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<SEC-DOCUMENT>0001062993-11-000134.txt : 20110112
<SEC-HEADER>0001062993-11-000134.hdr.sgml : 20110112
<ACCEPTANCE-DATETIME>20110112161332
ACCESSION NUMBER:		0001062993-11-000134
CONFORMED SUBMISSION TYPE:	8-K/A
PUBLIC DOCUMENT COUNT:		2
CONFORMED PERIOD OF REPORT:	20101029
ITEM INFORMATION:		Financial Statements and Exhibits
FILED AS OF DATE:		20110112
DATE AS OF CHANGE:		20110112

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			NET 1 UEPS TECHNOLOGIES INC
		CENTRAL INDEX KEY:			0001041514
		STANDARD INDUSTRIAL CLASSIFICATION:	FUNCTIONS RELATED TO DEPOSITORY BANKING, NEC [6099]
		IRS NUMBER:				980171860
		FISCAL YEAR END:			0630

	FILING VALUES:
		FORM TYPE:		8-K/A
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-31203
		FILM NUMBER:		11525649

	BUSINESS ADDRESS:	
		STREET 1:		4TH FLOOR, PRESIDENT PLACE
		STREET 2:		CNR. JAN SMUTS & BOLTON
		CITY:			ROSEBANK, JOHANNESBURG
		STATE:			T3
		ZIP:			00000
		BUSINESS PHONE:		27 11 343 2000

	MAIL ADDRESS:	
		STREET 1:		4TH FLOOR, PRESIDENT PLACE
		STREET 2:		CNR. JAN SMUTS & BOLTON
		CITY:			ROSEBANK, JOHANNESBURG
		STATE:			T3
		ZIP:			00000
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K/A
<SEQUENCE>1
<FILENAME>form8ka.htm
<DESCRIPTION>CURRENT REPORT
<TEXT>


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   <TITLE>Net 1 UEPS Technologies, Inc.: Form 8-K/A - Filed by newsfilecorp.com</TITLE>
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<HR noshade align="center" width=100% size=3 color="black">
<A name=page_1></A>
<P align=center><B><FONT size=5>UNITED STATES</FONT><BR><FONT
size=5>SECURITIES AND EXCHANGE COMMISSION</FONT></B><BR>Washington, D.C. 20549
<BR>___________________________ </P>
<P align=center><B><FONT size=5>FORM 8-K/A</FONT></B></P>
<P align=center><B>CURRENT REPORT <BR>Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934</B></P>
<P align=center>Date of Report (Date of earliest event reported): <B><U>January
12, 2011 (October 29, 2010)</U></B></P>
<P align=center><B><U><FONT size=5>NET 1 UEPS TECHNOLOGIES,
INC.</FONT></U> </B><BR>(Exact name of registrant as specified in its
charter)</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=center><B><U>Florida </U></B></TD>
    <TD align=center width="33%"><B><U>000-31203 </U></B></TD>
    <TD align=center width="33%"><B><U>98-0171860 </U></B></TD></TR>
  <TR vAlign=top>
    <TD align=center>(State or other jurisdiction </TD>
    <TD align=center width="33%">(Commission </TD>
    <TD align=center width="33%">(IRS Employer </TD></TR>
  <TR vAlign=top>
    <TD align=center>of incorporation) </TD>
    <TD align=center width="33%">File Number) </TD>
    <TD align=center width="33%">Identification No.) </TD></TR></TABLE>
<P align=center><B>President Place, 4<SUP>th</SUP> Floor, Cnr. Jan
Smuts Avenue and Bolton Road</B><BR><B><U>Rosebank, Johannesburg, South
Africa</U> </B><BR>
  (Address of principal executive offices) (ZIP Code) </P>
<P align=center>Registrant&#146;s telephone number, including area code:
<B><U>011-27-11-343-2000 </U></B></P>
<P align=center>Check the appropriate box below if the Form 8-K filing is
intended to simultaneously satisfy the filing obligation of the registrant under
any of the following provisions: </P>
<P align=center>[ ] Written communications pursuant to Rule 425 under the
Securities Act (17 CFR 230.425) </P>
<P align=center>[ ] Soliciting material pursuant to Rule 14a-12 under the
Exchange Act (17 CFR 240.14a -12) </P>
<P align=center>[ ] Pre-commencement communications pursuant to Rule 14d-2(b)
under the Exchange Act (17 CFR 240.14d -2(b)) </P>
<P align=center>[ ] Pre-commencement communications pursuant to Rule 13e-4(c)
under the Exchange Act (17 CFR 240.13e -4(c)) </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_2></A>
<P align=justify><B>Explanatory Note</B></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; On
October 29, 2010, we acquired 98.73% of the issued share capital of KSNET, Inc.
(&#147;KSNET&#148;) for a cash payment of KRW 270 billion (the &#147;Acquisition&#148;), subject to
an estimated post-closing working capital adjustment of $2.1 million. Under the
share purchase agreement, we were required to transfer the movement in net
working capital (excluding deferred taxes) between June 30, 2010, and October
29, 2010 to the sellers.</P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; On
November 3, 2010, we filed a Current Report on Form 8-K (the &#147;Form 8-K&#148;) under
Item 2.01 to report the completion of the Acquisition. In response to parts (a)
and (b) of Item 9.01 of the Form 8-K, we stated that we would file the required
financial information by amendment, as permitted by Item 9.01. This Form 8-K/A
is being filed to provide certain historical financial statements of KSNET and
pro forma financial information . </P>
<P align=justify><B>Item 9.01. Financial Statements and Exhibits. </B></P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD width="5%" align=left bgColor=#ffffff>(a)</TD>
    <TD colspan="2" align=left><U>Financial statements of businesses acquired</U>.
    </TD>
    <TD align=center width="5%">&nbsp; </TD>
  </TR>
  <TR>
    <TD width="5%" align=left bgColor=#ffffff>&nbsp;</TD>
    <TD align=left width="5%">&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD align=center width="5%">&nbsp; </TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" align=left bgColor=#ffffff></TD>
    <TD colspan="2" align=left bgColor=#eeeeee><A href="#page_3">Report of Independent
      Registered Public Accounting Firm </A></TD>
    <TD align=center width="5%" bgColor=#eeeeee><A href="#page_3">F-1 </A></TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" align=left bgColor=#ffffff>&nbsp;</TD>
    <TD colspan="2" align=left>KSNET, Inc. audited financial statements comprising:
    </TD>
    <TD align=center width="5%">&nbsp; </TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" align=left bgColor=#ffffff>&nbsp;</TD>
    <TD align=left width="5%" bgColor=#eeeeee>&nbsp;</TD>
    <TD align=left bgColor=#eeeeee><A href="#page_4">Balance Sheets as of December
      31, 2009 and 2008 </A></TD>
    <TD align=center width="5%" bgColor=#eeeeee><A href="#page_4">F-2 </A></TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" align=left bgColor=#ffffff>&nbsp;</TD>
    <TD align=left width="5%">&nbsp;</TD>
    <TD align=left><A href="#page_5">Statements of Income for the years ended
      December 31, 2009, 2008 and 2007 </A></TD>
    <TD align=center width="5%"><A href="#page_5">F-3 </A></TD>
  </TR>
  <TR vAlign=bottom>
    <TD width="5%" align=left bgColor=#ffffff>&nbsp;</TD>
    <TD align=left width="5%" bgColor=#eeeeee>&nbsp;</TD>
    <TD align=left bgColor=#eeeeee><A href="#page_6">Statements of Changes in
      Equity and Comprehensive Income for the years ended December 31, 2009, 2008
      and 2007 </A></TD>
    <TD align=center width="5%" bgColor=#eeeeee><A href="#page_6">F-4 </A></TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" align=left bgColor=#ffffff>&nbsp;</TD>
    <TD align=left width="5%">&nbsp;</TD>
    <TD align=left><A href="#page_7">Statements of Cash Flows for the years ended
      December 31, 2009, 2008 and 2007 </A></TD>
    <TD align=center width="5%"><A href="#page_7">F-5 </A></TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" align=left bgColor=#ffffff>&nbsp;</TD>
    <TD align=left width="5%" bgColor=#eeeeee>&nbsp;</TD>
    <TD align=left bgColor=#eeeeee><A href="#page_9">Notes to the Financial Statements
      for the years ended December 31, 2009, 2008 and 2007 </A></TD>
    <TD align=center width="5%" bgColor=#eeeeee><A href="#page_9">F-7 </A></TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" align=left bgColor=#ffffff>&nbsp;</TD>
    <TD colspan="2" align=left>KSNET, Inc. unaudited financial statements comprising:
    </TD>
    <TD align=center width="5%">&nbsp; </TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" align=left bgColor=#ffffff>&nbsp;</TD>
    <TD align=left width="5%" bgColor=#eeeeee>&nbsp;</TD>
    <TD align=left bgColor=#eeeeee><A href="#page_33">Unaudited Balance Sheets
      as of June 30, 2010 and 2009 </A></TD>
    <TD align=center width="5%" bgColor=#eeeeee><A href="#page_33">F-31 </A></TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" align=left bgColor=#ffffff>&nbsp;</TD>
    <TD align=left width="5%">&nbsp;</TD>
    <TD align=left><A href="#page_34">Unaudited Statements of Income for the six
      months ended June 30, 2010 and 2009 </A></TD>
    <TD align=center width="5%"><A href="#page_34">F-32 </A></TD>
  </TR>
  <TR vAlign=bottom>
    <TD width="5%" align=left bgColor=#ffffff>&nbsp;</TD>
    <TD align=left width="5%" bgColor=#eeeeee>&nbsp;</TD>
    <TD align=left bgColor=#eeeeee><A href="#page_35">Unaudited Statements of
      Changes in Equity and Comprehensive Income for the six months ended June
      30, 2010 and 2009 </A></TD>
    <TD align=center width="5%" bgColor=#eeeeee><A href="#page_35">F-33 </A></TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" align=left bgColor=#ffffff>&nbsp;</TD>
    <TD align=left width="5%">&nbsp;</TD>
    <TD align=left><A href="#page_36">Unaudited Statements of Cash Flows for the
      six months ended June 30, 2010 and 2009 </A></TD>
    <TD align=center width="5%"><A href="#page_36">F-34 </A></TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" align=left bgColor=#ffffff>&nbsp;</TD>
    <TD align=left width="5%" bgColor=#eeeeee>&nbsp;</TD>
    <TD align=left bgColor=#eeeeee><A href="#page_38">Notes to the Unaudited Financial
      Statements for the six months ended June 30, 2010 and 2009 </A></TD>
    <TD align=center width="5%" bgColor=#eeeeee><A href="#page_38">F-36 </A></TD>
  </TR>
  <TR>
    <TD width="5%" align=left bgColor=#ffffff>&nbsp;</TD>
    <TD align=left width="5%">&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD align=center width="5%">&nbsp; </TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" align=left bgColor=#ffffff>(b)</TD>
    <TD colspan="2" align=left bgColor=#eeeeee><U>Pro forma financial information</U>.
    </TD>
    <TD align=center width="5%" bgColor=#eeeeee>&nbsp; </TD>
  </TR>
  <TR>
    <TD width="5%" align=left bgColor=#ffffff>&nbsp;</TD>
    <TD align=left width="5%">&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD align=center width="5%">&nbsp; </TD>
  </TR>
  <TR>
    <TD width="5%" bgColor=#ffffff>&nbsp;</TD>
    <TD width="5%" bgColor=#eeeeee>&nbsp;</TD>
    <TD bgColor=#eeeeee><A href="#page_61">Unaudited Pro Forma Combined Financial
      Statements for Net 1 UEPS Technologies, Inc. comprising: </A></TD>
    <TD align=center width="5%" bgColor=#eeeeee></TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" align=left bgColor=#ffffff>&nbsp;</TD>
    <TD align=left width="5%">&nbsp;</TD>
    <TD align=left><A href="#page_62">Unaudited Pro Forma Combined Balance Sheet
      as of June 30, 2010 </A></TD>
    <TD align=center width="5%"><A href="#page_62">F-60 </A></TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" align=left bgColor=#ffffff>&nbsp;</TD>
    <TD align=left width="5%" bgColor=#eeeeee>&nbsp;</TD>
    <TD align=left bgColor=#eeeeee><A href="#page_63">Unaudited Pro Forma Combined
      Statement of Operations for the year ended June 30, 2010 </A></TD>
    <TD align=center width="5%" bgColor=#eeeeee><A href="#page_63">F-61 </A></TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" align=left bgColor=#ffffff>&nbsp;</TD>
    <TD align=left width="5%">&nbsp;</TD>
    <TD align=left><A href="#page_64">Notes to the Unaudited Pro Forma Combined
      Financial Statements </A></TD>
    <TD align=center width="5%"><A href="#page_64">F-62 </A></TD>
  </TR>
</TABLE>
<P align=justify>(d)&nbsp;&nbsp;&nbsp;&nbsp; &nbsp;&nbsp;<U>Exhibits</U> </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left><B>Exhibits</B> </TD>
    <TD align=center width="85%"><B>Description</B> </TD>
  </TR>
  <TR>
    <TD width="5%">&nbsp;</TD>
    <TD align=left>&nbsp;</TD>
    <TD align=center width="85%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left bgColor=#eeeeee><a href="exhibit23-1.htm">23.1 </a></TD>
    <TD align=left width="85%" bgColor=#eeeeee><a href="exhibit23-1.htm">Consent
      of Ernst &amp; Young Han Young </a></TD>
  </TR>
</TABLE>
<BR>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_3></A>
<P align=center>Report of Independent Registered Public Accounting Firm<BR></P>
<P align=justify>The Board of Directors and Shareholders<BR>KSNET, Inc. <BR></P>
<P align=justify>We have audited the accompanying balance sheets of KSNET, Inc.
(the &#147;Company&#148;) as of December 31, 2009 and 2008, and the related statements of
income, changes in equity and comprehensive income, and cash flows for each of
the three years in the period ended December 31, 2009. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits. </P>
<P align=justify>We conducted our audits in accordance with auditing standards
generally accepted in the United States. Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. We were not engaged to perform an
audit of the Company's internal control over financial reporting. Our audits
included consideration of internal control over financial reporting as a basis
for designing audit procedures that are appropriate in the circumstances, but
not for the purpose of expressing an opinion on the effectiveness of the
Company's internal control over financial reporting. Accordingly, we express no
such opinion. An audit also includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing
the accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits provide a reasonable basis for our opinion. </P>
<P align=justify>In our opinion, the financial statements referred to above
present fairly, in all material respects, the financial position of the Company
at December 31, 2009 and 2008, and the results of its operations and its cash
flows for each of the three years in the period ended December 31, 2009, in
conformity with U.S. generally accepted accounting principles. </P>
<P align=justify>/s/ Ernst &amp; Young Han Young<BR>Seoul, Republic of Korea
<BR>January 10, 2011 <BR></P>
<P align=center>F-1</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_4></A>
<P align=justify><B>KSNET, Inc.</B> <BR><B>BALANCE SHEETS</B> <BR>
  <B>as of December 31, 2009 and 2008</B> </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD colspan="4" align=center>(In thousands of Korean won, </TD>
    <TD align=center width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD colspan="4" align=center style="BORDER-BOTTOM: #000000 1px solid">except
      share data) </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2009</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2008</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><div align="center"><B>ASSETS</B> </div></TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%">&nbsp; </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%">&nbsp; </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>CURRENT ASSETS </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Cash and cash equivalents (Note 6) </TD>
    <TD vAlign=bottom align=left width="1%" >&#65510;</TD>
    <TD vAlign=bottom align=right width="12%">18,650,898 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&#65510;</TD>
    <TD vAlign=bottom align=right width="12%">8,097,531 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp;Short-term financial instruments (Notes 3, 6 and 18)
    </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>2,228,000 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>5,738,000 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Accounts receivable, net (Notes 4 and 6) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">10,911,842 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">7,693,116 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp;Inventory (Note 5) </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>961,153 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>1,029,647 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Deferred tax assets (Note 15) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">482,053 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">729,238 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp;Other current assets (Notes 6, 11 and 20) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%" bgColor=#e6efff>13,046,226 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%" bgColor=#e6efff>9,796,119 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp;Total current assets </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">46,280,172 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">33,083,651 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>AVAILABLE-FOR-SALE SECURITIES (Note 6) </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>100,000 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>100,000 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>PROPERTY AND EQUIPMENT, net (Note 9) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">24,870,181 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">20,545,591 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>INTANGIBLE ASSETS, net (Note 10) </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>23,385 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>30,772 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>NON-CURRENT ACCOUNTS RECEIVABLE, net (Notes 4 and 6) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">1,906,418 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">2,889,876 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>NON-CURRENT DEFERRED TAX ASSETS (Note 15) </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>38,918 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>OTHER NON-CURRENT ASSETS (Notes 3, 6 and 11) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%">5,568,270 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%">5,751,657 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff><B>TOTAL ASSETS</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="12%" bgColor=#e6efff><B>78,748,426</B> </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="12%" bgColor=#e6efff><B>62,440,465</B> </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="12%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="12%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=center bgColor=#e6efff><B>LIABILITIES</B> </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>CURRENT LIABILITIES </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%">&nbsp; </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%">&nbsp; </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp;Accounts payable (Note 6) </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>6,462,841 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>4,301,624 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Short-term borrowings (Note 6) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">- </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">4,000,000 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp;Current portion of long-term debt (Notes 6 and 8) </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>10,000,000 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Other current liabilities (Notes 6, 7, 11 and 20) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%">16,744,433 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%">13,617,056 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left
      bgColor=#e6efff>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total
      current liabilities </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>33,207,274 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>21,918,680 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>LONG-TERM DEBT (Notes 6 and 8) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">- </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">4,000,000 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>ACCRUED SEVERANCE BENEFITS, net (Note 14) </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>749,779 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>733,989 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>NON-CURRENT DEFERRED TAX LIABILITIES (Note 15) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">389,488 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">- </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>OTHER NON-CURRENT LIABILITIES (Notes 11 and
      15) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%" bgColor=#e6efff>963,778 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>TOTAL LIABILITIES</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="12%"><B>35,310,319</B> </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="12%"><B>26,652,669</B> </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR>
    <TD bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=center><B>EQUITY</B> </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%">&nbsp; </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%">&nbsp; </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>COMMON STOCK (Note 13) </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>6,802,883 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>7,275,892 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Authorized shares: 36,500,000 with &#65510;500 par value at December
      31, 2009 and 2008 Issued and outstanding shares: 13,605,766 and 14,551,784
      at December 31, 2009 and 2008, respectively </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%"></TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%"></TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>ADDITIONAL PAID-IN-CAPITAL (Note 13) </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>33,568 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>33,568 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>RETAINED EARNINGS </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%">36,601,656 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%">28,478,336 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff><B>TOTAL EQUITY</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="12%" bgColor=#e6efff><B>43,438,107</B> </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="12%" bgColor=#e6efff><B>35,787,796</B> </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%" vAlign=bottom style="BORDER-BOTTOM: #000000 1px solid" >&nbsp;</TD>
    <TD width="12%" vAlign=bottom style="BORDER-BOTTOM: #000000 1px solid">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD width="1%" vAlign=bottom style="BORDER-BOTTOM: #000000 1px solid" >&nbsp;</TD>
    <TD width="12%" vAlign=bottom style="BORDER-BOTTOM: #000000 1px solid">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff><B>TOTAL LIABILITIES AND EQUITY</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="12%" bgColor=#e6efff><B>78,748,426</B> </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="12%" bgColor=#e6efff><B>62,440,465</B> </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=justify>See accompanying notes to financial statements. </P>
<P align=center>F-2 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_5></A>
<P align=justify><B>KSNET, Inc</B> <BR><B>STATEMENTS OF INCOME</B> <BR>
  <B>for the years ended December 31, 2009, 2008 and 2007</B> </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left >&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD colspan="9" align=center style="BORDER-BOTTOM: #000000 1px solid">(In
      thousands of Korean won, except per share data) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="1%"
    >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="14%"><B>2009</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="14%"><B>2008</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="14%"><B>2007</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >REVENUE </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="14%"
    bgColor=#e6efff>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="14%"
    bgColor=#e6efff>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="14%"
    bgColor=#e6efff>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Services rendered </TD>
    <TD style="BORDER-LEFT: #000000 1px solid" align=left width="1%"
    >&#65510;</TD>
    <TD align=right width="14%">87,382,235 </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD style="BORDER-RIGHT: #000000 1px solid; BORDER-LEFT: #000000 1px solid"
    align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="14%">72,434,882 </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD style="BORDER-RIGHT: #000000 1px solid; BORDER-LEFT: #000000 1px solid"
    align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="14%">66,306,804 </TD>
    <TD style="BORDER-RIGHT: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Sale of
      merchandise (Note 20) </TD>
    <TD style="BORDER-LEFT: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="14%" bgColor=#e6efff>2,657,854 </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-RIGHT: #000000 1px solid; BORDER-LEFT: #000000 1px solid"
    align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="14%" bgColor=#e6efff>3,260,281 </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-RIGHT: #000000 1px solid; BORDER-LEFT: #000000 1px solid"
    align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="14%" bgColor=#e6efff>4,025,601 </TD>
    <TD style="BORDER-RIGHT: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Others </TD>
    <TD style="BORDER-LEFT: #000000 1px solid; BORDER-BOTTOM: #000000 1px solid"
    align=left width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="14%">196,260 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-RIGHT: #000000 1px solid; BORDER-LEFT: #000000 1px solid"
    align=left width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="14%">345,838 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-RIGHT: #000000 1px solid; BORDER-LEFT: #000000 1px solid"
    align=left width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="14%">47,707 </TD>
    <TD
    style="BORDER-RIGHT: #000000 1px solid; BORDER-BOTTOM: #000000 1px solid"
    align=left width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="14%" bgColor=#e6efff>90,236,349 </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="14%" bgColor=#e6efff>76,041,001 </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="14%" bgColor=#e6efff>70,380,112 </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD >&nbsp; </TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="14%">&nbsp; </TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="14%">&nbsp; </TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="14%">&nbsp; </TD>
    <TD width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >EXPENSE </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="14%"
    bgColor=#e6efff>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="14%"
    bgColor=#e6efff>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="14%"
    bgColor=#e6efff>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Cost of services rendered
    </TD>
    <TD style="BORDER-LEFT: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD align=right width="14%">45,193,746 </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD style="BORDER-RIGHT: #000000 1px solid; BORDER-LEFT: #000000 1px solid"
    align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">36,384,790 </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD style="BORDER-RIGHT: #000000 1px solid; BORDER-LEFT: #000000 1px solid"
    align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">32,371,800 </TD>
    <TD style="BORDER-RIGHT: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Cost of
      merchandise sold (Note 20) </TD>
    <TD style="BORDER-LEFT: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="14%" bgColor=#e6efff>2,694,231 </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-RIGHT: #000000 1px solid; BORDER-LEFT: #000000 1px solid"
    align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="14%" bgColor=#e6efff>3,411,359 </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-RIGHT: #000000 1px solid; BORDER-LEFT: #000000 1px solid"
    align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="14%" bgColor=#e6efff>4,167,976 </TD>
    <TD style="BORDER-RIGHT: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Selling, general and administrative
      expenses </TD>
    <TD style="BORDER-LEFT: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD align=right width="14%">23,804,823 </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD style="BORDER-RIGHT: #000000 1px solid; BORDER-LEFT: #000000 1px solid"
    align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">1,759,563 </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD style="BORDER-RIGHT: #000000 1px solid; BORDER-LEFT: #000000 1px solid"
    align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">21,571,238 </TD>
    <TD style="BORDER-RIGHT: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Depreciation
      and amortization </TD>
    <TD style="BORDER-LEFT: #000000 1px solid; BORDER-BOTTOM: #000000 1px solid"
    align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="14%"
    bgColor=#e6efff>3,057,302 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-RIGHT: #000000 1px solid; BORDER-LEFT: #000000 1px solid"
    align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="14%"
    bgColor=#e6efff>3,072,933 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-RIGHT: #000000 1px solid; BORDER-LEFT: #000000 1px solid"
    align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="14%"
    bgColor=#e6efff>2,741,552 </TD>
    <TD
    style="BORDER-RIGHT: #000000 1px solid; BORDER-BOTTOM: #000000 1px solid"
    align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="14%">74,750,102 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="14%">64,628,645 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="14%">60,852,566 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
  </TR>
  <TR>
    <TD bgColor=#e6efff >&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="14%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="14%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="14%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >OPERATING INCOME </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">15,486,247 </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">11,412,356 </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">9,527,546 </TD>
    <TD align=left width="1%" >&nbsp;</TD>
  </TR>
  <TR>
    <TD bgColor=#e6efff >&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="14%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="14%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="14%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >INTEREST INCOME, net </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">209,430 </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">1,152,529 </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">3,154,316 </TD>
    <TD align=left width="1%" >&nbsp;</TD>
  </TR>
  <TR>
    <TD bgColor=#e6efff >&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="14%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="14%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="14%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >OTHER INCOME (EXPENSE), net (Note 12) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="14%">47,436 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="14%">(252,551</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="14%">158,596 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
  </TR>
  <TR>
    <TD bgColor=#e6efff >&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="14%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="14%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="14%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >INCOME BEFORE INCOME TAXES </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">15,743,113 </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">12,312,334 </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">12,840,458 </TD>
    <TD align=left width="1%" >&nbsp;</TD>
  </TR>
  <TR>
    <TD bgColor=#e6efff >&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="14%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="14%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="14%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >INCOME TAX EXPENSE (Note 15) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="14%">3,851,074 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="14%">3,135,605 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="14%">4,274,357 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
  </TR>
  <TR>
    <TD bgColor=#e6efff >&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="14%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="14%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="14%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >NET INCOME </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="14%">11,892,039 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="14%">9,176,729 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="14%">8,566,101 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&nbsp;</TD>
  </TR>
  <TR>
    <TD bgColor=#e6efff >&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="14%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="14%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="14%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left ><B>Net income per share (Note 16)</B> </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="14%">&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="14%">&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="14%">&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
  </TR>
  <TR>
    <TD bgColor=#e6efff >&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="14%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="14%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="14%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Basic earnings attributable
      to KSNET shareholders </TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="14%">862 </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="14%">616 </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="14%">529 </TD>
    <TD align=left width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Diluted
      earnings attributable to KSNET shareholders </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="14%" bgColor=#e6efff>862 </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="14%" bgColor=#e6efff>616 </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="14%" bgColor=#e6efff>424 </TD>
    <TD align=left width="1%"
  bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=justify>See accompanying notes to financial statements. </P>
<P align=center>F-3 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_6></A>
<P align=center><B>KSNET, Inc.</B> <BR>
  <B>STATEMENTS OF CHANGES IN EQUITY AND COMPREHENSIVE
  INCOME
  (in thousands of Korean won, except share data)</B><BR>
  <B>for the years ended December 31, 2009, 2008 and 2007 </B></P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 7pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD colspan="10" align=center style="BORDER-BOTTOM: #000000 1px solid"> Common
      stock </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD colspan="7" align=center style="BORDER-BOTTOM: #000000 1px solid"> Preferred
      stock </TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="6%">&nbsp; </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="6%">&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD width="6%" align=center nowrap>Number of </TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="6%">&nbsp; </TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="6%">Treasury </TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="10%">Additional </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="6%">Number </TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="6%">&nbsp; </TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="10%">Additional </TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="6%">Retained </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="6%">Total </TD>
    <TD align=left width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="6%">shares </TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="6%">Amount </TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="6%"> stock </TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD
      width="10%" align=center nowrap style="BORDER-BOTTOM: #000000 1px solid">paid-in capital </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="6%">of shares </TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="6%">Amount </TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD
      width="10%" align=center nowrap style="BORDER-BOTTOM: #000000 1px solid">paid-in capital </TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="6%">earnings </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="6%"> equity
    </TD>
    <TD align=left width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Balance &#150; Jan. 1, 2007 </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>16,355,138 </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>8,177,569 </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>(329,156</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>) </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>33,568 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>4,000,000 </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>2,000,000 </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>40,701,975 </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>33,459,687 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>84,043,643 </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Exercise of stock warrants </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">16,000 </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">8,000 </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">- </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">- </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">8,000 </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Comprehensive income: </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;Net income </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="10%">- </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="10%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="6%">8,566,101 </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="6%">8,566,101 </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Balance &#150; Dec. 31, 2007 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="6%" bgColor=#e6efff>16,371,138 </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="6%" bgColor=#e6efff>8,185,569 </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="6%" bgColor=#e6efff>(329,156</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>) </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="10%" bgColor=#e6efff>33,568 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="6%" bgColor=#e6efff>4,000,000 </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="6%" bgColor=#e6efff>2,000,000 </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="10%" bgColor=#e6efff>40,701,975 </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="6%" bgColor=#e6efff>42,025,788 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="6%" bgColor=#e6efff>92,617,744 </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="6%">&nbsp; </TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="6%">&nbsp; </TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="6%">&nbsp; </TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%">&nbsp;</TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="6%">&nbsp; </TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="6%">&nbsp; </TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="6%">&nbsp; </TD>
    <TD vAlign=bottom width="2%">&nbsp;</TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="6%">&nbsp; </TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
  </TR>
  <TR>
    <TD bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="6%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="6%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="6%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="10%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="6%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="6%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="10%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="6%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="6%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Balance &#150; Jan. 1, 2008 </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">16,371,138 </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">8,185,569 </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">(329,156</TD>
    <TD vAlign=bottom align=left width="1%">) </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">33,568 </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">4,000,000 </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">2,000,000 </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">40,701,975 </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">42,025,788 </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">92,617,744 </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Capital reduction &#150; common stock </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>(1,654,776</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>) </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>(827,388</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>) </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>(6,327,289</TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>) </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>(7,154,677</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Capital reduction &#150; preferred stock </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">- </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">(4,000,000</TD>
    <TD vAlign=bottom align=left width="1%">) </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">(2,000,000</TD>
    <TD vAlign=bottom align=left width="1%">) </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">(40,701,975</TD>
    <TD vAlign=bottom align=left width="1%">) </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">(16,150,025</TD>
    <TD vAlign=bottom align=left width="2%">) </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">(58,852,000</TD>
    <TD vAlign=bottom align=left width="1%">) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Stock retirement </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>(164,578</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>) </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>(82,289</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>) </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>329,156 </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>(246,867</TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>) </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Comprehensive income: </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">- </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">- </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp;Net income </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="10%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="10%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="6%" bgColor=#e6efff>9,176,729 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="6%" bgColor=#e6efff>9,176,729 </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Balance &#150; Dec. 31, 2008 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="6%">14,551,784 </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="6%">7,275,892 </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="10%">33,568 </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="10%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="6%">28,478,336 </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="6%">35,787,796 </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
  </TR>
  <TR>
    <TD bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="6%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="6%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="6%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="10%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="6%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="6%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="10%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="6%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="6%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="6%">&nbsp; </TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="6%">&nbsp; </TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="6%">&nbsp; </TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="2%">&nbsp;</TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="6%">&nbsp; </TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="6%">&nbsp; </TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="10%">&nbsp; </TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="6%">&nbsp; </TD>
    <TD vAlign=bottom width="2%">&nbsp;</TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
    <TD vAlign=bottom width="6%">&nbsp; </TD>
    <TD vAlign=bottom width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Balance &#150; Jan. 1, 2009 </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>14,551,784 </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>7,275,892 </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>33,568 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>28,478,336 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>35,787,796 </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Adoption of FIN 48 <BR> &nbsp;&nbsp; -adjustment to opening
      <BR> &nbsp;&nbsp; retained earnings </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">- </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">(154,210</TD>
    <TD vAlign=bottom align=left width="2%">) </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">(154,210</TD>
    <TD vAlign=bottom align=left width="1%">) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Revised retained earnings </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="6%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="6%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="6%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="10%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="6%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="6%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="10%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>28,324,126 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>35,633,586 </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Capital reduction </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">(946,018</TD>
    <TD vAlign=bottom align=left width="1%">) </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">(473,009</TD>
    <TD vAlign=bottom align=left width="1%">) </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">- </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">(3,614,509</TD>
    <TD vAlign=bottom align=left width="2%">) </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%">(4,087,518</TD>
    <TD vAlign=bottom align=left width="1%">) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Comprehensive income: </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="10%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="6%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp;Net income </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="10%">- </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="10%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="6%">11,892,039 </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="6%">11,892,039 </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
  </TR>
  <TR>
    <TD bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="6%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="6%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="6%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="10%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="6%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="6%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="10%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="6%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom width="6%" bgColor=#e6efff>&nbsp; </TD>
    <TD vAlign=bottom width="1%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Balance &#150; Dec. 31, 2009 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="6%">13,605,766 </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="6%">6,802,883 </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="10%">33,568 </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="6%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="10%">- </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="6%">36,601,656 </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="6%">43,438,107 </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
  </TR>
</TABLE>
<P align=justify>See accompanying notes to financial statements.</P>
<P align=center>F-4 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_7></A>
<P align=justify><B>KSNET, Inc.</B> <BR>
<B>STATEMENTS OF CASH FLOWS</B>
<BR>
  <B>for the years ended December 31, 2009, 2008 and 2007</B> </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD colspan="7" align=center style="BORDER-BOTTOM: #000000 1px solid">(In
      thousands of Korean won) </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2009</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2008</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2007</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff><B>Cash flows from operating activities</B>
    </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Net income </TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="12%">11,892,039 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="12%">9,176,729 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="12%">8,566,101 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Adjustments to reconcile net income to net cash provided by
      operating activities </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp;Provision for severance
      benefits </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>795,660 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>944,342 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>887,842 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp;Depreciation and amortization </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">9,893,357 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">8,469,269 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">7,554,783 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp;Loss (gain) on disposal
      of property and equipment </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(6,503</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>92,355 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>4,212 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp;Loss (gain) on valuation of derivatives
    </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(69,567</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">91,833 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp;Gain on disposal
      of investment securities </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(215,948</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp;Bad debt expenses </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(138,328</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">204,459 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(269,892</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp;Changes in operating
      assets and liabilities: </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Decrease (increase)
      in long-term accounts receivable </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">983,457 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(343,593</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(859,125</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Increase
      in accounts receivable </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(3,109,970</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(1,184,438</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(562,333</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Decrease (increase)
      in other receivables </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">89,734 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(102,420</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(34,318</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Decrease
      in accrued income </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>62,234 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>511,817 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>18,662 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Decrease (increase)
      in advanced payments </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">1,558,187 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(385,740</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(2,027,581</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Increase
      in prepaid expenses </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(4,938,925</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(3,311,860</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(68,116</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Decrease (increase)
      in inventory </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(12,002,583</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(7,752,580</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(5,449,491</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Decrease
      (increase) in guarantee deposits </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(153,487</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>1,432,905 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>343,8820 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Decrease in
      deferred tax assets </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">286,103 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">74,500 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">99,355 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;(Decrease)
      increase in deferred tax liabilities </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>389,488 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(95,930</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>95,930 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Decrease in
      accounts payable </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">2,161,217 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">676,297 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">3,148,047 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Increase
      in other payables </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>90,457 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(406,558</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(2,307,639</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;(Decrease)
      increase in advances from customers </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(161,577</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(106,398</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">106,349 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;(Decrease)
      increase in value-added tax payable </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>317,233 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>15,516 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(179,587</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Increase in
      accrued expenses </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">28,398 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">68,978 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">27,485 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Decrease
      in deposits received </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(190,156</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(20,869</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(53,124</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Increase in
      withholdings </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">3,439,170 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">1,753,869 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">2,208,543 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Decrease
      in income taxes payable </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(326,582</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(91,536</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(9,864</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Increase in
      other non-current liabilities </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">809,567 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;(Decrease)
      increase in deposit for severance benefits insurance </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(448,515</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>294,600 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(318,622</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp;Payment of severance benefits </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">(331,355</TD>
    <TD align=left width="2%" >) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">(1,368,019</TD>
    <TD align=left width="2%" >) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">(921,628</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B>Net
      cash provided by operating activities</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>10,918,753</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>8,637,528</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>9,783,861</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>Cash flows from investing activities</B> </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Decrease
      in short-term financial instruments </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>3,510,000 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>7,293,325 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>21,065,055 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Decrease in restricted
      cash </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">24,428 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Proceeds
      from sale of investment securities </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>329,240 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Decrease in short-term
      loans </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">43,140 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">6,175 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">83,459 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Decrease
      in long-term loans </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>736,912 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>554,111 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>567,992 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Decrease in other
      investment </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">101,650 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Proceeds
      from the disposal of property and equipment </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>174,112 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>316,752 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>77,824 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Increase in restricted
      cash </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(24,428</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Increase
      in long-term financial instruments </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(6,000</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(6,000</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(133,000</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Acquisition of investment
      securities </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(100,000</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Increase
      in short-term loans </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(53,000</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(35,000</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Increase in long-term
      loans </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(375,000</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(826,880</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(309,400</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Increase
      in other investment </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(942</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(174,187</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Acquisition of property
      and equipment </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">(2,307,090</TD>
    <TD align=left width="2%" >) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">(2,653,533</TD>
    <TD align=left width="2%" >) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">(3,619,765</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B>Net
      cash (used in) provided by investing activities</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>1,722,132</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>4,434,191</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>18,103,627</B> </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=center>F-5 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_8></A>
<P align=justify><B>KSNET, Inc.</B> <BR>
<B>STATEMENTS OF CASH FLOWS
(continued)</B> <BR>
  <B>for the years ended December 31, 2009, 2008 and 2007</B> </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD colspan="7" align=center style="BORDER-BOTTOM: #000000 1px solid">(In
      thousands of Korean won) </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2009</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2008</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2007</B> </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>Cash flows from financing activities</B> </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp;Proceeds from short-term
      borrowings </TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="12%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="12%" bgColor=#e6efff>4,000,000 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="12%" bgColor=#e6efff>8,000 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp;Proceeds from issuance of long-term
      debt </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">6,000,000 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">4,000,000 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp;Repayment of current
      portion of long-term debt </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(8,000</TD>
    <TD align=left width="2%" bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp;Repayment of short-term borrowings
    </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">(4,000,000</TD>
    <TD align=left width="2%">) </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">(2,500</TD>
    <TD align=left width="2%">) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp;Capital reduction
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>(4,087,518</TD>
    <TD align=left width="2%" bgColor=#e6efff>) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>(66,006,677</TD>
    <TD align=left width="2%" bgColor=#e6efff>) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>- </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp;<B>Net cash used in financing activities</B>
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>(2,087,518</B></TD>
    <TD align=left width="2%"><B>)</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>(58,006,677</B></TD>
    <TD align=left width="2%"><B>)</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>(2,500</B></TD>
    <TD align=left width="2%"><B>)</B> </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp;<B>Net increase
      (decrease) in cash and cash equivalents</B> </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>10,553,367</B> </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>(44,934,958</B></TD>
    <TD align=left width="2%" bgColor=#e6efff><B>)</B> </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>27,884,988</B> </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp;<B>Cash and cash equivalents &#150;
      beginning of year</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>8,097,531</B> </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>53,032,489</B> </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%"><B>25,147,501</B> </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp;<B>Cash and cash
      equivalents at end of year</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>18,650,898</B> </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>8,097,531</B> </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>53,032,489</B> </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>Non cash transaction</B> </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"><B>2009</B>
    </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"><B>2008</B>
    </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"><B>2007</B>
    </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Transfer from inventory to property and equipment
    </TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="12%" bgColor=#e6efff>12,071,077 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="12%" bgColor=#e6efff>7,259,169 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="12%" bgColor=#e6efff>5,546,053 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=justify>See accompanying notes to financial statements. </P>
<P align=center>F-6 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_9></A><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD></TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Financial Statements
      </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>for the years ended December 31, 2009, 2008 and 2007
  </B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts
      stated in thousands of Korean won, unless otherwise stated)
  </B></TD></TR></TABLE>
<P
align=justify><STRONG>1.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>DESCRIPTION
OF BUSINESS AND BASIS OF PRESENTATION </STRONG></P>
<P
align=justify><STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Description of business </STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;KSNET,
Inc. (the &#147;Company&#148;) was established through split-off from Chosun I&amp;C on
December 30, 1999 and engages in providing Value Added Network (VAN) services
and the sale of communication equipment in the Republic of Korea.</P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company&#146;s capital stock amounts to &#65510;6,802,883 thousand as of December 31, 2009
and the Company&#146;s shareholders and their ownership as of December 31, 2009 are
as follows:</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD width="5%"  >&nbsp;</TD>
    <TD align=left >&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>Number of shares </B></TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>Ownership (%) </B></TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR>
    <TD width="5%" >&nbsp;</TD>
    <TD >&nbsp; </TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="17%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="17%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff >H&amp;QNPS Van Investment </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>6,716,500 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>49.37 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left >Payment Services Asia LLC </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">6,716,500 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">49.37 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff >Others </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="17%"
    bgColor=#e6efff>172,766 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="17%"
    bgColor=#e6efff>1.26 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left >&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="17%">13,605,766 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="17%">100.00 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR></TABLE>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Basis
of presentation </STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company maintains its accounting records in Korean won and the accompanying
financial statements have been prepared in accordance with accounting principles
generally accepted in the United States of America (&#147;US GAAP&#148;). </P>
<P
align=justify><STRONG>2.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>SIGNIFICANT
  ACCOUNTING POLICIES </STRONG></P>
<P
align=justify><STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Use of estimates</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
preparation of the Company&#146;s financial statements in conformity with US GAAP
requires management to make estimates and assumptions that affect the reported
amounts of assets and liabilities and disclosure of contingent assets and
liabilities at the date of the financial statements and the reported amounts of
revenues and expenses during the reporting period. Actual results could differ
from those estimates. Significant items subject to such estimates and
assumptions include the useful lives of property and equipment; allowances for
doubtful accounts; the valuation of derivatives, deferred tax assets, property
and equipment, inventory, investment securities; and accrued severance benefits,
income tax uncertainties and other contingencies.</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Cash
and cash equivalents </STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company considers cash equivalents as all highly liquid investments and
short-term financial instruments, which are readily convertible to cash without
significant transaction cost, and do not carry significant risk from changes in
interest rates, and with maturities of three months or less when purchased. Cash
and cash equivalents mainly consist of money market trust and checking
deposits.</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Allowance
for doubtful accounts </STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Allowance
for doubtful accounts is estimated based on an analysis and past experience of
collections of individual accounts such as accounts receivable, other
receivables and loans. Allowance for doubtful accounts is presented as a
deduction from receivables. Account balances are charged off against the
allowance after all means of collection have been exhausted and the potential
for recovery is considered remote. </P>
<P align=center>F-7 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_10></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>for the years ended December 31, 2009, 2008 and 2007 </B></TD>
  </TR>

