrival: Provided, That where unloading has been
         delayed by a cause other than an act of god, the cover period shall
         terminate when such an unloading is generally completed. (Amended by
         Act No. 4470, Dec. 31, 1991)


ARTICLE 701 (EFFECT OF CHANGE OF VOYAGE)


         (1) If a ship starts on a voyage from a port other than the port of
         departure as determined in the insurance contract, the insurer shall be
         discharged from its liability.

         (2) If a ship starts on a voyage for a port other than the port of
         arrival as determined in the insurance contract, the provisions of
         paragraph (1) shall be also applicable.

         (3) If the port of arrival as determined in the insurance contract is
         changed after the liability of the insurer commenced, the insurer shall
         be discharged from its liability when the change is determined.
         [This Article Wholly Amended by Act No. 4470, Dec. 31, 1991]


ARTICLE 701-2 (DEVIATION FROM COURSE)

         If a ship deviates from the sea route as determined in the insurance
         contract without any justifiable reason, the insurer shall be
         discharged from its liability from the time of deviation. This
         provision shall also apply where the ship has regained her route before
         the occurrence of loss.
         [This Article Newly Inserted by Act No. 4470, Dec. 31, 1991]


ARTICLE 702 (EFFECT OF DELAY IN DEPARTURE OR VOYAGE)

<PAGE>

         If the insured delays departure or voyage without any justifiable
         reason, the insurer shall be discharged from its liability for any
         insured events from the time of delay.
         [This Article Wholly Amended by Act No. 4470, Dec. 31, 1991]


ARTICLE 703 (EFFECT OF CHANGE OF SHIP)

         In the case of a cargo insurance, if the ship has been changed due to
         any cause attributable either to the policyholder or to the insured,
         the insurer shall be discharged from liability for any insured events
         from the time of change. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 703-2 (EFFECT OF TRANSFER, ETC. OF SHIP)

         In case where a ship is insured, if any of the following causes exists,
         the insurance contract shall be terminated: Provided, That this shall
         not apply if otherwise agreed:

         1.Where the ship is transferred;

         2.Where the class of ship is changed; and

         3.Where the ship is undertaken by new management.
         [This Article Newly Inserted by Act No. 4470, Dec. 31, 1991]


ARTICLE 704 (FLOATING CARGO INSURANCE OF UNDETERMINED SHIP)


         (1) If the ship in which the cargo is to be loaded has not been
         determined at the time of making the contract of insurance, the
         policyholder or the insured shall, when he becomes aware of the loading
         of the cargo, without delay dispatch a notice to the insurer of the
         name and nationality of the ship, and type, quantity



<PAGE>

         and value of the cargo. (Amended by Act No. 4470, Dec. 31, 1991)

         (2) If the notice as referred to in paragraph (1) has been neglected,
         the insurer may terminate the contract within one month after it
         becomes aware of that fact. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 705

         Deleted. (by Act No. 4470, Dec. 31, 1991)


ARTICLE 706 (EXEMPTION OF MARINE INSURER'S LIABILITY)

         The insurer shall not be bound to indemnify for the following losses
         and expenses: (Amended by Act No. 4470, Dec. 31, 1991)

         1.If the ship or the freight has been insured, any loss arising from
         the failure, at the time of departure, to make preparations necessary
         for safe voyage or to have necessary documents on board;

         2.If the cargo has been insured, any loss arising from fraud or gross
         negligence of the charterer, consignor, or consignee; and

         3.Pilotage dues, port charges, light dues, quarantine fees, and other
         ordinary expenses incurred for the ship or cargo in the course of the
         voyage.


ARTICLE 707

         Deleted. (by Act No. 4470, Dec. 31, 1991)


ARTICLE 707-2 (INDEMNIFICATION FOR PARTIAL LOSS OF SHIP)


         (1) If a part of a ship which is damaged, is entirely repaired, the
         insurer shall be bound to indemnify for the expenses incurred for the
         repair up to the insured



<PAGE>

         amount in respect of any one casualty.

         (2) If a part of a ship which is damaged is only partially repaired,
         the insurer shall be bound to indemnify for the expenses incurred for
         the repair and the depreciation amount arising from the unrepaid
         damage.

         (3) If a part of a ship which is damaged is not repaired, the insurer
         shall be bound to indemnify for the depreciation amount arising from
         the unrepaired damage.
         [This Article Newly Inserted by Act No. 4470, Dec. 31, 1991]


ARTICLE 708 (INDEMNIFICATION FOR PARTIAL DAMAGE OF CARGO)

         Where the cargo insured has arrived at the port of unloading in a
         damaged condition, the insurer shall be bound to indemnify for the lost
         part of the insurable value in proportion to the insurable value in a
         damaged condition as compared with one in a sound condition.


ARTICLE 709 (INDEMNIFICATION FOR DAMAGE DUE TO SALE OF CARGO)


         (1) If the cargo insured has been sold in the course of the voyage by
         reason of an act of god, the insurer shall be bound to indemnify for
         the difference between the sale price deducted by the freight and other
         necessary expenses, and the insurable value.

         (2) If, in the case of paragraph (1), the buyer does not pay the
         purchase price, the insurer shall make its payment thereof. When he has
         made such payment, he shall acquire the rights of the insured against
         the buyer. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 710 (CAUSES FOR ABANDONMENT)


<PAGE>

         In the following cases, the insured may abandon the subject-matter of
         insurance to the insurer and claim the whole insured amount: (Amended
         by Act No. 4470, Dec. 31, 1991)

         1.Where, as the insured loses the possession of his own ship or cargo
         due to an insured event, it is unrecoverable, or the expenses of its
         recovery are expected to exceed its value at the time it is recovered;

         2.Where, as the ship is substantially damaged due to an insured events,
         the expenses of its repair are expected to exceed its value at the time
         it is repaired; and

         3.Where, as the cargo is substantially damaged due to an insured event,
         the total sum of the expenses incurred for its repair and its
         transportation to the destination are expected to exceed its value at
         the time it arrives at the destination.


ARTICLE 711 (MISSING SHIP)


         (1) A ship shall be deemed as missing, when it is uncertain for two
         months whether she exists or not. (Amended by Act No. 4470, Dec. 31,
         1991)

         (2) In the case as referred to in paragraph (1), a total loss shall be
         presumed. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 712 (CONTINUED CARRIAGE OF CARGO BY ANOTHER SHIP AND EXTINCTION OF RIGHT
OF ABANDONMENT)

         If, in the case of subparagraph 2 of Article 710, the master has,
         without delay, continued the carriage of the cargo by another ship, the
         insured shall not be allowed to abandon the cargo. (Amended by Act No.
         4470, Dec. 31, 1991)



<PAGE>

ARTICLE 713 (NOTICE OF ABANDONMENT)


         (1) If the insured elects to effect an abandonment, he shall dispatch a
         notice thereof to the insurer within a reasonable period. (Amended by
         Act No. 4470, Dec. 31, 1991)

         (2) Deleted. (by Act No. 4470, Dec. 31, 1991)


ARTICLE 714 (REQUISITES FOR EXERCISE OF RIGHT OF ABANDONMENT)


         (1) An abandonment shall be unconditional.

         (2) An abandonment shall be effected in respect of the whole
         subject-matter of insurance: Provided, That if the cause of abandonment
         has arisen only in respect of its part, only that part may be
         abandoned.

         (3) In case where a part of the insurable value has been insured, an
         abandonment may be effected only according to the proportion which the
         insured amount bears to the insurable value.


ARTICLE 715 (NOTICE OF OTHER INSURANCE CONTRACT, ETC.)


         (1) The insured shall, when effecting an abandonment, notify the
         insurer of the existence either of any other contract of insurance
         covering the subject-matter insured or of any obligation with which it
         is charged with, and if any, its type and contents.

         (2) The insurer may refuse to pay the insured amount until it has
         received the notice mentioned in paragraph (1). (Amended by Act No.
         4470, Dec. 31, 1991)

         (3) If the period for the payment of the insured amount has been agreed
         upon,


<PAGE>

         the period shall be computed from the day on which the notice of
         paragraph (1) has been received.


ARTICLE 716 (APPROVAL OF ABANDONMENT)

         After the insurer has accepted abandonment, it shall not raise any
         objection thereto.


ARTICLE 717 (REFUSAL OF ABANDONMENT)

         In case where the insurer has not accepted the abandonment, the insured
         shall not claim payment of the insured amount unless he proves the
         cause of abandonment.


ARTICLE 718 (EFFECT OF ABANDONMENT)


         (1) The insurer shall, by virtue of the abandonment, acquire all the
         rights of the insured subject-matter insured.

         (2) When the insured has effected an abandonment, he shall deliver all
         the documents relating to the subject-matter insured to the insurer.


         SECTION 5 LIABILITY INSURANCE

ARTICLE 719 (LIABILITY OF INSURER OF LIABILITY INSURANCE)

         If the insured is liable for the loss of a third person caused by an
         insured event during the cover period, the insurer of a contract of
         liability insurance shall be bound to indemnify therefor.



<PAGE>

ARTICLE 720 (BEARING EXPENSES DEFRAYED BY INSURED TO DEFEND HIMSELF)


         (1) Necessary expenses, judicial or extra-judicial, incurred by the
         insured to defend himself against the claims of a third person shall be
         deemed to have been included in the subject-matter of insurance. The
         insured may demand from the insurer an advance payment of such
         expenses.

         (2) If the insured can be relieved of the execution of judgment by
         furnishing a security or a deposit, he may demand the insurer to
         furnish a security or a deposit within the limit of the insured amount.

         (3) Where the act of paragraph (1) or (2) has been effected by the
         instruction of the insurer, even if the amount of security or deposit
         plus the amount of loss exceeds the insured amount, the insurer shall
         be liable for them. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 721 (SUBJECT-MATTER OF BUSINESS LIABILITY INSURANCE)

         If the liability in respect of the business which the insured manages
         is the subject-matter of insurance, the liability of the insured's
         agent or business supervisor against a third person shall be deemed as
         included in the subject-matter of insurance.


ARTICLE 722 (DUTY OF THE INSURED TO NOTIFY RISK)

         When a third person has demanded the insured to redress damage, he
         shall, without delay, give notice thereof to the insurer.


ARTICLE 723 (NOTICE OF PAYMENT, ETC. BY INSURED AND PAYMENT OF INSURED AMOUNT)



<PAGE>

         (1) When the insured has made a payment to a third person, approval or
         compromise with a third person and the insured's obligation has been
         settled by a judgment, the insured shall, without delay, dispatch
         notice thereof to the insurer.

         (2) Unless otherwise agreed as regards the period, the insurer shall
         pay the insured amount within ten days from the day on which he has
         received the notice of paragraph (1).

         (3) Even though there is an agreement by which the insurer is relieved
         of its liability when the insured has without the consent of the
         insurer made payment to a third person, approval or compromise with
         him, the insurer shall not be relieved of its liability to indemnify
         unless such an act is grossly unreasonable.


ARTICLE 724 (RELATIONS BETWEEN INSURER AND THIRD PERSON)


         (1) The insurer shall not pay the whole or a part of the insured amount
         to the insured before a third person has been indemnified for any loss
         caused by accidents attributable to the insured.

         (2) A third person may directed demand the insurer to indemnify for any
         loss caused by accidents attributable to the insured, within the limit
         of the insured amount: Provided, That the insurer may stand against the
         third person with a defense which the insured has in connection with
         the accidents. (Amended by Act No. 4470, Dec. 31, 1991)

         (3) The insurer shall, upon receiving a request under paragraph (2),
         without delay notify the insured of it. (Newly Inserted by Act No.
         4470, Dec. 31, 1991)

         (4) In the case of paragraph (2), the insured shall, upon a request
         from the insurer, cooperate in presenting necessary documents and
         evidence, making testimony, or calling a witness. (Newly Inserted by
         Act No. 4470, Dec. 31, 1991)



<PAGE>

ARTICLE 725 (LIABILITY INSURANCE OF CUSTODIAN)

         If a lessee, or any person who holds in his custody anything belonging
         to another person, has insured it against damages which he may have to
         pay, its owner may directly demand the insurer to indemnify for the
         loss.


ARTICLE 725-2 (SEVERAL LIABILITY INSURANCE)

         where several liability insurance contracts have been simultaneously or
         successively concluded which are to indemnify for the loss sustained by
         the insured, who should pay damages to a third person for the same
         accident, if the total insured amount exceeds the amount of damages
         paid by the insured to the third person, the provisions of Articles 672
         and 673 shall apply mutatis mutandis.
         [This Article Newly Inserted by Act No. 4470, Dec. 31, 1991]


ARTICLE 726 (APPLICATION TO REINSURANCE)

         The provisions of this Section shall apply mutatis mutandis to a
         contract of reinsurance. (Amended by Act No. 4470, Dec. 31, 1991)


         SECTION 6 AUTOMOBILE INSURANCE

ARTICLE 726-2 (LIABILITY OF INSURER OF AUTOMOBILE INSURANCE)

         The insurer of the automobile insurance contract shall be bound to
         indemnify for any loss caused by accidents which have occurred while
         the insured owns, uses or manages an automobile.
         [This Article Newly Inserted by Act No. 4470, Dec. 31, 1991]




ARTICLE 726-3 (AUTOMOBILE INSURANCE CERTIFICATE)
<PAGE>

         The automobile insurance certificate shall, besides the particulars
         mentioned in Article 666, contain the following ones:

         1.Names, birth dates or trade names of the owner and other possessors
         of the automobile;

         2.Registration number, chassis number, type in year and mechanism of
         the insured automobile; and

         3.Value of the automobile, if determined.
         [This Article Newly Inserted by Act No. 4470, Dec. 31, 1991]


ARTICLE 726-4 (TRANSFER OF AUTOMOBILE)


         (1) If the insured transfers the automobile during the cover period,
         the transferee shall succeed to the rights and obligations under the
         insurance contract only in case where the transferee obtains the
         approval from the insurer.