  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P align=justify><STRONG>2.</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG> SIGNIFICANT
  ACCOUNTING POLICIES (continued)</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Property
  and equipment</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Property
and equipment are shown at cost less accumulated depreciation. Property and
equipment are depreciated on the straight-line basis at rates which are
estimated to depreciate the assets to their anticipated residual values over
their useful lives. Within the following asset classifications, the expected
economic lives are approximately: </P>
<DIV align=center>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="80%" border=0>

  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Buildings </TD>
    <TD align=left width="50%" bgColor=#e6efff>30 years </TD></TR>
  <TR vAlign=top>
    <TD align=left>Structures </TD>
    <TD align=left width="50%">8 years </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Vehicles </TD>
    <TD align=left width="50%" bgColor=#e6efff>4 years </TD></TR>
  <TR vAlign=top>
    <TD align=left>Tools, furniture and fixtures </TD>
    <TD align=left width="50%">3 to 4 years </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Machinery and equipment </TD>
    <TD align=left width="50%" bgColor=#e6efff>8 years </TD></TR>
  <TR vAlign=top>
    <TD align=left>Software </TD>
    <TD align=left width="50%">5 years </TD></TR></TABLE></DIV>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
gain or loss arising on the disposal or retirement of an asset is determined as
the difference between the sales proceeds and the carrying amount of the asset
and is recognized in the statements of income.</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Property
and equipment do not require that an annual impairment test be performed;
instead, they are tested for impairment upon the occurrence of a triggering
event. Triggering events include the more likely than not disposal of a portion
of such assets or the occurrence of an adverse change in the market involving
the business employing the related assets. There were no impairment losses for
the years ended December 31, 2009, 2008 and 2007.</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Sales
  taxes</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Revenues
and expenses are presented net of value added taxes, as the case may be.</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Income
  taxes</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company provides for income taxes using the asset and liability method. This
approach recognizes the amount of taxes payable or refundable for the current
year, as well as deferred tax assets and liabilities for the future tax
consequence of events recognized in the financial statements and tax returns.
Deferred income taxes are adjusted to reflect the effects of changes in tax laws
or enacted tax rates. The effect on deferred tax assets and liabilities of a
change in tax rates is recognized in income in the period that includes the
enactment date. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Under
  the Corporate Tax Act in the Republic of Korea, corporate taxpayers are subject
  to corporate income taxes on taxable income at 22% (10% is applicable to the
  first &#65510;200 million of taxable income) in 2009. On top of the corporate income
  tax, 10% resident surtax is also assessed; thus the statutory tax rate becomes
  24.2% or 11% depending on the amount of taxable income; therefore, the income
  tax rate during the year ended December 31, 2009 was 24.2% . The income tax
  rate during the years ended December 31, 2008 and 2007 was 27.5% (including
  10% resident surtax).</P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
establishing the appropriate income tax valuation allowances, the Company
assesses the realizability of its net deferred tax assets, and based on all
available evidence, both positive and negative, determines whether it is more
likely than not that the net deferred tax assets or a portion thereof will be
realized. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Effective
January 1, 2009, the Company adopted the provisions of Accounting Standards
Codification (&#147;ASC&#148;) 740, <I>Income Taxes</I>, which set outs a consistent
framework to determine the appropriate level of tax reserve for uncertain tax
positions. The Company uses a two-step approach wherein a tax benefit is
recognized if a position is more-likely-than-not to be sustained. The amount of
the benefit is then measured as the highest tax benefit which is greater than
50% likely to be realized. The difference between the benefit recognized for a
position in accordance with ASC 740 and the tax benefit claimed on a tax return
is referred to as an unrecognized tax benefit.</P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company&#146;s policy is to include interest related to unrecognized tax benefits in
interest income, net and penalties in selling, general and administration in the
statements of income. </P>
<P align=center>F-8</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_11></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>for the years ended December 31, 2009, 2008 and 2007 </B></TD>
  </TR>

  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>2.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>SIGNIFICANT
ACCOUNTING POLICIES (continued) </STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Intangible
  assets</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Intangible
assets are shown at cost less accumulated amortization. Intangible assets are
amortized over the following useful lives:</P>
<DIV align=center>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="80%" border=0>

  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Trademarks </TD>
    <TD align=left width="50%" bgColor=#e6efff>10 years
</TD></TR></TABLE></DIV>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Intangible
assets are periodically evaluated for recoverability, and those evaluations take
into account events or circumstances that warrant revised estimates of useful
lives or that indicate an impairment exists. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Research
  and development expenditures</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Research
expenditures are charged to net income in the period in which they are
incurred.</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Costs
in respect of the development of software for the Company&#146;s internal use are
expensed as incurred, except to the extent that these costs are incurred during
the application development stage. All other costs including those incurred in
the project development and post-implementation stages are expensed as incurred.
For the years ended December 31, 2009, 2008 and 2007, the amount of research and
development expenditures charged to net income were &#65510;69,000 thousand, &#65510;86,800
thousand and &#65510;68,000 thousand, respectively. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Inventory</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventory
is stated at the lower of cost or market value. Cost is determined on a
first-in, first-out basis and includes transport and handling costs.</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Investment
  securities</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company classifies its debt security into available-for-sale security. The
Company classifies its equity securities that do not have readily determinable
fair values as other investment securities and those securities are stated at
cost. </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company reviews its investment portfolio each reporting period to determine
whether there are identified events or circumstances that would indicate there
is a decline in the fair value that is considered to be other-than-temporary.
For other securities which are stated at cost, if there are no identified events
or circumstances that would have a material adverse effect on the fair value of
the investment, then the fair value is not estimated. If an investment is deemed
to have experienced an other-than-temporary decline below its cost basis, the
Company reduces the carrying amount of the investment to its quoted or estimated
fair value, as applicable, and establishes a new cost basis for the investment.
There was no impairment loss on investment securities recognized for the years
ended December 31, 2009, 2008 and 2007. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Fair
  value measurements</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company applies fair value accounting for all financial assets and liabilities
and non&#8722;financial assets and liabilities that are recognized or disclosed at
fair value in the financial statements. The Company defines fair value as the
price that would be received from selling an asset or paid to transfer a
liability in an orderly transaction between market participants at the
measurement date. When determining the fair value measurements for assets and
liabilities, which are required to be recorded at fair value, the Company
considers the principal or most advantageous market in which the Company would
transact and the market&#8722;based risk measurements or assumptions that market
participants would use in pricing the asset or liability, such as inherent risk,
transfer restrictions and credit risk. ASC 820, <I>Fair Value Measurements and
Disclosure</I> (&#147;ASC 820&#148;), establishes a framework for measuring fair value and
expands disclosures about fair value measurements.</P>
<P align=center>F-9</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_12></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>for the years ended December 31, 2009, 2008 and 2007 </B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P align=justify><STRONG>2.</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG> SIGNIFICANT
  ACCOUNTING POLICIES (continued)</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Derivatives</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company recognizes all derivative financial instruments in the balance sheets as
either assets or liabilities at fair value.</P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
a derivative financial instrument not designated as a hedging instrument, the
gain or loss is recognized in earnings in the period of change.</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Revenue
recognition </STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company recognizes revenue when:</P>
<UL style="TEXT-ALIGN: justify">
  <LI>There is persuasive evidence of an agreement or arrangement;
  <LI>Delivery of products has occurred or services have been rendered;
  <LI>The seller&#146;s price to the buyer is fixed or determinable; and
  <LI>Collectability is reasonably assured. </LI></UL>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company&#146;s revenue mainly consists of revenue from Card VAN, Banking VAN, Payment
Gateway (PG) and sale of merchandise. The Company&#146;s revenue recognition methods
for each component are as follows: </P>
<P style="MARGIN-LEFT: 5%" align=justify><I>Card VAN</I></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Card
VAN services consist of services relating to authorization of credit card
transactions including transmission of transaction details (Authorization
Service), and collection of receipts associated with the credit card
transactions (Collection Service). With its Authorization Service, the Company
connects credit card companies with merchants online when a customer uses
his/her credit card via terminals installed at merchants&#146; sites and the
Company&#146;s central processing server for approval of credit card transactions.
Immediately after approval of credit card transactions, the Company transmits
details of the transactions to credit card companies online for processing
payments. Collection Service captures the transaction data and gathers receipts
as documented evidences and provides them to credit card companies upon request.
The Company earns service fees based on the number of processed transactions for
credit card companies when services are rendered in accordance with the
contracts entered into between credit card companies and the Company. The
Company bills for its service charges to credit card companies each month. Each
service could be provided either individually or collectively, based on terms of
contracts. </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company charges commission fee to credit card companies for the Authorization
Service provided based on the number of approvals transferred. The right to
receive fee for services rendered will take effect as credit card transactions
are approved and details of the transactions are transmitted. Therefore,
revenues from the Authorization Service are recognized when the credit card
transactions are authorized and details of the transactions are transmitted. In
the case of Collection Service, the Company is not allowed to receive its
commission fees until it provides collected receipts to the credit card
companies. Therefore, revenue from the Collection Service is recognized when the
Company collects the receipts and provides them to the card companies.</P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
multi-element arrangements, the Company has identified two deliverables in
arrangements. The first deliverable is the Authorization Service, and the second
deliverable is the Collection Service. The Company evaluates each deliverable in
an arrangement to determine whether they represent separate units of accounting.
A deliverable constitutes a separate unit of accounting when it has standalone
value and there are no customer-negotiated refunds or return rights for the
delivered elements. If the arrangement includes a customer-negotiated refund or
return right relative to the delivered item and the delivery and performance of
the undelivered item is considered probable and substantially in the Company's
control, the delivered element constitutes a separate unit of accounting. In
instances when the aforementioned criteria are not met, the deliverable is
combined with the undelivered elements and the allocation of the arrangement
consideration and revenue recognition is determined for the combined unit as a
single unit. Allocation of the consideration is determined at arrangement
inception on the basis of each unit's relative selling price. In such
circumstances, the Company uses a hierarchy to determine the selling price to be
used for allocating revenue to deliverables: (i)
vendor-specific objective evidence of fair value (&#147;VSOE&#148;), (ii) third-party
evidence of selling price (&#147;TPE&#148;), and (iii) best estimate of the selling price
(&#147;ESP&#148;).</P>
<P align=center>F-10</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_13></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>for the years ended December 31, 2009, 2008 and 2007 </B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>2.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>SIGNIFICANT
ACCOUNTING POLICIES (continued)</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Revenue
recognition (continued) </STRONG></P>
<P style="MARGIN-LEFT: 5%" align=justify><I>Card VAN (continued)</I></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;VSOE
generally exists only when the Company sells the deliverable separately and is
the price actually charged by the Company for that deliverable. ESPs reflect the
Company&#146;s best estimates of what the selling prices of elements would be if they
were sold regularly on a stand-alone basis. Because the Company has neither VSOE
nor TPE for the two deliverables, the allocation of revenue has been based on
the Company&#146;s ESPs. Amounts allocated to the Authorization and the Collection
Service are recognized at the time of service provided the other conditions for
revenue recognition have been met. </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company&#146;s process for determining its ESP for deliverables without VSOE or TPE
considers multiple factors that may vary depending upon the unique facts and
circumstances related to each deliverable. Key factors considered by the Company
in developing the ESPs include prices charged by the Company, historical pricing
practices and controls, range of prices for various customers and the nature of
the services. Consideration is also given to market conditions such as
competitor pricing strategies and market perception.</P>
<P style="MARGIN-LEFT: 5%" align=justify><I>Banking VAN</I></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Banking
VAN is a division supporting a Company&#146;s fund management business (large payment
transfers, collections, etc.) by relaying financial transactions between client
companies and financial institutions. Financial transactions between two or more
business enterprises, or between business enterprises and their customers, are
conducted through the transaction-processing network established between the
Company and the banks. Revenue from the Banking Van service is recognized when
the service is rendered by the Company. </P>
<P style="MARGIN-LEFT: 5%" align=justify><I>Payment Gateway service (PG service)</I></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;With
its PG service, the Company provides the Internet-based settlement service
between on-line shopping mall and a credit card company when a customer uses
his/her credit card, debit card or on-line payment to pay for goods or services.
The Company receives fees for carrying out settlements for electronic
transactions. Revenue from the PG service is recognized when the service is
rendered by the Company.</P>
<P style="MARGIN-LEFT: 5%" align=justify><I>Sale of merchandise</I></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company buys terminals from manufacturers, and subsequently sells them through
its subsidiary agencies. Revenue is recognized when significant risks and
rewards of ownership of terminals have passed to the buyer, usually on delivery
of the terminals to the buyer. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Accrued
  severance benefits</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Employees
and directors are entitled to receive a lump-sum payment upon termination of
their employment with the Company, based on their length of service and rate of
pay at the time of termination. Accrued severance benefits are estimated
assuming all eligible employees were to terminate their employment at the
balance sheet date. The annual severance benefits expense charged to income is
calculated based on the net change in the accrued severance benefits payable at
the balance sheet date, plus the actual payments made during the year.</P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
contributions to the severance insurance deposit are deducted from accrued
severance benefit liabilities. Contributed amounts are refunded from the
insurance company to employees upon their retirement.</P>
<P align=center>F-11</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_14></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>for the years ended December 31, 2009, 2008 and 2007 </B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>2.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>SIGNIFICANT
ACCOUNTING POLICIES (continued)</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Commitments
and contingencies</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Liabilities
arising from claims, assessments, litigation, fines, and penalties and other
sources, are recorded when it is probable that a liability has been incurred and
the amount of the assessment and/or remediation can be reasonably estimated.
Legal costs incurred in connection with loss contingencies are expensed as
incurred.</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Earnings
  per share</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic
earnings per share are computed by dividing net income by the weighted-average
number of shares of common stock outstanding during the year. Diluted earnings
per share are calculated by dividing net income by the weighted-average number
of shares of common stock outstanding during the year plus the weighted-average
number of common shares that would have been outstanding assuming the conversion
of all dilutive potential common shares.</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Recent
  accounting pronouncements adopted</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
June 2009, the Financial Accounting Standards Board (&#147;FASB&#148;) issued the FASB
Accounting Standards Codification (the &#147;Codification&#148;) as the single source of
authoritative GAAP recognized by the FASB to be applied by non-governmental
entities. The Codification supersedes all existing non-SEC accounting and
reporting standards. Following the issue of the Codification, the FASB has
issued new guidance in the form of Accounting Standards Updates. This
Codification is effective for financial statements issued for interim and annual
periods ending after September 15, 2009. The Codification was effective for the
Company from January 1, 2009. The Codification did not impact the Company&#146;s
financial position or results of operations.</P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
September 2009, the FASB issued guidance on revenue recognition in
multiple-deliverable revenue arrangements. The guidance amended the existing
guidance on allocating consideration received between the elements in a
multiple-deliverable arrangement and established a selling price hierarchy for
determining the selling price of a deliverable. The selling price used for each
deliverable will be based on vendor-specific objective evidence (&#147;VSOE&#148;) if
available, third-party evidence if VSOE is not available, or estimated selling
price if neither VSOE nor third-party evidence is available. The guidance
replaced the term &#147;fair value&#148; in the revenue allocation with &#147;selling price&#148; to
clarify that the allocation of revenue is based on entity specific assumptions
rather than the assumptions of a market place participant. The guidance
eliminates the residual method of allocation and requires that arrangement
consideration be allocated using the relative selling price method. It also
significantly expands the disclosures related to a vendor&#146;s multiple-deliverable
revenue arrangements. Earlier application is permitted. The Company adopted
these new accounting standards in the beginning of 2007. </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
October 2009, the FASB issued guidance which amended the scope of existing
software revenue recognition accounting. Tangible products containing software
components and non-software components that function together to deliver the
product&#146;s essential functionality would be scoped out of the accounting guidance
on software and accounted for based on other appropriate revenue recognition
guidance. This guidance must be adopted in the same period that the company
adopts the amended guidance for arrangements with multiple deliverables
described in the preceding paragraph. The adoption of this guidance did not have
an impact on the Company&#146;s financial position or results of operations. </P>
<P align=center>F-12</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_15></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>for the years ended December 31, 2009, 2008 and 2007 </B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>2.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>SIGNIFICANT
  ACCOUNTING POLICIES (continued)</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Recent
accounting pronouncements not yet adopted as of December 31, 2009 </STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
January 2010, the FASB issued Update 2010&#8722;06, <I>Fair</I> <I>Value Measurements
and Disclosures (Topic 820): Improving Disclosures about Fair Value
Measurements</I>, (&#147;Update 2010&#8722;06&#148;). Update 2010&#8722;06 amends ASC 820 and
clarifies and provides additional disclosure requirements related to recurring
and non&#8722;recurring fair value measurements and employers&#146; disclosures about
postretirement benefit plan assets. This Update became effective for us on
January 1, 2010. The Company is currently evaluating the impact of the adoption
of Update 2010&#8722;16. </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
July 2010, the FASB issued amendments to the disclosure requirements about the
credit quality of financing receivables and the allowance for credit losses. The
purpose of the additional disclosures is to enable users of financial statements
to better understand the nature of credit risk inherent in an entity&#146;s portfolio
of financing receivables and how that risk is analyzed. For end of period
balances, the new disclosures are required to be made in all interim and annual
periods ending on or after December 15, 2010. For activity during a reporting
period, the disclosures are required to be made in all interim and annual
periods after January 1, 2011. These changes will not have an impact on the
Company&#146;s financial results as this guidance only relates to additional
disclosures. </P>
<P
align=justify><STRONG>3.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>RESTRICTED
  FINANCIAL INSTRUMENTS</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following table represents financial instruments which are restricted in use as
of December 31, 2009 and 2008.</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="25%"><B>Restriction</B> </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="16%"><B>2009</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="16%"><B>2008</B> </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left bgColor=#e6efff>Short-term financial instruments </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="25%" bgColor=#e6efff>Pledge </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD vAlign=bottom align=right width="16%" bgColor=#e6efff>658,000 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD vAlign=bottom align=right width="16%" bgColor=#e6efff>738,000 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left>Long-term financial instruments </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="25%">Pledge, guarantee deposits for checking account
      and others </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="16%">3,000 </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="16%">3,000 </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;<B>Total</B> </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="25%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="16%" bgColor=#e6efff><B>661,000</B> </TD>
    <TD vAlign=bottom align=left
    width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="16%" bgColor=#e6efff><B>41,000</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="2%" bgColor=#e6efff>&nbsp;</TD></TR></TABLE>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
amount of restricted short-term financial instrument above is included in
short-term financial instruments and the amount of restricted long-term
financial instrument above is included in other non-current assets on the
balance sheets. </P>
<P align=justify><STRONG>4.</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG> ACCOUNTS
  RECEIVABLE</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following table presents current and non-current accounts receivable at December
31, 2009 and 2008:</P>
<P
align=justify><STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
Current accounts receivable, net</STRONG> </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="16%"><B>2009</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="16%"><B>2008</B> </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp;Current accounts receivable </TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="16%" bgColor=#e6efff>11,113,442 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="16%" bgColor=#e6efff>7,994,139 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp;Discount on current accounts receivable </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="16%">(7,236</TD>
    <TD align=left width="2%">) </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="16%">(9,336</TD>
    <TD align=left width="2%">) </TD></TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Allowance for doubtful
      accounts </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="16%"
    bgColor=#e6efff>(194,364</TD>
    <TD align=left width="2%" bgColor=#e6efff>) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="16%"
    bgColor=#e6efff>(291,687</TD>
    <TD align=left width="2%" bgColor=#e6efff>) </TD></TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left>&nbsp;<B>Current accounts receivable, net</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="16%"><B>10,911,842</B> </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="16%"><B>7,693,116</B> </TD>
    <TD align=left width="2%">&nbsp;</TD></TR></TABLE>
<P align=center>F-13</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_16></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>for the years ended December 31, 2009, 2008 and 2007 </B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>4.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>ACCOUNTS
RECEIVABLE (continued)</STRONG> </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<B>Non-current
accounts receivable, net </B></P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left width="5%">&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2009</B> </TD>
    <TD align=center
      width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2008</B> </TD>
    <TD align=right
      width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left bgcolor="#E6EFFF">Non-current accounts receivable </TD>
    <TD width="1%" align=right bgcolor="#E6EFFF">&#65510;</TD>
    <TD width="17%" align=right bgcolor="#E6EFFF">2,132,551 </TD>
    <TD width="2%" align=right bgcolor="#E6EFFF">&nbsp;</TD>
    <TD width="1%" align=right bgcolor="#E6EFFF">&#65510;</TD>
    <TD width="17%" align=right bgcolor="#E6EFFF">3,275,848 </TD>
    <TD width="2%" align=right bgcolor="#E6EFFF">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left>&nbsp;Discount on accounts receivable </TD>
    <TD align=right width="1%">&nbsp;</TD>
    <TD align=right width="17%">(204,807) </TD>
    <TD align=right width="2%">&nbsp;</TD>
    <TD align=right width="1%">&nbsp;</TD>
    <TD align=right width="17%">(353,214) </TD>
    <TD align=right width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left bgcolor="#E6EFFF">&nbsp;Allowance for doubtful accounts </TD>
    <TD
      width="1%" align=right bgcolor="#E6EFFF" style="BORDER-BOTTOM: #000000 1px solid">&nbsp;</TD>
    <TD
      width="17%" align=right bgcolor="#E6EFFF" style="BORDER-BOTTOM: #000000 1px solid">(21,326) </TD>
    <TD
      width="2%" align=right bgcolor="#E6EFFF">&nbsp;</TD>
    <TD
      width="1%" align=right bgcolor="#E6EFFF" style="BORDER-BOTTOM: #000000 1px solid">&nbsp;</TD>
    <TD
      width="17%" align=right bgcolor="#E6EFFF" style="BORDER-BOTTOM: #000000 1px solid">(32,758) </TD>
    <TD
      width="2%" align=right bgcolor="#E6EFFF">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left><B>Non-current accounts receivable, net</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="17%"><B>1,906,418</B> </TD>
    <TD align=right
      width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="17%"><B>2,889,876</B> </TD>
    <TD align=right
      width="2%">&nbsp;</TD>
  </TR></TABLE>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Non-current
accounts receivable arose from installment sales of Point of Sale (&#147;POS&#148;)
terminals for the three years to merchants. Non-current accounts receivable
amounts are determined based on the present value using appropriate risk
adjusted discount rate considering environment of counter-party. </P>
<P
align=justify><STRONG>5.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>INVENTORY
</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventory
valuations as of December 31, 2009 and 2008 are summarized as follows: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD colspan="7" align=center style="BORDER-BOTTOM: #000000 1px solid"> As
      of December 31, 2009 </TD>
    <TD align=left width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=center width="18%">&nbsp; </TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="18%"><B>Lower of cost or</B> </TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="18%"><B>Valuation</B> </TD>
    <TD align=left width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="18%"><B>Cost</B> </TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="18%"><B>market</B> </TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="18%"><B>allowance</B> </TD>
    <TD align=left width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left bgColor=#e6efff>Inventory: </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="18%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="18%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="18%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left>Merchandise </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="18%">961,153 </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="18%">961,153 </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="18%">- </TD>
    <TD align=left width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left bgColor=#e6efff><B>Total</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="18%"
    bgColor=#e6efff><B>961,153</B> </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="18%"
    bgColor=#e6efff><B>961,153</B> </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="18%"
    bgColor=#e6efff><B>-</B> </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD colspan="7" align=center style="BORDER-BOTTOM: #000000 1px solid"> As
      of December 31, 2008 </TD>
    <TD align=left width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=center width="18%">&nbsp; </TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="18%"><B>Lower of cost or</B> </TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="18%"><B>Valuation</B> </TD>
    <TD align=left width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="18%"><B>Cost</B> </TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="18%"><B>market</B> </TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="18%"><B>allowance</B> </TD>
    <TD align=left width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left bgColor=#e6efff>Inventory: </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="18%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="18%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="18%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left>Merchandise </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="18%">1,029,647 </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="18%">1,029,647 </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="18%">- </TD>
    <TD align=left width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left bgColor=#e6efff><B>Total</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="18%"
    bgColor=#e6efff><B>1,029,647</B> </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="18%"
    bgColor=#e6efff><B>1,029,647</B> </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="18%"
    bgColor=#e6efff><B>-</B> </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=center>F-14 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_17></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>for the years ended December 31, 2009, 2008 and 2007 </B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>6.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>FAIR
  VALUE MEASUREMENTS </STRONG></P>
<P
align=justify><STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Fair
  value of financial instruments </STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following table presents the carrying amounts and estimated fair values of the
Company&#146;s financial instruments at December 31, 2009 and 2008.</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD colspan="4" align=center style="BORDER-BOTTOM: #000000 1px solid"><B>2009</B>
    </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD colspan="4" align=center style="BORDER-BOTTOM: #000000 1px solid"><B>2008</B>
    </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>Carrying</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>Fair</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>Carrying</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>Fair</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>amount</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>value</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>amount</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>value</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff><B>Financial assets:</B> </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;Cash and cash equivalents </TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="12%">18,650,898 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="12%">18,650,898 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="12%">8,097,531 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="12%">8,097,531 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp;Short-term financial instruments </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>2,228,000 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>2,228,000 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>5,738,000 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>5,738,000 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;Accounts receivable, net </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">10,911,842 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">10,911,842 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">7,693,116 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">7,693,116 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp;Short-term loans, net </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>28,129 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>28,129 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>10,925 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>10,925 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp;Non-current accounts receivable, net </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">1,906,418 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">1,906,418 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">2,889,876 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">2,889,876 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Available-for-sale securities
    </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>100,000 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>100,000 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>100,000 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>100,000 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;Other investment securities </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">222,693 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">222,693 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">222,693 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">222,693 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Long-term financial instruments
    </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>19,500 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>19,500 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>13,500 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>13,500 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;Long-term loans, net </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">1,049,387 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">971,654 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">1,393,203 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">1,326,410 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR>
    <TD bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>Total financial assets</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="12%"><B>35,116,867</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="12%"><B>35,039,134</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="12%"><B>26,158,844</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="12%"><B>26,092,051</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR>
    <TD bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>Financial liabilities:</B> </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp;Accounts payable </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>6,462,841 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>6,462,841 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>4,301,624 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>4,301,624 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;Short-term borrowings </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">4,000,000 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">4,000,000 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp;Derivatives </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>22,266 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>22,266 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>91,833 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>91,833 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp;Current portion of long-term debt </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">10,000,000 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">10,000,000 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp;Long-term debt </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>4,000,000 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>3,716,744 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff><B>Total financial liabilities</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>16,485,107</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>16,485,107</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>12,393,457</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>12,110,201</B> </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
fair values of the financial instruments shown in the above table represent the
amounts that would be received to sell those assets or that would be paid to
transfer those liabilities in an orderly transaction between market participants
at that date. Those fair value measurements maximize the use of observable
inputs. However, in situations where there is little, if any, market activity
for the asset or liability at the measurement date, the fair value measurement
reflects the Company&#146;s own judgments about the assumptions that market
participants would use in pricing the asset or liability. Those judgments are
developed by the Company based on the best information available in the
circumstances, including expected cash flows and appropriately risk adjusted
discount rates, available observable and unobservable inputs. </P>
<P align=center>F-15</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_18></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>for the years ended December 31, 2009, 2008 and 2007 </B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P align=justify><STRONG>6.</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG> FAIR
VALUE OF FINANCIAL INSTRUMENTS (continued)</STRONG> </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Fair
  value of financial instruments (continued)</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following methods and assumptions were used to estimate the fair value of each
class of financial instruments: </P>
<P style="MARGIN-LEFT: 5%" align=justify><B><I>Cash and cash equivalents,
short-term financial instruments, long-term financial instruments, accounts
receivable, short-term loans, non-current accounts receivable, accounts payable,
short-term borrowings and current portion of long-term debt</I></B></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
carrying amounts, at face value or cost plus accrued interest, approximate fair
value because of the short maturity of these instruments.</P>
<P style="MARGIN-LEFT: 5%" align=justify><B><I>Available for sale and other investment
  securities</I></B></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Debt
securities classified as available-for-sale are measured using quoted market
prices multiplied by the quantity held when quoted market prices are available.
If quoted market prices for those debt securities are not available, the fair
value is determined using an income approach valuation technique (present value
using the discount rate adjustment technique) that considers, among other
things, rates currently observed in publicly traded debt markets for debt of
similar terms to companies with comparable credit risk, the issuer&#146;s credit
spread, and illiquidity by sector and maturity. Equity securities that do not
have readily determinable fair value are classified as other investment
securities and measured at cost less any impairment. </P>
<P style="MARGIN-LEFT: 5%" align=justify><B><I>Long-term loans</I></B></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
fair value of the long-term loans is determined using an income approach
valuation technique (present value using the discount rate adjustment technique)
based on the present value of expected future cash flows which incorporates a
risk premium to take into account the risks inherent in those expected cash
flows. The long-term loans are recorded at their carrying value. The fair value
is measured for disclosure purposes. </P>
<P style="MARGIN-LEFT: 5%" align=justify><B><I>Long-term debt</I></B></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
fair value of the Company&#146;s long term debt is measured using quoted offer side
prices when quoted market prices are available. If quoted market prices are not
available, the fair value is determined by discounting the future cash flows of
each instrument at rates that reflect rates currently observed in publicly
traded debt markets for debt of similar terms to companies with comparable
credit risk. For long-term debt measurements, where there are no rates currently
observable in publicly traded debt markets of similar terms to companies with
comparable credit, the Company uses market interest rates and adjusts that rate
for all necessary risks, including its own credit risk. In determining an
appropriate spread to reflect its credit standing, the Company considers credit
default swap spreads, bond yields of other long-term debt offered by the
Company, and interest rates currently offered to the Company for similar debt
instruments of comparable maturities by the Company&#146;s bankers as well as other
banks that regularly compete to provide financing to the Company. The long-term
debt is recorded at its carrying value. The fair value is measured for
disclosure purposes. </P>
<P style="MARGIN-LEFT: 5%" align=justify><B><I>Derivatives</I></B></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All
derivatives are recognized on the balance sheet at fair value based on quoted
market prices, dealer or counterparty quotes, if available. If quoted market
prices are not available, pricing or valuation models are applied to current
market information to estimate the fair value.</P>
<P align=center>F-16</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_19></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>for the years ended December 31, 2009, 2008 and 2007 </B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>6.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>FAIR
VALUE OF FINANCIAL INSTRUMENTS (continued)</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Fair
  value hierarchy</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Fair
value is defined as the price that would be received upon sale of an asset or
paid upon transfer of a liability in an orderly transaction between market
participants at the measurement date and in the principal or most advantageous
market for that asset or liability. The fair value should be calculated based on
assumptions that market participants would use in pricing the asset or
liability, not on assumptions specific to the entity. In addition, the fair
value of liabilities should include consideration of non-performance risk
including the Company&#146;s own credit risk.</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Fair
value measurements and inputs are categorized into a fair value hierarchy which
prioritizes the inputs into three levels based on the extent to which inputs
used in measuring fair value are observable in the market. Each fair value
measurement is reported in one of the three levels which are determined by the
lowest level input that is significant to the fair value measurement in its
entirety.</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;These
  levels are:</P>
<UL style="TEXT-ALIGN: justify">
  <LI>
  <P>Level 1 &#150; inputs are based upon unadjusted quoted prices for identical
  instruments traded in active markets. </P>
  <LI>
  <P>Level 2 &#150; inputs are based upon quoted prices for similar instruments in
  active markets, quoted prices for identical or similar instruments in markets
  that are not active, and model-based valuation techniques for which all
  significant assumptions are observable in the market or can be corroborated by
  observable market data for substantially the full term of the assets or
  liabilities. </P>
  <LI>
  <P>Level 3 &#150; inputs are generally unobservable and typically reflect
  management&#146;s estimates of assumptions that market participants would use in
  pricing the asset or liability. The fair values are therefore determined using
  model-based techniques that include option pricing models, discounted cash
  flow models, and similar techniques. </P></LI></UL>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following table presents the Company&#146;s assets and liabilities measured at fair
value on a recurring basis as of December 31, 2009:</P>
<DIV>
  <TABLE
style="BORDER-COLOR: black; FONT-SIZE: 9pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
    <TR vAlign=top>
    <TD width="5%"  >&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
      <TD align=center width="15%" ><B>Quoted price in</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
      <TD align=center width="14%"><B>Significant other</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>Significant</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
      <TD align=center width="15%" ><B>active markets for</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
      <TD align=center width="14%"><B>observable</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>unobservable</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
      <TD align=center width="15%" ><B>identical assets</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
      <TD align=center width="14%"><B>inputs</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>inputs</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="15%"
    ><B>(Level 1)</B></TD>
      <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="14%"><B>(Level 2)</B></TD>
      <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>(Level 3)</B></TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>Total</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Assets: </TD>
    <TD align=left width="1%" >&nbsp;</TD>
      <TD align=left width="15%" >&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
      <TD align=left width="14%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Available-for-sale securities </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="15%"
    bgColor=#e6efff >- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="14%"
    bgColor=#e6efff>100,000 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>100,000 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp;<B>Total assets at fair value</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="15%"
    ><B>-</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="14%"><B>100,000</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="12%"><B>-</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="12%"><B>100,000</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR>
    <TD width="5%" >&nbsp;</TD>
    <TD bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
      <TD width="15%" bgColor=#e6efff >&nbsp; </TD>
    <TD width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
      <TD width="14%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Liabilities: </TD>
    <TD align=left width="1%" >&nbsp;</TD>
      <TD align=left width="15%" >&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
      <TD align=left width="14%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Derivatives </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="15%"
    bgColor=#e6efff >- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="14%"
    bgColor=#e6efff>22,266 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>22,266 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp;<B>Total liabilities at fair value</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%">&#65510;</TD>
      <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="15%" ><B>-</B> </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%">&#65510;</TD>
      <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="14%"><B>22,266</B> </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"><B>-</B> </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"><B>22,266</B> </TD>
    <TD align=left width="2%">&nbsp;</TD></TR></TABLE>
</DIV>
<P align=center>F-17</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_20></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>for the years ended December 31, 2009, 2008 and 2007 </B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>6.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>FAIR
VALUE OF FINANCIAL INSTRUMENTS (continued)</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Fair
  value hierarchy (continued)</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  following table presents the Company&#146;s assets and liabilities measured
  at fair value on a recurring basis as of December 31, 2008:</P>
<DIV>
  <TABLE
style="BORDER-COLOR: black; FONT-SIZE: 9pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
    <TR vAlign=top>
      <TD width="5%" >&nbsp;</TD>
      <TD align=left>&nbsp; </TD>
      <TD align=left width="1%" >&nbsp;</TD>
      <TD align=center width="15%" ><B>Quoted price in</B> </TD>
      <TD align=center width="2%" >&nbsp;</TD>
      <TD align=center width="1%" >&nbsp;</TD>
      <TD align=center width="14%"><B>Significant other</B> </TD>
      <TD align=center width="2%" >&nbsp;</TD>
      <TD align=center width="1%" >&nbsp;</TD>
      <TD align=center width="12%"><B>Significant</B> </TD>
      <TD align=center width="2%" >&nbsp;</TD>
      <TD align=center width="1%" >&nbsp;</TD>
      <TD align=center width="12%">&nbsp; </TD>
      <TD align=left width="2%" >&nbsp;</TD>
    </TR>
    <TR vAlign=top>
      <TD width="5%" >&nbsp;</TD>
      <TD align=left>&nbsp; </TD>
      <TD align=left width="1%" >&nbsp;</TD>
      <TD align=center width="15%" ><B>active markets for</B> </TD>
      <TD align=center width="2%" >&nbsp;</TD>
      <TD align=center width="1%" >&nbsp;</TD>
      <TD align=center width="14%"><B>observable</B> </TD>
      <TD align=center width="2%" >&nbsp;</TD>
      <TD align=center width="1%" >&nbsp;</TD>
      <TD align=center width="12%"><B>unobservable</B> </TD>
      <TD align=center width="2%" >&nbsp;</TD>
      <TD align=center width="1%" >&nbsp;</TD>
      <TD align=center width="12%">&nbsp; </TD>
      <TD align=left width="2%" >&nbsp;</TD>
    </TR>
    <TR vAlign=top>
      <TD width="5%" >&nbsp;</TD>
      <TD align=left>&nbsp; </TD>
      <TD align=left width="1%" >&nbsp;</TD>
      <TD align=center width="15%" ><B>identical assets</B> </TD>
      <TD align=center width="2%" >&nbsp;</TD>
      <TD align=center width="1%" >&nbsp;</TD>
      <TD align=center width="14%"><B>inputs</B> </TD>
      <TD align=center width="2%" >&nbsp;</TD>
      <TD align=center width="1%" >&nbsp;</TD>
      <TD align=center width="12%"><B>inputs</B> </TD>
      <TD align=center width="2%" >&nbsp;</TD>
      <TD align=center width="1%" >&nbsp;</TD>
      <TD align=center width="12%">&nbsp; </TD>
      <TD align=left width="2%" >&nbsp;</TD>
    </TR>
    <TR vAlign=top>
      <TD width="5%" >&nbsp;</TD>
      <TD align=left>&nbsp; </TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="15%"
    ><B>(Level 1)</B></TD>
      <TD align=center width="2%" >&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="14%"><B>(Level 2)</B></TD>
      <TD align=center width="2%" >&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>(Level 3)</B></TD>
      <TD align=center width="2%" >&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>Total</B> </TD>
      <TD align=left width="2%" >&nbsp;</TD>
    </TR>
    <TR vAlign=top>
      <TD width="5%" >&nbsp;</TD>
      <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Assets: </TD>
      <TD align=left width="1%" >&nbsp;</TD>
      <TD align=left width="15%" >&nbsp; </TD>
      <TD align=left width="2%" >&nbsp;</TD>
      <TD align=left width="1%" >&nbsp;</TD>
      <TD align=left width="14%">&nbsp; </TD>
      <TD align=left width="2%" >&nbsp;</TD>
      <TD align=left width="1%" >&nbsp;</TD>
      <TD align=left width="12%">&nbsp; </TD>
      <TD align=left width="2%" >&nbsp;</TD>
      <TD align=left width="1%" >&nbsp;</TD>
      <TD align=left width="12%">&nbsp; </TD>
      <TD align=left width="2%" >&nbsp;</TD>
    </TR>
    <TR vAlign=top>
      <TD width="5%" >&nbsp;</TD>
      <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
        &nbsp;Available-for-sale securities </TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="15%"
    bgColor=#e6efff >- </TD>
      <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="14%"
    bgColor=#e6efff>100,000 </TD>
      <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>- </TD>
      <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>100,000 </TD>
      <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    </TR>
    <TR vAlign=top>
      <TD width="5%" >&nbsp;</TD>
      <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
        &nbsp;<B>Total assets at fair value</B> </TD>
      <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="15%"
    ><B>-</B> </TD>
      <TD align=left width="2%" >&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="14%"><B>100,000</B> </TD>
      <TD align=left width="2%" >&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="12%"><B>-</B> </TD>
      <TD align=left width="2%" >&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="12%"><B>100,000</B> </TD>
      <TD align=left width="2%" >&nbsp;</TD>
    </TR>
    <TR>
      <TD width="5%" >&nbsp;</TD>
      <TD bgColor=#e6efff>&nbsp; </TD>
      <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
      <TD width="15%" bgColor=#e6efff >&nbsp; </TD>
      <TD width="2%"  bgColor=#e6efff>&nbsp;</TD>
      <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
      <TD width="14%" bgColor=#e6efff>&nbsp; </TD>
      <TD width="2%"  bgColor=#e6efff>&nbsp;</TD>
      <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
      <TD width="12%" bgColor=#e6efff>&nbsp; </TD>
      <TD width="2%"  bgColor=#e6efff>&nbsp;</TD>
      <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
      <TD width="12%" bgColor=#e6efff>&nbsp; </TD>
      <TD width="2%"  bgColor=#e6efff>&nbsp;</TD>
    </TR>
    <TR vAlign=top>
      <TD width="5%" >&nbsp;</TD>
      <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Liabilities: </TD>
      <TD align=left width="1%" >&nbsp;</TD>
      <TD align=left width="15%" >&nbsp; </TD>
      <TD align=left width="2%" >&nbsp;</TD>
      <TD align=left width="1%" >&nbsp;</TD>
      <TD align=left width="14%">&nbsp; </TD>
      <TD align=left width="2%" >&nbsp;</TD>
      <TD align=left width="1%" >&nbsp;</TD>
      <TD align=left width="12%">&nbsp; </TD>
      <TD align=left width="2%" >&nbsp;</TD>
      <TD align=left width="1%" >&nbsp;</TD>
      <TD align=left width="12%">&nbsp; </TD>
      <TD align=left width="2%" >&nbsp;</TD>
    </TR>
    <TR vAlign=top>
      <TD width="5%" >&nbsp;</TD>
      <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
        &nbsp;Derivatives </TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="15%"
    bgColor=#e6efff >- </TD>
      <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="14%"
    bgColor=#e6efff>91,833 </TD>
      <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>- </TD>
      <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>91,833 </TD>
      <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    </TR>
    <TR vAlign=top>
      <TD width="5%" >&nbsp;</TD>
      <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
        &nbsp; &nbsp; &nbsp; &nbsp;<B>Total liabilities at fair value</B> </TD>
      <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%">&#65510;</TD>
      <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="15%" ><B>-</B> </TD>
      <TD align=left width="2%">&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%">&#65510;</TD>
      <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="14%"><B>91,833</B> </TD>
      <TD align=left width="2%">&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%">&#65510;</TD>
      <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"><B>-</B> </TD>
      <TD align=left width="2%">&nbsp;</TD>
      <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%">&#65510;</TD>
      <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"><B>91,833</B> </TD>
      <TD align=left width="2%">&nbsp;</TD>
    </TR>
  </TABLE>
</DIV>
<P align=justify><STRONG>7.</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>
DERIVATIVES </STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company uses derivative financial instruments primarily to manage the risks
associated with fluctuations in interest rates. In 2008, the Company used
variable-rate Certificate of Deposit (CD) debt to finance its operations. The
debt obligations expose the Company to variability in interest payments due to
changes in interest rates. Management believed that it is prudent to limit the
variability of a portion of its interest payments. To meet this objective,
management entered into CD based interest rate swap agreements to manage
fluctuations in cash flows resulting from changes in the benchmark interest rate
of CD. This swap changes the variable rate cash flow exposure on the debt
obligations to fixed cash flows. Under the terms of the interest rate swaps, the
Company receives CD based variable interest rate payments (CD + 1.425%) and
makes fixed interest rate payments of 6.625%, thereby creating the equivalent of
fixed-rate debt for the notional amount (&#65510;4,000 million) of its debt
hedged. However, the Company did not designate the interest rate related
derivatives as hedging instruments under ASC 815, Derivatives and Hedging, and
therefore, any gains or losses on these derivatives are recognized in the
current income. </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
fair value of derivatives held as of December 31, 2009 and 2008 are as follows:
</P>
<DIV align=center>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="80%" border=0>

  <TR vAlign=top>
    <TD align=left >&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2009</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2008</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >Derivatives: </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="17%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="17%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp;Interest Rate
      Swap </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>22,266 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>91,833 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="17%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="17%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp;Total derivatives not designated
      as <br>
      &nbsp; &nbsp; &nbsp;
      &nbsp;hedging instrument under ASC 815 </TD>
    <TD width="1%" align=left valign="bottom"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="17%" align=right valign="bottom" bgColor=#e6efff>22,266 </TD>
    <TD width="2%" align=left valign="bottom"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%" align=left valign="bottom"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="17%" align=right valign="bottom" bgColor=#e6efff>91,833 </TD>
    <TD width="2%" align=left valign="bottom"
  bgColor=#e6efff>&nbsp;</TD>
  </TR></TABLE></DIV>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
effects of derivatives instruments on income for the years ended December 31,
2009 and 2008 are summarized as follows:</P>
<DIV align=center>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="80%" border=0>

  <TR vAlign=top>
    <TD align=left >&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2009</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2008</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >Derivatives: </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="17%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="17%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp;Gains (loss) on
      derivatives </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>69,567 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>91,833</TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD></TR></TABLE></DIV>
<P align=center>F-18</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_21></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>for the years ended December 31, 2009, 2008 and 2007 </B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P align=justify><STRONG>8.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<STRONG>LONG-TERM DEBT</STRONG> </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Long-term
debt as of December 31, 2009 and 2008 are summarized as follows: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD width="5%"  >&nbsp;</TD>
    <TD align=left >&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="15%"><B>Maturity</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="15%"><B>2009</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="15%"><B>2008</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff >Long-term debt: </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="15%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="15%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="15%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left >&nbsp;(Annual interest rate: 5.08~6.63%) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="15%">2010 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="15%">10,000,000 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="15%">4,000,000 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff >&nbsp;Less: current portion
      of long-term debt </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="15%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="15%"
    bgColor=#e6efff>(10,000,000</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="15%"
    bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left >&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="15%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=right width="1%" >&nbsp;</TD>
    <TD align=right width="15%"></TD>
    <TD align=right width="2%" >&nbsp;</TD>
    <TD align=right width="1%" >&nbsp;</TD>
    <TD align=right width="15%"></TD>
    <TD align=right width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff
      >&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Total</STRONG>
    </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="15%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="15%"
    bgColor=#e6efff><B>-</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="15%"
    bgColor=#e6efff><B>4,000,000</B> </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD></TR></TABLE>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Long-term
debt is subject to various restrictive covenants. These covenants typically
include restrictions on the debt to equity ratio, credit rating, working capital
ratio, and other similar financial ratios. The Company was in compliance with
these financial covenants during all periods presented.</P>
<P
align=justify><STRONG>9.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>PROPERTY
AND EQUIPMENT </STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Property
and equipment as of December 31, 2009 and 2008 are summarized as follows: </P>
<DIV align=center>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="80%" border=0>

  <TR vAlign=top>
    <TD align=left >&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2009</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2008</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Cost: </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="17%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="17%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp;Land </TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="17%">981,257 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="17%">981,257 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp;Buildings </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>625,943 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>625,943 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp;Structures </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">203,350 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">203,350 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp;Vehicles </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>40,629 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>56,999 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp;Tools, furniture and fixtures
</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">70,381,043 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">56,821,824 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp;Machinery and
      equipment </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>6,054,301 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>6,054,301 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp;Software </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="17%">4,982,167 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="17%">4,416,270 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>83,268,690 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>69,159,944 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >Accumulated depreciation: </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="17%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="17%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp;Buildings </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>125,893 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>105,028 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp;Structures </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">126,527 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">101,108 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp;Vehicles </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>40,629 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>56,999 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp;Tools, furniture and fixtures
</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">48,963,351 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">40,128,396 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp;Machinery and
      equipment </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>5,384,975 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>4,944,946 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp;Software </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="17%">3,757,134 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="17%">3,255,575 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>58,398,509 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>48,592,052 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >Accumulated loss on impairment: </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="17%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="17%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp;Tools, furniture
      and fixtures </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="17%"
    bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="17%"
    bgColor=#e6efff>22,301 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">22,301 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Carrying amount: </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="17%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="17%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp;Land </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">981,257 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">981,257 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp;Buildings </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>500,050 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>520,915 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp;Structures </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">76,823 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">102,242 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp;Vehicles </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp;Tools, furniture and fixtures
</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">21,417,692 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">16,671,127 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp;Machinery and
      equipment </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>669,326 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>1,109,356 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp;Software </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="17%">1,225,033 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="17%">1,160,694 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff
      >&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Total
      carrying amount</STRONG> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="17%"
    bgColor=#e6efff><B>24,870,181</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="17%"
    bgColor=#e6efff><B>20,545,591</B> </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD></TR></TABLE></DIV>
<P align=center>F-19</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_22></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>for the years ended December 31, 2009, 2008 and 2007 </B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P align=justify><STRONG>9.</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
<STRONG>PROPERTY AND EQUIPMENT (continued)</STRONG> </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
the years ended December 31, 2009, 2008 and 2007, total depreciation expenses
for the property and equipment were &#65510;9,886 million, &#65510;8,462
million, and &#65510;7,547 million, respectively. Total depreciation expenses
include cost of sales in an amount of &#65510;6,836 million, &#65510;5,396
million and &#65510;4,813 million; and selling, general, administrative expenses
of &#65510;3,050 million, &#65510;3,066 million and &#65510;2,734 million for
the years ended December 31, 2009, 2008 and 2007, respectively. </P>
<P align=justify><STRONG>10.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;
<STRONG>INTANGIBLE ASSETS </STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Summarized
below is the carrying value and accumulated amortization of intangible assets as
of December 31, 2009 and 2008:</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD colspan="7" align=center style="BORDER-BOTTOM: #000000 1px solid"> <B>As
      of December 31, 2009</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=center width="15%"><B>Gross carrying</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="15%"><B>Accumulated</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="15%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="15%"><B>value</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="15%"><B>amortization</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="15%"><B>Net carrying value</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left bgColor=#e6efff>Finite-lived intangible assets: </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="15%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="15%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="15%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp;Trademarks </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="15%">77,057 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="15%">53,672 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="15%">23,385 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B>Total</B>
    </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="15%"
    bgColor=#e6efff>77,057 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="15%"
    bgColor=#e6efff>53,672 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="15%"
    bgColor=#e6efff>23,385 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD colspan="7" align=center style="BORDER-BOTTOM: #000000 1px solid"> <B>As
      of December 31, 2008</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=center width="15%"><B>Gross carrying</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="15%"><B>Accumulated</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="15%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="15%"><B>value</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="15%"><B>amortization</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="15%"><B>Net carrying value</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left bgColor=#e6efff>Finite-lived intangible assets: </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="15%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="15%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="15%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp;Trademarks </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="15%">77,057 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="15%">46,285 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="15%">30,772 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B>Total</B>
    </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="15%"
    bgColor=#e6efff>77,057 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="15%"
    bgColor=#e6efff>46,285 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="15%"
    bgColor=#e6efff>30,772 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization
expenses charged for the years to December 31, 2009, 2008 and 2007 were &#65510;7.4
million, respectively. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Future
estimated annual amortization expense for the next five fiscal years is
presented in the table below. Actual amortization expense in future periods
could differ from this estimate as a result of acquisitions, changes in useful
lives and other relevant factors.</P>
<DIV align=center>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="60%" border=0>

  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B>Year</B> </TD>
    <TD align=left width="10%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="32%"><B>Amount</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=center bgColor=#e6efff>2010 </TD>
    <TD align=left width="10%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="2%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="32%" bgColor=#e6efff>7,387 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=center>2011 </TD>
    <TD align=left width="10%">&nbsp;</TD>
    <TD align=right width="2%">&nbsp;</TD>
    <TD align=right width="32%">7,387 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=center bgColor=#e6efff>2012 </TD>
    <TD align=left width="10%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="32%" bgColor=#e6efff>7,387 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=center>2013 </TD>
    <TD align=left width="10%">&nbsp;</TD>
    <TD align=right width="2%">&nbsp;</TD>
    <TD align=right width="32%">1,224 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=center bgColor=#e6efff>2014 </TD>
    <TD align=left width="10%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="2%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="32%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR></TABLE>
</DIV>
<P align=center>F-20 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_23></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>for the years ended December 31, 2009, 2008 and 2007 </B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>11.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>OTHER
ASSETS AND LIABILITIES</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Details
of other assets and liabilities as of December 31, 2009 and 2008 are as follows:
</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Other
current assets </STRONG></P>
<DIV align=center>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="80%" border=0>

  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2009</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2008</B> </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Short-term loans </TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>29,609 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>19,750 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;Allowance for doubtful accounts </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="17%">(1,480</TD>
    <TD align=left width="2%">) </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="17%">(8,825</TD>
    <TD align=left width="2%">) </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Other receivables </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>400,069 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>489,802 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;Allowance for doubtful accounts </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="17%">(17,724</TD>
    <TD align=left width="2%">) </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="17%">(21,856</TD>
    <TD align=left width="2%">) </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Accrued income </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>57,912 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>120,146 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Advanced payments </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="17%">2,240,175 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="17%">3,798,362 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Prepaid expenses </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="17%"
    bgColor=#e6efff>10,337,665 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="17%"
    bgColor=#e6efff>5,398,740 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left><B>&nbsp;&nbsp;&nbsp; Total</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="17%">13,046,226 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="17%">9,796,119 </TD>
    <TD align=left
width="2%">&nbsp;</TD></TR></TABLE></DIV>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Other
non-current Assets</STRONG><BR>
<DIV align=center>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="80%" border=0>

  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="16%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="16%">&nbsp; </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="16%"><B>2009</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="16%"><B>2008</B> </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Long-term financial instruments </TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="16%" bgColor=#e6efff>19,500 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="16%" bgColor=#e6efff>13,500 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Other investment securities </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="16%">222,693 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="16%">222,693 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Long-term loans (*) </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="16%" bgColor=#e6efff>1,104,618 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="16%" bgColor=#e6efff>1,466,530 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;Allowance for doubtful accounts </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="16%">(55,231</TD>
    <TD align=left width="2%">) </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="16%">(73,327</TD>
    <TD align=left width="2%">) </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Guarantee deposits (**) </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="16%" bgColor=#e6efff>3,238,209 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="16%" bgColor=#e6efff>3,084,722 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp;<B>Total</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="16%">1,038,481 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="16%">1,037,539 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="16%"
    bgColor=#e6efff>5,568,270 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="16%"
    bgColor=#e6efff>5,751,657 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR></TABLE></DIV>
<P style="MARGIN-LEFT: 5%" align=justify>(*) Long-term loans include loans to
employees for mortgage in the amount of &#65510;788 million and &#65510;706
million as of December 31, 2009 and 2008, respectively. <BR>(**) Guarantee
deposits consist of deposits for leased offices. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Other
current liabilities </STRONG></P>
<DIV align=center>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="80%" border=0>

  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2009</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2008</B> </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Other payables </TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>2,536,737 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>2,446,280 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Advances from customers </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="17%">175,336 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="17%">336,912 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Value-added tax payable </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>1,086,111 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>768,878 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Withholdings (*) </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="17%">11,011,153 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="17%">7,571,983 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Other accrued expenses </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>419,696 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>391,298 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Deposits received </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="17%">170,751 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="17%">360,907 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Income taxes payable </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>1,322,383 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>1,648,965 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Derivatives </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="17%">22,266 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="17%">91,833 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff><B>&nbsp;&nbsp;&nbsp;&nbsp; Total</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="17%"
    bgColor=#e6efff>16,744,433 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="17%"
    bgColor=#e6efff>13,617,056 </TD>
    <TD align=left width="2%"
bgColor=#e6efff>&nbsp;</TD></TR></TABLE></DIV><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0 BCLLIST>

  <TR>
    <TD width="5%" >&nbsp;</TD>
    <TD vAlign=top width="5%">(*) </TD>
    <TD>
      <P align=justify>Withholdings are related to the Payment Gateway service
      for accounts received from the credit card companies withheld before they
      are passed to the on-line shopping mall.</P></TD></TR></TABLE>
<P align=center>F-21 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_24></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>for the years ended December 31, 2009, 2008 and 2007 </B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P align=justify><STRONG>11.</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>
OTHER ASSETS AND LIABILITIES (continued) </STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Other
non-current liabilities </STRONG></P>
<DIV align=center>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="80%" border=0>