         (2) When the insurer is notified of the fact of transfer by the
         transferee, the insurer shall notify without delay whether it accepts
         or not, and if it fails to do so within ten days after the notification
         thereof, it shall be considered to have accepted.
         [This Article Newly Inserted by Act No. 4470, Dec. 31, 1991]


         CHAPTER III PERSONAL INSURANCE

         SECTION 1 COMMON PROVISIONS

ARTICLE 727 (LIABILITY OF INSURER OF PERSONAL INSURANCE)


<PAGE>

         The insurer of a contract of personal insurance shall be liable for the
         payment of the insured amount and other benefits according as the
         contract of insurance provides, in case the insured events may arise in
         respect to life or body.


ARTICLE 728 (PERSONAL INSURANCE CERTIFICATE)

         A personal insurance certificate shall, besides the particulars
         mentioned in Article 666, contain the following ones: (Amended by Act
         No. 4470, Dec. 31, 1991)

         1.The kind of contract of insurance;

         2.The domicile, full name and birth date of the insured; and

         3.The address, full name and birth date of the beneficiary of
         insurance, if such a beneficiary has been determined.


ARTICLE 729 (PROHIBITION OF SUBROGATION BY INSURER AGAINST THIRD PERSONS)

         The insurer shall not subrogate and exercise the rights of the
         policyholder and of the beneficiary arisen through the insurance risks
         against the third persons: Provided, That in case of accident insurance
         contract, if there is a special stipulation between parties, the
         insurer may be subrogated in the position of the insured to exercise of
         any right of the insured, to the extent that it is unprejudicial to
         such right. (Amended by Act No. 4470, Dec. 31, 1991)


         SECTION 2 LIFE INSURANCE

ARTICLE 730 (LIABILITY OF INSURER IN LIFE INSURANCE)

         The insurer of a contract of life insurance shall be bound to pay the
         insured amount agreed upon if the insured events occur in respect of
         the life of the


<PAGE>

         insured.


ARTICLE 731 (LIFE INSURANCE CONTRACT FOR THIRD PERSON)


         (1) A contract of insurance which cover the death of a third person as
         an insured event shall require the written consent of the third person
         at the time the insurance contract is concluded.
         (Amended by Act No. 4470, Dec. 31, 1991)

         (2) The provisions of paragraph (1) shall apply if the rights arising
         from the contract of insurance have been transferred to the person
         other than the insured. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 732 (PROHIBITION OF INSURANCE CONTRACT FOR THOSE UNDER 15 YEARS OF AGE,
ETC.)

         A contract of insurance which designates the death of a person under 15
         years of age, of an insane person or of a mentally incompetent person
         as an insured event shall be null and void. (Amended by Act No. 1212,
         Dec. 1212, 1962; Act No. 4470, Dec. 31, 1991)


ARTICLE 732-2 (INSURANCE RISKS CAUSED BY GROSS NEGLIGENCE)

         In the case of an insurance contract covering death as an insured
         event, the insurer shall not be discharged from its liability, even
         though the insured event happens by reason of gross negligence of the
         policyholder, insured or beneficiary.
         [This Article Newly Inserted by Act No. 4470, Dec. 31, 1991]


ARTICLE 733 (RIGHT TO DESIGNATE OR CHANGE BENEFICIARY)


         (1) The policyholder is entitled to designate or change the
         beneficiary.


<PAGE>

         (2) If the policyholder has died without exercising the right of
         designation mentioned in paragraph (1), the insured shall be the
         beneficiary, and in case where the policyholder has died without
         exercising the right of change mentioned in paragraph (1), the right of
         the beneficiary shall be settled: Provided, That this shall not apply
         where there is an agreement by which the policyholder's successor may
         exercise the right mentioned in paragraph (1) in the case of the
         policyholder's death. (Amended by Act No. 4470, Dec. 31, 1991)

         (3) If the beneficiary has died during the cover period. the
         policyholder may re-designate any other beneficiary. In such a case, if
         the policyholder has died without exercising the right of designation,
         the inheritor of the beneficiary shall be a beneficiary.

         (4) If the insured event occurs before the policyholder exercises the
         right of designation as referred to in paragraphs (2) and (3), the
         inheritor of the insured or beneficiary shall be a beneficiary. (Newly
         Inserted by Act No. 4470, Dec. 31, 1991)


ARTICLE 734 (NOTIFICATION OF RIGHT TO DESIGNATE BENEFICIARY OF INSURANCE, ETC.)


         (1) If, after entering into a contract, the policyholder designates or
         changes the beneficiary, such a designation or change shall not be
         asserted against the insurer, unless the insurer has been given a
         notice thereof.

         (2) The provisions mentioned in Article 731 (1) shall apply mutatis
         mutandis to the designation or change mentioned in paragraph (1).
         (Amended by Act No. 1212, Dec. 12, 1962; Act No. 4470, Dec. 31, 1991)


ARTICLE 735 (ENDOWMENT INSURANCE)

         In the contract of insurance by which the death of the insured has been
         covered as an insured event, it may be agreed that the insured amount
         shall be paid at


<PAGE>

         the time of the termination of the cover period even if the insured
         event has not occurred.


ARTICLE 735-2 (ANNUITY INSURANCE)

         The insurer of a life insurance contract may, upon the occurrence of an
         insured event on the life of the insured, pay the insured amount in
         installments as an annuity, as the contract provides.
         [This Article Newly Inserted by Act No. 4470, Dec. 31, 1991]


ARTICLE 735-3 (GROUP INSURANCE)


         (1) In case where, according to a covenant, an organization effects a
         life insurance contract in which the whole or part of its members are
         the insured, the provisions of Article 731 shall not be applicable.

         (2) When the insurance contract as referred to in paragraph (1) is
         effected, the insurer shall deliver the insurance certificate only to
         the policyholder.
         [This Article Newly Inserted by Act No. 4470, Dec. 31, 1991]


ARTICLE 736 (DUTY TO RETURN ACCUMULATION FOR INSURANCE, ETC.)


         (1) When a contract of insurance has been terminated in accordance with
         the provisions of Articles 649, 650, 651 and 652 through 655, and when
         the liability for paying the insured amount has been relieved in
         accordance with the provisions of Articles 659 and 660, the insurer
         shall pay to the policyholder the amount accumulated for the
         beneficiary: Provided, That unless the contract provides otherwise, the
         same shall not apply where the insured event mentioned in Article 659
         (1) has occurred due to the policyholder. (Amended by Act No. 4470,
         Dec. 31, 1991)


<PAGE>

         (2) Deleted. (by Act No. 4470, Dec. 31, 1991)


         SECTION 3 ACCIDENT INSURANCE

ARTICLE 737 (LIABILITY OF INSURER OF ACCIDENT INSURANCE)

         The insurer of a contract of accident insurance shall be liable for the
         payment of the insured amount and other benefits if the insured event
         causing the injury of the body occurs.


ARTICLE 738 (ACCIDENT INSURANCE CERTIFICATE)

         When, in the case of an accident insurance, the insured and the
         policyholder are not the same person, only the official function or
         position of the insured may be written down on the insurance
         certificate instead of the particulars mentioned in subparagraph 2 of
         Article 728.


ARTICLE 739 (APPLICABLE PROVISIONS)

         The provisions concerning life insurance except Article 732 shall apply
         mutatis mutandis to accident insurance.


         PART V MARITIME COMMERCE

         CHAPTER I SHIPS

ARTICLE 740 (DEFINITION OF SHIP)

         A ship mentioned in this Act is one which is used for navigation for
         the purpose


<PAGE>

         of commercial activities or any other profit-making transactions.
         (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 741 (BOATS AND VESSEL PROPELLED BY OARS)

         The provisions of this Part shall not apply to small boats or to any
         vessel propelled mainly by oars. (Amended by Act No. 4470, Dec. 31,
         1991)


ARTICLE 742 (ACCESSORY TO SHIP)

         Any Article entered in the ship's inventory of equipments shall be
         presumed to be an accessory to the ship.


ARTICLE 743 (TRANSFER OF RIGHT RELATING TO SHIP)

         The transfer of the right relating to a ship shall take effect only by
         an agreement between the parties: Provided, That such transfer shall
         not be asserted against to a third person unless it has been registered
         and an entry thereof has been made in the certificate of the ship's
         nationality.


ARTICLE 744 (ARREST OR PROVISIONAL ARREST OF SHIP)

         No arrest or provisional arrest can be levied on a ship which has
         completed preparations for commencing a voyage, or on her equipments:
         Provided, That this shall not apply to such obligations which have been
         incurred for the purpose of making preparations for commencing a
         voyage.


ARTICLE 745 (SMALL SHIPS)

         The provisions of Articles 743 and 744 shall not apply to any ship of a
         gross tonnage of less than twenty tons. (Amended by Act No. 4470, Dec.
         31, 1991)

<PAGE>

         CHAPTER II SHIPOWNER

ARTICLE 746 (SHIPOWNER'S LIMITATION OF LIABILITY)

         The shipowner may limit his liability for the claims falling under any
         of the following subparagraphs to the amounts as prescribed in Article
         747, whatever the basis of liability may be: Provided, That the
         shipowner shall not be entitled to limit his liability if the loss
         resulted from his personal act or ommission, committed with the intent
         to cause such loss, or recklessly and with knowledge that such loss
         would probably result:

         1.Claims in respect of loss of life or personal injury or loss of or
         damage to property other than the ship, occurring on board or in direct
         connection with the operation of the ship;

         2.Claims in respect of loss resulting from delay in the carriage by sea
         of cargos, passengers or their luggages;

         3.Claims in respect of other loss resulting from infringement of
         another person's rights other than contractual rights, occurring in
         direct connection with the operation of the ship other than claims
         referred to in subparagraphs 1 and 2; and

         4.Claims of a person in respect of measures taken in order to avert or
         minimize loss for which the person liable may limit in accordance with
         subparagraphs 1 through 3, and further loss caused by such measures.
         [This Article Wholly Amended by Act No. 4470, Dec. 31, 1991]


ARTICLE 747 (LIMITS OF LIABILITY)


         (1) The limits of the liability for claims against the shipowner shall
         be calculated as follows:


<PAGE>

         1.The limits of liability in respect of claims for loss of life or
         personal injury of passengers shall be an amount of 46,666 Units of
         Account multiplied by the number of passengers which the ship is
         authorized to carry according to the ship's certificate, but not
         exceeding 25 million Units of Account.

         2.The limits of liability in respect of claims for loss of life or
         personal injury of a person other than passengers shall be calculated
         on the basis of the ship as follows: Provided, That the limits of
         liability shall be 167,000 Units of Account for a ship with a tonnage
         of less than 300 tons:

         (a) 333,000 Units of Account for a ship not exceeding 500 tons; and

         (b) For a ship with a tonnage in excess 500 tons, the following amount
         in addition to that mentioned in (a):

         (i)For each ton from 501 to 3,000 tons, 500 Units of Account;

         (ii)For each ton from 3,001 to 30,000 tons, 333 Units of Account;

         (iii)For each ton from 30,001 to 70,000 tons, 250 Units of Account; and

         (iv)for each ton in excess of 70,000 tons, 167 Units of Account.

         3.The limits of liability in respect of any other claims shall be
         calculated on the basis of the tonnage of the ship as follows:
         Provided, That the limits of liability shall be 83,000 Units of Account
         for a ship with a tonnage of less than 300 tons:

         (a) 167,000 Units of Account for a ship not exceeding 500 tons; and

         (b) for a ship with a tonnage in excess 500 tons, the following amount
         in addition to that mentioned in (a):

         (i)For each ton from 501 to 30,000 tons, 167 Units of Account;

         (ii)For each ton from 30,001 to 70,000 tons, 125 Units of Account; and


<PAGE>

         (iii)For each ton in excess of 70,000 tons, 83 Units of Account.

         (2) The limits of liability as referred to in subparagraphs of
         paragraph (1) shall cover all claims against the shipowner, arising on
         any distinct occasion.

         (3) The claims for which the shipowner may limit his liability in
         accordance with Article 746 shall rank rateably with the claims
         mentioned in each subparagraph.

         (4) If the limits of liability calculated in accordance with paragraph
         (1) 2 is insufficient to pay the claims mentioned therein in full, the
         limits of liability calculated in accordance with paragraph (1) 3 shall
         be available for payment of the unpaid balance of claims under
         subparagraph 2, and such unpaid balance shall rank rateably with the
         claims mentioned under subparagraph 3 when the claims mentioned under
         subparagraph 2 and 3 arose from the same accident.

         (5) The Unit of Account referred to paragraph (1) is the Special
         Drawing Right as defined by the International Monetary Fund.
         [This Article Wholly Amended by Act No. 4470, Dec. 31, 1991]


ARTICLE 748 (CLAIMS EXCEPTED FROM LIMITATION)

         The shipowner shall not limit his liability for the following claims:
         (Amended by Act No. 5809, Feb. 5, 1999)

         1.Claims by the master, seaman or other employees whose duties are
         connected with the operations of the ship, including claims of their
         inheritors, dependents or other person entitled to make such claims
         against the shipowner;

         2.Claims for rescue from marine accidents or contribution in general
         average;

         3.Claims for oil pollution damage within the meaning of the
         International Convention on Civil Liability for Oil Pollution Damage,
         dated November 29th 1969 or of any amendment or Protocol thereto which
         is in force;


<PAGE>

         4.Claims in respect of the raise, removal, destruction or the rendering
         harmless of a ship which is sunk, wrecked, stranded or abandoned,
         including anything that is or has been on board such ship; and

         5.Claims for nuclear damages.
         [This Article Wholly Amended by Act No. 4470, Dec. 31, 1991]


ARTICLE 749 (COUNTERCLAIMS)

         Where the shipowner has a claim against the claimant arising out of the
         same occurrence, their respective claims shall be set off against each
         other and the limitation of liability shall only apply to the balance,
         if any.
         [This Article Wholly Amended by Act No. 4470, Dec. 31, 1991]


ARTICLE 750 (PERSONS ENTITLED TO LIMIT LIABILITY)


         (1) The following persons may limit their liability to the same extent
         as the shipowner in accordance with the provisions of this Chapter:

         1.Charterer, manager and operator of a ship;

         2.Corporate shipowner and a member with unlimited liability of the
         persons mentioned in subparagraph 1; and

         3.Master, seaman, pilot, or employee or agent of the shipowner or the
         persons as referred to in subparagraph 1, who has incurred through his
         own act the claims as prescribed in subparagraphs of Article 746 for
         the shipowner or the person as enumerated in subparagraph 1.