  <TR vAlign=top>
    <TD align=left >&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="16%"><B>2009</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="16%"><STRONG>2008</STRONG></TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Unrecognized tax benefits
      (Note 15) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="16%"
    bgColor=#e6efff>963,778 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="16%"
    bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp; &nbsp; &nbsp;<B>Total</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="16%"><B>963,778</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="16%"><B>-</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR></TABLE></DIV>
<P
align=justify><STRONG>12.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>OTHER
INCOME (EXPENSE), net</STRONG> </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Details
of other income (expense), net for the years ended December 31, 2009, 2008 and
2007 are as follows:</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2009</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2008</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2007</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Gain (loss) on foreign currency
      transactions </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(121</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(1</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(33</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD></TR>
  <TR vAlign=top>
    <TD align=left>Gain (loss) on disposal of property and equipment </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">6,503 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(92,355</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(4,212</TD>
    <TD align=left width="2%" >) </TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Gain (loss) on disposal of investment
      securities </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>215,948 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>Gain (loss) on valuation of derivates </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">69,567 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(91,833</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Donations </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(28,420</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(94,873</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(87,564</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD></TR>
  <TR vAlign=top>
    <TD align=left>Miscellaneous </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
width="12%">(93</TD>
    <TD align=left width="2%" >) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">26,511 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">34,457 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp;<B>Total</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>47,436</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>(252,551</B></TD>
    <TD align=left width="2%"  bgColor=#e6efff><B>)</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>158,596</B> </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD></TR></TABLE>
<P
align=justify><STRONG>13.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>EQUITY</STRONG>
</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Common
stock </STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
holder of each share of common stock has the right to one vote. The number of
issued common shares as of December 31, 2009 and 2008 are 13,605,766 and
14,551,784 respectively. All common stock is issued at par value. Amount of
capital stock and additional paid-in capital as of December 31, 2009 and 2008
are as follows:</P>
<DIV align=center>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="60%" border=0>

  <TR vAlign=top>
    <TD align=left >&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="22%"><B>2009</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="22%"><B>2008</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Capital stock: </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="22%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="22%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp;Common stock </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="22%">6,802,883 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="22%">7,275,892 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff ><B>&nbsp;&nbsp;&nbsp;
      Total</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="22%"
    bgColor=#e6efff><B>6,802,883</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="22%"
    bgColor=#e6efff><B>7,275,892</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD align=left >&nbsp; </TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="22%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="22%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Additional paid-in capital:
    </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="22%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="22%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp;Other </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="22%">33,568 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="22%">33,568 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff ><B>&nbsp;&nbsp;&nbsp;
      Total</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="22%"
    bgColor=#e6efff><B>33,568</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="22%"
    bgColor=#e6efff><B>33,568</B> </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD></TR></TABLE></DIV>
<P align=center>F-22 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_25></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>for the years ended December 31, 2009, 2008 and 2007 </B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>13.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>EQUITY
(continued)</STRONG> </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Common
stock (continued)</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
2000, the Company issued preferred stock at &#65510;11,000 (par value
&#65510;500) and treated the amount of excess over par value less stock issuance
costs as additional paid-in capital &#150; preferred stock. The preferred stock is
non-cumulative and is convertible into common stock from the issuance date. The
number of issued preferred shares as of December 31, 2007 was 4,000,000. There
were no shares of preferred stock outstanding as of December 31, 2009 and 2008
due to capital reduction in 2008. Additional paid-in capital &#150;common stock of
&#65510;33,568 thousand relates to the amount of excess fair value of net assets
over common stock at the time of split off in 1999.</P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
February 15, 2008, the Company&#146;s shareholders approved an amendment to the
Certificate of Incorporation decreasing the authorized shares from 42,400,000 to
36,500,000 shares, par value &#65510;500 per share. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Stock
  retirement</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total
amount of common stocks and preferred stocks retired for the years ended
December 31, 2009, 2008 and 2007 are as follows:</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD width="5%"  >&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD colspan="4" align=center style="BORDER-BOTTOM: #000000 1px solid"><B>2009</B>
    </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD colspan="4" align=center style="BORDER-BOTTOM: #000000 1px solid"><B>2008</B>
    </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%">Shares </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%">Amount </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%">Shares </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%">Amount </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>Common stock: </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Capital reduction </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>946,018 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="12%" bgColor=#e6efff>473,009 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>1,654,776 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="12%" bgColor=#e6efff>827,388 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp;Treasury stock retirement </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">164,578 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">82,289 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>Preferred stock: </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp;Capital reduction </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">4,000,000 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">2,000,000 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp;<B>Total</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>946,018</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>473,009</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>5,819,354</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>2,909,677</B> </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;According
to ASC 505, Equity, if an entity&#146;s stock is retired, an excess of purchase price
over par or stated value may be allocated between additional paid-in capital and
retained earnings.</P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
February 15, 2008, the Company repurchased and retired all of its preferred
shares. An excess of repurchase price over par value was allocated between
additional paid-in capital &#150; preferred stock in an amount of &#65510;40,702 million and
retained earnings in an amount of &#65510;16,150 million. On the same date, the Company
reduced 1,654,776 shares of common stock by capital reduction and retired
164,578 shares of treasury stock. </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
March 26, 2009, the Company repurchased and retired 946,018 shares of common
stock and an excess of repurchase price over par value was allocated to retained
earnings for amount of &#65510;3,615 million. </P>
<P align=center>F-23</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_26></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>for the years ended December 31, 2009, 2008 and 2007 </B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>14.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>ACCRUED
SEVERANCE BENEFITS </STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued
severance benefits as of December 31, 2009 and 2008 are as follows: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD width="5%"  >&nbsp;</TD>
    <TD align=left >&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="16%"><B>2009</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="16%"><B>2008</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR>
    <TD width="5%" >&nbsp;</TD>
    <TD >&nbsp; </TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="16%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="16%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff >Balance at beginning of year
    </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="16%" bgColor=#e6efff>1,993,792 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="16%" bgColor=#e6efff>2,417,469 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left >Provision for severance benefits </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="16%">795,660 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="16%">944,342 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff >Severance payments during the
      year </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="16%"
    bgColor=#e6efff>(331,355</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="16%"
    bgColor=#e6efff>(1,368,019</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left >Balance at end of year </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="16%">2,458,097 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="16%">1,993,792 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff >Deposit for severance
      benefits insurance </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="16%"
    bgColor=#e6efff>(1,708,318</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="16%"
    bgColor=#e6efff>(1,259,803</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left ><B>Accrued severance benefits</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="16%"><B>749,779</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="16%"><B>733,989</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR></TABLE>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
severance benefits are funded approximately 69.5% and 63.2% as of December 31,
2009 and 2008, respectively through severance insurance deposits with the
Shinhan Life Insurance Company and the Hana Bank for the payment of severance
benefits. The Company has no additional liability once the amount has been
contributed, thus the Company deducts contributions made to the severance
insurance deposits from accrued severance benefit liabilities. The beneficiaries
of the severance insurance deposit are the Company&#146;s employees.</P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company expects to pay the following severance benefits, which are currently
accrued for the Company&#146;s obligation through December 31, 2009, to its
employees. If they terminate upon their normal retirement age: </P>
<DIV align=center>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="60%" border=0>

  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B>Year</B> </TD>
    <TD align=left width="3%"  >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="2%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="22%"
    ><B>Amount</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>2010 </TD>
    <TD align=left width="3%"  bgColor=#e6efff
    >&nbsp;</TD>
    <TD align=right width="2%" bgColor=#e6efff >&#65510;</TD>
    <TD align=right width="22%" bgColor=#e6efff >- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>2011 </TD>
    <TD align=left width="3%"  >&nbsp;</TD>
    <TD align=right width="2%" >&nbsp;</TD>
    <TD align=right width="22%" >- </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>2012 </TD>
    <TD align=left width="3%"  bgColor=#e6efff
    >&nbsp;</TD>
    <TD align=right width="2%" bgColor=#e6efff >&nbsp;</TD>
    <TD align=right width="22%" bgColor=#e6efff >- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>2013 </TD>
    <TD align=left width="3%"  >&nbsp;</TD>
    <TD align=right width="2%" >&nbsp;</TD>
    <TD align=right width="22%" >- </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>2014 </TD>
    <TD align=left width="3%"  bgColor=#e6efff
    >&nbsp;</TD>
    <TD align=right width="2%" bgColor=#e6efff >&nbsp;</TD>
    <TD align=right width="22%" bgColor=#e6efff >- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>2015 ~ 2019 </TD>
    <TD align=left width="3%"  >&nbsp;</TD>
    <TD align=right width="2%" >&#65510;</TD>
    <TD align=right width="22%" >235,392 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR></TABLE>
</DIV>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
above amounts were determined based on the employees&#146; current salary rates and
the number of service years that will be accumulated upon their retirement date.
These amounts do not include amounts that might be paid to employees that will
cease working with the Company before their normal retirement age. </P>
<P align=center>F-24 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_27></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>for the years ended December 31, 2009, 2008 and 2007 </B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>15.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>INCOME
  TAXES</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
statutory income tax rate, including tax surcharges, applicable to the Company
was 27.5% in 2007 and 2008. In accordance with the amendment of Corporate Tax
Act enacted in 2008, the statutory income tax rate was amended to 24.2%
effective for fiscal year 2009 and 22.0% for fiscal years 2010 and thereafter.
However, in 2009, Corporate Income Tax Law was further amended and the statutory
income tax rate of 24.2% is effective for fiscal years 2009 until 2011 and 22%
for fiscal years 2012 and thereafter. Accordingly, deferred income taxes as of
December 31, 2009 were calculated based on the enacted rates of 24.2% and 22.0%
..</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Actual
income tax expense differs from the theoretical amount that would arise at the
Korean statutory tax rate for the years ended December 31, 2009, 2008 and 2007
as follows: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD width="5%"  >&nbsp;</TD>
    <TD align=left >&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="14%"><B>2009</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="14%"><B>2008</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="14%"><B>2007</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR>
    <TD width="5%" >&nbsp;</TD>
    <TD >&nbsp; </TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="14%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="14%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="14%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff >Income tax expense at Korean
      statutory tax rate </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="14%" bgColor=#e6efff>3,785,377 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="14%" bgColor=#e6efff>3,355,549 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="14%" bgColor=#e6efff>3,517,933 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left >Nondeductible items </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">208,270 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">244,933 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">274,638 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff >Adjustments to uncertain and
      effectively settled tax positions </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="14%" bgColor=#e6efff>806,625 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="14%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="14%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left >Income tax exemption </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">(781,976</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">(557,483</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">(429,792</TD>
    <TD align=left width="2%" >) </TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff >Tax investigation by National
      Tax Service </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="14%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="14%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="14%" bgColor=#e6efff>786,280 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left >Others </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="14%">(167,222</TD>
    <TD align=left width="2%" >) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="14%">92,606 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="14%">125,298 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff ><B>Income tax expense</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="14%"
    bgColor=#e6efff><B>3,851,074</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="14%"
    bgColor=#e6efff><B>3,135,605</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="14%"
    bgColor=#e6efff><B>4,274,357</B> </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD></TR></TABLE>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following is a reconciliation of income taxes computed at the Korean tax rate to
actual effective income tax provision:</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD width="5%"  >&nbsp;</TD>
    <TD align=left >&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="14%"><B>2009</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="14%"><B>2008</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="14%"><B>2007</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR>
    <TD width="5%" >&nbsp;</TD>
    <TD >&nbsp; </TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="14%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="14%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="14%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff >Statutory income tax rate </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="14%" bgColor=#e6efff>24.2% </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="14%" bgColor=#e6efff>27.5% </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="14%" bgColor=#e6efff>27.5% </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left >Expenses not deductible for tax purposes </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">1.3 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">2.0 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">2.14 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff >Tax exemptions </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="14%" bgColor=#e6efff>(5.0</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="14%" bgColor=#e6efff>(4.5</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="14%" bgColor=#e6efff>(3.3</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left >FIN 48 tax contingencies and settlements </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">5.1 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff >Tax investigation by National
      Tax Service </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="14%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="14%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="14%" bgColor=#e6efff>7.1 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left >Others </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
    width="14%">(1.1</TD>
    <TD align=left width="2%" >) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="14%">0.5
    </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
    width="14%">(0.1</TD>
    <TD align=left width="2%" >) </TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff ><B>Effective income tax
      rate</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="14%"
    bgColor=#e6efff><B>24.5%</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="14%"
    bgColor=#e6efff><B>25.5%</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="14%"
    bgColor=#e6efff><B>33.3%</B> </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD></TR></TABLE>
<P align=center>F-25</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_28></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>for the years ended December 31, 2009, 2008 and 2007 </B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>15.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>INCOME
TAXES (continued)</STRONG> </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Deferred
tax assets and liabilities</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred
income taxes reflect the temporary differences between the amounts at which
assets and liabilities are recorded for financial reporting purposes and the
amounts utilized for tax purposes. The primary components of the temporary
differences that gave rise to the Company&#146;s deferred tax assets and liabilities
as of December 31, 2009 and 2008 and their classification were as follows: </P>
<DIV align=center>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="80%" border=0>

  <TR vAlign=top>
    <TD align=left ><B>Deferred tax assets</B> </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="17%">&nbsp; </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="17%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2009</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2008</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Investment securities </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>271,154 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>293,155 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left
      >&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      Depreciation and amortization </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">77,616 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">36,158 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Derivatives </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>4,899 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>20,203 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Other
      payables </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">980,979 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">630,595 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Advances from customers </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>35,903 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>75,655 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Accrued
      severance benefits </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">445,332 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">382,271 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Bad debt </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>154,048 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>176,836 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Other </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="17%">65,818 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="17%">99,175 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B>Total deferred tax assets</B>
    </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="17%"
    bgColor=#e6efff><B>2,035,749</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="17%"
    bgColor=#e6efff><B>1,714,048</B> </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD></TR></TABLE></DIV><BR>
<DIV align=center>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="80%" border=0>

  <TR vAlign=top>
    <TD align=left ><B>Deferred tax liabilities</B> </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="17%">&nbsp; </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="17%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2009</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2008</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Accounts receivable </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>965,937 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>640,596 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Other
      current assets </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">13,545 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">28, 139 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff
      >&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposit for
      severance benefits insurance </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>375,830 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>277,157 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Other </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="17%">587,872 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="17%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff
      ><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      Total deferred tax liabilities</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="17%"
    bgColor=#e6efff><B>1,943,184</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="17%"
    bgColor=#e6efff><B>945,892</B> </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD></TR></TABLE></DIV><BR>
<DIV align=center>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="80%" border=0>

  <TR vAlign=top>
    <TD align=left ><B>Reported as:</B> </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="17%">&nbsp; </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="17%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2009</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2008</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Current deferred tax assets </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>482,053 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>729,238 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Non-current
      deferred tax assets </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">38,918 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Non-current deferred tax liabilities </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="17%"
    bgColor=#e6efff>(389,488</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="17%"
    bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp;<B>Net deferred income tax assets</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="17%"><B>92,565</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="17%"><B>768,156</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR></TABLE></DIV>
<P align=center>F-26 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_29></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>for the years ended December 31, 2009, 2008 and 2007 </B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>15.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>INCOME
TAXES (continued)</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Uncertain
tax positions</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
January 1, 2009, the Company adopted the provisions of ASC 740 which set outs a
consistent framework to determine the appropriate level of tax reserve for
uncertain tax positions. ASC Subtopic 740-10 originally was effective for fiscal
years beginning after December 15, 2006. The FASB issued ASC Subtopic 740-10
(FSP FIN 48-3, Effective date of FASB Interpretation No. 48 for Certain
Nonpublic Enterprises), which deferred the effective date of ASC Subtopic 740-10
for nonpublic entities that had not already issued a complete set of annual
financial statements fully reflecting ASC Subtopic 740-10&#146;s requirements or are
consolidated entities of public entities that report in US GAAP. This means that
ASC Subtopic 740-10 was required for such entities with fiscal years beginning
after December 15, 2008 and accordingly, the Company adopted the provisions in
2009.</P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following table is a reconciliation of the beginning and ending amount of the
Company&#146;s gross unrecognized tax benefits for the year ended December 31, 2009:
</P>
<DIV align=center>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="70%" border=0>

  <TR vAlign=top>
    <TD align=left></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="16%"
    ><STRONG>2009</STRONG></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Beginning balance </TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="16%" bgColor=#e6efff >154,210 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp;Gross increases/(decreases) &#150; tax
      positions in prior period </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="16%" >- </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp;Gross
      increases/(decreases) &#150; current period tax positions </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="16%" bgColor=#e6efff >809,568 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp;Settlements </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="16%" >- </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp;Lapse of statute of
      limitations </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="16%"
    bgColor=#e6efff >- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD align=left><B>Ending balance</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="16%"
    ><B>963,778</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left
    width="2%">&nbsp;</TD></TR></TABLE></DIV>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Upon
adoption at January 1, 2009, the Company&#146;s decreased retained earnings by
&#65510;154,210 thousand. For the year ended December 31, 2009, the unrecognized
tax benefit increased by &#65510;809,568 thousand which all related to permanent
differences. As of December 31, 2009, the Company&#146;s total unrecognized tax
benefits that, if recognized, would affect the effective tax rate is
&#65510;809,568 thousand. During the year ended December 31, 2009, the Company
recognized approximately &#65510;2,942 thousand for the payment of interest and
penalty. The Company had approximately &#65510;12,099 thousand and
&#65510;14,403 thousand for the payment of interest and penalties accrued in the
balance sheet as of December 31, 2009. </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company files income tax returns in the Republic of Korea. In 2007, the Korea
National Tax Service, or NTS, has effectively completed the examination of the
Company&#146;s returns in the Republic of Korea related to years 2002 through 2006
</P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;It
is expected that the amount of unrecognized tax benefits will also change for
other reasons in the next 12 months; however, the Company does not expect the
change to have a significant impact on our financial position or results of
operations. </P>
<P align=center>F-27</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_30></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>for the years ended December 31, 2009, 2008 and 2007 </B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>16.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>EARNINGS
  PER SHARE</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic
earnings per share of common stock is computed by dividing net income by the
weighted average number of shares of common stock outstanding for the period,
less the weighted average number of shares subject to stock retirement. Diluted
earnings per share of common stock is computed using the weighted average number
of shares of common stock outstanding plus the effect of common stock
equivalents, unless the common stock equivalents are anti-dilutive. The
calculation of diluted earnings per share includes the dilutive effect of an
exercise of stock warrants.</P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
following details the computation of earnings per share of common stock as of
December 31, 2009, 2008 and 2007:</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD width="5%"  >&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2009</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2008</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2007</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR>
    <TD width="5%" >&nbsp;</TD>
    <TD>&nbsp; </TD>
    <TD align=right width="1%" >&nbsp;</TD>
    <TD align=right width="12%">&nbsp; </TD>
    <TD align=right width="2%" >&nbsp;</TD>
    <TD align=right width="1%" >&nbsp;</TD>
    <TD align=right width="12%">&nbsp; </TD>
    <TD align=right width="2%" >&nbsp;</TD>
    <TD align=right width="1%" >&nbsp;</TD>
    <TD align=right width="12%">&nbsp; </TD>
    <TD align=right width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>Net income </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>11,892,039 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>9,176,729 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>8,566,101 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD width="5%" >&nbsp;</TD>
    <TD>&nbsp; </TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">&nbsp; </TD>
    <TD vAlign=bottom align=right width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">&nbsp; </TD>
    <TD vAlign=bottom align=right width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">&nbsp; </TD>
    <TD vAlign=bottom align=right width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>Weighted average shares used in computing
      basic earnings per share </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>13,800,153 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>14,895,399 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>16,203,185 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>Weighted average effect of dilutive securities: stock
      warrants </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">- </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">- </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">4,003,375 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>Weighted average shares used in computing
      diluted earnings per share </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>13,800,153 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>14,895,399 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>20,206,560 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD width="5%" >&nbsp;</TD>
    <TD>&nbsp; </TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="12%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="12%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="12%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff><B>Basic earnings per share (in Korean
      won)</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="12%" bgColor=#e6efff>862 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="12%" bgColor=#e6efff>616 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="12%" bgColor=#e6efff>529 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR>
  <TR>
    <TD width="5%" >&nbsp;</TD>
    <TD>&nbsp; </TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="12%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="12%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD>
    <TD vAlign=bottom width="1%" >&nbsp;</TD>
    <TD vAlign=bottom width="12%">&nbsp; </TD>
    <TD vAlign=bottom width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff><B>Diluted earnings per share (in Korean
      won)</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="12%" bgColor=#e6efff>862 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="12%" bgColor=#e6efff>616 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="12%" bgColor=#e6efff>424 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD></TR></TABLE>
<P
align=justify><STRONG>17.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>COMMITMENTS
AND CONTINGENCIES </STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company is involved in a total of four litigations that have arisen in the
ordinary course of business, including matters involving price fixing. The
results and timing of the ultimate resolutions of these proceedings are
inherently unpredictable. The outcome of any claim, suit, assessment,
investigation, or legal proceeding, individually or collectively will depend on
a number of variables, including the nature, timing, and amount of any
associated expenses, amounts paid in settlement, damages or other remedies or
consequences. As of December 31, 2009, the Company did not accrue liabilities
with respect to the pending litigations. The Company will accrue a liability
when it believes that it is both probable that a liability has been incurred and
that it can reasonably estimate the amount of the loss.</P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
of December 31, 2009, the Company has guarantees provided by non-related party
for the Company as follows (Korean won in thousands): </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD width="5%"  >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B>Providing
      by</B> </TD>
    <TD align=center width="2%"  >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="2%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="15%"
    ><B>Amount</B> </TD>
    <TD align=left width="2%"  >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="45%"
    ><B>Description</B> </TD></TR>
  <TR>
    <TD width="5%" >&nbsp;</TD>
    <TD>&nbsp; </TD>
    <TD align=center width="2%"  >&nbsp;</TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="15%" >&nbsp; </TD>
    <TD width="2%"  >&nbsp;</TD>
    <TD width="45%" >&nbsp; </TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>Seoul Guarantee Insurance Co., Ltd. </TD>
    <TD align=center width="2%"  bgColor=#e6efff
    >&nbsp;</TD>
    <TD align=center width="2%" bgColor=#e6efff >&#65510;</TD>
    <TD align=center width="15%" bgColor=#e6efff >3,078,047 </TD>
    <TD align=left width="2%"  bgColor=#e6efff
    >&nbsp;</TD>
    <TD align=left width="45%" bgColor=#e6efff >Payment guarantee
      provided by the insurance company </TD></TR></TABLE>
<P align=center>F-28</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_31></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>for the years ended December 31, 2009, 2008 and 2007 </B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>18.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>PLEDGED
ASSETS </STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Details
of assets pledged by the Company as collateral for operating activities as of
December 31, 2009 are as follows:</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD width="5%"  >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B>Pledged to </B></TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="31%"><B>Pledged assets </B></TD>
    <TD align=center width="2%"
    >&nbsp;</TD>
    <TD width="1%" align=center style="BORDER-BOTTOM: #000000 1px solid" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="27%"
    ><B>Pledged amount </B></TD>
  <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>Kookmin Bank </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="31%" bgColor=#e6efff>Short-term financial
      instruments </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="27%" bgColor=#e6efff >400,000 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>Industrial Bank of Korea </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="31%">Short-term financial instruments </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="27%" >100,000 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>Hana Bank </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="31%" bgColor=#e6efff>Short-term financial
      instruments </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%" align=left  bgColor=#e6efff style="BORDER-BOTTOM: #000000 1px solid">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="27%"
    bgColor=#e6efff >158,000 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
     bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left><B>&nbsp;&nbsp; Total </B></TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="31%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD width="1%" align=left style="BORDER-BOTTOM: #000000 3px double" >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="27%"
    ><B>658,000 </B></TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="2%"
    >&nbsp;</TD></TR></TABLE>
<P
align=justify><STRONG>19.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>SUPPLEMENTAL
CASH FLOWS INFORMATION </STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Supplemental
cash flows information for the years ended December 31, 2009, 2008 and 2007 is
as follows:</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD width="5%"  >&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2009 </B></TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2008 </B></TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2007 </B></TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR>
    <TD width="5%" >&nbsp;</TD>
    <TD>&nbsp; </TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>Cash paid during the year for: </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp;Interest </TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="12%">575,203 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="12%">407,126 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="12%">667 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp;Income taxes </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>2,695,440 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>3,248,571 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>4,088,937 </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD></TR></TABLE>
<P
align=justify><STRONG>20.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>RELATED
PARTY TRANSACTIONS </STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Significant
transactions which occurred in the normal course of business with related
companies for the years ended December 31, 2009, 2008 and 2007 are as follows:
</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 8pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD width="5%"  >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B>Relationship
      </B></TD>
    <TD align=left width="2%"  >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="15%"><B>Name </B></TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="13%"><B>Transaction </B></TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="13%"><B>2009 </B></TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="13%"><B>2008 </B></TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="13%"><B>2007 </B></TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR>
    <TD width="5%" >&nbsp;</TD>
    <TD align="center">&nbsp; </TD>
    <TD width="2%"  >&nbsp;</TD>
    <TD width="15%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="13%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="13%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="13%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="13%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=center bgColor=#e6efff>(*) </TD>
    <TD align=left width="2%"  bgColor=#e6efff
    >&nbsp;</TD>
    <TD align=center width="15%" bgColor=#e6efff>Kooryoonsoft Co. Ltd </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="13%" bgColor=#e6efff>Sales and others </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="13%" bgColor=#e6efff>53,112 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="13%" bgColor=#e6efff>75,702 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="13%" bgColor=#e6efff>34,574 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=center>&nbsp; </TD>
    <TD align=left width="2%"  >&nbsp;</TD>
    <TD align=center width="15%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="13%">Purchases and others </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="13%">476,930 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="13%">1,958,473 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="13%">1,943,201 </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR></TABLE>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Account
balances with related companies as of December 31, 2009 and 2008 are as follows:
</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 8pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD width="5%"  >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B>Relationship
      </B></TD>
    <TD align=center width="2%"  >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="15%"><B>Name </B></TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD colspan="4" align=center style="BORDER-BOTTOM: #000000 1px solid"
    ><B>2009 </B></TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD colspan="4" align=center style="BORDER-BOTTOM: #000000 1px solid"><B>2008 </B> </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD align=right width="2%"  >&nbsp;</TD>
    <TD align=left width="15%">&nbsp;</TD>
    <TD align=right width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="13%"
    >Receivables&nbsp;</TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="13%">Payables </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="13%">Receivables </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="13%">Payables </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=center></TD>
    <TD align=center width="2%"  >&nbsp;</TD>
    <TD align=center width="15%"></TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=right width="1%" >&nbsp;</TD>
    <TD align=right width="13%" >&nbsp;</TD>
    <TD align=right width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="13%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="13%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="13%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=center bgColor=#e6efff>(*) </TD>
    <TD align=center width="2%"  bgColor=#e6efff
    >&nbsp;</TD>
    <TD align=center width="15%" bgColor=#e6efff>Kooryoonsoft Co. Ltd </TD>
    <TD align=right width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="13%"  bgColor=#e6efff>100,442&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="13%" bgColor=#e6efff>43,105 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="13%" bgColor=#e6efff>122,498 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="13%" bgColor=#e6efff>41,295 </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD></TR></TABLE>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(*)
The Company&#146;s operating department manager is serving as a director of
Kooryoonsoft. Co. Ltd. </P>
<P align=center>F-29 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_32></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>for the years ended December 31, 2009, 2008 and 2007 </B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>21.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>CONCENTRATIONS
OF CREDIT RISKS </STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Financial
instruments that potentially expose the Company to concentrations of credit risk
consist primarily of cash, cash equivalents, restricted deposits, and accounts
receivable. Substantially all of the Company&#146;s cash, cash equivalents, and
short-term and long-term financial instruments are held at financial
institutions that management believes to be of high credit quality. </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
substantial portion of the Company&#146;s sales for the years ended December 31,
2009, 2008 and 2007 was made to credit card companies. Sales and accounts
receivable from customers accounting for 10% or more of the Company&#146;s sales are
as follows: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD width="5%"  >&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=center width="21%"><B>Sales for the year ended</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="21%"><B>Accounts receivable as of</B> </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B>Major
      Customers</B> </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="21%"><B>December 31, 2009</B> </TD>
    <TD align=center
    width="2%">&nbsp;</TD>
    <TD width="1%" align=center style="BORDER-BOTTOM: #000000 1px solid">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="21%"><B>December 31, 2009</B> </TD>
    <TD align=left
    width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>BC Card </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="21%" bgColor=#e6efff>18,910,505 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="21%" bgColor=#e6efff>2,353,548 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>NTS (National Tax Service) </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="21%">5,845,391 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="21%">2,044,259 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>Shinhan Card </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="21%" bgColor=#e6efff>14,421,231 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="21%" bgColor=#e6efff>1,703,070 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>Kookmin Card </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="21%">12,318,036 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="21%">1,432,215 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="21%"
    bgColor=#e6efff>51,495,163 </TD>
    <TD align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%" align=left bgColor=#e6efff style="BORDER-BOTTOM: #000000 3px double">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="21%"
    bgColor=#e6efff>7,533,092 </TD>
    <TD align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR></TABLE><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD width="5%"  >&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=center width="21%"><B>Sales for the year ended</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="21%"><B>Accounts receivable as of</B> </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B>Major
      Customers</B> </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="21%"><B>December 31, 2008</B> </TD>
    <TD align=center
    width="2%">&nbsp;</TD>
    <TD width="1%" align=center style="BORDER-BOTTOM: #000000 1px solid">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="21%"><B>December 31, 2008</B> </TD>
    <TD align=left
    width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>BC Card </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="21%" bgColor=#e6efff>15,067,882 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="21%" bgColor=#e6efff>1,482,641 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>Shinhan Card </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="21%">10,540,921 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="21%">1,295,034 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>Kookmin Card </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="21%"
    bgColor=#e6efff>10,361,607 </TD>
    <TD align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="21%"
    bgColor=#e6efff>1,121,757 </TD>
    <TD align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="21%">35,970,410 </TD>
    <TD align=left
    width="2%">&nbsp;</TD>
    <TD width="1%" align=left style="BORDER-BOTTOM: #000000 3px double">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="21%">3,899,432 </TD>
    <TD align=left
    width="2%">&nbsp;</TD>
  </TR></TABLE><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>