         (2) The total amount of the limits of liability of the shipowner and
         the persons enumerated in paragraph (1) for all of the claims arising
         from the same accident shall not exceed the limits of liability as
         prescribed in Article 747 for each ship.


<PAGE>

         (3) If a shipowner or one of those as referred to in subparagraphs of
         paragraph (1) is subject to a decision to commence the procedures on
         the limitation of liability, other persons who are entitled to limit
         their liability, may take advantage of such decision.
         [This Article Wholly Amended by Act No. 4470, Dec. 31, 1991]


ARTICLE 751 (TONNAGE OF SHIP FOR LIMITATION ON LIABILITY)

         For the purpose of Article 747 (1), the tonnage of the ship engaged in
         international navigation shall be the international gross tonnage as
         set forth in the Vessels Act, and the tonnage of other ships shall be
         the gross tonnage as prescribed by the said Act.
         [This Article Wholly Amended by Act No. 4470, Dec. 31, 1991]


ARTICLE 752 (PROCEDURES OF LIMITATION OF LIABILITY)


         (1) Any person who desires to limit his liability pursuant to the
         provisions of this Chapter, shall apply for a commencement of the
         procedures of limitation of liability to the court within one year
         after he receives from the creditor a request in writing of an amount
         exceeding the limit of liability.

         (2) The application for commencement of the procedure of limitation of
         liability, formation of the limitation fund, public notice,
         participation in the procedures, distribution of the fund, and other
         necessary matters shall be set forth by another Act.
         [This Article Wholly Amended by Act No. 4470, Dec. 31, 1991]


ARTICLE 752-2 (LIMITED LIABILITY OF SALVORS)


         (1) The provisions of Articles 746 through 752 shall be applicable
         mutatis mutandis to limitation of liability for any claim arising in
         direct connection with



<PAGE>

         salvage operations of salvors. (Amended by Act No. 5809, Feb. 5, 1999)

         (2) Any salvor who has not performed the salvage operation from on
         board a ship, or has performed only on the ship which has been rescued,
         shall be considered to be a ship of 1,500 tons with respect to the
         limits of liability as prescribed in Article 747.

         (3) The limit of liability of a salvor shall be extended to each rescue
         ship, and in the case as referred to in paragraph (2), to all claims
         arising from the same accident for each salvor.
         [This Article Newly Inserted by Act No. 4470, Dec. 31, 1991]


ARTICLE 753 (CO-OWNERSHIP OF SHIP: MATTERS RELATING TO USE)


         (1) The matters relating to the use of the ship owned by the co-owners
         shall be determined by the majority of the share of the co-owner in
         proportion to the value of the share of the co-owner.

         (2) The matters which alter the contract relating to the co-ownership
         of a ship shall be determined by the unanimous consent of the
         co-owners.


ARTICLE 754 (CO-OWNERSHIP OF SHIP: BURDEN OF EXPENSES)

         The co-owner of a ship shall bear the expenses relating to the use of
         the ship and the obligations which have arisen in respect of such use
         in proportion to the value of his share.


ARTICLE 755 (APPORTIONMENT OF PROFIT AND LOSS)

         The apportionment of loss and profit shall be performed in proportion
         to the value of the share of the co-owner of a ship after each voyage
         has been completed.



<PAGE>

ARTICLE 756 (ASSIGNMENT OF SHARE)

         Even if there is a partnership between the co-owners of a ship, each
         co-owner may transfer his share to another person without obtaining the
         consent of other co-owners: Provided, That the same shall not apply in
         the case of a manager of the ship.


ARTICLE 757 (CO-OWNERSHIP OF SHIP: LOSS OF NATIONALITY AND PURCHASE OF QUOTA OR
APPLICATION FOR AUCTION)


         (1) When a ship loses the nationality of the Republic of Korea by
         transfer of the portion of the co-owner of a ship or by losing his
         nationality, other co-owners may purchase such share at a reasonable
         price or may apply the court for the auction of such share.

         (2) When a ship which belongs to the ownership of a company loses the
         nationality of the Republic of Korea through the transfer of any share
         of the members, in case of "partnership company" the other member, and
         in case of "limited partnership company", the member with unlimited
         liability, may purchase such share at a reasonable price.


ARTICLE 758 (RIGHT TO DEMAND PURCHASE OF SHARES BELONGING TO PERSONS WHO OBJECT
TO RESOLUTION)


         (1) When the co-owners of a ship have resolved to commence a new voyage
         or to repair the ship extensively, any co-owner who has an objection
         thereto may demand of another co-owner for purchase of his share at a
         reasonable price.

         (2) Any person who intends to effect the demand mentioned in paragraph
         (1) shall dispatch the notice thereof to another co-owner or to a ship
         manager


<PAGE>

         within three days from the date of resolution, and in case where the
         person did not participate in the resolution, from the day on which he
         has received the notice of the resolution. (Amended by Act No. 4470,
         Dec. 31, 1991)


ARTICLE 759 (TRANSFER OF SHIP DURING VOYAGE, ETC.)

         If a ship in the course of a voyage, or the share on the ship has been
         transferred, the transferee shall acquire the profit and bear the loss
         arising from the voyage, unless otherwise agreed upon between the
         parties.


ARTICLE 760 (APPOINTMENT AND REGISTRATION OF SHIP MANAGER)


         (1) The co-owners of a ship shall appoint a ship manager. The consent
         of all the co-owners shall be required for the appointment of a ship
         manager who is not a co-owner. (Amended by Act No. 4470, Dec. 31, 1991)

         (2) The appointment of a ship manager and the termination of his proxy
right shall be registered.


ARTICLE 761 (AUTHORITIES OF SHIP MANAGER)


         (1) The ship manager shall have the authority to do all judicial and
         extra-judicial acts relating to the use of the ship.

         (2) No restriction upon such proxy right of a ship manager shall be
         asserted against a third person acting in good faith.


ARTICLE 762 (RESTRICTION ON AUTHORITIES OF SHIP MANAGER)

         The ship manager shall not do the following acts unless he has been
         authorized


<PAGE>

         to so in writing by co-owners of the ship:

         1.The assigning and chartering, or offering as security of the ship;

         2.The commencing of a new voyage;

         3.The obtaining of an insurance coverage on the ship;

         4.The extensive repair of the ship; and

         5.The borrowing of money.


ARTICLE 763 (ENTRY AND KEEPING OF RECORD)

         The ship manager shall keep a record relating to the administration of
         his duties. All matters relating to the use of the ship shall be
         entered therein.


ARTICLE 764 (REPORT OF SHIP MANAGER AND APPROVAL THEREOF)

         After the termination of each voyage, the ship manager shall, without
         delay, prepare the documents relating to the progresses of such voyage
         and the account, report them to the co-owners of the ship, and obtain
         their approval.


ARTICLE 765 (RIGHT TO REQUEST REGISTRATION OF LESSEE AND EFFECT OF REGISTRATION)


         (1) The lessee of a ship may request the shipowner to cooperate in
         effecting the registration of the lease.

         (2) The lease of a ship, if registered, shall be effective against
         third persons from the time registration has been effected.



<PAGE>

ARTICLE 766 (LEASE OF SHIP AND LEGAL RELATION AGAINST THIRD PERSON)


         (1) If the lessee of a ship makes the ship available in navigation for
         the purpose of engaging in commercial activities and of acquiring
         profits, the lessee shall, in relation to third persons, have the same
         rights and duties as the shipowner in connection with matters relating
         to the use of the ship.

         (2) In the case mentioned in paragraph (1), any preferential right
         which has arisen in connection with the use of the ship shall be
         effective even against the shipowner. This shall not, however, apply in
         cases where the holder of the preferential right was aware that the use
         was not in conformity with the contract of such use. (Amended by Act
         No. 4470, Dec. 31, 1991)


         CHAPTER III MASTER

ARTICLE 767 (APPOINTMENT AND DISMISSAL OF MASTER)

         The shipowner may appoint or dismiss the master.


ARTICLE 768 (CLAIM FOR COMPENSATION OF DAMAGE AGAINST UNREASONABLE DISMISSAL OF
MASTER)


         (1) If the master is dismissed without reasonable cause by the
         shipowner, the master may demand the shipowner to compensate for any
         damage arising therefrom.

         (2) If a master who is also a co-owner of a ship is dismissed against
         his intention, he may demand of the other co-owners that they purchase
         his share at a reasonable price.

         (3) If a master intends to make the demand mentioned in paragraph (2),
         he shall


<PAGE>

         dispatch without delay the notice thereof to the other co-owner or to
         the ship manager. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 769 (MASTER'S LIABILITY OF CONTINUE PERFORMANCE OF HIS DUTIES)

         If a master is dismissed or his term expires during the voyage, he
         shall be liable to perform his duties until another master is able to
         perform such duties or the ship arrives at the port of registry.


ARTICLES 770 AND 771

         Deleted. (by Act No. 4470, Dec. 31, 1991)


ARTICLE 772 (RESPONSIBILITY FOR APPOINTING ANOTHER MASTER IN HIS PLACE)

         If the master is unable to perform his duties by reason of force
         majeure, he may appoint another master by his own responsibility and
         require the latter to perform his duties, except as otherwise provided
         by Acts, subordinate statutes.


ARTICLE 773 (SCOPE OF PROXY RIGHT)


         (1) While away from the port of registry, the master shall have
         authority to perform all judicial and extra-judicial acts which are
         necessary for voyage.

         (2) While at the port of registry, the master has authority only to
         hire and dismiss seamen, except in cases where he has been vested with
         special authority.


ARTICLE 774 (AUTHORITY IN RESPECT OF SPECIAL ACTS)



<PAGE>

         (1) The master shall not do any of the following acts except in order
         to reimburse expenses for repair of the ship, salvage remuneration, or
         any other expenses necessary for the continuance of the voyage:
         (Amended by Act No. 5809, Feb. 5, 1999)

         1.Offering ship or her equipment as security;

         2.Borrowing of money; and

         3.Disposing of the whole or a part of the cargo.

         (2) The amount of damages, if the master disposes of the cargo, shall
         be determined by the value of such cargo at the port of unloading at
         the time when it should have arrived there: Provided, That any expenses
         which are not required to be paid shall be deducted from such value.


ARTICLE 775 (RESTRICTION UPON PROXY RIGHT)

         No restriction upon the proxy right of the master shall be asserted
         against a third person acting in good faith.


ARTICLE 776 (DISPOSITION OF CARGO FOR BENEFIT OF PERSONS INTERESTED)


         (1) If the master disposes of the cargo during the voyage, disposition
         of the cargo shall be done in such a manner for the best interest of
         the persons interested.

         (2) In the case mentioned in paragraph (1), the person interested shall
         be liable against the person who became the creditor on account of such
         a disposition within the limit of the value of the cargo: Provided,
         That this shall not apply where such a person has been guilty of
         negligence. (Amended by Act No. 4470, Dec. 31, 1991)



<PAGE>

ARTICLE 777 (AUCTION OF SHIP)

         If the ship has become unrepairable while away from the port of
         registry, the master may sell the ship by auction with the
         authorization of the marine authority. (Amended by Act No. 1212, Dec.
         12, 1962)


ARTICLE 778 (UNREPAIRABLE CASES)


         (1) A ship shall be deemed to be unrepairable in the following cases:

         1.If the ship cannot be repaired at the place where she lies and cannot
         proceed to a place where repairs can be effected; and

         2.If the expenses for repair will exceed three-quarters of the value of
         the ship.

         (2) If the ship has been damaged in the course of a voyage, the value
         mentioned in paragraph (1) 2, shall be the value at the time of
         commencement of such voyage; and in other cases, it shall be the value
         of the ship before she sustained such damage. (Amended by Act No. 4470,
         Dec. 31, 1991)


ARTICLE 779 (DUTY TO REPORT AND MAKE UP ACCOUNTS)


         (1) The master shall, without delay, report to the shipowner on all
         important matters relating to the voyage.

         (2) At the end of each voyage, the master shall, without delay, present
         the statement of the accounts to the shipowner and obtain the
         shipowner's approval thereof.

         (3) Whenever required by the shipowner, the master shall report on
         matters relating to the voyage and on the accounts.



<PAGE>

         CHAPTER IV CARRIAGE

         SECTION 1 CARRIAGE OF GOODS

         SUB-SECTION 1 COMMON PROVISIONS

ARTICLE 780 (TYPES OF CONTRACT OF CARRIAGE)

         The contracts of carriage of goods shall be divided into the following
         two categories:

         1.A charter party, the object of which is providing the whole or a part
         of a ship for the carriage of goods; and

         2.A contract the object of which is carrying separate goods.


ARTICLE 781 (CHARTER PARTY AND WRITTEN CONTRACT OF CARRIAGE)

         A party to a charter party shall, upon demand by the other party,
         provide a written contract of carriage.


ARTICLE 782 (CHARTER PARTY AND NOTICE OF READINESS FOR LOADING GOODS, PERIOD FOR
LOADING GOODS)


         (1) If a charter party has been entered into, the carrier shall, as
         soon as the preparations necessary for loading the goods have been
         completed, dispatch notice thereof to the charterer without delay.
         (Amended by Act No. 4470, Dec. 31, 1991)


<PAGE>

         (2) If the period for loading goods is stipulated, such period shall
         commence from one o'clock p.m. on the day, when the notification as
         referred to in paragraph (1) is made before noon, and from six o'clock
         a.m. of the following day, when it is made in the afternoon. This
         period shall not include the day on which the loading is impossible by
         force majeure, and the day on which no loading work is done due to
         custom in the port. (Amended by Act No. 4470, Dec. 31, 1991)

         (3) If any goods have been loaded after the passage of such period as
         referred to in paragraph (2), the carrier may demand reasonable
         remuneration. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 783 (NOTICE AND LOADING WHERE THIRD PERSON IS SHIPPER)

         In cases where a third person other than the charterer loads the goods,
         if it is impossible for the master to ascertain such person or if such
         person fails to load the goods, the master shall, without delay,
         dispatch a notice thereof to the charterer. In such cases, the
         charterer may load the goods only within the period allowed for
         loading.


ARTICLE 784 (RIGHT TO REQUEST COMMENCEMENT OF VOYAGE OF CHARTERER AND POWER TO
COMMENCE VOYAGE OF MASTER)


         (1) The charterer may require the master to commence the voyage even
         when all the goods have not been loaded.

         (2) The master may, with the lapse of the period allowed for loading,
         immediately commence the voyage, even though the charterer has not
         loaded all the goods.

         (3) In cases mentioned in paragraphs (1) and (2), the charterer shall
         pay the full amount of the freight and any expenses arising from his
         failure in loading all the



<PAGE>

         goods, and shall, if required by the carrier, provide adequate
         security. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 785 (TRANSPORT OF SEPARATE ARTICLE AND PROVIDING GOODS)


         (1) If a separate Article is the object of a carriage contract, the
         shipper shall hand over the goods to the carrier at such time and place
         as agreed upon between parties or as determined in accordance with the
         custom of the loading port.

         (2) If the shipper fails to hand over goods to the carrier at such time
         and place as referred to in paragraph (1), the contract shall be
         considered to have been rescinded. In this case, the master may
         immediately commence the voyage, and the shipper shall pay freight in
         full.
         [This Article Wholly Amended by Act No. 4470, Dec. 31, 1991]


ARTICLE 786 (FURNISHING DOCUMENTS NECESSARY FOR CARRIAGE)

         The charterer or the shipper shall, within the period allowed for
         loading, furnish the master with the documents necessary for the
         carriage.


ARTICLE 787 (DUTY TO EXERCISE DUE DILIGENCE AS TO SEAWORTHINESS)

         The carrier shall be liable for damages for any loss of, damages to, or
         delay of the goods, unless he proves that neither he, nor the crew, nor
         any of his employees has failed to exercise due diligence in connection
         with the following particulars at the commencement of the voyage:
         (Amended by Act No. 4470, Dec. 31, 1991)

         1.Make the ship seaworthy;

         2.Properly man, equip and supply the ship; and


<PAGE>

         3.Make the holds, refrigerating and cool chambers, and all other parts
         of the ship in which goods are carried, fit and safe for their
         reception, carriage and preservation.


ARTICLE 788 (DUTY OF CARE AND DILIGENCE TO GOODS)


         (1) If a carrier fails to prove that he or the crew or other employee
         of a ship exercised his duty of care in reception, loading, stowage,
         carriage, keeping, discharging and delivering of the goods, he shall be
         liable to compensate for damages caused by loss, damage or delay of the
         goods.

         (2) The carrier shall not be responsible for damage of the goods
         arising or resulting from act of the master, mariner or pilot, or the
         employees of the carrier in the navigation or in the management of the
         ship, or fire. This shall not apply where the fire was caused by actual
         fault or privity of the carrier.
         [This Article Wholly Amended by Act No. 4470, Dec. 31, 1991]


ARTICLE 789 (CAUSES FOR EXEMPTION FROM LIABILITY)


         (1) Deleted. (by Act No. 4470, Dec. 31, 1991)

         (2) The carrier shall be relieved of the liability for compensation, if
         he has proved that any fact of the following subparagraphs existed and
         that any damage of the goods might usually be caused by such fact:
         Provided, That the same shall not apply if it was proved that he has
         failed to exercise due diligence notwithstanding the fact that he could
         have avoided such damage if he had exercised the due diligence
         mentioned in Articles 787 and 788 (1): (Amended by Act No. 4470, Dec.
         31, 1991)

         1.Perils or accidents of the sea and other navigable waters;


<PAGE>

         2.Act of God;

         3.War, riots, or civil commotions;

         4.Piracy and other similar acts;

         5.Judicial seizure, quarantine restrictions and other restrictions by
         public authorities;

         6.Act of the shipper or the owner of the goods or his employees;

         7.Strikes, restraint of labor or lockouts;

         8.Saving life or property at sea or any deviation in saving life or
         property at sea or any reasonable deviation;

         9.Insufficiency of packing of the goods or insufficiency or inadequacy
         of marks;

         10.Particular nature or latent defects of the goods; and

         11.Latent defects of the ship.


ARTICLE 789-2 (LIMITATION OF LIABILITY)


         (1) The carrier shall not in any case be or become liable for any loss
         or damage to or in connection with the goods in accordance with
         Articles 787 through 789 in an amount exceeding the equivalent of 500
         Units of Account per package or unit: Provided, That the carrier shall
         not limit his liability if it is proved that the damage resulted from
         an act or omission of the carrier done with intent to cause damage, or
         recklessly and with knowledge that damage would probably result.

         (2) In applying paragraph (1), the number of the package or unit shall
         be determined as follows:


<PAGE>

         1.Where a container or similar article of transport is used to
         consolidate the goods, the number of packages or units enumerated in
         the bill of lading or other documents evidencing the contract of
         carriage as packed in such article of transport shall be deemed the
         number of packages or units. Except as aforesaid, such article of
         transport shall be considered the package or unit; and

         2.Where the article of transport itself supplied by a person other than
         the carrier is lost or damaged, such article of transport shall be
         deemed a separate package or unit.

         (3) The provisions of paragraphs (1) and (2) shall not apply if, at the
         time of delivery of the goods to the carrier by the shipper, the nature
         and value of the goods have been declared by the shipper and inserted
         in the bill of lading or other documents evidencing the contract of
         carriage. The carrier shall not be responsible in any event for loss or
         damage to the goods if the nature or value thereof has been knowingly
         significantly misstated unless the carrier or his employees were aware
         of this.

         (4) The provisions of paragraphs (1) through (3) shall not affect the
         application of Articles 746 through 752.

         (5) The Unit of Account as referred to in paragraph (1) shall have the
         same meaning as that prescribed in Article 747 (5).
         [This Article Newly Inserted by Act No. 4470, Dec. 31, 1991]


ARTICLE 789-3 (APPLICATION TO NON-CONTRACTUAL CLAIM)


         (1) The provisions of this Chapter concerning the liability of carrier
         shall also apply to the carrier's liability in tort.

         (2) If any action against a employee or agent of the carrier in respect
         of loss or damage of the goods and if such loss or damage occurred
         during performance of his duties, such employee or agent shall be
         entitled to avail himself of the defences and limits of liability which
         the carrier is entitled to invoke.


<PAGE>

         Nevertheless, a employee or agent of the carrier shall not be entitled
         to avail himself of the provisions of this Article, if it is proved
         that the damage resulted from an act or omission of the employee or
         agent done with intent to cause damage or recklessly and with knowledge
         that damage would probably result.

         (3) In the case as referred to in the text of paragraph (2), the
         aggregate of the amounts recoverable from the carrier, such employees
         and agents shall in no case exceed the limit as prescribed in Article
         789-2 (1).

         (4) The provisions of paragraphs (1) through (3) shall also apply even
         in case where the claim for damages in respect of the goods is made
         against the actual carrier other than the carrier or his employees or
         agents.
         [This Article Newly Inserted by Act No. 4470, Dec. 31, 1991]


ARTICLE 790 (PROHIBITION OF REDUCTION OF CARRIER'S LIABILITY)


         (1) No special agreement between the parties that reduces or exempts
         any obligation or liability of the carrier in contrary to the
         provisions of Articles 787 through 789-3, shall be valid. This
         provision shall also apply to a stipulation transferring the benefit of
         insurance in respect of the goods to the carrier, or to any
         stipulations to this effect.

         (2) The provisions of paragraph (1) shall not be applicable to any
         transport of live animals and transport of the goods on deck after
         inserting such intention on the bill of lading or the surface of other
         documents evidencing the contract of carriage.

         (3) Except in case where it is contrary to the provisions of Article
         787, the provisions of paragraph (1) shall not be applicable to a
         charter party: Provided, That in case where a bill of lading is issued
         pursuant to the charter party, the provisions of paragraph (1) shall be
         applicable to any obligation or liability of the carrier to any holder
         of the bill of lading other than the charterer.
         [This Article Wholly Amended by Act No. 4470, Dec. 31, 1991]



<PAGE>

ARTICLE 791 (DISPOSAL OF UNLAWFUL GOODS LOADED)


         (1) The goods which have been loaded in contravention of any Acts,
         subordinate statutes or a contract, may, at any time, be unloaded by
         the master, and if there is any danger that such goods will imperil the
         ship or other goods, they may be abandoned.

         (2) If the master carries the goods mentioned in paragraph (1), he may
         demand the maximum freight prevailing for the same types of goods at
         the time and place of the loading. (Amended by Act No. 4470, Dec. 31,
         1991)

         (3) The provisions of paragraphs (1) and (2) shall not affect any claim
         for damages by the carrier or any other interested person. (Amended by
         Act No. 4470, Dec. 31, 1991)


ARTICLE 791-2 (DISPOSAL OF DANGEROUS GOODS)


         (1) Goods of an inflammable, explosive or dangerous nature whereof the
         carrier had knowledge of their nature and character may, if such goods
         shall become a danger to the ship or other goods, may at any time
         before discharge be landed, or destroyed or rendered innocuous by the
         master.

         (2) The carrier shall be exempted from the liability to compensate for
         any loss inflicted on the goods by such disposal as referred to in
         paragraph (1) except its liability to general average contribution.
         [This Article Newly Inserted by Act No. 4470, Dec. 31, 1991]


ARTICLE 792 (RESCISSION OF CONTRACT OF WHOLE CHARTER PRIOR TO COMMENCEMENT OF
VOYAGE, ETC.)



<PAGE>

         (1) Prior to the commencement of the voyage, the whole charterer may
         rescind the contract upon payment of one-half of the freight.

         (2) If, in case of the charter party for a rounder-trip voyage, the
         whole charterer terminates the charter party prior to the homeward
         voyage, he shall pay two-thirds of the freight.

         (3) The provision of paragraph (2) shall apply, if, in case where the
         voyage is to be made from another port to the port of loading, the
         whole charterer has terminated the charter party before the ship leaves
         the port of loading. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 793 (SPACE CHARTER AND RESCISSION OF CONTRACT PRIOR TO COMMENCEMENT OF
VOYAGE, ETC.)


         (1) The charterer who has chartered a part of a ship, or a shipper, may
         rescind or terminate the charter party in accordance with Article 792
         only when the rescission or the termination is done jointly by other
         charterers and all shippers together. (Amended by Act No. 4470, Dec.
         31, 1991)

         (2) Even if, except in cases mentioned in paragraph (1), the space
         charterer, or a shipper, has rescinded or terminated the charter party
         before the commencement of a voyage, he shall pay the full amount of
         the freight. (Amended by Act No. 4470, Dec. 31, 1991)

         (3) Even before the commencement of a voyage, if the space charterer or
         a shipper has loaded the whole or a part of the goods, he may not
         rescind or terminate the charter party without obtaining the consent of
         the other charterers and shippers.


ARTICLE 794 (DUTY TO PAY INCIDENTAL EXPENSES AND SUBSTITUTED DONATION FOR
ANOTHER PERSON)



<PAGE>

         (1) Even if a charterer or shipper has rescinded or terminated the
         charter party in accordance with the provisions of Articles 792 and 793
         (1), he shall not be relieved of the liability to pay any incidental
         expenses and substituted donation for another person related thereto.

         (2) In the case mentioned in Article 792 (2) and (3), the charterer or
         the shipper shall pay, in addition to the amount mentioned in paragraph
         (1), the amount of his contribution to general average or rescue from
         marine accidents in proportion to the value of the goods. (Amended by
         Act No. 4470, Dec. 31, 1991; Act No. 5809, Feb. 5, 1999)


ARTICLE 795 (EXPENSES OF LOADING AND UNLOADING)

         If, in the cases mentioned in Articles 793 and 794, the whole or a part
         of the goods have been loaded, the charterer or the shipper shall bear
         the expenses of such loading and unloading.
         (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 796 (EFFECT OF FAILURE TO LOAD WITHIN PERIOD ALLOWED FOR LOADING)

         The charterer shall be deemed to have rescinded or terminated the
         charter party if he has failed to load the goods within the period
         allowed for loading. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 797 (TERMINATION OF CHARTER PARTY AFTER COMMENCEMENT OF VOYAGE)

         After the commencement of a voyage, the charterer or the shipper may
         not terminate the charter party unless he pays the full amount of the
         freight, advances, the moorage charges, the amount of his contribution
         to general average or rescue from marine accidents, and pays
         compensation for any damages arising from the unloading or provides
         adequate security therefor. (Amended by Act No. 5809, Feb. 5, 1999)



<PAGE>

ARTICLE 798 (CHARTER PARTY AND UNLOADING GOODS)


         (1) If, in case where a charter party has been made, preparations
         necessary for unloading the goods have been completed, the master shall
         without delay dispatch notice thereof to the consignee.

         (2) The provisions of Article 782 (2) shall be applicable mutatis
         mutandis to the calculation of allowed time for unloading the goods.
         (Amended by Act No. 4470, Dec. 31, 1991)

         (3) If any goods have been unloaded after the passage of such period as
         referred to in paragraph (2), the carrier may demand reasonable
         remuneration. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 799 (CARRIAGE OF SEPARATE ARTICLE AND RECEIPT OF GOODS)

         If carriage of a separate Article is the purpose of the contract, the
         consignee who is notified of the arrival of the goods, shall receive
         goods without delay at such time and place as agreed between the
         parties or determined pursuant to the custom of the unloading port.
         [This Article Wholly Amended by Act No. 4470, Dec. 31, 1991]


ARTICLE 800 (LIABILITY OF CONSIGNEE, MASTER'S RIGHT OF RETENTION)


         (1) When the consignee has received the goods, he shall be liable to
         pay the freight, the incidental expenses, substituted donation for
         another person and the moorage charges, the amount of his contribution
         to general average and rescue from marine accidents in proportion to
         the value of the goods, in accordance with the purport of the contract
         of carriage or of the bill of lading.
         (Amended by Act No. 5809, Feb. 5, 1999)


<PAGE>

         (2) The master shall not be responsible to deliver the goods except
         upon payment of the amount in accordance with the provisions mentioned
         in paragraph (1). (Amended by Act No. 4470, Dec. 31, 1991)



ARTICLE 800-2 (NOTICE OF PARTIAL LOSS OF OR DAMAGE OF GOODS)


         (1) If the consignee finds a partial loss of or damage to the goods, he
         shall send the carrier a written notice providing a summary thereof
         without delay after he discovers it: Provided, That if it is impossible
         to detect such loss or damage immediately, he shall send such notice
         within three days after discovery thereof.