  <TR vAlign=top>
    <TD width="5%"  >&nbsp;</TD>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=center width="21%"><B>Sales for the year ended</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="21%"><B>Accounts receivable as of</B> </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center><B>Major
      Customers</B> </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="21%"><B>December 31, 2007</B> </TD>
    <TD align=center
    width="2%">&nbsp;</TD>
    <TD width="1%" align=center style="BORDER-BOTTOM: #000000 1px solid">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="21%"><B>December 31, 2007</B> </TD>
    <TD align=left
    width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>BC Card </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="21%" bgColor=#e6efff>16,302,366 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="21%" bgColor=#e6efff>1,313,688 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>Shinhan Card </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="21%">13,545,208 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="21%">988,340 </TD>
    <TD align=left width="2%">&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>
      <P>Kookmin Card </P></TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="21%" bgColor=#e6efff>10,802,548 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="21%" bgColor=#e6efff>935,356 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD></TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>Hyundai Card </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="21%">7,775,082 </TD>
    <TD align=left
    width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="21%">624,783 </TD>
    <TD align=left
    width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="21%"
    bgColor=#e6efff>48,425,204 </TD>
    <TD align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%" align=left bgColor=#e6efff style="BORDER-BOTTOM: #000000 3px double">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="21%"
    bgColor=#e6efff>3,862,167 </TD>
    <TD align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR></TABLE>
<P align=justify><STRONG>22.</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>
SUBSEQUENT EVENTS</STRONG> </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
September 16, 2010, Net 1 UEPS Technologies, Inc. announced that it had agreed
to purchase 98.73% of the outstanding share capital of the Company for
&#65510;270 billion in cash considerations, subject to a post-closing working
capital adjustment. The acquisition was made by Net 1 Applied Technologies
Korea, an indirect wholly-owned subsidiary of Net 1 UEPS Technologies, Inc.,
which was closed on October 29, 2010.</P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
Company has evaluated subsequent events through the date that the financial
statements were issued on January 10, 2011. </P>
<P align=center>F-30 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_33></A>
<P align=justify><B>KSNET, Inc.</B> <BR>
<B>UNAUDITED BALANCE SHEETS</B> <BR>
  <B>as of June 30, 2010 and 2009</B> </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD colspan="4" align=center>(In thousands of Korean won, </TD>
    <TD align=center width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD colspan="4" align=center style="BORDER-BOTTOM: #000000 1px solid">except
      share data) </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2010</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2009</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=center><B>ASSETS</B> </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>CURRENT ASSETS </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Cash and cash equivalents (Note 6) </TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="12%">20,017,727 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="12%">8,565,795 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp;Short-term financial instruments (Notes 3, 6 and 18)
    </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>3,199,364 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>1,798,000 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Accounts receivable, net (Notes 4 and 6) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">11,111,189 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">9,087,081 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp;Inventory (Note 5) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>1,380,603 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>1,864,666 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Deferred tax assets (Note 15) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">175,164 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp;Other current assets (Notes 6, 11 and 20) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>16,525,627 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>13,103,960 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=center>Total current assets </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">52,234,510 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">34,594,666 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>AVAILABLE-FOR-SALE SECURITIES (Note 6) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>100,000 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>100,000 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>PROPERTY AND EQUIPMENT, net (Note 9) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">26,114,027 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">22,447,255 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>INTANGIBLE ASSETS, net (Note 10) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>19,691 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>27,078 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>NON-CURRENT ACCOUNTS RECEIVABLE, net (Notes 4 and 6) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">1,505,297 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">2,043,439 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>NON-CURRENT DEFERRED TAX ASSETS (Note 15) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>282,013 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>OTHER NON-CURRENT ASSETS (Notes 3, 6 and 11) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">5,583,247 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">5,735,795 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff><B>TOTAL ASSETS</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>85,556,772</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>65,230,246</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=center bgColor=#e6efff><B>LIABILITIES</B> </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>CURRENT LIABILITIES </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp;Accounts payable (Note 6) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>6,154,692 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>5,171,972 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Short-term borrowings (Note 6) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">2,000,000 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp;Current portion of long-term debt (Notes 6 and 8) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>6,000,000 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>4,000,000 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Deferred tax liabilities (Note 15) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">12,060 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp;Other current liabilities (Notes 6, 7, 11 and 20) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>17,061,849 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>10,959,742 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=center>Total current liabilities </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">31,228,601 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">20,131,714 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>LONG-TERM DEBT (Notes 6 and 8) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>6,000,000 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>ACCRUED SEVERANCE BENEFITS, net (Note 14) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">1,192,860 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">1,082,422 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>NON-CURRENT DEFERRED TAX LIABILITIES (Note
      15) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>152,536 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>OTHER NON-CURRENT LIABILITIES (Note 15) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">1,036,750 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">148,135 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff><B>TOTAL LIABILITIES</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>33,610,747</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>27,362,271</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=center bgColor=#e6efff><B>EQUITY</B> </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>COMMON STOCK (Note 13) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">6,802,883 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">7,275,892 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Authorized shares: 36,500,000 with &#65510;500 par
      value at June 30, 2010 and 2009 </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Issued and outstanding shares: 13,605,766 at June 30, 2010
      and 2009 </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp; </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>ADDITIONAL PAID-IN-CAPITAL (Note 13) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>33,568 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>33,568 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>RETAINED EARNINGS </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">45,109,574 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">31,031,524 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff><B>TOTAL EQUITY</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>51,946,025</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>37,867,975</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp; </TD>
    <TD width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff><B>TOTAL LIABILITIES AND EQUITY</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>85,556,772</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>65,230,246</B> </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=justify>See accompanying notes to financial statements. </P>
<P align=center>F-31 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_34></A>
<P align=justify><B>KSNET, INC.</B> <BR>
  <B>UNAUDITED STATEMENTS OF INCOME</B> <BR>
  <B>For the six months ended June 30, 2010 and 2009</B> </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD colspan="5" align=center>(In thousands of Korean won, </TD>
    <TD align=left width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD colspan="5" align=center style="BORDER-BOTTOM: #000000 1px solid">except
      share data) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="11%"><B>2010</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="11%"><B>2009</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>REVENUE </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="11%">&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="11%">&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Services
      rendered </TD>
    <TD style="BORDER-LEFT: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="11%" bgColor=#e6efff>51,359,503 </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-RIGHT: #000000 1px solid; BORDER-LEFT: #000000 1px solid"
    align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="11%" bgColor=#e6efff>40,176,730 </TD>
    <TD style="BORDER-RIGHT: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Sale of merchandise (Note
      20) </TD>
    <TD style="BORDER-LEFT: #000000 1px solid" align=left width="1%">&nbsp;</TD>
    <TD align=right width="11%">1,534,002 </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-RIGHT: #000000 1px solid; BORDER-LEFT: #000000 1px solid"
    align=left width="1%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="11%">1,334,725 </TD>
    <TD style="BORDER-RIGHT: #000000 1px solid" align=left
  width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Others </TD>
    <TD style="BORDER-LEFT: #000000 1px solid; BORDER-BOTTOM: #000000 1px solid"
    align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="11%"
    bgColor=#e6efff>81,514 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-RIGHT: #000000 1px solid; BORDER-LEFT: #000000 1px solid"
    align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="11%"
    bgColor=#e6efff>122,033 </TD>
    <TD
    style="BORDER-RIGHT: #000000 1px solid; BORDER-BOTTOM: #000000 1px solid"
    align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="11%">52,975,019 </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="11%">41,633,488 </TD>
    <TD align=left width="1%">&nbsp;</TD>
  </TR>
  <TR>
    <TD bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="11%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="11%" bgColor=#e6efff>&nbsp; </TD>
    <TD width="1%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>EXPENSE </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="11%">&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="11%">&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Cost of services
      rendered </TD>
    <TD style="BORDER-LEFT: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="11%" bgColor=#e6efff>26,783,173 </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-RIGHT: #000000 1px solid; BORDER-LEFT: #000000 1px solid"
    align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="11%" bgColor=#e6efff>20,383,587 </TD>
    <TD style="BORDER-RIGHT: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Cost of merchandise sold
      (Note 20) </TD>
    <TD style="BORDER-LEFT: #000000 1px solid" align=left width="1%">&nbsp;</TD>
    <TD align=right width="11%">1,453,776 </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-RIGHT: #000000 1px solid; BORDER-LEFT: #000000 1px solid"
    align=left width="1%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="11%">1,304,229 </TD>
    <TD style="BORDER-RIGHT: #000000 1px solid" align=left
  width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Selling,
      general and administrative expenses </TD>
    <TD style="BORDER-LEFT: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="11%" bgColor=#e6efff>12,475,505 </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-RIGHT: #000000 1px solid; BORDER-LEFT: #000000 1px solid"
    align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="11%" bgColor=#e6efff>10,582,655 </TD>
    <TD style="BORDER-RIGHT: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Depreciation and amortization
    </TD>
    <TD style="BORDER-LEFT: #000000 1px solid; BORDER-BOTTOM: #000000 1px solid"
    align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="11%">1,607,823 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-RIGHT: #000000 1px solid; BORDER-LEFT: #000000 1px solid"
    align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="11%">1,524,479 </TD>
    <TD
    style="BORDER-RIGHT: #000000 1px solid; BORDER-BOTTOM: #000000 1px solid"
    align=left width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="11%"
    bgColor=#e6efff>42,320,277 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="11%"
    bgColor=#e6efff>33,794,950 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="11%">&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="11%">&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>OPERATING INCOME </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="11%" bgColor=#e6efff>10,654,742 </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="11%" bgColor=#e6efff>7,838,538 </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="11%">&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="11%">&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>INTEREST INCOME, net </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="11%" bgColor=#e6efff>86,710 </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="11%" bgColor=#e6efff>139,695 </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="11%">&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="11%">&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>OTHER INCOME (EXPENSE), net (Note 12) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="11%"
    bgColor=#e6efff>(244,306</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>) </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="11%"
    bgColor=#e6efff>7,496 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="11%">&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="11%">&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>INCOME BEFORE INCOME TAXES </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="11%" bgColor=#e6efff>10,497,146 </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="11%" bgColor=#e6efff>7,985,729 </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="11%">&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="11%">&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>INCOME TAX EXPENSE (Note 15) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="11%"
    bgColor=#e6efff>1,989,228 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="11%"
    bgColor=#e6efff>1,663,822 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="11%">&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="11%">&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>NET INCOME </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="11%"
    bgColor=#e6efff>8,507,918 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="11%"
    bgColor=#e6efff>6,321,907 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="11%">&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="11%">&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff><B>Net income per share (Note 16)</B> </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="11%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="11%" bgColor=#e6efff>&nbsp; </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="11%">&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="11%">&nbsp; </TD>
    <TD width="1%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Basic earnings
      attributable to KSNET shareholders </TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="11%" bgColor=#e6efff>617 </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="11%" bgColor=#e6efff>450 </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=justify>See accompanying notes to financial statements. </P>
<P align=center>F-32 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_35></A>
<P align=center><B>KSNET,</B><B> INC.</B> <BR>
    <B>UNAUDITED STATEMENTS</B><B> OF </B><B>CHANGES</B><B> IN </B><B>EQUITY</B><B> AND </B><B>COMPREHENSIVE</B><B> </B><B>INCOME</B><B> (in </B><B>thousands</B><B> of won, except share data)</B> <BR>
    <B>For the six month</B><B>s</B><B> ended June 30, 2010 and 2009 </B></P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 6pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD colspan="10" align=center style="BORDER-BOTTOM: #000000 1px solid"> Common stock </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD colspan="7" align=center style="BORDER-BOTTOM: #000000 1px solid"> Preferred
      stock </TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="5%">&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="5%">&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="5%">Numbeof </TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="5%">&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="5%">Treasury </TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="8%" >Additional paid-</TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="5%">Number </TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="5%">&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="8%">Additional paid- </TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="5%">Retained </TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="5%">Total </TD>
    <TD align=center width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="5%">of shares </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="5%">Amount </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="5%">stock </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="8%"
    >in capital</TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="5%">os hares </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="5%">Amount </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="8%">in
      capital </TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="5%">earnings </TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="5%"> equity </TD>
    <TD align=center width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Balance &#150; Jan. 1, 2009 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>14,551,784 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>7,275,892 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="8%" bgColor=#e6efff>33,568 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="8%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>28,478,336 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>35,787,796 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Adoption of FIN 48 -adjustment to opening retained earnings </TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="8%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="8%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">(154,210</TD>
    <TD vAlign=bottom align=left width="1%">) </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">(154,210</TD>
    <TD vAlign=bottom align=left width="1%">) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Revised retained earnings </TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="8%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="8%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>28,324,126 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>35,633,586 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Capital reduction </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">(946,018</TD>
    <TD vAlign=bottom align=left width="1%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">(473,009</TD>
    <TD vAlign=bottom align=left width="1%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">- </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="8%">- </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">- </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">- </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="8%">- </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">(3,614,509</TD>
    <TD vAlign=bottom align=left width="1%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">(4,087,518</TD>
    <TD vAlign=bottom align=left width="1%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Comprehensive income: </TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="8%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="8%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp;&nbsp; Net income </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="5%">- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="5%">- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="5%">- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="8%">- </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="5%">- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="5%">- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="8%">- </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="5%">6,321,907 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="5%">6,321,907 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Balance &#150; Jun. 30, 2009 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="5%" bgColor=#e6efff>13,605,766 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="5%" bgColor=#e6efff>6,802,883 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="5%" bgColor=#e6efff>- </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="8%" bgColor=#e6efff>33,568 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="5%" bgColor=#e6efff>- </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="5%" bgColor=#e6efff>- </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="8%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="5%" bgColor=#e6efff>31,031,524 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="5%" bgColor=#e6efff>37,867,975 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD align=left >&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="8%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="8%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
  </TR>
  <TR>
    <TD align=left bgColor=#e6efff >&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="8%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="8%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD align=left >&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="8%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="8%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" >&nbsp;</TD>
  </TR>
  <TR>
    <TD align=left bgColor=#e6efff >&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="8%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="8%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Balance &#150; Jan. 1, 2010 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">13,605,766 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">6,802,883 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">- </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="8%">33,568 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">- </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">- </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="8%">- </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">36,601,656 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%">43,438,107 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Comprehensive income: </TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="8%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="8%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="5%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp;&nbsp; Net income </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="5%">- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="5%">- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="5%">- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="8%">- </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="5%">- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="5%">- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="8%">- </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="5%">8,507,918 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="5%">8,507,918 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Balance &#150; Jun. 30, 2010 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="5%" bgColor=#e6efff>13,605,766 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="5%" bgColor=#e6efff>6,802,883 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="5%" bgColor=#e6efff>- </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="8%" bgColor=#e6efff>33,568 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="5%" bgColor=#e6efff>- </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="5%" bgColor=#e6efff>- </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="8%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="5%" bgColor=#e6efff>45,109,574 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="5%" bgColor=#e6efff>51,946,025 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=justify>See accompanying notes to financial statements.</P>
<P align=center>F-33 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_36></A>
<P align=justify><B>KSNET, INC.</B> <BR>
    <B>UNAUDITED STATEMENTS OF CASH FLOWS</B> <BR>
    <B>for the six months ended June 30, 2010 and 2009</B> </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B>Cash flows from operating activities</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD colspan="4" align=center style="BORDER-BOTTOM: #000000 1px solid">(In
      thousands of Korean won) </TD>
    <TD align=right width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2010</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2009</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Net income </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="12%" bgColor=#e6efff>8,507,918 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="12%" bgColor=#e6efff>6,321,907 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Adjustments to reconcile net income to net cash provided by
      operating activities: </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Provision for severance benefits </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>569,331 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>405,862 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Depreciation
      and amortization </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">5,619,874 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">4,658,789 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Gain on disposal of property and equipment </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(14,626</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(1,642</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Gain
      on valuation of derivatives </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(22,266</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(21,427</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Loss on impairment of property, plant and equipment </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>12,359 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Bad
      debt expenses </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">85 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(131,969</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Changes in operating assets and liabilities: </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Decrease in long-term accounts receivable </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">401,122 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">846,437 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp;Increase in accounts receivable </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(210,632</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(1,267,112</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Decrease (Increase) in other receivables </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(182,222</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">50,623 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp;Decrease in accrued income </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>15,723 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>75,010 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Increase in advanced payments </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(893,338</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(678,726</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp;Increase in prepaid expenses </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(2,443,317</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(2,723,956</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Increase in inventory </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(5,725,187</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(6,293,703</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp;Decrease (Increase) in guarantee deposits </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>30,000 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(132,949</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Decrease in deferred tax assets </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">482,053 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">310,978 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp;(Decrease) Increase in deferred tax liabilities </TD>
    <TD align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%"
    bgColor=#e6efff>(236,952</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%"
    bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;(Decrease) Increase in accounts payable </TD>
    <TD align=left width="1%"
    >&nbsp;</TD>
    <TD align=right
      width="12%">(296,089</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%"
    >&nbsp;</TD>
    <TD align=right
      width="12%">870,348 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp;Decrease in other payables </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(71,217</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(1,249,939</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Decrease in advances from customers </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(41,236</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(76,202</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp;(Decrease) Increase in value-added tax payable </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>12,581 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(7,137</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Increase in accrued expenses </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">32,324 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">32,938 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp;Increase in deposits received </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>9,400 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;(Decrease) Increase in withholdings </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">107,145 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(1,110,863</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp;(Decrease) Increase in income taxes payable </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>300,085 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(234,084</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;(Decrease) Increase in other non-current liabilities </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">72,972 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(6,076</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp;Decrease in deposits for severance benefits insurance </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>196,854 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>90,878 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Payment of severance benefits </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">(323,104</TD>
    <TD align=left width="2%" >) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">(148,307</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;<B>Net cash provided by (used in) operating activities</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>5,900,240</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>(410,922</B></TD>
    <TD align=left width="2%"  bgColor=#e6efff><B>)</B> </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>Cash flows from investing activities</B> </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Decrease in short-term financial instruments </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>3,940,000 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Decrease
      in short-term loans </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">27,110 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">6,333 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Decrease in long-term loans </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>271,866 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>336,802 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Proceeds from disposal of property and equipment </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">54,584 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">120,518 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Increase in short-term financial instruments </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(971,364</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Increase
      in long-term financial instruments </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(194,000</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(3,000</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Increase in short-term loans </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(40,000</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Increase
      in long-term loans </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(115,000</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(177,000</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Acquisition of property and equipment </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(1,358,607</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(867,450</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Acquisition
      of intangible assets </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">(248,000</TD>
    <TD align=left width="2%" >) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">(349,500</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;<B>Net cash provided by (used in) investing activities</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>(2,533,411</B></TD>
    <TD align=left width="2%"  bgColor=#e6efff><B>)</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>2,966,703</B> </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=center>F-34 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_37></A>
<P align=justify><B>KSNET, INC.</B> <BR>
    <B>UNAUDITED STATEMENTS OF CASH FLOWS
      (continued)</B> <BR>
        <B>for the six months ended June 30, 2010 and 2009</B> </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B>Cash flows from operating activities</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD colspan="4" align=center style="BORDER-BOTTOM: #000000 1px solid">(In
      thousands of Korean won) </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2010</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2009</B> </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff><B>Cash flows from financing activities</B> </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Proceeds
      from short-term borrowings </TD>
    <TD align=left width="1%">&#65510;</TD>
    <TD align=right width="12%">2,000,000 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&#65510;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Proceeds from issuance of long-term debt </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>6,000,000 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Repayment
      of current portion of long-term debt </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">(4,000,000</TD>
    <TD align=left width="2%">) </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Repayment of short-term borrowings </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(4,000,000</TD>
    <TD align=left width="2%" bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Capital
      reduction </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">- </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">(4,087,517</TD>
    <TD align=left width="2%">) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;<B>Net cash used in financing activities</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>(2,000,000</B></TD>
    <TD align=left width="2%" bgColor=#e6efff><B>)</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>(2,087,517</B></TD>
    <TD align=left width="2%" bgColor=#e6efff><B>)</B> </TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;<B>Net increase in cash and cash equivalents</B> </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>1,366,829</B> </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff><B>468,264</B> </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;<B>Cash and cash equivalents &#150; beginning of year</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>18,650,898</B> </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff><B>8,097,531</B> </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;<B>Cash and cash equivalents at end of year</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>20,017,727</B> </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>8,565,795</B> </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>Non cash transaction</B> </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="12%">&nbsp;</TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="12%">&nbsp;</TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="12%"><B>2010</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="12%"><B>2009</B> </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Transferred from inventory to property and
      equipment </TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="12%" bgColor=#e6efff>5,305,737 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="12%" bgColor=#e6efff>5,458,685 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=justify>See accompanying notes to financial statements.</P>
<P align=center>F-35 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_38></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Unaudited Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>For the six months ended June 30, 2010 and 2009</B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P align=justify><STRONG>1.</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <STRONG>&nbsp;DESCRIPTION OF BUSINESS AND BASIS OF PRESENTATION</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Description
  of business</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;KSNET,
  INC. (the &#147;Company&#148;) was established through split off from Chosun I&amp;C on
  December 30, 1999 and engages in the Value Added Network (VAN) service and sale
  of communication equipment in the Republic of Korea.</P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  Company&#146;s capital stock amounts to &#65510;6,802,883 thousand as of June 30, 2010
  and the Company&#146;s shareholders and their ownership as of June 30, 2010
  are as follows:</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>Number of shares</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>Ownership (%)</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR>
    <TD >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="17%">&nbsp;</TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="17%">&nbsp;</TD>
    <TD width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >H&amp;QNPS Van Investment </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>6,716,500 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>49.37 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Payment Services Asia LLC </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">6,716,500 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">49.37 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Others </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="17%"
    bgColor=#e6efff>172,766 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="17%"
    bgColor=#e6efff>1.26 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="17%">&nbsp;</TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="17%">&nbsp;</TD>
    <TD width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="17%"
    bgColor=#e6efff>13,605,766 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="17%"
    bgColor=#e6efff>100.00 </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Basis
  of presentation </STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  Company maintains its accounting records in Korean Won and the accompanying
  financial statements have been prepared in accordance with accounting principles
  generally accepted in the United States of America (&#147;US GAAP&#148;).</P>
<P align=justify><STRONG>2.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <STRONG>SIGNIFICANT ACCOUNTING POLICIES</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Use
  of estimates</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  preparation of the Company&#146;s financial statements in conformity with US GAAP
  requires management to make estimates and assumptions that affect the reported
  amounts of assets and liabilities and disclosure of contingent assets and
  liabilities at the date of the financial statements and the reported amounts of
  revenues and expenses during the reporting period. Actual results could differ
  from those estimates. Significant items subject to such estimates and
  assumptions include the useful lives of property and equipment; allowances for
  doubtful accounts; the valuation of derivatives, deferred tax assets, property
  and equipment, inventory, investment securities; and accrued severance benefits,
  income tax uncertainties and other contingencies. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Cash
  and cash equivalents</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  Company considers cash equivalents as all highly liquid investments and
  short-term financial instruments, which are readily convertible to cash without
  significant transaction cost, do not have significant risk from changes in
  interest rates, and with maturities of three months or less when purchased. Cash
  and cash equivalents mainly consist of money market trust and checking
  deposits.</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Allowance
  for doubtful accounts</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Allowance
  for doubtful accounts is estimated based on an analysis and past experience of
  collections of individual accounts such as accounts receivable, other
  receivables and loans. Allowance for doubtful accounts is presented as a
  deduction from receivables. Account balances are charged off against the
  allowance after all means of collection have been exhausted and the potential
  for recovery is considered remote.</P>
<P align=center>F-36</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_39></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Unaudited Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>For the six months ended June 30, 2010 and 2009</B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P align=justify><STRONG>2.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <STRONG>SIGNIFICANT ACCOUNTING POLICIES (continued)</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Property
  and equipment</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Property
  and equipment are shown at cost less accumulated depreciation. Property and
  equipment are depreciated on the straight-line basis at rates which are
  estimated to depreciate the assets to their anticipated residual values over
  their useful lives. Within the following asset classifications, the expected
  economic lives are approximately: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; " align=center
cellSpacing=0 cellPadding=0 width="80%" border=0>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Buildings </TD>
    <TD align=left width="50%" bgColor=#e6efff>30 years </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Structures </TD>
    <TD align=left width="50%">8 years </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Vehicles </TD>
    <TD align=left width="50%" bgColor=#e6efff>4 years </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Tools, furniture and fixtures </TD>
    <TD align=left width="50%">3 to 4 years </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Machinery and equipment </TD>
    <TD align=left width="50%" bgColor=#e6efff>8 years </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Software </TD>
    <TD align=left width="50%">5 years </TD>
  </TR>
</TABLE>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  gain or loss arising on the disposal or retirement of an asset is determined as
  the difference between the sales proceeds and the carrying amount of the asset
  and is recognized in the statements of income.</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Property
  and equipment do not require that an annual impairment test be performed;
  instead, they are tested for impairment upon the occurrence of a triggering
  event. Triggering events include the more likely than not disposal of a portion
  of such assets or the occurrence of an adverse change in the market involving
  the business employing the related assets. For six months ended June 30, 2010
  and 2009, the amount of impairment losses were &#65510;12,359 thousand and zero
  respectively. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Sales
  taxes</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Revenues
  and expenses are presented net of value added taxes, as the case may be.</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Income
  taxes</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  Company provides for income taxes using the asset and liability method. This
  approach recognizes the amount of taxes payable or refundable for the current
  year, as well as deferred tax assets and liabilities for the future tax
  consequence of events recognized in the financial statements and tax returns.
  Deferred income taxes are adjusted to reflect the effects of changes in tax laws
  or enacted tax rates. The effect on deferred tax assets and liabilities of a
  change in tax rates is recognized in income in the period that includes the
  enactment date. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Under
  the Corporate Income Tax Law in the Republic of Korea, corporate taxpayers are
  subject to corporate income taxes on taxable income at 22% (10% is applicable
  to the first &#65510;200 million of taxable income) in 2010. On top of the corporate
  income tax, 10% resident surtax is also assessed; thus the statutory tax rate
  becomes 24.2% or 11% depending on the amount of taxable income; therefore, the
  income tax rate during the periods ended June 30, 2010 and 2009 was 24.2% .</P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
  establishing the appropriate income tax valuation allowances, the Company
  assesses the realizability of its net deferred tax assets, and based on all
  available evidence, both positive and negative, determines whether it is more
  likely than not that the net deferred tax assets or a portion thereof will be
  realized. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Effective
  January 1, 2009, the Company adopted the provisions of Accounting Standards
  Condification (&#147;ASC&#148;) 740, <I>Income Taxes</I>, which set outs a consistent
  framework to determine the appropriate level of tax reserve for uncertain tax
  positions. The Company uses a two-step approach wherein a tax benefit is
  recognized if a position is more-likely-than-not to be sustained. The amount of
  the benefit is then measured as the highest tax benefit which is greater than
  50% likely to be realized. The difference between the benefit recognized for a
  position in accordance with ASC 740 and the tax benefit claimed on a tax return
  is referred to as an unrecognized tax benefit. The Company&#146;s policy is to
  include interest related to unrecognized tax benefits in interest income, net
  and penalties in selling, general and administration in the statements of
  income. </P>
<P align=center>F-37</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_40></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Unaudited Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>For the six months ended June 30, 2010 and 2009</B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P align=justify><STRONG>2.</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <STRONG>&nbsp;SIGNIFICANT
  ACCOUNTING POLICIES (continued)</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Intangible
  assets</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Intangible
  assets are shown at cost less accumulated amortization. Intangible assets are
  amortized over the following useful lives:</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="60%" border=0>
  <TR vAlign=top>
    <TD width="8%"></TD>
    <TD align=left bgColor=#e6efff>Trademarks </TD>
    <TD align=left width="40%" bgColor=#e6efff>10 years </TD>
  </TR>
</TABLE>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Intangible
  assets are periodically evaluated for recoverability, and those evaluations take
  into account events or circumstances that warrant revised estimates of useful
  lives or that indicate impairment exists. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Research
  and development expenditures</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Research
  expenditures are charged to net income in the period in which they are incurred. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Costs
  in respect of the development of software for the Company&#146;s internal use are
  expensed as incurred, except to the extent that these costs are incurred during
  the application development stage. All other costs including those incurred in
  the project development and post-implementation stages are expensed as incurred.
  For six-month periods ended June 30, 2010 and 2009, the amount of research and
  development expenditures charged to net income were zero and &#65510;69,000 thousand,
  respectively. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Inventory</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventory
  is stated at the lower of cost or market value. Cost is determined on a
  first-in, first-out basis and includes transport and handling costs.</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Investment
  securities</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  Company classifies its debt security into available-for-sale security. The
  Company classifies its equity securities that do not have readily determinable
  fair values as other investment securities and those securities are stated at
  cost. </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  Company reviews its investment portfolio each reporting period to determine
  whether there are identified events or circumstances that would indicate there
  is a decline in the fair value that is considered to be other-than-temporary.
  For other securities which are stated at cost, if there are no identified events
  or circumstances that would have a material adverse effect on the fair value of
  the investment, then the fair value is not estimated. If an investment is deemed
  to have experienced an other-than-temporary decline below its cost basis, the
  Company reduces the carrying amount of the investment to its quoted or estimated
  fair value, as applicable, and establishes a new cost basis for the investment.
  There was no impairment loss on investment securities recognized for six-months
  periods ended June 30, 2010 and 2009. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Fair
  value of financial instruments</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  Company applies fair value accounting for all financial assets and liabilities
  and non&#8722;financial assets and liabilities that are recognized or disclosed at
  fair value in the financial statements. The Company defines fair value as the
  price that would be received from selling an asset or paid to transfer a
  liability in an orderly transaction between market participants at the
  measurement date. When determining the fair value measurements for assets and
  liabilities, which are required to be recorded at fair value, the Company
  considers the principal or most advantageous market in which the Company would
  transact and the market&#8722;based risk measurements or assumptions that market
  participants would use in pricing the asset or liability, such as inherent risk,
  transfer restrictions and credit risk. ASC 820, <I>Fair Value Measurements and
    Disclosure</I> (&#147;ASC 820&#148;), establishes a framework for measuring fair value and
  expands disclosures about fair value measurements.</P>
<P align=center>F-38</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_41></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Unaudited Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>For the six months ended June 30, 2010 and 2009</B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P align=justify><STRONG>2.</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <STRONG>&nbsp;SIGNIFICANT ACCOUNTING POLICIES (continued)</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Derivatives</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  Company recognizes all derivative financial instruments in the balance sheets as
  either assets or liabilities at fair value.</P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
  a derivative financial instrument not designated as a hedging instrument, the
  gain or loss is recognized in earnings in the period of change </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Revenue
  recognition&nbsp;</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  Company recognizes revenue when:</P>
<UL style="TEXT-ALIGN: justify">
  <LI>There is persuasive evidence of an agreement or arrangement;
  <LI>Delivery of products has occurred or services have been rendered;
  <LI>The seller&#146;s price to the buyer is fixed or determinable; and
  <LI>Collectability is reasonably assured. </LI>
</UL>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  Company&#146;s revenue is mainly consists of revenue from Card VAN, Banking VAN,
  Payment Gateway (PG) and Sale of Merchandise. The Company&#146;s revenue recognition
  methods for each component are as follows: </P>
<P style="MARGIN-LEFT: 5%" align=justify><I>Card VAN</I></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Card
  VAN services consist of services relating to authorization of credit card
  transactions including transmission of transaction details (Authorization
  Service), and collection of receipts associated with the credit card
  transactions (Collection Service). With its Authorization Service, the Company
  connects credit card companies with merchants online when a customer uses
  his/her credit card via terminals installed at merchants&#146; sites and the
  Company&#146;s central processing server for approval of credit card transactions.
  Immediately after approval of credit card transactions, the Company transmits
  details of the transactions to credit card companies online for processing
  payments. Collection Service captures the transaction data and gathers receipts
  as documented evidences and provides them to credit card companies upon request.
  The Company earns service fees based on the number of processed transactions for
  credit card companies when services are rendered in accordance with the
  contracts entered into between credit card companies and the Company. The
  Company bills for its service charges to credit card companies each month. Each
  service could be provided either individually or collectively, based on terms of
  contracts. </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  Company charges commission fee to credit card companies for the Authorization
  Service provided based on the number of approvals transferred. The right to
  receive fee for services rendered will take effect as credit card transactions
  are approved and details of the transactions are transmitted. Therefore,
  revenues from the Authorization Service are recognized when the credit card
  transactions are authorized and details of the transactions are transmitted. In
  the case of Collection Service, the Company is not allowed to receive its
  commission fees until it provides collected receipts to the credit card
  companies. Therefore, revenue from the Collection Service is recognized when the
  Company collects the receipts and provides them to the card companies. </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
  multi-element arrangements, the Company has identified two deliverables in
  arrangements. The first deliverable is the Authorization Service, and the second
  deliverable is the Collection Service. The Company evaluates each deliverable in
  an arrangement to determine whether they represent separate units of accounting.
  A deliverable constitutes a separate unit of accounting when it has standalone
  value and there are no customer-negotiated refunds or return rights for the
  delivered elements. If the arrangement includes a customer-negotiated refund or
  return right relative to the delivered item and the delivery and performance of
  the undelivered item is considered probable and substantially in the Company's
  control, the delivered element constitutes a separate unit of accounting. In
  instances when the aforementioned criteria are not met, the deliverable is
  combined with the undelivered elements and the allocation of the arrangement
  consideration and revenue recognition is determined for the combined unit as a
  single unit. Allocation of the consideration is determined at arrangement
  inception on the basis of each unit's relative selling price. In such