         (2) If there is no notice as referred to in paragraph (1), the goods
         shall be presumed to have been delivered to the consignee without any
         loss or damage.

         (3) The provisions of paragraphs (1) and (2) shall not be applicable in
         case where the carrier or his employee was aware of such loss or
         damage.

         (4) If any loss of or damage to the goods has taken place, or there is
         suspicion, the carrier and consignee shall provide necessary
         conveniences for the other part's inspection of such goods.

         (5) The special agreement between the parties unfavorable to the
         consignee in violation of the provisions of paragraphs (1) through (4)
         shall not be valid.
         [This Article Newly Inserted by Act No. 4470, Dec. 31, 1991]


ARTICLE 801 (FREIGHT)

         If the freight has been fixed on the basis of the weight or volume of
         the goods, the amount of the freight shall be determined by the weight
         or volume of such goods at the time of delivery.


ARTICLE 802 (IDEM)


<PAGE>

         (1) If the freight has been fixed on the basis of period, the amount of
         the freight shall be determined by the period from the day on which
         loading of goods was commenced to the day on which the unloading was
         completed.

         (2) The period mentioned in paragraph (1) shall not include the period
         during which by reason of an act of god the ship has anchored at the
         port of loading or in the course of the voyage, or it has been repaired
         in the course of the voyage. Such period shall not include the number
         of days on which the goods have been loaded or unloaded after passage
         of the period of loading or unloading of the goods, as in the case of
         Article 782 (2) or 798 (2). (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 803 (DEPOSIT, ETC. OF GOODS)


         (1) If the consignee neglects to receive the goods, the master may
         deposit them, or deliver them to the custom house or other place
         permitted by the authorities as prescribed by the relevant Acts and
         subordinate statutes. In this case, the master shall dispatch the
         notice thereof without delay to the consignee.

         (2) If the consignee cannot be identified, or he refuses to receive the
         goods, the master shall deposit them, or deliver them to the custom
         house, or other place permitted by the authorities, and dispatch notice
         thereof without delay to the charterer or shipper and the consignee, if
         known

         (3) If the goods are deposited, or delivered to the custom house or
         other place permitted by the authorities under paragraphs (1) and (2),
         the goods shall be considered to have been delivered to the holder of
         the bill of lading or the consignee.
         [This Article Wholly Amended by Act No. 4470, Dec. 31, 1991]


ARTICLE 804 (SHIPOWNER'S RIGHT TO SELL GOODS BY AUCTION)


<PAGE>

         (1) In order to obtain payment of the amounts specified in Article 800
         (1), the carrier may, with the permission of the court, sell the goods
         by auction, and is entitled to receive payment in preference to others.
         (Amended by Act No. 4470, Dec. 31, 1991)

         (2) A carrier may exercise his right as referred to in paragraph (1)
         over the goods even after the master has delivered them to the
         consignee: Provided, That this shall not apply when thirty days have
         elapsed from the date of delivery or if a third person has acquired
         possession of such goods.
         (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 805

         Deleted. (by Act No. 4470, Dec. 31, 1991)


ARTICLE 806 (RECONTRACT OF CARRIAGE AND LIABILITY OF SHIPOWNER)

         If a charterer has entered into a contract of carriage with a third
         person under his own name, the shipowner shall assume the liability as
         prescribed in Articles 787 and 788 to the third person to the extent
         that the fulfillment of the contract belongs to the duties of the
         master.
         [This Article Wholly Amended by Act No. 4470, Dec. 31, 1991]


ARTICLE 807 (REASONS FOR TERMINATION OF CONTRACT OF CARRIAGE)


         (1) A contract of carriage shall be terminated by any of the following
         reasons:

         1.If the ship has sunk or has been lost;

         2.If the ship has become unrepairable;


<PAGE>

         3.If the ship has been captured; and

         4.If the goods have been lost by reason of an act of god.

         (2) If any of the events mentioned in subparagraphs 1 through 3 of
         paragraph (1) has occurred during the voyage, the charterer or the
         shipper shall pay freight to the extent of the value of the goods in
         proportion to the carriage performed. (Amended by Act No. 4470, Dec.
         31, 1991)


ARTICLE 808 (RESCISSION OF CONTRACT FOR REASONS STIPULATED IN ACT)


         (1) If the voyage or carriage has become illegal, or if by reason of an
         act of god fulfilling the purpose of the contract was made has become
         impossible, either party may rescind the contract.

         (2) If, in case where either of the reasons mentioned in paragraph (1)
         has occurred in the course of the voyage, the contract has been
         terminated, the charterer or the shipper shall pay freight in
         proportion to the carriage performed. (Amended by Act No. 4470, Dec.
         31, 1991)


ARTICLE 809 (ACT OF GOD IN RESPECT OF PART OF GOODS)


         (1) If either of the reasons mentioned in Articles 807 (1) 4 and
         Article 808 (1) has occurred in respect to a part of the goods, the
         charterer or the shipper may load other goods in so far as the
         liability of the carrier does not increase thereby. (Amended by Act No.
         4470, Dec. 31, 1991)

         (2) If the charterer or the shipper desires to exercise the right
         mentioned in paragraph (1), he shall unload or load the goods without
         delay. If he has neglected such unloading or loading, he shall pay the
         full amount of the freight. (Amended by Act No. 4470, Dec. 31, 1991)



<PAGE>

ARTICLE 810 (DISPOSAL OF CARGO BY MASTER AND FREIGHT)

         A carrier may demand the full payment of the freight in any of the
         following cases: (Amended by Act No. 4470, Dec. 31, 1991)

         1.If the master has disposed of the cargo in accordance with the
         provision of Article 774 (1); and

         2.If the master has disposed of the cargo in accordance with the
         provision of Article 832.


ARTICLE 811 (TIME-BAR OF CLAIMS AND OBLIGATIONS OF CARRIER)

         Any claims and obligations of the carrier to the shipper, consignor or
         consignee shall, regardless of the cause of the claims, be extinguished
         if no legal action is filed within one year after the carrier delivers
         or should have delivered the goods to the consignee: Provided, That
         this period may be extended by agreement between the parties.
         [This Article Wholly Amended by Act No. 4470, Dec. 31, 1991]


ARTICLE 812 (APPLICABLE PROVISIONS)

         The provisions of Articles 134, 136 through 140 shall apply mutatis
         mutandis to the carrier. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 812-2 (DEFINITION OF TIME CHARTER)

         A time charter party shall take effect only after an owner or lessee of
         a ship stipulates to have a charterer use for a navigation a ship
         manned by crew and provided with navigational equipments for a
         specified period, and the charterer stipulates to pay the hire
         calculated by the period.
         [This Article Newly Inserted by Act No. 4470, Dec. 31, 1991]



<PAGE>

ARTICLE 812-3 (RIGHT OF TIME CHARTERER TO COMMAND MASTER)


         (1) At any time the charterer shall be entitled to command the master
         for the use of a ship within the stipulated extent.

         (2) If the master, seaman or other employees of a ship inflicts any
         loss on the time charterer in contravention of the latter's reasonable
         orders, the shipowner shall be liable to compensate for it.
         [This Article Newly Inserted by Act No. 4470, Dec. 31, 1991]


ARTICLE 812-4 (LIEN AND AUCTION RIGHT OF SHIPOWNER ON GOODS)


         (1) The provisions of Articles 800 (2) and 804 shall be applicable
         mutatis mutandis in case where the time charterer fails to pay the
         shipowner for the hire or advances, or to perform any similar
         obligations under the time charter party: Provided, That the shipowner
         shall not oppose to a third person who has acquired in good faith the
         bill of lading issued by the time charterer.

         (2) The right of the shipowner as referred to in paragraph (1) to the
         goods shall not be exercised beyond the limit of the hire or freight
         stipulated by the time charterer on the goods.
         [This Article Newly Inserted by Act No. 4470, Dec. 31, 1991]


ARTICLE 812-5 (ARREARS OF HIRE, TERMINATION OF CONTRACT, ETC.)


         (1) If the time charterer fails to pay the hire by the due date, the
         shipowner may rescind or terminate the charter party.

         (2) If the shipowner rescinds or terminates the charter party under
         paragraph


<PAGE>

         (1) during navigation of the ship after the time charterer enters into
         a contract of carriage with a third person and makes a shipment of
         goods, the shipowner shall have the same liability to carry as the time
         charterer as to the person interested in the goods.

         (3) If the shipowner notifies in writing those interested in the goods
         of his intention of rescission or termination of the charter party or
         continuous transport under paragraph (2), he shall be considered to
         have established the right of pledge for the purpose of a claim for the
         hire or freight, which the time charterer holds to those interested in
         the goods, for securing the hire advances and other similar claims
         arising from the time charter.

         (4) The provisions of paragraphs (1) to (3) shall not affect the claim
         for damages by the shipowner or those interested in the goods to the
         time charterer. [This Article Newly Inserted by Act No. 4470, Dec. 31,
         1991]


ARTICLE 812-6 (TIME-BAR OF CLAIM UNDER TIME CHARTER)

         Any claims between the parties arising from the time charter shall be
         extinguished if no local action is filed within one year after the ship
         is returned to its owner: Provided, That in this case, the proviso of
         Article 811 shall be applicable mutatis mutandis.
         [This Article Newly Inserted by Act No. 4470, Dec. 31, 1991]


         SUB-SECTION 2 BILL OF LADING

ARTICLE 813 (ISSUANCE OF BILL OF LADING)


         (1) The carrier shall, upon demand by the charterer or the shipper,
         provide him with a bill of lading in one or more copies after receipt
         of the goods. (Amended by Act No. 4470, Dec. 31, 1991)


<PAGE>

         (2) The carrier shall, upon demand by the charterer or the shipper,
         provide him with the on board bill of lading in one or more copies
         after loading of the goods, or shall indicate such loading on the bill
         of lading mentioned in paragraph (1). (Amended by Act No. 4470, Dec.
         31, 1991)

         (3) The carrier may authorize a master or any other agent to provide
         the on board bills of lading or to indicate such loading on the bills
         of lading mentioned in paragraph (2). (Amended by Act No. 4470, Dec.
         31, 1991)


ARTICLE 814 (MATTERS TO BE ENTERED IN BILL OF LADING)


         (1) The bill of lading shall include the following matters, and the
         carrier shall write his name and affix his seal or sign on the bill of
         lading:

         1.Name, nationality and tonnage of the ship;

         2.Type, weight or volume of the goods, type, number and marks of
         packing, which have been notified in writing by the shipper;

         3.External appearances of the goods;

         4.Name or trade name of the charterer or the shipper;

         5.Name or trade name of the consignee or the notify party;

         6.Loading port;

         7.Unloading port;

         8.Freight;

         9.Issuing date and place; and

         10.If several bills of lading are issued, the number thereof.


<PAGE>

         (2) If there is any considerable reason to doubt that the weight,
         volume, number or marks of the goods as referred to in paragraph (1) 2
         fail to exactly indicate the goods which the carrier actually received,
         or if there is no adequate way to confirm it, such entry may be
         omitted.

         (3) The shipper shall be considered to have warranted the carrier that
         the information as referred to in paragraph (1) 2 is correct.

         (4) If the carrier has made notification of the goods to the notify
         party specified in the bill of lading, he shall be considered to have
         made the notification to the charterer or the shipper, the holder of
         the bill of lading and other consignee.
         [This Article Wholly Amended by Act No. 4470, Dec. 31, 1991]


ARTICLE 814-2 (EFFECT OF ENTRY IN BILL OF LADING)

         If the bill of lading is issued in accordance with the provisions of
         Article 814 (1), the carrier shall be presumed to have received or
         shipped goods as it is entered in the bill of lading: Provided, That
         the carrier may not oppose a third person who has acquired in good
         faith the bill of lading.
         [This Article Newly Inserted by Act No. 4470, Dec. 31, 1991]


ARTICLE 815 (DELIVERY OF COPY)

         The charterer or the shipper who has been provided with a bill of
         lading shall, upon demand by the issuer, write his name and affix his
         seal or sign on the copy of the bill of lading and deliver it to the
         issuer. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 816 (MULTIPLE COPIES OF BILL OF LADING AND DELIVERY OF GOODS AT PORT OF
UNLOADING)



<PAGE>

         (1) At the port of unloading, the master shall not refuse to deliver
         the goods, even though the holder of only one of multiple copies of the
         bill of lading demands such delivery.

         (2) If the holder of only one of multiple copies of the bill of lading
         has taken delivery of the goods in accordance with the provisions of
         paragraph (1), other copies of bill of lading shall become invalid.
         (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 817 (MULTIPLE COPIES OF BILL OF LADING AND DELIVERY OF GOODS AT PLACES
OTHER THAN PORT OF UNLOADING)

         At places other than the port of unloading, the master shall not
         deliver the goods except upon receipt of all the copies of the bill of
         lading.


ARTICLE 818 (DEMAND TO DELIVER GOODS BY NUMEROUS HOLDERS AND DEPOSIT)


         (1) If two or more holders of the bill of lading have demanded delivery
         of the goods, the master shall without delay deposit the goods with the
         competent authority and dispatch notice thereof to each person who has
         demanded such delivery.

         (2) If, after the master has delivered a part of the goods in
         accordance with the provision of Article 816 (1), another holder has
         demanded delivery of the goods, the provision of paragraph (1) shall
         apply in respect of the goods remaining. (Amended by Act No. 4470, Dec.
         31, 1991)


ARTICLE 819 (RANKS OF NUMEROUS HOLDERS OF BILL OF LADING)


         (1) As to the goods that have been deposited with the competent
         authority pursuant to the provisions of Article 818, the holder of the
         bill of lading who has



<PAGE>

         received the bill of lading from the former holder, whose priority is
         common to several holders of the bill of lading, shall be prior to
         other holders of the bill of lading. (Amended by Act No. 4470, Dec. 31,
         1991)

         (2) In regards to the bill of lading dispatched to an absentee, the
         time when a bill of lading has been dispatched shall be deemed to be
         the time it is delivered.


ARTICLE 820 (APPLICABLE PROVISIONS)

         The provisions of Articles 129, 130, 132 and 133 shall apply mutatis
         mutandis to the bills of lading. (Amended by Act No. 4470, Dec. 31,
         1991)


         SECTION 2 CARRIAGE OF PASSENGERS

ARTICLE 821 (TICKET IN NAME OF PARTICULAR PASSENGER)

         A ticket in the name of a particular passenger shall not be assigned to
         another person.


ARTICLE 822 (DUTY OF PROVIDING MEALS)

         Unless otherwise agreed, meals of a passenger during the voyage shall
         be provided by the carrier. (Amended by Act No. 4470, Dec. 31, 1991)

ARTICLE 823 (DUTY OF PROVIDING LODGING AND MEALS FOR PASSENGERS DURING SHIP
REPAIR)


         (1) If a ship has to be repaired in the course of a voyage, the carrier
         shall provide adequate lodging and meals for passengers during the
         period of repair: Provided, That this shall not apply in cases where he
         has provided them with the convenience of a passage to the ports of
         disembarkation without prejudicing



<PAGE>

         their right thereby. (Amended by Act No. 4470, Dec. 31, 1991)

         (2) In the case mentioned in paragraph (1), a passenger may terminate
         the contract after paying freight in proportion to the voyage
         performed. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 824 (DUTY OF FREE CARRIAGE FOR LUGGAGE)

         In the absence of any agreement to the contrary, the carrier shall not
         demand freight for luggage which a passenger is entitled to accompany
         pursuant to the contract. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 825 (DELAY OF BOARDING SHIP AND MASTER'S RIGHT TO COMMENCE VOYAGE)


         (1) If a passenger does not get on board at the time fixed for
         embarkation, the master may commence the voyage immediately. The same
         shall apply at the port of call during the course of the voyage.
         (Amended by Act No. 4470, Dec. 31, 1991)

         (2) In the case of paragraph (1), the passenger shall pay the full
         amount of the freight. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 826 (RESCISSION OF CONTRACT BY PASSENGER AND FREIGHT)

         If, prior to the commencement of the voyage, a passenger rescinds the
         contract, he shall pay one-half of the freight, and if he rescinds the
         contract after the commencement of the voyage, he shall pay the full
         amount of the freight.


ARTICLE 827 (RESCISSION OF CONTRACT FOR REASONS SPECIFICALLY STIPULATED)

         If, prior to the commencement of the voyage, a passenger has become
         incapable


<PAGE>

         of making the voyage because of death, illness, or any other act of
         god, the carrier may demand three-tenths of the freight, and if any of
         such reasons have occurred after the commencement of the voyage, the
         carrier may, at his option, demand either three-tenths of the freight
         or freight in proportion to the carriage performed. (Amended by Act No.
         4470, Dec. 31, 1991)


ARTICLE 828 (PASSENGER'S DEATH AND DISPOSAL OF HIS LUGGAGE)

         If a passenger dies, the master shall dispose of luggage brought by the
         deceased in such manner as will be to the best interest of his
         successors.


ARTICLE 829 (LEGAL REASONS FOR TERMINATION OF CONTRACT)

         A contract of carriage shall be terminated by any of the reasons
         mentioned in Article 807 (1) 1 through 3. If any of such reasons have
         occurred during the voyage, the passenger shall pay the freight in
         proportion to the carriage performed.


ARTICLE 830 (APPLICABLE PROVISIONS)


         (1) The provisions of Articles 148, 787, 790 (1) and 806 shall be
         applicable mutatis mutandis to the carriage of passengers by sea.

         (2) The provisions of Articles 134, 136, 149 (2), 787 through 791-2,
         800, 800-2, 806, 808 and 811 shall be applicable mutatis mutandis to
         the carriage of the luggages of the passengers that have been entrusted
         to the carrier.

         (3) The provisions of Articles 150, 789-2 (1) and (4), 789-3, 790 (1),
         806 and 811 shall be applicable mutatis mutandis to the luggage of the
         passengers that have not been entrusted to the carrier.
         [This Article Wholly Amended by Act No. 4470, Dec. 31, 1991]



<PAGE>

ARTICLE 831 (IDEM)

         If a charter party is entered into for carrying passengers, the
         provisions of Articles 781, 782 (1), 783, 784, 786, 787, 790 (1), 791,
         792 through 797, 802, 807, 808 and 811 shall be applicable mutatis
         mutandis to the relation between the carrier and the charterer.
         [This Article Wholly Amended by Act No. 4470, Dec. 31, 1991]


         CHAPTER V GENERAL AVERAGE

ARTICLE 832 (REQUIREMENTS OF GENERAL AVERAGE)

         Damage and expenditure which have arisen from any disposition of the
         ship or the cargo by the master in order to preserve the ship and the
         cargo from a common peril shall constitute a general average.


ARTICLE 833 (PERSONS WHO BEAR GENERAL AVERAGE)

         General average shall be borne respectively by the different
         contributing interests in proportion to the ratio that the value of the
         ship and the cargo preserved from a common peril, one-half of the
         freight, and the amount of the damages constituting general average
         bear to one another.


ARTICLE 834 (COMPUTATION OF AMOUNTS TO BE CONTRIBUTED TO GENERAL AVERAGE)

         With regard to the determination of the amount to be contributed to
         general average the value of the ship shall be its value at the time
         and place of arrival, and the value of the cargo shall be its value at
         the time and place of unloading: Provided, That in regard to the cargo,
         the freight and any other expenses which have been exempted from
         payment due to the loss of such cargo shall be deducted.



<PAGE>

ARTICLE 835 (LIMITED LIABILITY TO GENERAL AVERAGE)

         The persons who are to contribute to general average in accordance with
         the provisions of Articles 833 and 834 shall be liable only to the
         extent of the values which exist at the time when the ship has arrived
         or the cargo has been delivered. (Amended by Act No. 4470, Dec. 31,
         1991)


ARTICLE 836 (COMPUTATION OF DAMAGES CONSTITUTING GENERAL AVERAGE)

         With regard to the determination of the amount of general average, the
         value of the ship shall be its value at the time and place of arrival,
         and the value of the cargo shall be its value at the time and place of
         unloading: Provided, That in regard to the cargo, all the expenses
         which have been exempted from payment thereof due to the loss of such
         cargo shall be deducted.


ARTICLE 837 (RIGHT OF SUBROGATION AGAINST PERSON LIABLE)

         If a common peril of the ship and cargo has arisen from any defect of
         the ship or cargo or from any negligent act, a contributor to the
         general average may exercise the right of subrogation against the
         person liable for such peril.


ARTICLE 838 (EXCLUSION FROM CALCULATING CONTRIBUTIONS TO GENERAL AVERAGE)

         The value of the arms installed on board a ship, the wages of the
         crews, and the food and clothing of the crews and passengers, even if
         they are preserved, shall not be included in calculating contributions
         to the general average, and such value shall be included in calculating
         the value of the general average if they have been lost.


ARTICLE 839 (EXCLUSION FROM DEMAND FOR CONTRIBUTION TO GENERAL AVERAGE)



<PAGE>

         (1) The value of any appurtenances not included in the inventory of
         appurtenances, the goods loaded without a bill of lading or any other
         document by which the value of the cargo may be determined, or money or
         the negotiable instruments and any other valuable goods of which the
         particulars and value are not expressed, if they are preserved, shall
         be included in calculating contributions to the general average,
         whereas such value shall not be included in calculating the amount of
         general average if they are lost.

         (2) The provision of paragraph (1) shall also apply to the goods loaded
         on deck: Provided, That this shall not apply in cases of coastwise
         navigation. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 840 (FALSE STATEMENT OF VALUE OF CARGO AND GENERAL AVERAGE)


         (1) If, in the bill of lading or any other document available as a
         basis for the valuation of the cargo, the value of the cargo has been
         stated higher than its actual value, in cases where the cargo is
         preserved, the amount of contributions to the general average shall be
         determined upon the basis of the value so stated, and in cases where
         such value has been stated lower than its actual value, the value so
         stated shall be the amount of general average if the cargo has been
         lost.

         (2) The provisions of paragraph (1) shall apply mutatis mutandis in
         cases where a false entry has been made regarding any matters that may
         affect the value of the cargo. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 841 (RECOVERY OF DAMAGE WHICH IS GENERAL AVERAGE)

         If, after the shipowner, charterer, shipper, or any other person
         interested has contributed to the amount of general average, the whole
         or a part of the ship, its appurtenances or the cargo has been restored
         to the owner thereof, he shall return the amount of money he has
         received as general average remuneration


<PAGE>

         after deducting therefrom any salvage remuneration and the amount of
         damage which has arisen from a partial loss or damage.


ARTICLE 842 (TIME-BAR OF GENERAL AVERAGE CLAIM)

         Any claim created by a general average or claim for the subrogation as
         prescribed in Article 837 shall be extinguished if no legal action is
         filed within one year after the calculation thereof is completed. In
         this case, however, the provisions of the proviso of Article 811 shall
         be applicable mutatis mutandis.
         [This Article Wholly Amended by Act No. 4470, Dec. 31, 1991]


         CHAPTER VI COLLISION OF VESSELS

ARTICLE 843 (PROVISIONS APPLICABLE TO COLLISION OF VESSELS)

         Where a collision occurs between seagoing vessels or between a seagoing
         vessels and vessels of inland navigation, the compensation due for
         damages caused to the vessels, or to any things or persons on board
         therof, shall be settled in accordance with the provisions in this
         chapter, in whatever waters the collision takes place. (Amended by Act
         No. 4470, Dec. 31, 1991)


ARTICLE 844 (COLLISION DUE TO ACT OF GOD)

         If the collision is due to an act of god, or if the causes of the
         collision are in doubt, the damages shall be borne by those who have
         suffered them.


ARTICLE 845 (COLLISION CAUSED BY FAULT OF ONE PARTY)

         If the collision is caused by the fault of a crew of one of the
         vessels, the owner of the vessel in fault shall be liable for
         compensation due for the damages arising therefrom.



<PAGE>

ARTICLE 846 (COLLISION CAUSED BY FAULT OF BOTH PARTIES)


         (1) When the collision is due to the fault of crews of both vessels,
         the owner of each vessel shall be liable for damages in proportion to
         the degree of the faults respectively committed, the liability shall be
         apportioned equally.

         (2) In the cases mentioned in paragraph (1), in respect of damage
         caused by death or personal injury of third parties, the owners of both
         vessels shall be jointly and severally liable toward such third
         parties. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 847 (COLLISION CAUSED BY FAULT OF PILOT)

         Even in case where the collision is caused by the fault of the pilot of
         a vessel, the owner of such vessel shall be liable for damages in
         accordance with the provisions of Articles 845 and 846.
         (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 848 (TIME-BAR OF COLLISION CLAIM)

         Action claim for the recovery of damages caused by collision shall be
         barred if no action is instituted within two years from the date of the
         collision. In this case, however, the proviso of Article 811 shall be
         applicable mutatis mutandis.
         [This Article Wholly Amended by Act No. 4470, Dec. 31, 1991]


         CHAPTER VII RESCUE FROM MARINE ACCIDENTS

ARTICLE 849 (REQUIREMENTS OF RESCUE FROM MARINE ACCIDENTS)


<PAGE>

         A person who, without any duty to do so, has salvaged a ship in
         distress, or its cargo or any other goods on any water surface, may
         claim reasonable remuneration for the result obtained from such
         efforts. The same shall apply to a rescue from marine accidents between
         seagoing ships and ships of inland navigation. (Amended by Act No.
         5809, Feb. 5, 1999)


ARTICLE 850 (DETERMINATION OF SALVAGE REMUNERATION)

         In case where there is no special stipulation as to salvage
         remuneration, and any agreement as to the amount thereof between the
         parties has not been made, the court shall, upon the application of the
         parties, determine the amount, taking into consideration the degree of
         the risk, the labor of salvage, expenses, result of the salvage,
         efforts to prevent environmental loss and all other circumstances.
         (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 851 (ALTERATION OF STIPULATED SALVAGE REMUNERATION)

         In case where special stipulation has been made as to the amount of the
         salvage remuneration at the time of marine accidents and such amount is
         grossly unreasonable, the court may increase or reduce such amount,
         taking into consideration the circumstances mentioned in Article 850.
         (Amended by Act No. 4470, Dec. 31, 1991; Act No. 5809, Feb. 5, 1999)


ARTICLE 852 (LIMITATION ON AMOUNT OF SALVAGE REMUNERATION)


         (1) Unless agreed otherwise, the amount of salvage remuneration shall
         not exceed the value of the thing salvaged.

         (2) If there is in existence a preferential right of higher priority,
         the amount of the salvage remuneration shall not exceed the amount that
         remains after deducting the amount of the claim of the person having
         such preferential right.



<PAGE>

         (Amended by Act No. 1212, Dec. 12, 1962)


ARTICLE 853 (DISTRIBUTION OF SALVAGE REMUNERATION AMONG JOINT SALVORS)


         (1) If two or more persons have together engaged in the salvage, the
         provision of Article 850 shall apply mutatis mutandis in regard to the
         proportions of the distribution of the salvage remuneration.

         (2) A person who has engaged in salvaging human life may also share in
         the distribution of the salvage remuneration in accordance with the
         provisions of paragraph (1). (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 854 (DISTRIBUTION OF SALVAGE REMUNERATION FOR SALVAGE INSIDE SHIP)


         (1) If a ship has engaged in the salvage and has received remuneration
         therefor, the amount of damage caused to such ship and the expenses
         required for the salvage shall be paid to the shipowner, and the
         balance shall be paid in equal portions to the master and to the
         seamen.

         (2) As to the distribution of remuneration to be paid to the seamen in
         accordance with the provisions of paragraph (1), the master shall,
         prior to the termination of the voyage, draw up a schedule of
         distribution, taking into consideration the labor of each seaman, the
         results thereof and the circumstances, and shall notify the seamen
         thereof. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 855 (CASE OF SALVAGE BY TUGBOAT)

         In regard to the salvage for the tow or the cargo on board the tow by a
         tugboat, the salvage remuneration shall not be demanded unless any
         special labor, which shall not be deemed to be the performance of a
         contract of towage, has been provided.