  circumstances, the Company uses a hierarchy to determine the selling price to be
  used for allocating revenue to deliverables: (i) vendor-specific objective
  evidence of fair value (&#147;VSOE&#148;), (ii) third-party evidence of selling price
  (&#147;TPE&#148;), and (iii) best estimate of the selling price (&#147;ESP&#148;).</P>
<P align=center>F-39</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_42></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Unaudited Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>For the six months ended June 30, 2010 and 2009</B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P align=justify><STRONG>2.</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <STRONG>&nbsp;SIGNIFICANT ACCOUNTING POLICIES (continued)</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Revenue
  recognition (continued)</STRONG></P>
<P style="MARGIN-LEFT: 5%" align=justify><I>Card VAN (continued) </I></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;VSOE
  generally exists only when the Company sells the deliverable separately and is
  the price actually charged by the Company for that deliverable. ESPs reflect the
  Company&#146;s best estimates of what the selling prices of elements would be if they
  were sold regularly on a stand-alone basis. Because the Company has neither VSOE
  nor TPE for the two deliverables, the allocation of revenue has been based on
  the Company&#146;s ESPs. Amounts allocated to the Authorization and the Collection
  Service are recognized at the time of service provided the other conditions for
  revenue recognition have been met. </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  Company&#146;s process for determining its ESP for deliverables without VSOE or TPE
  considers multiple factors that may vary depending upon the unique facts and
  circumstances related to each deliverable. Key factors considered by the Company
  in developing the ESPs include prices charged by the Company, historical pricing
  practices and controls, range of prices for various customers and the nature of
  the services. Consideration is also given to market conditions such as
  competitor pricing strategies and market perception. </P>
<P style="MARGIN-LEFT: 5%" align=justify><I>Banking VAN:</I></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Banking
  VAN is a division supporting a Company&#146;s fund management business (large payment
  transfers, collections, etc.) by relaying financial transactions between client
  companies and financial institutions. Financial transactions between two or more
  business enterprises, or between business enterprises and their customers, are
  conducted through the transaction-processing network established between the
  Company and the banks. The data is consolidated and transmitted to each bank
  batch/real time. Revenue from the Banking Van service is recognized when the
  service is rendered by the Company.</P>
<P style="MARGIN-LEFT: 5%" align=justify><I>Payment Gateway service (PG service)</I></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;With
  its PG service, the Company provides the Internet-based settlement service
  between on-line shopping mall and a credit card company when a customer uses
  his/her credit card, debit card or on-line payment to pay for goods or services.
  The Company receives fees for carrying out settlements for electronic
  transactions. Revenue from the PG service is recognized when the service is
  rendered by the Company.</P>
<P style="MARGIN-LEFT: 5%" align=justify><I>Sale of Merchandise</I></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  Company buys terminals from manufacturers, and subsequently sells them through
  its subsidiary agencies. Revenue is recognized when significant risks and
  rewards of ownership of terminals have passed to the buyer, usually on delivery
  of the terminals to the buyer. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Accrued
  severance benefits</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Employees
  and directors are entitled to receive a lump-sum payment upon termination of
  their employment with the Company, based on their length of service and rate of
  pay at the time of termination. Accrued severance benefits are estimated
  assuming all eligible employees were to terminate their employment at the
  balance sheet date. The annual severance benefits expense charged to income is
  calculated based on the net change in the accrued severance benefits payable at
  the balance sheet date, plus the actual payments made during the year.</P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  contributions to the severance insurance deposit are deducted from accrued
  severance benefit liabilities. Contributed amounts are refunded from the
  insurance company to employees upon their retirement.</P>
<P align=center>F-40</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_43></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Unaudited Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>For the six months ended June 30, 2010 and 2009</B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P align=justify><STRONG>2.</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <STRONG>&nbsp;SIGNIFICANT ACCOUNTING POLICIES (continued)</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Commitments
  and contingencies</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Liabilities
  arising from claims, assessments, litigation, fines, and penalties and other
  sources, are recorded when it is probable that a liability has been incurred and
  the amount of the assessment and/or remediation can be reasonably estimated.
  Legal costs incurred in connection with loss contingencies are expensed as
  incurred.</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Earnings
  per share</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic
  earnings per share are computed by dividing net income by the weighted-average
  number of shares of common stock outstanding during the year. Diluted earnings
  per share are calculated by dividing net income by the weighted-average number
  of shares of common stock outstanding during the year plus the weighted-average
  number of common shares that would have been outstanding assuming the conversion
  of all dilutive potential common shares. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Recent
  accounting pronouncements adopted</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
  June 2009, the Financial Accounting Standards Board (&#147;FASB&#148;) issued the FASB
  Accounting Standards Codification (the &#147;Codification&#148;) as the single source of
  authoritative GAAP recognized by the FASB to be applied by non-governmental
  entities. The Codification supersedes all existing non-SEC accounting and
  reporting standards. Following the issue of the Codification, the FASB has
  issued new guidance in the form of Accounting Standards Updates. This
  Codification is effective for financial statements issued for interim and annual
  periods ending after September 15, 2009. The Codification was effective for the
  Company from January 1, 2009. The Codification did not impact the Company&#146;s
  financial position or results of operations.</P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
  September 2009, the FASB issued guidance on revenue recognition in
  multiple-deliverable revenue arrangements. The guidance amended the existing
  guidance on allocating consideration received between the elements in a
  multiple-deliverable arrangement and established a selling price hierarchy for
  determining the selling price of a deliverable. The selling price used for each
  deliverable will be based on vendor-specific objective evidence (&#147;VSOE&#148;) if
  available, third-party evidence if VSOE is not available, or estimated selling
  price if neither VSOE nor third-party evidence is available. The guidance
  replaced the term &#147;fair value&#148; in the revenue allocation with &#147;selling price&#148; to
  clarify that the allocation of revenue is based on entity specific assumptions
  rather than the assumptions of a market place participant. The guidance
  eliminates the residual method of allocation and requires that arrangement
  consideration be allocated using the relative selling price method. It also
  significantly expands the disclosures related to a vendor&#146;s multiple-deliverable
  revenue arrangements. Earlier application is permitted. The Company adopted
  these new accounting standards in the beginning of 2007. </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
  October 2009, the FASB issued guidance which amended the scope of existing
  software revenue recognition accounting. Tangible products containing software
  components and non-software components that function together to deliver the
  product&#146;s essential functionality would be scoped out of the accounting guidance
  on software and accounted for based on other appropriate revenue recognition
  guidance. This guidance must be adopted in the same period that the company
  adopts the amended guidance for arrangements with multiple deliverables
  described in the preceding paragraph. The adoption of this guidance did not have
  an impact on the Company&#146;s financial position or results of operations. </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
  January 2010, the FASB issued Update 2010&#8722;06, <I>Fair</I> <I>Value Measurements
    and Disclosures (Topic 820): Improving Disclosures about Fair Value
    Measurements</I>, (&#147;Update 2010&#8722;06&#148;). Update 2010&#8722;06 amends ASC 820 and
  clarifies and provides additional disclosure requirements related to recurring
  and non&#8722;recurring fair value measurements and employers&#146; disclosures about
  postretirement benefit plan assets. This Update became effective for us on
  January 1, 2010. The adoption did not have an material impact on the Company&#146;s
  financial position or results of operations. </P>
<P align=center>F-41</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_44></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Unaudited Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>For the six months ended June 30, 2010 and 2009</B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P align=justify><STRONG>2.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <STRONG>SIGNIFICANT ACCOUNTING POLICIES (continued)</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Recent
  accounting pronouncements not yet adopted as of December 31, 2009 </STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
  July 2010, the FASB issued amendments to the disclosure requirements about the
  credit quality of financing receivables and the allowance for credit losses. The
  purpose of the additional disclosures is to enable users of financial statements
  to better understand the nature of credit risk inherent in an entity&#146;s portfolio
  of financing receivables and how that risk is analyzed. For end of period
  balances, the new disclosures are required to be made in all interim and annual
  periods ending on or after December 15, 2010. For activity during a reporting
  period, the disclosures are required to be made in all interim and annual
  periods after January 1, 2011. These changes will not have an impact on the
  Company&#146;s financial results as this guidance only relates to additional
  disclosures. </P>
<P align=justify><STRONG>3.</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG> RESTRICTED
  FINANCIAL INSTRUMENTS</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  following table represents financial instrument which are restricted in use as
  of June 30, 2010 and 2009.</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="32%"
    ><B>Restriction</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD width="1%" align=center style="BORDER-BOTTOM: #000000 1px solid" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="12%"
    ><B>2010</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD width="1%" align=center style="BORDER-BOTTOM: #000000 1px solid" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="12%"
    ><B>2009</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Short-term financial instruments </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="32%" bgColor=#e6efff >Pledge, etc. </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="12%" bgColor=#e6efff >1,179,364 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="12%" bgColor=#e6efff >788,000 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Long-term financial instruments </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="32%" >Pledge , Guarantee deposits for checking account,
      etc. </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD width="1%" align=left style="BORDER-BOTTOM: #000000 1px solid" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    >197,000 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD width="1%" align=left style="BORDER-BOTTOM: #000000 1px solid" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    >3,000 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;<B>Total</B> </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="32%" bgColor=#e6efff >&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%" align=left  bgColor=#e6efff style="BORDER-BOTTOM: #000000 3px double">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff >1,376,364 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%" align=left  bgColor=#e6efff style="BORDER-BOTTOM: #000000 3px double">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff >791,000 </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  entire amount of restricted short-term financial instrument is included in
  short-term financial instruments and the entire amount of restricted long-term
  financial instrument is included in other non-current assets in the balance
  sheet. </P>
<P align=justify><B>4.&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; ACCOUNTS
  RECEIVABLE</B></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  following table presents accounts receivable at June 30, 2010 and 2009:</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Current
  accounts receivable, net</STRONG></P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; " align=center
cellSpacing=0 cellPadding=0 width="80%" border=0>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2010</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2009</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Accounts receivable, gross </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>11,326,377 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>9,284,748 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp;Discount on current accounts receivable </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">(5,108</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">(23,066</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp;Allowance for doubtful
      accounts </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="17%"
    bgColor=#e6efff>(210,080</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="17%"
    bgColor=#e6efff>(174,601</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Accounts receivable, net </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="17%">11,111,189 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="17%">9,087,081 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
</TABLE>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Non-current
  accounts receivable, net </STRONG></P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; " align=center
cellSpacing=0 cellPadding=0 width="80%" border=0>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2010</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2009</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Non-current accounts
      receivable, gross </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>1,689,403 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>2,299,111 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp;Discount on accounts receivable </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">(167,212</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">(232,681</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp;Allowance for doubtful
      accounts </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="17%"
    bgColor=#e6efff>(16,894</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="17%"
    bgColor=#e6efff>(22,991</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Non-current accounts receivable, net </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="17%">1,505,297 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="17%">2,043,439 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
</TABLE>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Non-current
  accounts receivable arose from installment sales of Point of Sale(&#147;POS&#148;)
  terminals for the three years to merchants. Non-current accounts receivable
  amounts are determined based on the present value using appropriate risk
  adjusted discount rate considering environment of counter-party.<B> </B></P>
<P align=center>F-42 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_45></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Unaudited Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>For the six months ended June 30, 2010 and 2009</B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P align=justify><STRONG>5.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <STRONG>INVENTORY</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Inventory
  valuations as of June 30, 2010 and 2009 are summarized as follows:</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD width="5%"  >&nbsp;</TD>
    <TD align=left >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD colspan="7" align=center style="BORDER-BOTTOM: #000000 1px solid"><B>As
      of June 30, 2010</B> </TD>
    <TD align=left width="2%"
    >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="15%">&nbsp;</TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="15%">Lower of Cost or </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="15%">Valuation </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="15%">Cost </TD>
    <TD align=center width="2%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="15%">Market </TD>
    <TD align=center width="2%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="15%">Allowance </TD>
    <TD align=left width="2%"
    >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff >Inventory: </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="15%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="15%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="15%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left >&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Merchandise </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="15%">1,380,603 </TD>
    <TD align=left width="2%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="15%">1,380,603 </TD>
    <TD align=left width="2%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="15%">- </TD>
    <TD align=left width="2%"
    >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff ><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="15%"
    bgColor=#e6efff>1,380,603 </TD>
    <TD align=left width="2%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="15%"
    bgColor=#e6efff>1,380,603 </TD>
    <TD align=left width="2%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="15%"
    bgColor=#e6efff><B>-</B> </TD>
    <TD align=left width="2%"
     bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD width="5%"  >&nbsp;</TD>
    <TD align=left >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD colspan="7" align=center style="BORDER-BOTTOM: #000000 1px solid"><B>As
      of June 30, 2009</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="15%">&nbsp;</TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="15%">Lower of Cost or </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="15%">Valuation </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="15%">Cost </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="15%">Market </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="15%">Allowance </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff >Inventory: </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="15%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="15%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="15%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left >&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Merchandise </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="15%">1,864,666 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="15%">1,864,666 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="15%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff ><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="15%"
    bgColor=#e6efff>1,864,666 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="15%"
    bgColor=#e6efff>1,864,666 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="15%"
    bgColor=#e6efff><B>-</B> </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=center>F-43 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_46></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Unaudited Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>For the six months ended June 30, 2010 and 2009</B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P align=justify><STRONG>6.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <STRONG>FAIR VALUE OF FINANCIAL INSTRUMENTS</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Fair
  value of financial instruments </STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  following table presents the carrying amounts and estimated fair values of the
  Company&#146;s financial instruments as of June 30, 2010 and 2009: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD colspan="4" align=center style="BORDER-BOTTOM: #000000 1px solid"><B>2010</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD colspan="4" align=center style="BORDER-BOTTOM: #000000 1px solid"><B>2009</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>Carrying</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>Fair</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>Carrying</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>Fair</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>amount</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>value</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>amount</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>value</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>Financial assets</B> </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Cash and cash equivalents </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="12%" bgColor=#e6efff>20,017,727 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="12%" bgColor=#e6efff>20,017,727 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="12%" bgColor=#e6efff>8,565,795 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="12%" bgColor=#e6efff>8,565,795 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Short-term financial instruments </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">3,199,364 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">3,199,364 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">1,798,000 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">1,798,000 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Accounts receivable, net </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>11,111,189 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>11,111,189 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>9,087,081 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>9,087,081 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Short-term loans, net </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">2,375 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">2,375 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">43,320 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">43,320 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Non-current accounts receivable, &nbsp;net </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>1,505,297 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>1,505,297 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>2,043,439 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>2,043,439 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Available-for-sale securities </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">100,000 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">100,000 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">100,000 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">100,000 </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF">Other investment securities </TD>
    <TD width="1%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="12%" align=right bgcolor="#E6EFFF">222,693 </TD>
    <TD width="2%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="1%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="12%" align=right bgcolor="#E6EFFF">222,693 </TD>
    <TD width="2%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="1%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="12%" align=right bgcolor="#E6EFFF">222,693 </TD>
    <TD width="2%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="1%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="12%" align=right bgcolor="#E6EFFF">222,693 </TD>
    <TD width="2%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Long-term financial instruments </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">213,500 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">213,500 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">16,500 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">16,500 </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF">Long-term loans, net </TD>
    <TD width="1%" align=left bgcolor="#E6EFFF"
    >&nbsp;</TD>
    <TD
      width="12%" align=right bgcolor="#E6EFFF">900,364 </TD>
    <TD width="2%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="1%" align=left bgcolor="#E6EFFF"
    >&nbsp;</TD>
    <TD
      width="12%" align=right bgcolor="#E6EFFF">833,153 </TD>
    <TD width="2%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="1%" align=left bgcolor="#E6EFFF"
    >&nbsp;</TD>
    <TD
      width="12%" align=right bgcolor="#E6EFFF">1,241,392 </TD>
    <TD width="2%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="1%" align=left bgcolor="#E6EFFF"
    >&nbsp;</TD>
    <TD
      width="12%" align=right bgcolor="#E6EFFF">1,136,150 </TD>
    <TD width="2%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="1%" style="BORDER-BOTTOM: #000000 1px solid">&nbsp;</TD>
    <TD width="12%" style="BORDER-BOTTOM: #000000 1px solid">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%" style="BORDER-BOTTOM: #000000 1px solid">&nbsp;</TD>
    <TD width="12%" style="BORDER-BOTTOM: #000000 1px solid">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%" style="BORDER-BOTTOM: #000000 1px solid">&nbsp;</TD>
    <TD width="12%" style="BORDER-BOTTOM: #000000 1px solid">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%" style="BORDER-BOTTOM: #000000 1px solid">&nbsp;</TD>
    <TD width="12%" style="BORDER-BOTTOM: #000000 1px solid">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF"><B>Total financial assets</B> </TD>
    <TD width="1%" align=left bgcolor="#E6EFFF" style="BORDER-BOTTOM: #000000 3px double"
    >&nbsp;</TD>
    <TD
      width="12%" align=right bgcolor="#E6EFFF" style="BORDER-BOTTOM: #000000 3px double"><B>37,272,509</B> </TD>
    <TD width="2%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="1%" align=left bgcolor="#E6EFFF" style="BORDER-BOTTOM: #000000 3px double"
    >&nbsp;</TD>
    <TD
      width="12%" align=right bgcolor="#E6EFFF" style="BORDER-BOTTOM: #000000 3px double"><B>37,205,298</B> </TD>
    <TD width="2%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="1%" align=left bgcolor="#E6EFFF" style="BORDER-BOTTOM: #000000 3px double"
    >&nbsp;</TD>
    <TD
      width="12%" align=right bgcolor="#E6EFFF" style="BORDER-BOTTOM: #000000 3px double"><B>23,118,220</B> </TD>
    <TD width="2%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="1%" align=left bgcolor="#E6EFFF" style="BORDER-BOTTOM: #000000 3px double"
    >&nbsp;</TD>
    <TD
      width="12%" align=right bgcolor="#E6EFFF" style="BORDER-BOTTOM: #000000 3px double"><B>23,012,978</B> </TD>
    <TD width="2%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF"><B>Financial liabilities</B> </TD>
    <TD width="1%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="12%" align=left bgcolor="#E6EFFF">&nbsp;</TD>
    <TD width="2%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="1%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="12%" align=left bgcolor="#E6EFFF">&nbsp;</TD>
    <TD width="2%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="1%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="12%" align=left bgcolor="#E6EFFF">&nbsp;</TD>
    <TD width="2%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="1%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="12%" align=left bgcolor="#E6EFFF">&nbsp;</TD>
    <TD width="2%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Accounts payable </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">6,154,692 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">6,154,692 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">5,171,972 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">5,171,972 </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF">Short-term borrowings </TD>
    <TD width="1%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="12%" align=right bgcolor="#E6EFFF">2,000,000 </TD>
    <TD width="2%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="1%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="12%" align=right bgcolor="#E6EFFF">2,000,000 </TD>
    <TD width="2%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="1%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="12%" align=right bgcolor="#E6EFFF">- </TD>
    <TD width="2%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="1%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="12%" align=right bgcolor="#E6EFFF">- </TD>
    <TD width="2%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Derivatives </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">70,406 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">70,406 </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF">Current portion of long-term debt </TD>
    <TD width="1%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="12%" align=right bgcolor="#E6EFFF">6,000,000 </TD>
    <TD width="2%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="1%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="12%" align=right bgcolor="#E6EFFF">6,000,000 </TD>
    <TD width="2%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="1%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="12%" align=right bgcolor="#E6EFFF">4,000,000 </TD>
    <TD width="2%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="1%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="12%" align=right bgcolor="#E6EFFF">4,000,000 </TD>
    <TD width="2%" align=left bgcolor="#E6EFFF" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Long-term debt </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">6,000,000 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="12%">5,780,714 </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR>
    <TD bgcolor="#E6EFFF">&nbsp;</TD>
    <TD width="1%" bgcolor="#E6EFFF" style="BORDER-BOTTOM: #000000 1px solid" >&nbsp;</TD>
    <TD width="12%" bgcolor="#E6EFFF" style="BORDER-BOTTOM: #000000 1px solid">&nbsp;</TD>
    <TD width="2%" bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="1%" bgcolor="#E6EFFF" style="BORDER-BOTTOM: #000000 1px solid" >&nbsp;</TD>
    <TD width="12%" bgcolor="#E6EFFF" style="BORDER-BOTTOM: #000000 1px solid">&nbsp;</TD>
    <TD width="2%" bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="1%" bgcolor="#E6EFFF" style="BORDER-BOTTOM: #000000 1px solid" >&nbsp;</TD>
    <TD width="12%" bgcolor="#E6EFFF" style="BORDER-BOTTOM: #000000 1px solid">&nbsp;</TD>
    <TD width="2%" bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="1%" bgcolor="#E6EFFF" style="BORDER-BOTTOM: #000000 1px solid" >&nbsp;</TD>
    <TD width="12%" bgcolor="#E6EFFF" style="BORDER-BOTTOM: #000000 1px solid">&nbsp;</TD>
    <TD width="2%" bgcolor="#E6EFFF" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>Total financial liabilities</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"><B>14,154,692</B> </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"><B>14,154,692</B> </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"><B>15,242,378</B> </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"><B>15,023,092</B> </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
</TABLE>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  fair values of the financial instruments shown in the above table represent the
  amounts that would be received to sell those assets or that would be paid to
  transfer those liabilities in an orderly transaction between market participants
  at that date. Those fair value measurements maximize the use of observable
  inputs. However, in situations where there is little, if any, market activity
  for the asset or liability at the measurement date, the fair value measurement
  reflects the Company&#146;s own judgments about the assumptions that market
  participants would use in pricing the asset or liability. Those judgments are
  developed by the Company based on the best information available in the
  circumstances, including expected cash flows and appropriately risk adjusted
  discount rates, available observable and unobservable inputs. </P>
<P align=center>F-44</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_47></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Unaudited Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>For the six months ended June 30, 2010 and 2009</B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P align=justify><STRONG>6.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <STRONG>FAIR VALUE OF FINANCIAL INSTRUMENTS (continued)</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Fair
  value of financial instruments (continued)</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  following methods and assumptions were used to estimate the fair value of each
  class of financial instruments: </P>
<P style="MARGIN-LEFT: 5%" align=justify><B><I>Cash and cash equivalents,
  short-term financial instruments, long-term financial instruments, accounts
  receivable, short-term loans, non-current accounts receivable, accounts payable,
  short-term borrowings and current portion of long-term debt</I></B></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  carrying amounts, at face value or cost plus accrued interest, approximate fair
  value because of the short maturity of these instruments.</P>
<P style="MARGIN-LEFT: 5%" align=justify><B><I>Available for sale and other investment
  securities</I></B></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Debt
  securities classified as available-for-sale are measured using quoted market
  prices multiplied by the quantity held when quoted market prices are available.
  If quoted market prices for those debt securities are not available, the fair
  value is determined using an income approach valuation technique (present value
  using the discount rate adjustment technique) that considers, among other
  things, rates currently observed in publicly traded debt markets for debt of
  similar terms to companies with comparable credit risk, the issuer&#146;s credit
  spread, and illiquidity by sector and maturity. Equity securities that do not
  have readily determinable fair value are classified as other investment
  securities and measured at cost less any impairment. </P>
<P style="MARGIN-LEFT: 5%" align=justify><B><I>Long-term loans</I></B></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  fair value of the long-term loans is determined using an income approach
  valuation technique (present value using the discount rate adjustment technique)
  based on the present value of expected future cash flows which incorporates a
  risk premium to take into account the risks inherent in those expected cash
  flows. The long-term loans are recorded at their carrying value. The fair value
  is measured for disclosure purposes. </P>
<P style="MARGIN-LEFT: 5%" align=justify><B><I>Long-term debt</I></B></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  fair value of the Company&#146;s long term debt is measured using quoted offer side
  prices when quoted market prices are available. If quoted market prices are not
  available, the fair value is determined by discounting the future cash flows of
  each instrument at rates that reflect rates currently observed in publicly
  traded debt markets for debt of similar terms to companies with comparable
  credit risk. For long-term debt measurements, where there are no rates currently
  observable in publicly traded debt markets of similar terms to companies with
  comparable credit, the Company uses market interest rates and adjusts that rate
  for all necessary risks, including its own credit risk. In determining an
  appropriate spread to reflect its credit standing, the Company considers credit
  default swap spreads, bond yields of other long-term debt offered by the
  Company, and interest rates currently offered to the Company for similar debt
  instruments of comparable maturities by the Company&#146;s bankers as well as other
  banks that regularly compete to provide financing to the Company. The long-term
  debt is recorded at its carrying value. The fair value is measured for
  disclosure purposes. </P>
<P style="MARGIN-LEFT: 5%" align=justify><B><I>Derivatives</I></B></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;All
  derivatives are recognized on the balance sheet at fair value based on quoted
  market prices, dealer or counterparty quotes, if available. If quoted market
  prices are not available, pricing or valuation models are applied to current
  market information to estimate the fair value.</P>
<P align=center>F-45</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_48></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Unaudited Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>For the six months ended June 30, 2010 and 2009</B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>6.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>FAIR
  VALUE OF FINANCIAL INSTRUMENTS (continued)</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Fair
  value hierarchy</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Fair
  value is defined as the price that would be received upon sale of an asset or
  paid upon transfer of a liability in an orderly transaction between market
  participants at the measurement date and in the principal or most advantageous
  market for that asset or liability. The fair value should be calculated based on
  assumptions that market participants would use in pricing the asset or
  liability, not on assumptions specific to the entity. In addition, the fair
  value of liabilities should include consideration of non-performance risk
  including the Company&#146;s own credit risk.</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Fair
  value measurements and inputs are categorized into a fair value hierarchy which
  prioritizes the inputs into three levels based on the extent to which inputs
  used in measuring fair value are observable in the market. Each fair value
  measurement is reported in one of the three levels which are determined by the
  lowest level input that is significant to the fair value measurement in its
  entirety.</P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;These
  levels are:</P>
<UL style="TEXT-ALIGN: justify">
  <LI>
    <P>Level 1 &#150; inputs are based upon unadjusted quoted prices for identical
      instruments traded in active markets. </P>
  <LI>
    <P>Level 2 &#150; inputs are based upon quoted prices for similar instruments in
      active markets, quoted prices for identical or similar instruments in markets
      that are not active, and model-based valuation techniques for which all
      significant assumptions are observable in the market or can be corroborated by
      observable market data for substantially the full term of the assets or
      liabilities. </P>
  <LI>
    <P>Level 3 &#150; inputs are generally unobservable and typically reflect
      management&#146;s estimates of assumptions that market participants would use in
      pricing the asset or liability. The fair values are therefore determined using
      model-based techniques that include option pricing models, discounted cash
      flow models, and similar techniques. </P>
  </LI>
</UL>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  following table presents the Company&#146;s assets and liabilities measured at fair
  value on a recurring basis as of June 30, 2010:</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 9pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=center>&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="15%">Quoted price in </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="14%">&nbsp;</TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%">Significant </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=center>&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="15%">active markets for </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="14%">Significant other </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%">unobservable </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=center>&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="15%">identical assets </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="14%">observable inputs </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%">inputs </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=center>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="15%">(Level 1)</TD>
    <TD align=center width="2%" ></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="14%">(Level 2)</TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%">(Level 3)</TD>
    <TD align=center width="2%" ></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>Total</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Assets </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="15%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="14%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp;Available-for-sale securities </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="15%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="14%">100,000 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">100,000 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B>Total
      assets at fair value</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="15%"
    bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="14%"
    bgColor=#e6efff><B>100,000</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>-</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>100,000</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="14%">&nbsp;</TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
    <TD width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Liabilities </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="15%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="14%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp;Derivatives </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="15%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="14%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="12%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B>Total
      liabilities at fair value</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="15%"
    bgColor=#e6efff><B>-</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="14%"
    bgColor=#e6efff><B>-</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>-</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>-</B> </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=center>F-46</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_49></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Unaudited Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>For the six months ended June 30, 2010 and 2009</B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P align=justify><STRONG>6.</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <STRONG>&nbsp;FAIR VALUE OF FINANCIAL INSTRUMENTS (continued) </STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Fair
  value hierarchy (continued) </STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  following table presents the Company&#146;s assets and liabilities measured at fair
  value on a recurring basis as of June 30, 2009: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 9pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="15%">Quoted Price in </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%">Significant Other </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%">Significant </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="15%">Active Markets for </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%">Observable </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%">Unobservable </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="15%">Identical Assets </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%">Inputs </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%">Inputs </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="15%">(Level 1)</TD>
    <TD align=center width="2%" ></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%">(Level 2)</TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%">(Level 3)</TD>
    <TD align=center width="2%" ></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>Total </B></TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Assets </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="15%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp;Available-for-sale securities </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="15%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">100,000 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">100,000 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B>Total
      assets at fair value </B></TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="15%"
    bgColor=#e6efff><B>- </B></TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>100,000 </B></TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>- </B></TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>100,000 </B></TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="15%">&nbsp;</TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
    <TD width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Liabilities </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="15%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp;Derivatives </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="15%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">70,406 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">70,406 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B>Total
      liabilities at fair value </B></TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="15%"
    bgColor=#e6efff><B>- </B></TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>&nbsp;</B><B>70,406 </B></TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>- </B></TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>&nbsp;</B><B>70,406 </B></TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=justify><STRONG>7.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <STRONG>DERIVATIVES </STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  Company uses derivative financial instruments primarily to manage the risks
  associated with fluctuations in interest rates. In 2008, the Company used
  variable-rate Certificate of Deposit (CD) debt to finance its operations. The
  debt obligations expose to the Company to variability in interest payments due
  to changes in interest rates. Management believed that it is prudent to limit
  the variability of a portion of its interest payments. To meet this objective,
  management entered into CD based interest rate swap agreements to manage
  fluctuations in cash flows resulting from changes in the benchmark interest rate
  of CD. This swap changes the variable rate cash flow exposure on the debt
  obligations to fixed cash flows. Under the terms of the interest rate swaps, the
  Company receives CD based variable interest rate payments (CD + 1.425%) and
  makes fixed interest rate payments of 6.625%, thereby creating the equivalent of
  fixed-rate debt for the notional amount (&#65510;4,000 million) of its debt hedged.
  However, the Company did not designate the interest rate related derivatives as
  hedging instruments under ASC 815 and therefore, any gains or losses on
  derivatives are recognized in the current income. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  fair value of derivatives held as of June 30, 2010 and 2009 are as follows: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD colspan="4" align=center style="BORDER-BOTTOM: #000000 1px solid">Liability
      derivatives </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="22%"><B>2010 </B></TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="22%"><STRONG>2009</STRONG></TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR>
    <TD >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="22%">&nbsp;</TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="22%">&nbsp;</TD>
    <TD width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Derivatives: </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="22%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="22%" bgColor=#e6efff>70,406 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp;Interest Rate Swap </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="22%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="22%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgcolor="#E6EFFF" >Total derivatives not designated as hedging instruments under ASC 815 </TD>
    <TD width="1%" align=left valign="bottom" bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="22%" align=right valign="bottom" bgcolor="#E6EFFF"><B>- </B></TD>
    <TD width="2%" align=left valign="bottom" bgcolor="#E6EFFF" >&nbsp;</TD>
    <TD width="1%" align=left valign="bottom" bgcolor="#E6EFFF" >&#65510;</TD>
    <TD width="22%" align=right valign="bottom" bgcolor="#E6EFFF">70,406 </TD>
    <TD width="2%" align=left valign="bottom" bgcolor="#E6EFFF" >&nbsp;</TD>
  </TR>
</TABLE>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  effects of derivates instruments on income for the periods ended June 30, 2010
  and 2009 are summarized as follows:</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD colspan="4" align=center style="BORDER-BOTTOM: #000000 1px solid">Gains
      (Losses) </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left ></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="22%"><B>2010 </B></TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="22%"><B>2009</B></TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Gains (losses) on derivatives </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="22%" bgColor=#e6efff>22,266 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="22%" bgColor=#e6efff>21,427 </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=center>F-47 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_50></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Unaudited Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>For the six months ended June 30, 2010 and 2009</B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>8.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>LONG-TERM
  DEBT</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Long-term
  debt as of June 30, 2010 and 2009 are summarized as follows: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD width="5%"  >&nbsp;</TD>
    <TD align=left >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="15%"><B>Maturity </B></TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="15%"><B>2010 </B></TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="15%"><B>2009 </B></TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left >Long-term debt </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="15%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="15%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="15%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp;(Annual interest
      rate: 4.95~5.77%) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=center width="15%" bgColor=#e6efff>2010 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="15%" bgColor=#e6efff>6,000,000 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="15%" bgColor=#e6efff>10,000,000 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left >Current portion of long-term debt </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="15%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="15%">(6,000,000</TD>
    <TD align=left width="2%" >) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="15%">(4,000,000</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff >Total </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=center width="15%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="15%"
    bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="15%"
    bgColor=#e6efff>6,000,000 </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Long-term
  debt is subject to various restrictive covenants. These covenants typically
  include restrictions on the debt to equity ratio, credit rating, working capital
  ratio, and other similar financial ratios. The Company was in compliance with
  these financial covenants during all periods presented.</P>
<P align=justify><STRONG>9.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <STRONG>PROPERTY AND EQUIPMENT</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Property
  and equipment as of June 30, 2010 and 2009 are summarized as follows: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD width="10%"  >&nbsp;</TD>
    <TD align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2010 </B></TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2009 </B></TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR>
    <TD width="10%" >&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
    <TD width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left>Cost: </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Land </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="12%" bgColor=#e6efff>981,257 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="12%" bgColor=#e6efff>981,257 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp;Buildings </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">625,943 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">625,943 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Structures </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>203,350 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>203,350 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left>&nbsp;Vehicles </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">25,350 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">40,629 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Tools, furniture and fixtures </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>76,993,018 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>62,986,908 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp;Machinery and equipment </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">6,054,301 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">6,054,301 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Software </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>5,230,167 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>4,742,157 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%"><B>90,113,386 </B></TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%"><B>75,634,545 </B></TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>Accumulated depreciation: </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp;Buildings </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">136,326 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">115,461 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Structures </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>139,236 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>113,817 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp;Vehicles </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">25,350 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">40,629 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Tools, furniture and fixtures </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>54,123,608 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>44,224,728 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp;Machinery and equipment </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">5,558,521 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">5,169,204 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Software </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>4,003,959 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>3,501,150 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%"><B>63,987,000 </B></TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%"><B>53,164,989 </B></TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>Accumulated loss on impairment: </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp;Tools, furniture and fixtures </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">22,301 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Machinery and equipment </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>12,359 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%"><B>12,359 </B></TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%"><B>22,301 </B></TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>Carrying amount: </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp;Land </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">981,257 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">981,257 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Buildings </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>489,617 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>520,915 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp;Structures </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">64,114 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">102,242 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Vehicles </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp;Tools, furniture and fixtures </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">22,869,410 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">16,671,127 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Machinery and equipment </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>483,420 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>1,109,356 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp;Software </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">1,226,208 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">1,160,694 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="10%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>26,114,027 </B></TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff><B>&nbsp;</B><B>22,447,255 </B></TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=center>F-48</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_51></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Unaudited Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>For the six months ended June 30, 2010 and 2009</B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P align=justify><STRONG>9.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; <STRONG>PROPERTY AND EQUIPMENT (continued) </STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
  six-month periods ended June 30, 2010 and 2009, total depreciation expenses for
  the property and equipment were &#65510;5,620 million, and &#65510;4,659 million, respectively.
  Total depreciation expenses include cost of sales in an amount of &#65510;4,012 million
  and &#65510;3,135 million; and selling, general, administrative expenses of &#65510;1,608
  million, and &#65510;1,524 million for six-month periods ended June 30, 2010 and 2009,
  respectively. </P>
<P
align=justify><STRONG>10.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>INTANGIBLE
  ASSETS </STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Summarized