<PAGE>

ARTICLE 856 (REMUNERATION BETWEEN SHIPS BELONGING TO SAME OWNER)

         Even between ships which belong to the same owner, any person who has
         been engaged in salvage may demand a reasonable remuneration therefor.


ARTICLE 857 (PERSONS WHO SHALL NOT DEMAND SALVAGE REMUNERATION)

         Any of the following persons shall not demand salvage remuneration:
         (Amended by Act No. 5809, Feb. 5, 1999)

         1.The person who worked on board the salvaged ship;

         2.The person who has caused the marine accidents, either intentionally
         or by negligence;

         3.The person who has forcibly effected salvage, notwithstanding that it
         was declined for justifiable reasons; and

         4.The person who has concealed or disposed of any goods salvaged
         without justifiable reasons.


ARTICLE 858 (SALVOR'S PREFERENTIAL RIGHT)


         (1) The claims for remuneration of the person who has been engaged in
         the salvage shall have a preferential right over the cargo salvaged:
         Provided, That such right shall not be exercised against such cargo
         after the debtor has delivered it to a third person.

         (2) The provisions relating to the preferential rights of a ship's
         creditor shall apply mutatis mutandis to the preferential rights
         mentioned in paragraph (1). (Amended by Act No. 4470, Dec. 31, 1991)



<PAGE>

ARTICLE 859 (MASTER'S AUTHORITY CONCERNING PAYMENT OF SALVAGE REMUNERATION)


         (1) The master has authority to do, on behalf of the salvage debtors,
         all judicial and extra-judicial acts relating to the payment of the
         salvage remuneration.

         (2) The master may himself become a party to an action relating to
         salvage remuneration and a final judgment in such action shall be
         valid as to the debtors of the salvage remuneration. (Amended by Act
         No. 1212, Dec. 12, 1962)


ARTICLE 860 (TIME-BAR OF SALVAGE CLAIMS)

         Any claim for remuneration of salvage shall be time-barred if no action
         is instituted within two years from the date when the salvage is
         finished. In this case, however, the provisions of the proviso of
         Article 811 shall be applicable mutatis mutandis.
         [This Article Wholly Amended by Act No. 4470, Dec. 31, 1991]


                         CHAPTER VIII CLAIMS ON VESSEL

ARTICLE 861 (CLAIM GIVING RISE TO MARITIME LIEN)


         (1) A person who has any of the following claims holds maritime lien on
         a vessel and the appurtenances of the vessel, on the freight for the
         voyage during which the claim giving rise to the lien arises, and on
         the accessories of the vessel and freight: (Amended by Act No. 4470,
         Dec. 31, 1991)

         1.Law costs incurred in the common interest of the creditors, expenses
         incurred with respect to public auction of the vessel and the
         appurtenances, public taxes imposed on the vessel regarding the voyage,
         pilotage dues and towage dues, and



<PAGE>

         the cost of preservation and watching from the time of the entry of the
         vessel into the last port;

         2.Claims arising out of the contract of engagement of the master and
         other persons hired on board;

         3.Remuneration for salvage, and the contribution of the vessel in
         general average; and

         4.Indemnities for collision or other accidents of navigation, as also
         for damage caused to works forming part of harbors, docks, and
         navigable ways, and indemnities for personal injury to passengers or
         crew.

         (2) A creditor of the vessel who has maritime lien mentioned in
         paragraph (1) shall have the right to receive priority performance of
         his claims to the other creditors in respect of the property mentioned
         in paragraph (1) in accordance with this Act or other Acts. In such
         case, the provisions relating to the mortgage of the Civil Act shall
         apply mutatis mutandis in so far as the nature of such right is not
         incompatible. (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 862 (ACCESSARIES OF VESSEL AND FREIGHT)

         The accessories of the vessel and the freight mentioned in Article 861
         mean: (Amended by Act No. 4470, Dec. 31, 1991; Act No. 5809, Feb. 5,
         1999)

         1.Compensation due to the shipowner for material damage sustained by
         the vessel or for loss of freight;

         2.General average contributions due to the shipowner in respect of
         material damage sustained by the vessel, or in respect of loss of
         freight; and

         3.Remuneration due to the shipowner for the rescue from marine
         accidents.


ARTICLE 863 (MARITIME LIEN ON FREIGHT)


<PAGE>

         The maritime lien on freight may be exercised only against the freight
         unpaid and the amount of money that has been paid and possessed by the
         shipowner or his agent.


ARTICLE 864 (EXCLUSION OF INSURANCE AMOUNT, ETC.)

         The provisions of Article 862 shall not apply to payments due to the
         shipowner on policies of insurance and any other bounties or national
         subsidies.


ARTICLE 865 (CLAIMS ARISING FROM CONTRACT OF ENGAGEMENT OF EMPLOYEE OF SHIP)

         The claims mentioned in the provisions of Article 861 (1) 2 shall have
         preferential rights on the total amount of freight due for all voyage
         made during the subsistence of the contract of engagement.


ARTICLE 866 (PRIORITY OF MARITIME LIENS)


         (1) Claims secured by a lien and relating to the same voyage rank in
         the order in which they are set out in subparagraphs of Article 861(1).

         (2) The claims mentioned in Article 861 (1) 3 rank in the inverse order
         of the dates on which they came into existence. The claims arising from
         the same accident shall be deemed to have arisen at the same time.
         (Amended by Act No. 4470, Dec. 31, 1991)


ARTICLE 867 (IDEM)


         (1) In case of concurrence of the claims secured by a lien which have
         arisen in regard to two or more voyages, a claim arising in respect of
         a later voyage shall



<PAGE>

         rank prior to a claim arising in respect of an earlier voyage.

         (2) The claims mentioned in Article 865 shall rank equally with claims
         attaching to the last voyage.


ARTICLE 868 (CLAIMS SAME RANK)

         In case of concurrence of the claims of the same rank in accordance
         with Articles 865 through 867, they shall be paid concurrently and
         rateably in proportion to the amount of the claims. (Amended by Act No.
         4470, Dec. 31, 1991)


ARTICLE 869 (OVERTAKING NATURE OF MARITIME LIENS)

         The maritime lien of the ship's creditors shall not be affected by the
         transfer of ownership of the ship.


ARTICLE 870 (TIME-BAR OF MARITIME LIEN)


         (1) The maritime lien of a ship's creditor shall be time-barred if it
         has not been exercised within one year from the date on which it has
         arisen. (Amended by Act No. 4470, Dec. 31, 1991)

         (2) Deleted. (by Act No. 4470, Dec. 31 191)


ARTICLE 871 (SHIP MORTGAGE)


         (1) A registered ship may be the object of a ship mortgage.

         (2) A mortgage on a ship shall extend to its appurtenances.


<PAGE>

         (3) The provisions relating to the mortgage mentioned in the Civil Act
         shall apply mutatis mutandis to the ship mortgage.


ARTICLE 872 (CONCURRENCE OF SHIP MORTGAGE, ETC. AND MARITIME LIEN)

         The maritime lien of a ship's creditor shall take precedence over a
         pledge and mortgage.


ARTICLE 873 (PROHIBITION OF PUTTING REGISTERED SHIP IN PLEDGE)

         Any registered ship shall not be the subject of a pledge.


ARTICLE 874 (APPLICABLE PROVISIONS TO SHIP UNDER CONSTRUCTION)

         The provisions of this Chapter shall apply mutatis mutandis to ships
         under construction. (Amended by Act No. 4470, Dec. 31, 1991)


         ADDENDA


ARTICLE 1 (MANDATORY PROVISIONS)

         The scope of petty merchants shall be determined by a Cabinet Order.


ARTICLE 2 (IDEM)

         The lakes, rivers, ports and bays under Article 125 shall be determined
         by a Cabinet Order.



<PAGE>

ARTICLE 3 (DEFERMENT OF GIVING PUBLIC NOTICE ON COMMERCIAL REGISTRATION)


         (1) The provisions relating to the public notices mentioned in Article
         36 shall no longer apply after a reasonable period. Such period shall
         be determined by the Supreme Court Regulations.

         (2) If, in the case of the preceding paragraph, the registration has
         been effected in the period mentioned in the preceding paragraph,
         public notice shall be deemed to have been made.


ARTICLE 4 (PROHIBITION ON ISSUANCE OF SHARE CERTIFICATE IN BEARER FORM COMPANY
TO BE ORGANIZED ONLY BY NATIONALS OF REPUBLIC OF KOREA)

         The stock company which should be organized by only nationals of the
         Republic of Korea in accordance with the Acts and subordinate statutes,
         and a stock company having special rights. on the condition that it is
         to be organized by only nationals of the Republic of Korea, shall not
         issue share certificates in bearer from. If the above mentioned
         provisions have been contravened, such share certificates shall be null
         and void and the last non-bearer shareholder shall be a shareholder.


ARTICLE 5

         Deleted. (by Act No. 3724, Apr. 10, 1984)


ARTICLE 6 (QUALIFICATION OF COMPANY COMMISSIONED TO OFFER BONDS FOR
SUBSCRIPTION)

         No person other than a bank, trust or securities company shall be
         commissioned to offer bonds for subscription or become a successor of
         the business under Article 483. (Amended by Act No. 3724, Apr. 10,
         1984)



<PAGE>

ARTICLE 7 (METHOD TO DEPOSIT BEARER BOND CERTIFICATE BY HOLDER THEREOF)

         If the holder of bearer bond certificates has not deposited his bond
         certificates with the public official who is in charge of deposit in
         accordance with the provisions of Articles 491 (4) and 492 (2) or
         provisions to be applied mutatis mutandis, he shall deposit such bond
         certificates in the bank or trust company which is to be designated by
         the Chief Justice of the Supreme Court. (Amended by Act No. 1212,
         Dec. 12, 1962)


ARTICLE 8 (MANNER OF PUBLIC NOTICE RELATING TO MEETINGS OF BONDHOLDERS)

         The public notice with regard to convocation of meeting of bondholders,
         payment of redemption amount or execution of resolution of meeting of
         bondholders relating to payment of redemption amount shall be given of
         public notice determined by Articles of incorporation of issuing
         company according to the manner.


ARTICLE 9 (MANDATORY PROVISIONS)

         The Form of the inventory of equipments mentioned in Article 742 shall
         be determined by a Cabinet Order.


ARTICLE 10 (IDEM)

         The scope of coastal navigations mentioned in the proviso of Article
         839 (2) shall be determined by a Cabinet Order.


ARTICLE 11 (IDEM)

         The matters concerning the enforcement of this Act shall be determined
         by separate Act.



<PAGE>

ARTICLE 12 (ENFORCEMENT DATE AND EFFECT OF OLD ACT)


         (1) This Act shall enter into force on Jan. 1, 1963.

         (2) The Commercial Act, Limited Liability Company Act, Act on
         Implemention Commercial Act, Act for Enforcement of Amendment of the
         Commercial Act applied in accordance with Article 1 of the Chosun Civil
         Affairs Ordinance shall be effective until the date of enforcement of
         this Act.


         ADDENDUM (Act No. 1212, Dec. 12, 1962)

         This Act shall enter into force on January 1, 1963.


         ADDENDA (Act No. 3724, Apr. 10, 1984)


         ARTICLE 1 (ENFORCEMENT DATE)

         This Act shall enter into force on September 1, 1984.


         ARTICLE 2 (PRINCIPLES OF TRANSITIONAL MEASURES)

         Except as otherwise provided, this Act shall be applicable to the
         matters which have taken place before the enforcement of this Act:
         Provided, That any effect given by the previous provisions shall not be
         affected.


         ARTICLE 3 (TRANSITIONAL MEASURES AS TO TRADE BOOKS, ETC.)

         The previous provisions shall apply with respect to trade books and

<PAGE>

         supplementary schedules, which a person who is a merchant when this Act
         enters into force should prepare before the fixed time under the
         revised provisions of Article 30 (2) (for the company, this date means
         the period for settlement of accounts; hereinafter referred to as the
         same in this Article), to the accounts to be made before and at the
         fixed time.


ARTICLE 4 (TRANSITIONAL MEASURES AS TO MINIMUM AMOUNT OF CAPITAL OF STOCK
COMPANY)


         (1) A company which has been formed as a stock company before the
         enforcement of this Act, and the capital of which is less than fifty
         million won at the enforcement date of this Act, shall increase its
         capital to fifty million won or more, or alter its organization into a
         limited liability company within three years from the enforcement date
         of this Act.

         (2) If the company fails to take such a procedure in the period as
         prescribed in paragraph (1), it shall be regarded as being dissolved.

         (3) The companies which are as considered to have been dissolved under
         paragraph (2) but the liquidation of which is not closed, may continue
         their operation by a special resolution as prescribed in Article 434,
         according to the procedure in paragraph (1) within one year from the
         enforcement date of this Act. (Newly Inserted by Act No. 4372, May. 31,
         1991)


ARTICLE 5 (TRANSITIONAL MEASURES AS TO PAR VALUE OF SHARES)


         (1) With respect to the par value of shares of stock company issued
         formed before the enforcement of this Act, the previous provisions
         shall be applicable for three years from the enforcement date of this
         Act regardless of the revised provisions of Article 329 (4).

         (2) A stock company formed before the enforcement of this Act shall
         consolidate the shares by a resolution under Article 434, in order to
         make the shares the par


<PAGE>

         value of which is less than five thousand won into those above five
         thousand won, within three years from the enforcement date of this Act.
         In this case, the provisions of Articles 440 through 444 shall be
         applicable mutatis mutandis.


ARTICLE 6 (TRANSITIONAL MEASURES AS TO TRANSFER OF SHARES BEFORE ISSUING SHARE
CERTIFICATES)

         The revised provisions of the proviso of Article 335 (2) shall also be
         applicable to a transfer of shares which has been made without issuing
         the share certificates before the enforcement of this Act.


ARTICLE 7 (TRANSITIONAL MEASURES AS TO TRANSFER OF SHARES BY DELIVERY OF SHARE
CERTIFICATES)


         (1) With respect to a transfer or acquisition of shares before the
         enforcement of this Act, the previous provisions of Articles 336 and
         359 shall be applicable even after the enforcement of this Act:
         Provided, That with regard to a possession of share certificates after
         the enforcement of this Act, the revised provisions of Article 336 (2)
         shall be applicable.

         (2) Even though a person who has, after the enforcement of this Act
         acquired share certificates issued before the enforcement of this Act,
         has not investigated as to the uninterrupted series of endorsements or
         the propriety of instrument for conveyance, the failure of such
         investigation shall not be considered as an act of bad faith or gross
         negligence, for the purpose of application of the revised provisions of
         Article 359.


ARTICLE 8 (TRANSITIONAL MEASURES AS TO TRANSFER AGENT)


         (1) A transfer agent who was appointed before the enforcement of this
         Act, under Article 11-6 of the Capital Market Promotion Act, shall be
         regarded to



<PAGE>

         have been appointed under the revised provisions of Article 337 (2) of
         this Act.

         (2) The qualification of the transfer agent under this Act shall be
         determined by a Presidential Decree.


ARTICLE 9 (TRANSITIONAL MEASURES AS TO ACQUIREMENT OF SHARES OF PARENT COMPANY
BY SUBSIDIARY COMPANY)


         (1) If a subsidiary company which is subject to Article 342-2, has the
         shares of a parent company which is subject to the said Article, at the
         time this Act enters into force, the former shall dispose of such
         shares within three years from the enforcement date of this Act.

         (2) The provisions of Article 625-2 shall be applicable mutatis
         mutandis to the case of non-disposition of shares in contravention of
         the provisions of paragraph (1).


ARTICLE 10 (TRANSITIONAL MEASURES AS TO NON-BEARING OF SHARE CERTIFICATES)

         A measure pertaining to the non-issue of share certificates, which was
         taken before the enforcement of this Act, under the provisions of
         Article 11-7 of the Capital Market Promotion Act, shall be considered
         to have been taken under the revised provisions of Article 358-2 of
         this Act.


ARTICLE 11 (TRANSITIONAL MEASURES AS TO PERIOD OF CLOSURE OF REGISTER OF
SHAREHOLDERS AND RECORD DATE)

         If a day within two weeks from the day of enforcement of this Act is
         determined as the period of closure of shareholders' register or the
         record date, the previous provisions shall be applicable.



<PAGE>

ARTICLE 12 (TRANSITIONAL MEASURES AS TO EXERCISE VOTE IN DISUNITY)

         The revised provisions of Article 368-2 (including the cases to which
         this Article is applied mutatis mutandis by Articles 308 (2) and 527
         (3)) shall not be applicable to the exercise of a vote at a general
         shareholders' meeting or inaugural general meeting which is held on a
         day within two weeks from the enforcement date of this Act.


ARTICLE 13 (TRANSITIONAL MEASURES AS TO ACTION FOR AFFIRMING NON-EXISTENCE OF
RESOLUTION OF GENERAL MEETING)

         The revised provisions of Article 380 (including the cases to which
         this Article is applied mutatis mutandis by Articles 308 (2) and 578)
         shall also be applicable to the cases pending to the court at the time
         when this Act enters into force: Provided, That the effect of an action
         brought before the enforcement of this Act shall not be affected.

ARTICLE 14 (TRANSITIONAL MEASURES AS TO TERM OF OFFICE OF DIRECTORS AND
AUDITORS)

         With respect to the term of office of directors and auditors of a stock
         company who are in office at the time this Act enters into force, the
         previous provisions shall be applicable, regardless of the revised
         provisions of Articles 383 (2) and 410.


ARTICLE 15 (TRANSITIONAL MEASURES AS TO DUTY AND POWER OF AUDITORS)

         With respect to the duty and power of an auditor of a stock company
         appointed before the enforcement of this Act, and is in office before
         closing of a ordinary general meeting relating to the period for the
         settlement of accounts which arrives first after the enforcement of
         this Act, the previous provisions shall be applicable.



<PAGE>

ARTICLE 16 (TRANSITIONAL MEASURES AS TO REPRESENTATIVE OF COMPANY FOR ACTION
BETWEEN COMPANY AND Directors)

         With respect to the person who is to represent a company in an action
         brought by a stock company against a director (including a liquidator,
         and hereinafter referred to the same in this Article) and vice versa,
         the previous provisions shall be applicable until the ordinary general
         meeting relating to the period for the settlement of accounts which
         arrives first after the enforcement of this Act, is closed.


ARTICLE 17 (TRANSITIONAL MEASURES AS TO ALLOTMENT OF NEW SHARES)

         When a resolution to issue new shares is adopted before the enforcement
         of this Act, the revised provisions of Article 418 (2) shall not be
         applicable.


ARTICLE 18 (TRANSITIONAL MEASURES AS TO TIME OF EFFECTING NEW SHARES)

         When a resolution to issue new shares is made before the enforcement of
         this Act, the time when a person becomes a shareholder shall be
         determined according to the previous provisions, regardless of the
         revised provisions of Article 423.


ARTICLE 19 (TRANSITIONAL MEASURES AS TO REDUCTION OF CAPITAL)

         When a resolution concerning the reduction of capital is made before
         the enforcement of this Act, the fractional shares shall be disposed of
         according to the previous provisions, regardless of the revised
         provisions of Article 443 (1).


ARTICLE 20 (TRANSITIONAL MEASURES AS TO TIME TO PAY DIVIDEND)

         The revised provisions of Article 464-2 shall not be applicable to the
         dividend which has been decided to be paid by a resolution under
         Article 449 (1) before


<PAGE>

         the enforcement of this Act.


ARTICLE 21 (TRANSITIONAL MEASURES AS TO ISSUANCE OF CONVERTIBLE BONDS)

         When a resolution to issue convertible bonds has been made before the
         enforcement of this Act, such bonds shall be issued according to the
         previous provisions.


ARTICLE 22 (TRANSITIONAL MEASURES AS TO PROHIBITION AGAINST GRANTING BENEFITS)

         The revised provisions of Article 467-2 shall not be applicable to an
         act performed before the enforcement of this Act.


ARTICLE 23 (TRANSITIONAL MEASURES AS TO DISCLOSURE OF BALANCE SHEET FOR MERGER)

         The revised provisions of Article 522-2 (including the cases to which
         this Article is applied mutatis mutandis by Article 603) shall not be
         applicable to a case where the general shareholders' meeting under
         paragraph (1) of the said Article is to be held on a day within two
         weeks after the enforcement of this Act.


ARTICLE 24 (TRANSITIONAL MEASURES AS TO TOTAL AMOUNT OF CAPITAL OF LIMITED
LIABILITY COMPANIES)


         (1) A company which was a limited liability company before the
         enforcement of this Act, and whose total amount of capital and amount
         of one contribution unit at the time of enforcement of this Act are
         less than the amount as prescribed in the revised provisions of Article
         546, shall raise the amount, in the case of the total amount of
         capital, to ten million won or more, and, in the case of the amount of
         contribution unit, to five thousand won or more, within three years
         from the enforcement date of this Act.


<PAGE>

         (2) The company which fails to raise its total amount of capital within
         the period as prescribed in paragraph (1) shall be deemed to have been
         dissolved.

         (3) The companies which as considered to have been dissolved under
         paragraph (2), but the liquidation of which is not completed, may
         continue their operation by a special resolution as prescribed in
         Article 585, according to the procedure as referred to in paragraph (1)
         within one year from the enforcement date of this Act. (Newly Inserted
         by Act No. 4372, May. 31, 1991)


ARTICLE 25 (REVISION OF RELEVANT ACTS AND RELATIONS WITH OTHER ACTS)


         (1) through (7) Omitted.

         (8) In the cases where the previous provisions of the Commercial Act
         are cited in the Acts other than those prescribed in paragraphs (1)
         through (7), at the time this Act enters into force, if the provisions
         corresponding to them are included in this Act, such corresponding
         provisions of this Act shall be considered to have been cited in lieu
         of the previous provisions.


         ADDENDUM (Act No. 4372, May. 31, 1991)

         This Act shall enter into force on the date of its promulgation.


         ADDENDA (Act No. 4470, Dec. 31, 1991)


ARTICLE 1 (ENFORCEMENT DATE)

         This Act shall enter into force on January 1, 1993.



<PAGE>

ARTICLE 2 (TRANSITIONAL MEASURES)


         (1) The provisions of Part IV of this Act shall also be applicable to
         any insurance contract concluded before this Act enters into force:
         Provided, That the effect given by the previous provisions shall not be
         affected.

         (2) The provisions of Part V of this Act shall not be applicable to any
         obligation on damages caused by any accident taken place before this
         Act enters into force, but the previous provisions shall be applicable.


ARTICLE 3 (TRANSITIONAL MEASURES CONCERNING APPLICATION OF LIMITATION TONNAGE)

         In application of Article 751, the gross tonnage shall be applicable in
         lieu of the international gross tonnage to a ship which is engaged in
         an international navigation, and fails to be delivered an international
         tonnage certificate or written international tonnage confirmation by
         the Administrator of the Korea Maritime and Port Administration under
         Article 13 of the Vessels Act.


ARTICLE 4 (RELATION WITH OTHER ACTS)

         In case where other Acts cite the previous provisions of the Commercial
         Act at the time this Act enters into force, if the provisions
         corresponding to them are included in this Act, such corresponding
         provisions of this Act shall be considered to have been cited in lieu
         of the previous provisions.


         ADDENDA (Act No. 4796, Dec. 22, 1994)


ARTICLE 1 (ENFORCEMENT DATE)

         This Act shall enter into force on January 1, 1995.



<PAGE>

ARTICLES 2 THROUGH 4

         Omitted.


         ADDENDA (Act No. 5053, Dec. 29, 1995)


ARTICLE 1 (ENFORCEMENT DATE)

         This Act shall enter into force on October 1, 1995.


ARTICLE 2 (PRINCIPLES OF TRANSITIONAL MEASURES)

         Except as provided otherwise by this Act, this Act shall also apply to
         the matters taken place before this Act enters into force: Provided,
         That it shall not affect any effect taken pursuant to the previous
         provisions.


ARTICLE 3 (TRANSITIONAL MEASURES CONCERNING TRADE BOOKS, ETC.)

         The previous provisions shall apply with respect to trade books and
         supplementary schedules, which a person who is a merchant at the time
         this Act enters into force should prepare before the fixed time under
         the revised provision of Article 30 (2) (for the company, this date
         means the period for settlement of accounts; hereinafter referred to as
         the same in this Article) which arrives for the first time after the
         enforcement of this Act, and to the accounts to be made before and at
         the fixed time.


ARTICLE 4 (TRANSITIONAL MEASURES CONCERNING CLASS OF SHARES HAVING PREFERENTIAL
          RIGHTS)

         Any class of shares having preferential rights, issued before this Act
         enters into


<PAGE>

         force, shall be subject to the previous provisions.


ARTICLE 5 (TRANSITIONAL MEASURES CONCERNING TERM OF OFFICE OF AUDITOR)

         The term of any auditor of a stock company, who is in office at the
         time this Act enters into force, shall be subject to the previous
         provisions.


ARTICLE 6 (RELATION WITH OTHER ACTS)

         In case where other Acts cite the provisions of the previous Commercial
         Act at the time this Act enters into force, if the provisions
         corresponding to them are included in this Act, such corresponding
         provisions of this Act shall be considered to have been cited in lieu
         of the previous provisions.


         ADDENDA (Act No. 5591, Dec. 28, 1998)


ARTICLE 1 (ENFORCEMENT DATE)

         This Act shall enter into force on the date of its promulgation:
         Provided, That the amended provisions of Article 382-2 shall enter into
         force six months after its promulgation.


ARTICLE 2 (PRINCIPLES OF TRANSITIONAL MEASURES)

         Except as otherwise prescribed by this Act, this Act shall also apply
         to matters which took place before this Act enters into force:
         Provided, That it shall not affect any effect taken pursuant to the
         previous provisions.


ARTICLE 3 (TRANSITIONAL MEASURES CONCERNING MERGER)


<PAGE>

         With respect to a merger effected pursuant to a merger contract
         concluded prior to the enforcement of this Act, the previous provisions
         shall continue to apply even after this Act enters into force:
         Provided, That the period of institution of an objection by creditors
         under Articles 232 and 527-5 shall apply to that publicly notified on
         or after the enforcement date of this Act.


ARTICLE 4 (TRANSITIONAL MEASURES CONCERNING APPLICATION OF PENAL PROVISIONS)

         The application of penal provisions to an act conducted prior to the
         enforcement of this Act, and to acts conducted after the enforcement of
         this Act which are subject to the previous provisions under Article 3,
         shall follow the previous provisions.


ARTICLE 5

         Omitted.


         ADDENDA (Act No. 5809, Feb. 5, 1999)


ARTICLE 1 (ENFORCEMENT DATE)

         This Act shall enter into force six months after its promulgation.
         (Proviso Omitted.)


ARTICLES 2 THROUGH 6 Omitted.


          ADDENDA (Act No. 6086, Dec. 31, 1999)



<PAGE>

ARTICLE 1 (ENFORCEMENT DATE)

         This Act shall enter into force on the date of its promulgation.


ARTICLE 2 (PRINCIPLES OF TRANSITIONAL MEASURES)

         Except as otherwise provided, this Act shall also apply to the matters
         which occurred before the enforcement of this Act: Provided, That this
         shall be without prejudice to any effect given by the previous
         provisions.


ARTICLE 3 (TRANSITIONAL MEASURES CONCERNING DIVISION)

         The previous provisions shall continue to govern even after the
         enforcement of this Act with respect to the division of a corporation
         effected under a division agreement that was concluded before this Act
         enters into force.


ARTICLE 4

         Omitted.


         ADDENDA (Act No. 6488, Jul. 24, 2001)

         (1) (Enforcement Date) This Act shall enter into force on the date of
         its promulgation.

         (2) (Application Examples for Request for Action Cost by Shareholders
         Instituting Action Who Won the Case) The amended provisions of Article
         405 (1) shall apply also to the pending case at the court at the time
         of enforcement of this Act.


<PAGE>

         (3) (General Transitional Measures) This Act shall apply also to the
         case occurred prior to the enforcement of this Act unless otherwise
         prescribed by this Act: Provided, That this shall not affect the
         validity accrued by the previous provisions.


         ADDENDUM (Act No. 6545, Dec. 29, 2001)

         This Act shall enter into force on July 1, 2002.








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