  below is the carrying value and accumulated amortization of intangible assets as
  of June 30, 2010 and 2009:</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD colspan="7" align=center style="BORDER-BOTTOM: #000000 1px solid"><B>As
      of June 30, 2010</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="19%">&nbsp;</TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="19%"><B>Accumulated</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="19%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="19%"
    ><STRONG>Gross carrying value</STRONG> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="19%"><B>amortization</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="19%"><B>Net carrying value</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Finite-lived intangible assets: </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="19%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="19%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="19%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Trademarks </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="19%">77,057 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="19%">57,366 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="19%">19,691 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Total finite-lived intangible assets </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="19%" bgColor=#e6efff><B>77,057</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="19%" bgColor=#e6efff><B>57,366</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="19%" bgColor=#e6efff><B>19,691</B> </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD colspan="7" align=center style="BORDER-BOTTOM: #000000 1px solid"><B>As
      of June 30, 2009</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="19%">&nbsp;</TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="19%"><B>Accumulated</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="19%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="19%"
    ><STRONG>Gross carrying value</STRONG> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="19%"><B>amortization</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="19%"><B>Net carrying value</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Finite-lived intangible assets: </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="19%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="19%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="19%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Trademarks </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="19%">77,057 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="19%">49,979 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="19%">27,078 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Total finite-lived intangible assets </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="19%" bgColor=#e6efff><B>77,057</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="19%" bgColor=#e6efff><B>49,979</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="19%" bgColor=#e6efff><B>27,078</B> </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Amortization
  expenses charged for the periods ended June 30, 2010 and 2009 were &#65510;3.7 million,
  respectively. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Future
  estimated annual amortization expense for the next five fiscal years is
  presented in the table below. Actual amortization expense in future periods
  could differ from this estimate as a result of acquisitions, changes in useful
  lives and other relevant factors.</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; " align=center
cellSpacing=0 cellPadding=0 width="50%" border=0>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>Year </TD>
    <TD align=left width="10%"  >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="32%"
    >Amount </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>2011 </TD>
    <TD align=left width="10%"  bgColor=#e6efff
    >&nbsp;</TD>
    <TD align=right width="32%" bgColor=#e6efff >7,387 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>2012 </TD>
    <TD align=left width="10%"  >&nbsp;</TD>
    <TD align=right width="32%" >7,387 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>2013 </TD>
    <TD align=left width="10%"  bgColor=#e6efff
    >&nbsp;</TD>
    <TD align=right width="32%" bgColor=#e6efff >1,224 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>2014 </TD>
    <TD align=left width="10%"  >&nbsp;</TD>
    <TD align=right width="32%" >- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>2015 </TD>
    <TD align=left width="10%"  bgColor=#e6efff
    >&nbsp;</TD>
    <TD align=right width="32%" bgColor=#e6efff >- </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=center>F-49 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_52></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Unaudited Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>For the six months ended June 30, 2010 and 2009</B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>11.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>OTHER
  ASSETS AND LIABILITIES </STRONG></P>
<P align=justify><B>Other Current Assets </B></P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; " align=center
cellSpacing=0 cellPadding=0 width="90%" border=0>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2010</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2009</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Short-term Loans </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>2,500 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>53,416 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp;Allowance for doubtful accounts </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">(125</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">(10,096</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Other receivables </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>582,290 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>439,179 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp;Allowance for doubtful accounts </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">(15,723</TD>
    <TD align=left width="2%" >) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">(23,459</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Accrued income </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>42,190 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>45,136 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Advanced prepayments </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">3,133,513 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">4,477,088 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Prepaid expenses </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="17%"
    bgColor=#e6efff>12,780,982 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="17%"
    bgColor=#e6efff>8,122,696 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="17%">16,525,627 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="17%">13,103,960 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR>
    <TD >&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="17%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="17%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left ><B>Other non-current Assets</B> </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="17%">&nbsp;</TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="17%">&nbsp;</TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="17%"><B>2010</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="17%"><B>2009</B> </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Long-term financial
      instruments </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>213,500 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>16,500 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#ffffff >Other investment securities </TD>
    <TD align=left width="1%"  bgColor=#ffffff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#ffffff>222,693 </TD>
    <TD align=left width="2%"  bgColor=#ffffff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#ffffff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#ffffff>222,693 </TD>
    <TD align=left width="2%"  bgColor=#ffffff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Long-term loans (*) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>947,752 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>1,306,728 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#ffffff >&nbsp;Allowance for doubtful
      accounts </TD>
    <TD align=left width="1%"  bgColor=#ffffff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#ffffff>(47,388</TD>
    <TD align=left width="2%"  bgColor=#ffffff>) </TD>
    <TD align=left width="1%"  bgColor=#ffffff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#ffffff>(65,336</TD>
    <TD align=left width="2%"  bgColor=#ffffff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Guarantee deposits (**) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>3,208,209 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>3,216,729 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#ffffff >Other investment </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
     bgColor=#ffffff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="17%"
    bgColor=#ffffff>1,038,481 </TD>
    <TD align=left width="2%"  bgColor=#ffffff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
     bgColor=#ffffff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="17%"
    bgColor=#ffffff>1,038,481 </TD>
    <TD align=left width="2%"  bgColor=#ffffff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>5,583,247 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>5,735,795 </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=justify>(*) Long-term loans include loans to employees for mortgage in
  an amount of &#65510;765 million and &#65510;758 million as of June 30, 2010 and 2009,
  respectively. <BR>
  (**) Guarantee deposits consist of deposits for leased
  offices.</P>
<P align=justify><B>Other current Liabilities </B></P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; " align=center
cellSpacing=0 cellPadding=0 width="90%" border=0>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2010</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2009</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Other payables </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>2,465,520 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>1,196,341 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Advances from customers </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">134,099 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">260,710 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Value-added tax payable </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>1,098,692 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>761,741 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Withholdings (*) </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">11,118,299 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">6,461,120 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Other accrued expenses </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>452,020 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>424,237 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Deposits received </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">170,751 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">370,307 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Income taxes payable </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>1,622,468 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>1,414,880 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Derivatives </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="17%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right
      width="17%">70,406 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>17,061,849 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>10,959,742 </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=justify>(*) Withholdings are related to the Payment Gateway Service for
  accounts received from the credit card companies withheld before they are passed
  to the on-line shopping mall.</P>
<P align=justify><B>Other non-current Liabilities </B></P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; " align=center
cellSpacing=0 cellPadding=0 width="90%" border=0>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2010</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2009</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Unrecognized tax
      benefits(Note15) </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="17%"
    bgColor=#e6efff>1,036,750 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="17%"
    bgColor=#e6efff>148,135 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="17%">1,036,750 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="17%">148,135 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
</TABLE>
<P align=center>F-50 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_53></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Unaudited Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>For the six months ended June 30, 2010 and 2009</B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>12.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>OTHER
  INCOME (EXPENSE), net </STRONG></P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left ><B>Other income(expense), net</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2010</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2009</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Loss on foreign currency
      transactions </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>(104</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>(113</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Gain on disposal of property and equipment </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">2,267 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">1,642 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Loss on impairment of
      property and equipment </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>(12,359</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Gain on valuation of derivates </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">22,266 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">21,427 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Donations </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>(267,611</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>(15,460</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Miscellaneous </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right
    width="17%">(1,124</TD>
    <TD align=left width="2%" >) </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right width="17%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>(244,306</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>7,496 </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>13.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>EQUITY </STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Common
  stock </STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  holder of each share of common stock has the right to one vote. The number of
  issued common shares as of June 30, 2010 and 2009 are 13,605,766, respectively.
  All common stock is issued at par value. Amount of capital stock and additional
  paid-in capital as of June 30, 2010 and 2009 are as follows:</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; " align=center
cellSpacing=0 cellPadding=0 width="80%" border=0>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2010</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2009</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Capital stock: </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="17%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="17%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp;Common stock </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="17%">6,802,883 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="17%">6,802,883 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff ><B>&nbsp; &nbsp;&nbsp; &nbsp;Total</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="17%"
    bgColor=#e6efff><B>6,802,883</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="17%"
    bgColor=#e6efff><B>6,802,883</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD align=left >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="17%">&nbsp;</TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="17%">&nbsp;</TD>
    <TD width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Additional paid-in capital: </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="17%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="17%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp;Other paid-in capital </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="17%">33,568 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="17%">33,568 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff ><B>&nbsp; &nbsp;&nbsp; &nbsp;Total</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="17%"
    bgColor=#e6efff><B>33,568</B> </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="17%"
    bgColor=#e6efff><B>33,568</B> </TD>
    <TD align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Stock
  retirement</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Total
  amount of common stocks retired as of June 30, 2010 and 2009 are as follows:</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; " align=center
cellSpacing=0 cellPadding=0 width="80%" border=0>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="14%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="2%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="14%"><B>2010</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="14%"><B>2009</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="2%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="14%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left ></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="14%"
    >Shares</TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="14%">Amount </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="14%">Shares </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="14%">Amount </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Common stock </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="14%"
     bgColor=#e6efff>-</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="2%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="14%"
    bgColor=#e6efff>- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="14%"
    bgColor=#e6efff>946,018 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="2%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="14%"
    bgColor=#e6efff>473,009 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="2%"
     bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp;Total </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%" >-</TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">946,018 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="14%">473,009 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
</TABLE>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;According
  to ASC 505, if an enterprise&#146;s stock is retired, an excess of purchase price
  over par or stated value may be allocated between additional paid-in capital and
  retained earnings. On March 26, 2009, the Company repurchased and retired
  946,018 shares of common stock and an excess of repurchase price over par value
  was allocated to the retained earnings for amount of &#65510;3,615 million. </P>
<P align=center>F-51 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_54></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Unaudited Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>For the six months ended June 30, 2010 and 2009</B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>14.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>ACCRUED
  SEVERANCE BENEFITS</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accrued
  severance benefits as of June 30, 2010 and 2009 are as follows: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; " align=center
cellSpacing=0 cellPadding=0 width="80%" border=0>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2010</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2009</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR>
    <TD >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="17%">&nbsp;</TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="17%">&nbsp;</TD>
    <TD width="2%" >&nbsp;</TD>
  </TR>
  <TR>
    <TD >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="17%">&nbsp;</TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="17%">&nbsp;</TD>
    <TD width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Balance at beginning of
      period </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>2,458,097 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>1,993,792 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Provision for severance benefits </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">569,331 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">405,862 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Severance payments during the
      period </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="17%"
    bgColor=#e6efff>(323,104</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="17%"
    bgColor=#e6efff>(148,307</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Balance at end of period </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">2,704,324 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">2,251,347 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Deposit for severance
      benefits insurance </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="17%"
    bgColor=#e6efff>(1,511,464</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="17%"
    bgColor=#e6efff>(1,168,925</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Accrued severance benefits </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="17%"><B>1,192,860</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="17%"><B>1,082,422</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
</TABLE>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  severance benefits are funded approximately 55.9% and 51.9% as of June 30, 2010
  and 2009, respectively through severance insurance deposits with the Shinhan
  Life Insurance Company and the Hana Bank for the payment of severance benefits.
  The Company has no additional liability once the amount has been contributed,
  thus the Company deducts contributions made to the severance insurance deposits
  from accrued severance benefit liabilities. The beneficiaries of the severance
  insurance deposit are the Company&#146;s employees.</P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  Company expects to pay the following severance benefits, which are currently
  accrued for the Company&#146;s obligation through June 30, 2010, to its employees. If
  they terminate upon their normal retirement age: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; " align=center
cellSpacing=0 cellPadding=0 width="50%" border=0>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>2011 </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="32%" bgColor=#e6efff >- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>2012 </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="32%" >- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>2013 </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="32%" bgColor=#e6efff >- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>2014 </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="32%" >- </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>2015 </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="32%" bgColor=#e6efff >- </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>2016~2020 </TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="32%" >235,392 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
</TABLE>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  above amounts were determined based on the employees&#146; current salary rates and
  the number of service years that will be accumulated upon their retirement date.
  These amounts do not include amounts that might be paid to employees who will
  cease working with the Company before their normal retirement age.</P>
<P
align=justify><STRONG>15.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>INCOME
  TAXES</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;In
  accordance with the amendment of Corporate Tax Act enacted in 2008, the
  statutory income tax rate was amended to 24.2% effective for fiscal year 2009
  and 22.0% for fiscal years 2010 and thereafter. However, in 2009, Corporate
  Income Tax Law was further amended and the statutory income tax rate of 24.2% is
  effective for fiscal years 2009 until 2011 and 22% for fiscal years 2012 and
  thereafter. Accordingly, deferred income taxes as of December 31, 2009 were
  calculated based on the enacted rates of 24.2% and 22.0% .</P>
<P align=center>F-52</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_55></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Unaudited Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>For the six months ended June 30, 2010 and 2009</B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>15.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>INCOME
  TAXES (continued)</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Actual
  income tax expense differs from the theoretical amount that would arise at the
  Korean statutory tax rate for six months ended June 30, 2010 and 2009 as
  follows: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; " align=center
cellSpacing=0 cellPadding=0 width="80%" border=0>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2010</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2009</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR>
    <TD >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="17%">&nbsp;</TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="17%">&nbsp;</TD>
    <TD width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Income tax expense at Korean
      statutory tax rate </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>2,526,580 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>1,920,220 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Nondeductible items </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">113,806 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">(90,455</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Adjustments to uncertain and
      effectively settled tax positions </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>(688,185</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>(276,014</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Income tax exemption </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">68,283 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">(5,524</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Other </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="17%"
    bgColor=#e6efff>(31,256 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="17%"
    bgColor=#e6efff>115,595 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp;Income tax expense(benefit) </TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="17%">1,989,228 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&#65510;</TD>
    <TD align=right width="17%">1,663,822 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
</TABLE>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  following is a reconciliation of income taxes computed at the Korean tax rate to
  actual effective income tax provision:</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; " align=center
cellSpacing=0 cellPadding=0 width="80%" border=0>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2010</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2009</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR>
    <TD >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="17%">&nbsp;</TD>
    <TD width="2%" >&nbsp;</TD>
    <TD width="1%" >&nbsp;</TD>
    <TD width="17%">&nbsp;</TD>
    <TD width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Statutory income tax rate </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>24.2% </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>24.2% </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Expenses not deductible for tax purposes </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">1.1 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">(1.1</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Tax exemptions </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>(6.6</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>(3.5</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >FIN 48 tax contingencies and settlements </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">0.6 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="17%">(0.1</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Others </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="17%"
    bgColor=#e6efff>(0.3</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="17%"
    bgColor=#e6efff>1.3 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Effective income tax rate </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="17%">19.0% </TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="17%">20.8% </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
</TABLE>
<P align=center>F-53</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_56></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Unaudited Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>For the six months ended June 30, 2010 and 2009</B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>15.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>INCOME
  TAXES (continued)</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Deferred
  tax assets and liabilities</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred
  income taxes reflect the temporary differences between the amounts at which
  assets and liabilities are recorded for financial reporting purposes and the
  amounts utilized for tax purposes. The primary components of the temporary differences
  that gave rise to the Company&#146;s deferred tax assets and liabilities as
  of June 30, 2010 and 2009, and their classification, were as follows: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; " align=center
cellSpacing=0 cellPadding=0 width="80%" border=0>
  <TR vAlign=top>
    <TD align=left><B>Deferred tax assets</B> </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="17%">&nbsp;</TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="17%">&nbsp;</TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2010</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2009</B> </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Investment securities </TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>271,154 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>293,155 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      Depreciation and amortization </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="17%">112,542 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="17%">49,014 </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Derivatives </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>15,489 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Advanced payments </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="17%">- </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="17%">169,806 </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Other
      payables </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>487,232 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>379,238 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Advances from customers </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="17%">21,341 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="17%">51,398 </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Accrued
      severance benefits </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>512,685 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>411,465 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Bad debt </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="17%">207.501 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="17%">6,609 </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Other </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="17%"
    bgColor=#e6efff>113,492 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="17%"
    bgColor=#e6efff>121,679 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp;<B>Total deferred tax assets</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="17%">1,725,947 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="17%">1,497,853 </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
</TABLE>
<BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; " align=center
cellSpacing=0 cellPadding=0 width="80%" border=0>
  <TR vAlign=top>
    <TD align=left><B>Deferred tax liabilities</B> </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="17%">&nbsp;</TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="17%">&nbsp;</TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2010</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2009</B> </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Accounts
      receivable </TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>960,589 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>774,248 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Other current assets </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="17%">9,560 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="17%">9,265 </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left
      bgColor=#e6efff>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Deposit
      for severance benefits insurance </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>332,522 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>257,163 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Other </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="17%">587,872 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="17%">- </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left
      bgColor=#e6efff>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Total
      deferred tax liabilities</STRONG> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="17%"
    bgColor=#e6efff>1,890,543 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="17%"
    bgColor=#e6efff>1,040,676 </TD>
    <TD align=left width="2%"
bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; " align=center
cellSpacing=0 cellPadding=0 width="80%" border=0>
  <TR vAlign=top>
    <TD align=left><B>Reported as:</B> </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="17%">&nbsp;</TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="17%">&nbsp;</TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2010</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2009</B> </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="17%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="17%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Current
      deferred tax assets </TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>175,164 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Non-current deferred tax
      assets </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="17%">- </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="17%">282,013 </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Current
      deferred tax liabilities </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>12,060 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="17%" bgColor=#e6efff>- </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Non-current deferred tax
      liabilities </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="17%">152,536 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="17%">- </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B>Net
      deferred income tax assets(liabilities)</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="17%"
    bgColor=#e6efff>(164,596</TD>
    <TD align=left width="2%" bgColor=#e6efff>) </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="17%"
    bgColor=#e6efff>457,177 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=center>F-54 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_57></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Unaudited Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>For the six months ended June 30, 2010 and 2009</B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P align=justify><STRONG>15.</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG> INCOME TAXES (continued)</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>Uncertain
  tax positions</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
  January 1, 2009, the Company adopted the provisions of ASC 740 which set outs a
  consistent framework to determine the appropriate level of tax reserve for
  uncertain tax positions. ASC Subtopic 740-10 originally was effective for fiscal
  years beginning after December 15, 2006. The FASB issued ASC Subtopic 740-10
  (FSP FIN 48-3, Effective date of FASB Interpretation No. 48 for Certain
  Nonpublic Enterprises), which deferred the effective date of ASC Subtopic 740-10
  for nonpublic entities that had not already issued a complete set of annual
  financial statements fully reflecting ASC Subtopic 740-10&#146;s requirements or are
  consolidated entities of public entities that report in US GAAP. This means that
  ASC Subtopic 740-10 was required for such entities with fiscal years beginning
  after December 15, 2008 and accordingly, the Company adopted the provisions in
  2009.</P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  following table is a reconciliation of the beginning and ending amount of the
  Company&#146;s gross unrecognized tax benefits for the six-month periods ended June
  30, 2010 and 2009: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; " align=center
cellSpacing=0 cellPadding=0 width="80%" border=0>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="22%"><B>2010</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Beginning balance </TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="22%" bgColor=#e6efff>963,778 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp;Gross increases/(decreases) &#150; tax
      positions in prior period </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="22%">- </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp;Gross
      increases/(decreases) &#150; current period tax positions </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="22%" bgColor=#e6efff>72,972 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp;Settlements </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="22%">- </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp;Lapse of statute of
      limitations </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="22%"
    bgColor=#e6efff>- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Ending balance </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="22%">1,036,750 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left
    width="2%">&nbsp;</TD>
  </TR>
</TABLE>
<BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; " align=center
cellSpacing=0 cellPadding=0 width="80%" border=0>
  <TR vAlign=top>
    <TD align=left></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="22%"><STRONG>2009</STRONG> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Beginning balance </TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="22%" bgColor=#e6efff>154,210 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp;Gross increases/(decreases) &#150; tax
      positions in prior period </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="22%">- </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp;Gross
      increases/(decreases) &#150; current period tax positions </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="22%" bgColor=#e6efff>(6,075</TD>
    <TD align=left width="2%" bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp;Settlements </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="22%">- </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp;Lapse of statute of
      limitations </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="22%"
    bgColor=#e6efff>- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Ending balance </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left
    width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="22%">148,135 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left
    width="2%">&nbsp;</TD>
  </TR>
</TABLE>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Upon
  adoption at January 1, 2009, the Company&#146;s decreased retained earnings by
  &#65510;154,210 thousand. For the six-month periods ended June 30, 2009, the
  unrecognized tax benefit decreased by &#65510;6,075 thousand which all related to
  permanent differences. As of June 30, 2009, the Company&#146;s total unrecognized tax
  benefits that, if recognized, would affect the effective tax rate is &#65510;148,135
  thousand. During the six-month periods ended June 30, 2009, the Company
  recognized approximately &#65510;82 thousand for the payment of interest and penalty.
  The Company had approximately &#65510;11,544 thousand and &#65510;5,661 thousand for the payment
  of interest and penalties accrued in the balance sheet as of June 30,2009. </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;For
  the six-month periods ended June 30, 2010, the unrecognized tax benefit
  increased by &#65510;72,972 thousand which all related to permanent differences. As of
  June 30, 2010, the Company&#146;s total unrecognized tax benefits that, if
  recognized, would affect the effective tax rate is &#65510;1,036,750 thousand. During
  the six-month periods ended June 30, 2010, the Company recognized approximately
  &#65510;3,687 thousand for the payment of interest and penalty. The Company had
  approximately &#65510;18,090 thousand and &#65510;39,827 thousand for the payment of interest
  and penalties accrued in the balance sheet as of June 30,2010. </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  Company files income tax returns in the Republic of Korea. In 2007, the Korea
  National Tax Service, or NTS, has effectively completed the examination of the
  Company&#146;s returns in the Republic of Korea related to years 2002 through 2006. </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;It
  is expected that the amount of unrecognized tax benefits will also change for
  other reasons in the next 12 months; however, the Company does not expect the
  change to have a significant impact on our financial position or results of
  operations </P>
<P align=center>F-55</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_58></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Unaudited Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>For the six months ended June 30, 2010 and 2009</B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>16.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>EARNINGS
  PER SHARE</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Basic
  earnings per share of common stock is computed by dividing net income by the
  weighted average number of shares of common stock outstanding for the period,
  less the weighted average number of shares subject to stock retirement. </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  following details the computation of earnings per share of common stock for six
  months ended June 30, 2010 and 2009: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2010</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="12%"><B>2009</B> </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="12%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Net income </TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="12%" bgColor=#e6efff>8,507,918 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="12%" bgColor=#e6efff>6,321,908 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Weighted average shares used in computing basic earnings
      per share </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">13,800,153 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="12%">14,044,802 </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff><B>Basic earnings per share</B> </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>617 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>450 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>17.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>COMMITMENTS
  AND CONTINGENCIES</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  Company is involved in a total of four litigations that have arisen in the
  ordinary course of business, including matters involving price fixing. The
  results and timing of the ultimate resolutions of these proceedings are
  inherently unpredictable. The outcome of any claim, suit, assessment,
  investigation, or legal proceeding, individually or collectively will depend on
  a number of variables, including the nature, timing, and amount of any
  associated expenses, amounts paid in settlement, damages or other remedies or
  consequences. As of June 30, 2010, the Company did not accrue liabilities with
  respect to the pending litigations. The Company will accrue a liability when it
  believes that it is both probable that a liability has been incurred and that it
  can reasonably estimate the amount of the loss.</P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;As
  of June 30, 2010, the Company has guarantees provided by non-related party for
  the Company as follows:</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD width="5%"  >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>Providing by </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="13%">Amount </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="45%"
    >Description </TD>
  </TR>
  <TR>
    <TD width="5%" >&nbsp;</TD>
    <TD>&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="13%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="45%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>Seoul Guarantee Insurance Co., Ltd. </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="13%" bgColor=#e6efff>10,456,000 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="45%" bgColor=#e6efff >Payment guarantee
      provided by the insurance company </TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>18.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>PLEDGED
  ASSETS</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Details
  of assets pledged by the Company as collateral for operating activities as of
  June 30, 2010 are as follows</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>Pledged to </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="32%">Pledged assets </TD>
    <TD align=right width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="25%">Pledged amount </TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=center bgColor=#e6efff>Kookmin Bank </TD>
    <TD align=center width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=center width="32%" bgColor=#e6efff>Short-term financial
      instruments </TD>
    <TD align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="25%" bgColor=#e6efff>1,079,364 </TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=center>Industrial Bank of Korea </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD align=center width="32%">Short-term financial instruments </TD>
    <TD align=right width="2%">&nbsp;</TD>
    <TD align=right width="1%">&nbsp;</TD>
    <TD align=right width="25%">100,000 </TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=center bgColor=#e6efff>Shinhan Bank </TD>
    <TD align=center width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=center width="32%" bgColor=#e6efff>Long-term financial
      instruments </TD>
    <TD align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="25%"
    bgColor=#e6efff>194,000 </TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%">&nbsp;</TD>
    <TD align=left>&nbsp;</TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD align=center width="32%">&nbsp;</TD>
    <TD align=right width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="1%">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="25%">&nbsp;1,373,364 </TD>
  </TR>
</TABLE>
<P align=center>F-56</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_59></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Unaudited Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>For the six months ended June 30, 2010 and 2009</B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>19.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>SUPPLEMENTAL
  CASH FLOWS INFORMATION</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Supplemental
  cash flows information for the periods ended June 30, 2010 and 2009 is as
  follows: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2010</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2009</B> </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="17%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="17%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Cash paid during the year for </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="17%">&nbsp;</TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="17%">&nbsp;</TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Interest </TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>255,509 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>267,960 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Income taxes </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="17%">2,184,689 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="17%">1,118,759 </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="17%"
    bgColor=#e6efff>2,440,198 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="17%"
    bgColor=#e6efff>1,386,719 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=justify><STRONG>20.</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG> RELATED PARTY TRANSACTIONS</STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Significant
  transactions which occurred in the normal course of business with related
  companies as of June 30, 2010 and 2009 are as follows: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 8pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="90%" border=0 align=center>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center>Relationship </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center width="17%">Name </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%">Transaction </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2010</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="17%"><B>2009</B> </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD align=left width="17%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD align=left width="17%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="17%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="17%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Other </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="17%" bgColor=#e6efff>Kooryoonsoft Co. Ltd </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="17%" bgColor=#e6efff>Sales and others </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>15,336 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="17%" bgColor=#e6efff>38,540 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="17%">&nbsp;</TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=left width="17%">Purchases and others </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&#65510;</TD>
    <TD align=right width="17%">242,965 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="1%">&#65510;</TD>
    <TD align=right width="17%">202,207 </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
</TABLE>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Account
  balances with related companies as of June 30, 2010 and 2009 are as follows: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 8pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="90%" border=0 align=center>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left>Relationship </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="17%">Name </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD colspan="4" align=center style="BORDER-BOTTOM: #000000 1px solid"><B>2010</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD colspan="4" align=center style="BORDER-BOTTOM: #000000 1px solid"><B>2009</B> </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD align=left width="17%">&nbsp;</TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="13%">Receivables </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="13%">Payables </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="13%">Receivables </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=center
      width="13%">Payables </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Other </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="17%" bgColor=#e6efff>Kooryoonsoft Co. Ltd </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="13%" bgColor=#e6efff>21,191 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="13%" bgColor=#e6efff>-</TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="13%" bgColor=#e6efff>106,065 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="13%" bgColor=#e6efff>22,677 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>21.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>CONCENTRATIONS
  OF CREDIT RISKS </STRONG></P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Financial
  instruments that potentially expose the Company to concentrations of credit risk
  consist primarily of cash, cash equivalents, restricted deposits, and accounts
  receivable. Substantially all of the Company&#146;s cash, cash equivalents, and
  short-term and long-term financial instruments are held at financial
  institutions that management believes to be of high credit quality. </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;A
  substantial portion of the Company&#146;s sales for six months ended June 30, 2010
  and 2009 were made to credit card companies. Sales and accounts receivable from
  customers accounting for 10% or more of the Company&#146;s sales are as follows:</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="1%">&nbsp;</TD>
    <TD align=center width="22%"><B>Sales for the period ended</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="22%"><B>Accounts receivable as of</B> </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=center><B>Major
      Customers</B> </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right
      width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=center
      width="22%"><B>June 30, 2010</B> </TD>
    <TD align=center
    width="2%">&nbsp;</TD>
    <TD
      width="1%" align=center style="BORDER-BOTTOM: #000000 2px solid">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=center
      width="22%"><B>June 30, 2010</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>BC Card </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="22%" bgColor=#e6efff>10,811,047 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%" align=right bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="22%" bgColor=#e6efff>1,995,160 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>NTS (National Tax Service) </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="1%">&nbsp;</TD>
    <TD align=right width="22%">4,053,506 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD width="1%" align=right>&nbsp;</TD>
    <TD align=right width="22%">2,371,165 </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Shinhan Card </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="22%" bgColor=#e6efff>8,792,240 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%" align=right bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="22%" bgColor=#e6efff>1,611,020 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Kookmin Card </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="22%">7,009,895 </TD>
    <TD align=left
    width="2%">&nbsp;</TD>
    <TD
      width="1%" align=right style="BORDER-BOTTOM: #000000 1px solid">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="22%">1,261,050 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="22%"
    bgColor=#e6efff>30,666,688 </TD>
    <TD align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%" align=right
    bgColor=#e6efff style="BORDER-BOTTOM: #000000 3px double">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="22%"
    bgColor=#e6efff>7,238,395 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="1%">&nbsp;</TD>
    <TD align=center width="22%"><B>Sales for the period ended</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="22%"><B>Accounts receivable as of</B> </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=center><B>Major
      Customers</B> </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=right
      width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=center
      width="22%"><B>June 30, 2009</B> </TD>
    <TD align=center
    width="2%">&nbsp;</TD>
    <TD
      width="1%" align=center style="BORDER-BOTTOM: #000000 2px solid">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=center
      width="22%"><B>June 30, 2009</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left
    width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>BC Card </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="1%" bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="22%" bgColor=#e6efff>10,275,047 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%" align=right bgColor=#e6efff>&#65510;</TD>
    <TD align=right width="22%" bgColor=#e6efff>2,353,548 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>NTS (National Tax Service) </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=right width="1%">&nbsp;</TD>
    <TD align=right width="22%">2,462,656 </TD>
    <TD align=left width="2%">&nbsp;</TD>
    <TD width="1%" align=right>&nbsp;</TD>
    <TD align=right width="22%">1,448,175 </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Shinhan Card </TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="22%" bgColor=#e6efff>6,733,393 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%" align=right bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="22%" bgColor=#e6efff>1,250,688 </TD>
    <TD align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Kookmin Card </TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="22%">5,919,433 </TD>
    <TD align=left
    width="2%">&nbsp;</TD>
    <TD
      width="1%" align=right style="BORDER-BOTTOM: #000000 1px solid">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
      width="22%">1,064,968 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left
    width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="1%"
    bgColor=#e6efff>&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="22%"
    bgColor=#e6efff>25,390,529 </TD>
    <TD align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%" align=right
    bgColor=#e6efff style="BORDER-BOTTOM: #000000 3px double">&#65510;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="22%"
    bgColor=#e6efff>6,117,379 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=center>F-57 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_60></A> <BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left><B><FONT size=4>KSNET, Inc. </FONT></B></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><FONT size=3><B>Notes to the Unaudited Financial Statements </B></FONT></TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><B>For the six months ended June 30, 2010 and 2009</B></TD>
  </TR>
  <TR vAlign=top>
    <TD style="BORDER-BOTTOM: #000000 2px solid" align=left><B>(All amounts stated
      in thousands of Korean won, unless otherwise stated) </B></TD>
  </TR>
</TABLE>
<P
align=justify><STRONG>22.&nbsp;</STRONG>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>SUBSEQUENT
  EVENTS</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;On
  September 16, 2010, Net 1 UEPS Technologies, Inc. announced that it had agreed
  to purchase 98.73% of the outstanding share capital of the Company for &#65510;270
  billion in cash, subject to a post-closing working capital adjustment. The
  acquisition closed on October 29, 2010 and the acquisition was made by Net 1
  Applied Technologies Korea, an indirect wholly-owned subsidiary of Net 1 UEPS
  Technologies, Inc.</P>
<P align=center>F-58</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_61></A>
<P align=center><B>NET 1 UEPS TECHNOLOGIES, INC. </B></P>
<P align=center><B>UNAUDITED PRO FORMA COMBINED FINANCIAL STATEMENTS</B></P>
<P align=justify><B>Overview </B></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  following unaudited pro forma combined financial statements have been prepared
  to give effect to the Acquisition. We have prepared these unaudited pro forma
  combined financial statements based on (a) our historical audited consolidated
  financial statements as of and for the year ended June 30, 2010 and (b)
  financial information for KSNET as of the same date and for the same period
  which has been derived as described below. The unaudited pro forma combined
  financial statements present the pro forma financial position and results of
  operations of the combined company based on the historical financial information
  and after giving effect to the Acquisition and certain adjustments which we
  believe to be factually supportable as described in the notes to the unaudited
  pro forma combined financial statements. </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
  have presented an unaudited pro forma combined balance sheet which combines the
  historical balance sheets of Net1 and KSNET, each as of June 30, 2010, as if the
  Acquisition had occurred on that date. We have presented an unaudited combined
  pro forma statement of operations of Net1 and KSNET which combines the
  historical statements of operations of Net1 for the year ended June 30, 2010,
  and financial information for KSNET for the same period, as if the Acquisition
  had occurred on July 1, 2009. </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Our
  fiscal year ends on June 30 and KSNET&#146;s fiscal year ends on December 31. SEC
  rules require us to prepare the pro forma statement of operations by using our
  fiscal year end and bring KSNET&#146;s statement of operations up to within 93 days
  of our fiscal year end. Thus, we have prepared the pro forma combined statement
  of operations to coincide with our fiscal year end as follows: </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;We
  used KSNET&#146;s statement of operations for the year ended December 31, 2009, added
  the first six months of KSNET&#146;s 2010 fiscal year (i.e. the six months ended June
  30, 2010) and deducted the comparable period of KSNET&#146;s 2009 fiscal year (i.e.,
  the six months ended June 30, 2009).</P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  financial information of KSNET which has been derived as described above for the
  year ended June 30, 2010, was prepared in accordance with US GAAP, is unaudited,
  and is denominated in Korean Won (&#147;KRW&#148;). An exchange rate of $1/KRW1,217.73 has
  been used to translate KSNET&#146;s historical balance sheet as of June 30, 2010,
  from KRW to U.S. dollars, based on the closing exchange rate as of June 30,
  2010, as reported by an independent external source (www.oanda.com) (&#147;Oanda&#148;).
  An exchange rate of $1/KRW1,183.33 has been used to translate KSNET&#146;s results of
  operations for the year ended June 30, 2010, from KRW to U.S. dollars, based on
  the average daily exchange rate for the year ended June 30, 2010, as reported by
  Oanda.</P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  Acquisition has been recorded using the purchase method of accounting. Under the
  purchase method of accounting, the aggregate consideration paid is allocated to
  the tangible and identifiable intangible assets acquired and liabilities assumed
  on the basis of their fair values on the transaction date. Any purchase price in
  excess of net assets acquired is recorded as goodwill. These unaudited pro forma
  combined financial statements have been prepared based on preliminary estimates
  of fair values. The actual amounts and the allocation between net tangible and
  intangible assets ultimately recorded may differ materially from the information
  presented in these unaudited pro forma combined financial statements, including
  property, plant and equipment, identifiable intangible assets and residual
  goodwill. The preliminary estimates of the fair values of the assets acquired
  and liabilities assumed reflected herein are subject to change based upon
  completion of the valuation of the assets acquired and liabilities assumed as of
  the closing date. </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;No
  account has been taken within these unaudited pro forma combined financial
  statements of any future changes in accounting policies or any synergies
  (including cost savings), all of which may or may not occur as a result of the
  Acquisition. In addition, the impact of ongoing integration activities and other
  changes in KSNET&#146;s assets and liabilities could cause material differences in
  the information presented. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;These
  unaudited pro forma combined financial statements are not necessarily indicative
  of the consolidated results of operations or financial position of the combined
  company that would have been reported had the Acquisition been completed as of
  the dates presented, and are not necessarily representative of future
  consolidated results of operations or financial condition of the combined
  company. </P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;You
  should read these unaudited pro forma combined financial statements in
  conjunction with the historical audited consolidated financial statements and
  accompanying notes of KSNET included in Item 9.01(a) of this Form 8-K/A and our
  audited consolidated financial statements included in our Annual Report on Form
  10-K. Certain KSNET balances have been reclassified to conform to the balance
  sheet and statement of operations presentation of Net1. </P>
<P align=center>F-59 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_62></A>
<P align=justify><B>UNAUDITED PRO FORMA COMBINED BALANCE SHEET </B><BR>
    <B>(in
      thousands, except per share data or unless otherwise indicated) </B><BR>
        <B>As of June 30, 2010 </B></P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 8pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="9%"><B>Net1</B> </TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="9%"><B>KSNET</B> </TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="9%"><B>KSNET</B> </TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="9%"><B>Pro forma</B> </TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="9%">&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="9%"><B>Pro forma</B> </TD>
    <TD align=center width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="9%"><B>(USD &#145;000)</B></TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="9%"><B>(KRW M) </B></TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="9%" ><STRONG>(USD &#145;000)</STRONG></TD>
    <TD align=center width="1%" ></TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="9%" ><STRONG>adjustments</STRONG></TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="9%" ><STRONG>Notes</STRONG></TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="9%" ><STRONG>(USD &#145;000)</STRONG></TD>
    <TD align=center width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left ><B>ASSETS</B> </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="9%">&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="9%">&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="9%">&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="9%">&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="9%">&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="9%">&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Current assets </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp; &nbsp; &nbsp;Cash and cash
      equivalents </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">153,742 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">8,899 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">7,308 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">(116,610</TD>
    <TD vAlign=bottom align=left width="1%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">3(a)</TD>
    <TD vAlign=bottom align=center width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">44,440 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp; &nbsp;
      &nbsp;Pre-funded social welfare grants receivable </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>6,660 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>6,660 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp; &nbsp; &nbsp;Accounts
      receivable, net </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">41,854 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">27,637 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">22,695 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">64,549 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp; &nbsp;
      &nbsp;Finance loans receivable, net </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>4,221 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>4,221 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp; &nbsp; &nbsp;Inventory </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">3,622 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">1,381 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">1,134 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">4,756 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp; &nbsp;
      &nbsp;Deferred income taxes </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>16,330 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>16,330 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp; &nbsp; &nbsp;Other current
      assets </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%">- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%">3,199 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%">2,627 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="9%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%">2,627 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp;Total current assets before settlement assets </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>226,429 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>41,116 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>33,764 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>(116,610</TD>
    <TD vAlign=bottom align=left width="1%"  bgColor=#e6efff>) </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>143,583 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Settlement assets </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%">83,661 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%">11,118 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%">9,130 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="9%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%">92,791 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Total current assets </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>310,090 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>52,234 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>42,894 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>(116,610</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>) </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>236,374 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Long term receivable, </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">7,423 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">100 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">82 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">7,505 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Property, plant and
      equipment, net </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>7,286 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>26,114 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>21,445 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>28,731 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Equity-accounted investments </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">2,598 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">- </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">- </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">2,598 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Goodwill </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>76,346 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>92,800 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>3(b)</TD>
    <TD vAlign=bottom align=center width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>169,146 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Intangible assets, net </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">68,347 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">20 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">16 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">117,691 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">3(c) </TD>
    <TD vAlign=bottom align=center width="1%" ></TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">186,054 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Other long-term assets </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>7,089 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>5,821 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>5,821 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left ><B>TOTAL ASSETS</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="9%">472,090 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="9%">85,557 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="9%">70,258 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="9%">93,881 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="9%">636,229 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp; &nbsp;
      &nbsp;<B>LIABILITIES</B> </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Current liabilities </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>5,393 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>3(d) </TD>
    <TD vAlign=bottom align=center width="1%"
bgColor=#e6efff></TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp; &nbsp; &nbsp;Trade payables </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">3,596 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">6,155 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">5,054 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">2,855 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">3(e)</TD>
    <TD vAlign=bottom align=center width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">16,898 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp; &nbsp;
      &nbsp;Other payables </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>50,855 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>5,369 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>4,409 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>592 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>3(f)</TD>
    <TD vAlign=bottom align=center width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>55,856 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp; &nbsp; &nbsp;Short-term
      borrowings </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">- </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">2,000 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">1,642 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">1,642 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp; &nbsp;
      &nbsp;Current portion of long-term debt </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>6,000 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>4,927 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>6,672 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>3(g) </TD>
    <TD vAlign=bottom align=center width="1%"
bgColor=#e6efff></TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>11,599 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp; &nbsp; &nbsp; &nbsp;Income taxes
      payable </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%">3,476 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%">1,622 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%">1,332 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="9%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%">4,808 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp;Total current liabilities before settlement obligations </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>57,927 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>21,146 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>17,364 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>15,512 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>90,803 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Settlement obligations </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%">83,661 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%">11,118 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%">9,130 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="9%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%">92,791 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Total current liabilities </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>141,588 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>32,264 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>26,494 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>15,512 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>183,594 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Deferred income taxes </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">38,858 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">153 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">125 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">26,494 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">3(c) </TD>
    <TD vAlign=bottom align=center width="1%" ></TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">65,477 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Long-term debt </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>4,343 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>100,495 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>3(g) </TD>
    <TD vAlign=bottom align=center width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>104,838 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Accrued severance benefits </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%">- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%">1,193 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%">980 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="9%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%">980 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff ><B>TOTAL LIABILITIES</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>184,789 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>33,610 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>27,599 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>142,501 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>354,889 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Common stock </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">59 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">6,803 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">5,587 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">(5,587</TD>
    <TD vAlign=bottom align=left width="1%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">3(h) </TD>
    <TD vAlign=bottom align=center width="1%" ></TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">59 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Additional paid-in-capital </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>133,543 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>34 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>28 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>(28</TD>
    <TD vAlign=bottom align=left width="1%"  bgColor=#e6efff>) </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>3(h) </TD>
    <TD vAlign=bottom align=center width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>133,543 </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >Treasury shares </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">(173,671</TD>
    <TD vAlign=bottom align=left width="1%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">- </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">- </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">(173,671</TD>
    <TD vAlign=bottom align=left width="1%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Accumulated other
      comprehensive income </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>(66,396</TD>
    <TD vAlign=bottom align=left width="1%"  bgColor=#e6efff>) </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>- </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>(66,396</TD>
    <TD vAlign=bottom align=left width="1%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">(5,393</TD>
    <TD vAlign=bottom align=left width="1%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">3(d) </TD>
    <TD vAlign=bottom align=center width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>(2,855</TD>
    <TD vAlign=bottom align=left width="1%"  bgColor=#e6efff>) </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>3(e)</TD>
    <TD vAlign=bottom align=center width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">(592</TD>
    <TD vAlign=bottom align=left width="1%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">3(f)</TD>
    <TD vAlign=bottom align=center width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Retained earnings </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>392,343 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>45,110 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>37,044 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>(37,044</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>) </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>3(h) </TD>
    <TD vAlign=bottom align=center width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>383,503 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left ><B>TOTAL NET1 EQUITY</B> </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">285,878 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">51,947 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">42,659 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">(51,499</TD>
    <TD vAlign=bottom align=left width="1%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">277,038 </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff >Non-controlling interest </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>1,423 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>2,879 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>4,302 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left ><B>TOTAL EQUITY</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="9%">287,301 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="9%">51,947 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="9%">42,659 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="9%">(48,620</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" >) </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="9%">281,340 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff ><B>TOTAL LIABILITIES AND
      EQUITY</B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>472,090 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>85,557 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>70,258 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>93,881 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>636,229 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=center>See accompanying notes to unaudited pro forma combined financial
  statements. </P>
<P align=center>F-60 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_63></A>
<P align=justify><B>UNAUDITED PRO FORMA COMBINED STATEMENT OF OPERATIONS </B><BR>
    <B>(in thousands, except per share data or unless otherwise indicated) </B><BR>
    <B>For the year ended June 30, 2010 </B></P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 8pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=center width="9%"><B>Net1</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="9%"><B>KSNET</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="9%"><B>KSNET</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="9%"><B>Pro forma</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="9%">&nbsp;</TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="9%"><B>Pro forma</B> </TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="1%">&nbsp;</TD>
    <TD align=center width="9%"><B>(USD &#145;000)</B></TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="9%"><B>(KRW M)</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="9%"><B>(USD &#145;000)</B></TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="9%"><B>adjustments</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="9%"><B>Notes</B> </TD>
    <TD align=center width="2%">&nbsp;</TD>
    <TD align=center width="1%">&nbsp;</TD>
    <TD align=center width="9%"><B>(USD &#145;000)</B></TD>
    <TD align=left width="2%">&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="9%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="9%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="9%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="9%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="9%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
    <TD width="1%">&nbsp;</TD>
    <TD width="9%">&nbsp;</TD>
    <TD width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Revenue </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>280,364 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>101,578 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>85,841</TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>366,205</TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Expenses </TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp;Cost of goods sold, IT processing, </TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;servicing and support </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>72,973 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>54,437 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>46,003 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>118,976 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">39 </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">3(e)</TD>
    <TD vAlign=bottom align=center width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>164 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>3(f) </TD>
    <TD vAlign=bottom align=center width="2%" bgColor=#e6efff></TD>
    <TD vAlign=bottom align=center width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp;General and administration </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">80,854 </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">25,902</TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">21,889</TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">202 </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">3(i)</TD>
    <TD vAlign=bottom align=center width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">103,148 </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp;Depreciation and amortization </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>19,348 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>3,141 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>2,654 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>12,046</TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>3(c)</TD>
    <TD vAlign=bottom align=center width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>34,048 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Impairment of goodwill </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%">37,378 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%">- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%">- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="2%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="1%">&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%">37,378 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%">&nbsp;</TD>
  </TR>
  <TR>
    <TD bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Operating income (loss) </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">69,811 </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">18,098 </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">15,295 </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">(12,451</TD>
    <TD vAlign=bottom align=left width="2%">) </TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">72,655 </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
  </TR>
  <TR>
    <TD bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">(7,731</TD>
    <TD vAlign=bottom align=left width="2%">) </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">3(a) </TD>
    <TD vAlign=bottom align=center width="2%"></TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Interest income (expense), net </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>9,069 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>156 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>132 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>(7,852</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%" bgColor=#e6efff>) </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>3(e)</TD>
    <TD vAlign=bottom align=center width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>(6,382</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%" bgColor=#e6efff>) </TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Net income (loss) before income taxes </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>78,880 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>18,254 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>15,427 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>(28,034</TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>) </TD>
    <TD vAlign=bottom align=center width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>66,273 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>(2,671</TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>) </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>3(a) </TD>
    <TD vAlign=bottom align=center width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">(2,915</TD>
    <TD vAlign=bottom align=left width="2%">) </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">3(c)</TD>
    <TD vAlign=bottom align=center width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Income tax expense (benefit) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>40,822 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>4,176 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>3,529 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>40 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>3(f)</TD>
    <TD vAlign=bottom align=center width="2%" bgColor=#e6efff></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>38,805 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Net income (loss) before earnings from
      equity-accounted investments </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>38,058 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>14,078 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>11,898 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>(22,488</TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>) </TD>
    <TD vAlign=bottom align=center width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff></TD>
    <TD vAlign=bottom align=center width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>27,468 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Earnings from equity-accounted investments </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>93 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>93 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Net income (loss) </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>38,151 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>14,078 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>11,898 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>(22,488</TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>) </TD>
    <TD vAlign=bottom align=center width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>27,561 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Add: Net loss attributable to
      non-controlling interest </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>(839</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%" bgColor=#e6efff>) </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>- </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff></TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff></TD>
    <TD vAlign=bottom align=center width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=center
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>(839</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%" bgColor=#e6efff>) </TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Net income (loss) attributable to Net1 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>38,990 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>14,078 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>11,898 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>(22,488</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="2%" bgColor=#e6efff>) </TD>
    <TD vAlign=bottom align=center width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=center
    width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=right
    width="9%" bgColor=#e6efff>28,400 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" vAlign=bottom align=left
    width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Earnings per share: </TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left><I>Basic earnings</I> </TD>
    <TD vAlign=bottom align=left width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">0.84 </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">0.61 </TD>
    <TD vAlign=bottom align=left width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff><I>Diluted earnings</I> </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>0.84 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>0.61 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Weighted-average number of outstanding
      shares of common stock used to calculate basic earnings per share </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>46,244,609 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff></TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff></TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>60,000 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>3(i)</TD>
    <TD vAlign=bottom align=center width="2%" bgColor=#e6efff></TD>
    <TD vAlign=bottom align=center width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>46,304,609 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="2%">&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%">&nbsp;</TD>
    <TD vAlign=bottom align=right width="2%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Weighted-average number of outstanding
      shares of common stock used to calculate diluted earnings per share </TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>46,434,608 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff></TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff></TD>
    <TD vAlign=bottom align=right width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>60,000 </TD>
    <TD vAlign=bottom align=left width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="9%" bgColor=#e6efff>3(i)</TD>
    <TD vAlign=bottom align=center width="2%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=center width="1%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="9%" bgColor=#e6efff>46,494,608 </TD>
    <TD vAlign=bottom align=left width="2%"
  bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=center>See accompanying notes to unaudited pro forma combined financial
  statements. </P>
<P align=center>F-61 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_64></A>
<P align=center><B>NET 1 UEPS TECHNOLOGIES, INC.</B></P>
<P align=center><B>NOTES TO UNAUDITED PRO FORMA COMBINED FINANCIAL
  STATEMENTS</B></P>
<P align=justify><B>1. Basis of presentation</B></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  accompanying unaudited pro forma combined financial statements present the pro
  forma financial position and results of operations of the combined company based
  on the historical financial information and after giving effect to the
  Acquisition and certain adjustments which we believe to be factually
  supportable, which are described in these notes. The Acquisition has been
  recorded using the purchase method of accounting, with Net1 as the acquirer.
  Please refer to &#147;Overview&#148; for further discussion of the basis of presentation
  of these unaudited pro forma combined financial statements. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Certain
  KSNET balances have been reclassified to conform to the balance sheet and
  statement of operations presentation of Net1 as described in Note 3(j). </P>
<P align=justify><B>2. Acquisition of KSNET</B></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  following table sets forth the components of the purchase price for the
  Acquisition (using exchange rates applicable as of June 30, 2010 for cash paid
  at closing):</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD width="5%"  >&nbsp;</TD>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%"><B>USD &#145;000</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>Cash paid at closing to former KSNET
      shareholders </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>221,724 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>Cash payable to former KSNET shareholders resulting from
      the working capital adjustment </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">2,053 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp;Total purchase
      price </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff>223,777 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="2%"
     bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  following table sets forth the preliminary allocation of the purchase price: </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>USD &#145;000</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Cash and cash equivalents </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>7,308 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Accounts receivable, net </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">22,695 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Inventory </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>1,134 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Other current assets </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">2,627 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Settlement assets </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>9,130 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Long term receivable, </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">82 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Property, plant and equipment, net </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>21,445 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Goodwill </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">92,800 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Intangible assets, net </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>117,708 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Other long-term assets </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">5,821 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Trade payables </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(5,054</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Other payables </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(4,409</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Short-term borrowings </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(1,642</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Current portion of long-term borrowings </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(4,927</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Income taxes payable </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(1,332</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Settlement obligations </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">(9,130</TD>
    <TD align=left width="2%" >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>Deferred income taxes - long-term
      liabilities </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(26,620</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Accrued severance benefits </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
    width="12%">(980</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp;Total net assets of
      KSNET attributable to shareholders, including goodwill </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>226,656 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Less
      attributable to non-controlling interest </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
    width="12%">(2,879</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    >) </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left
      bgColor=#e6efff>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
      &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp; Total purchase price </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff>223,777 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="2%"
     bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=center>F-62 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_65></A>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  preliminary purchase price allocation is based on management estimates as of
  January 12, 2011, and may be adjusted up to one year following the closing of
  the Acquisition. The purchase price allocation has not been finalized, as
  management has not yet analyzed in detail the assets acquired and liabilities
  assumed. We expect to finalize the purchase price allocation on or before June
  30, 2011. The actual amounts and the allocation between net tangible and
  intangible assets ultimately recorded may differ materially from the information
  presented in these unaudited pro forma combined financial statements, including
  property, plant and equipment, identifiable intangible assets and residual
  goodwill. </P>
<P
align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;<STRONG>3.
  Pro forma adjustments</STRONG></P>
<P align=justify>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;The
  following are descriptions of each of the pro forma adjustments included in
  the unaudited pro forma combined financial statements: </P>
<P align=justify>(a) Reduction in cash and cash equivalents and interest income</P>
<P style="MARGIN-LEFT: 5%" align=justify>Represents the estimated reduction in
  interest income of $7.7 million on Net1&#146;s cash reserves of $116.6 million for
  the year ended June 30, 2010, which was used to fund the a portion of the
  Acquisition at an assumed pre-tax South African interest rate of 6.63% . The tax
  effect of $2.7 million related to this adjustment is included on the income tax
  expense line in the unaudited pro forma combined statement of operations. </P>
<P align=justify>(b) Goodwill</P>
<P style="MARGIN-LEFT: 5%" align=justify>Represents the excess of the purchase
  price over the fair value of net assets acquired of $133.8 million as presented
  within the preliminary purchase price allocation in Note 2 above.</P>
<P align=justify>(c) Acquired intangible assets and amortization expense</P>
<P style="MARGIN-LEFT: 5%" align=justify>Represents the portion of the purchase
  price allocated to KSNET&#146;s intangible assets acquired, at estimated fair values
  based on management&#146;s estimates. As of June 30, 2010, these assets had a
  carrying value on KSNET&#146;s balance sheet of approximately $1 million. As noted
  above, this identification and estimation of fair value is provisional and may
  change when the final purchase price allocation is made. Since the tax basis of
  these identifiable intangible assets is less than their accounting basis, the
  purchase price allocated to these assets results in additional deferred tax
  liabilities.</P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 8pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD width="5%"  >&nbsp;</TD>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="12%">&nbsp;</TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%">&nbsp;</TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%">&nbsp;</TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>Annual</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>Fair value</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%">&nbsp;</TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>Estimated</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>amortization</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>Annual</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>(KRW</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>Fair value</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>useful life</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>expense (1)</B></TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>tax effect</B> </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>million)</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>(USD &#145;000)</B></TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>(in years)</B> </TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>(USD &#145;000)</B></TD>
    <TD align=center width="2%" >&nbsp;</TD>
    <TD align=center width="1%" >&nbsp;</TD>
    <TD align=center width="12%"><B>(USD &#145;000)</B></TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left><B><I>Finite lived intangibles assets</I></B> </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>Customer relationships </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>106,624 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>87,560 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>15 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>5,837 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>1,413 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>Software </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">33,032 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">27,126 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">5 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">5,425 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">1,313 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>Trade names </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%" bgColor=#e6efff>4,860 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%" bgColor=#e6efff>3,991 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>20 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%" bgColor=#e6efff>443</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%" bgColor=#e6efff>107</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%">144,516 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%">118,677 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%">11,705</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%">2,833</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff><B><I>Deferred tax liabilities</I></B> </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>Customer relationships </TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">23,692 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%">19,456 </TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>Software </TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>7,484 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=right width="12%" bgColor=#e6efff>6,146 </TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>Trade names </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%">1,087 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%" >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%">892 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%" >&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%">&nbsp;</TD>
    <TD vAlign=bottom align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%" bgColor=#e6efff>32,263 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=right
    width="12%" bgColor=#e6efff>26,494 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" vAlign=bottom align=left
    width="2%"  bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="1%"
    bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD vAlign=bottom align=left width="2%"
    bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0 BCLLIST>
  <TR>
    <TD width="5%"  >&nbsp;</TD>
    <TD vAlign=top width="5%">(1) </TD>
    <TD><P align=justify>Using the average exchange rate for the year ended June
      30, 2010, the total annual amortization expense related to these
      intangible assets was $12.0 million. The deferred tax effect of $2.9
      million related to this adjustment is included on the income tax expense
      line in the unaudited pro forma combined statement of
      operations.</P></TD>
  </TR>
</TABLE>
<P align=justify>(d) Transaction costs &#150; incurred subsequent to June 30,
  2010</P>
<P style="MARGIN-LEFT: 5%" align=justify>Represents the Company&#146;s estimate of
  the expected KSNET acquisition costs of $5.4 million owing to external
  professional advisors for services provided which are not reflected in Net1&#146;s
  June 30, 2010 consolidated balance sheet. These costs have been accrued as a
  current liability. We do not expect to deduct these expenses for tax purposes.
  Because we are required to expense these costs as they are
  incurred, we have charged them to retained earnings as of June 30, 2010. No
  adjustment has been made to the unaudited pro forma combined statement of
  operations for these costs as they are non-recurring. </P>
<P align=center>F-63</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_66></A>
<P align=justify>(e) Upfront fees, deferred financing costs and interest expense</P>
<P style="MARGIN-LEFT: 5%" align=justify>On signing the Facilities Agreement,
  upfront fees and deferred financing costs of KRW 3.5 billion (equivalent of $2.9
  million) at the USD/ KRW exchange rate on June 30, 2010, were paid. Accordingly,
  an amount of $2.9 million is included in accounts payable as of June 30,
  2010.</P>
<P style="MARGIN-LEFT: 5%" align=justify>Represents interest of $7.5 million
  under the Facilities Agreement for the year ended June 30, 2010, using the Korea
  CD rate of 2.66% plus the margin of 4.10% . Amount also includes $0.4 million
  which represents twelve months of amortization of the total deferred financing
  costs, or KRW 1.7 billion (equivalent of $1.3 million) at the USD/ KRW exchange
  rate on July 1, 2009, on signing the Facilities Agreement.</P>
<P style="MARGIN-LEFT: 5%" align=justify>A change of 1/8<sup>th</sup> of a percentage point in the CD rate
  results in a change of KRW 0.2 billion (equivalent of $0.1 million) in the
  interest expense. </P>
<P align=justify>(f) Salary and cash incentive compensation</P>
<P style="MARGIN-LEFT: 5%" align=justify>Represents the effect of the increase
  in the salary and cash incentive compensation of a member of KSNET&#146;s management.
  We agreed to these compensation arrangements as a condition to the closing of
  the Acquisition, which became effective on closing and remain fixed until June
  30, 2013. The expected incremental difference between the compensation expense
  included in KSNET&#146;s historical statement of operations and the new compensation
  arrangements are reflected in the combined pro forma combined statement of
  operations.</P>
<P align=justify>(g) Long-term debt and current portion of long-term debt</P>
<P style="MARGIN-LEFT: 5%" align=justify>Represents a loan in the principal
  amount of KRW 130.5 Billion, or $107.2 million, translated at exchange rates
  prevailing on June 30, 2010, under the senior facilities agreement (&#147;Facilities
  Agreement&#148;) used to fund a portion of the Acquisition. Under the Facilities
  Agreement, $6.7 million of the total $107.2 million facility is repayable one
  year after the initial draw down of the facility. As a result, we have included
  this amount within current liabilities and the remainder in long-term debt in
  the unaudited pro forma combined balance sheet. </P>
<P align=justify>(h) Elimination of KSNET shareholders&#146; equity</P>
<P style="MARGIN-LEFT: 5%" align=justify>Represents the elimination of KSNET&#146;s
  common stock of $5.6 million, additional paid in capital of $0.03 million and
  retained earnings of $37.0 million, acquired by Net1. </P>
<P align=justify>(i) Stock-based compensation</P>
<P style="MARGIN-LEFT: 5%" align=justify>Represents the annual stock-based
  compensation charge of $0.2 million related to 60,000 restricted shares of
  Net1&#146;s common stock awarded to a member of KSNET&#146;s management. The restricted
  stock vests on June 30, 2014, unless the recipient fails to receive a
  conditional incremental bonus for each of the fiscal years ended June 30, 2011,
  2012, 2013 and 2014, in which event the restricted stock shall not vest. We have
  assumed that all 60,000 shares of restricted stock will vest on June 30, 2014.
  The restricted stock has been valued using the closing price, or $12.33, of our
  common stock on October 29, 2010, the acquisition date, and the effective date
  of the restricted stock award agreement. We do not expect to deduct this
  stock-based compensation charge for tax purposes. </P>
<P align=justify>(j) Reclassifications</P>
<P style="MARGIN-LEFT: 5%" align=justify>Certain balances have been reclassified
  from the financial statements of KSNET so their presentation would be consistent
  with Net1.</P>
<P style="MARGIN-LEFT: 5%" align=justify>The following reclassifications have
  been made to the balance sheet as of June 30, 2010 (in millions): </P>
<P align=center>F-64 </P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_67></A><BR>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR>
    <TD width="5%"  >&nbsp;</TD>
    <TD align=left >&nbsp;</TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%" ><STRONG>KRW</STRONG>&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left ><STRONG><EM>Cash and cash
      equivalents</EM></STRONG></TD>
    <TD align=right width="1%" >&nbsp;</TD>
    <TD align=right width="12%" >&nbsp;</TD>
    <TD align=right width="2%" >&nbsp;</TD>
  </TR>
  <TR>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left
      bgColor=#e6efff>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;KSNET:</TD>
    <TD align=right width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;Cash
      and cash equivalents </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">20,017 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp;Reclassified to settlement assets </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>(11,118</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
     bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><I>KSNET cash and cash
        equivalents after reclassification</I></B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="12%">8,899 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="2%"
    >&nbsp;</TD>
  </TR>
  <TR>
    <TD width="5%" >&nbsp;</TD>
    <TD bgColor=#e6efff>&nbsp;</TD>
    <TD width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left><B><I>Accounts receivable, net</I></B> </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp;KSNET: </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Accounts receivable, net </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">11,111 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp;Other current assets </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%"
    bgColor=#e6efff>16,526 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
     bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp;<B><I>KSNET accounts receivable, net after
        reclassification</I></B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right
      width="12%">27,637 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="2%"
    >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff><B><I>Other long-term assets, net</I></B> </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp;KSNET: </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp;Other long-term assets </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>5,583 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Non-current accounts receivable, net </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right width="12%">1,506 </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><I>KSNET other
        loan-term assets, net after reclassification</I></B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff>7,089 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="2%"
     bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left><B><I>Other current liabilities</I></B> </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=left width="12%">&nbsp;</TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp;KSNET: </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="12%" bgColor=#e6efff>&nbsp;</TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Other current liabilities </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">17,061 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp;Deferred tax liabilities </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>12 </TD>
    <TD align=left width="2%"  bgColor=#e6efff>&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Other non-current liabilities </TD>
    <TD align=left width="1%" >&nbsp;</TD>
    <TD align=right width="12%">1,036 </TD>
    <TD align=left width="2%" >&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp;Reclassified to settlement obligations </TD>
    <TD align=left width="1%"  bgColor=#e6efff>&nbsp;</TD>
    <TD align=right width="12%" bgColor=#e6efff>(11,118</TD>
    <TD align=left width="2%"  bgColor=#e6efff>) </TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp;Reclassified to income taxes payable </TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="1%"
    >&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=right
    width="12%">(1,622</TD>
    <TD style="BORDER-BOTTOM: #000000 1px solid" align=left width="2%"
    >) </TD>
  </TR>
  <TR vAlign=top>
    <TD width="5%" >&nbsp;</TD>
    <TD align=left bgColor=#e6efff>&nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;
      &nbsp; &nbsp; &nbsp; &nbsp; &nbsp; &nbsp;<B><I>KSNET other current
        liabilities after reclassification</I></B> </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="1%"
     bgColor=#e6efff>&nbsp;</TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=right width="12%"
    bgColor=#e6efff>5,369 </TD>
    <TD style="BORDER-BOTTOM: #000000 3px double" align=left width="2%"
     bgColor=#e6efff>&nbsp;</TD>
  </TR>
</TABLE>
<P align=justify>No significant reclassifications were made to the statement of
  operations for the year ended June 30, 2010.</P>
<P align=center>F-65</P>
<HR style="PAGE-BREAK-AFTER: always" align=center width="100%" color=black
noShade SIZE=5>
<A name=page_68></A>
<P align=center><B>SIGNATURES</B></P>
<P align=justify>Pursuant to the requirements of the Securities Exchange Act of
  1934, the registrant has duly caused this report to be signed on its behalf by
  the undersigned hereunto duly authorized. </P>
<TABLE
style="BORDER-COLOR: black; FONT-SIZE: 10pt; BORDER-COLLAPSE: collapse; "
cellSpacing=0 cellPadding=0 width="100%" border=0>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="50%"><B>NET 1 UEPS TECHNOLOGIES, INC.</B> </TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="50%">&nbsp;</TD>
  </TR>
  <TR>
    <TD>&nbsp;</TD>
    <TD width="50%">&nbsp;</TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>Date: January 12, 2011 </TD>
    <TD align=left width="50%">By: <U>/s/ Serge Belamant</U> </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="50%">Dr. Serge C.P. Belamant </TD>
  </TR>
  <TR vAlign=top>
    <TD align=left>&nbsp;</TD>
    <TD align=left width="50%">Chief Executive Officer </TD>
  </TR>
</TABLE>
<BR>
<HR align=center width="100%" color=black noShade SIZE=5>
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</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-23.1
<SEQUENCE>2
<FILENAME>exhibit23-1.htm
<DESCRIPTION>CONSENT OF ERNST & YOUNG HAN YOUNG
<TEXT>


<HTML>
<HEAD>
   <TITLE>Net 1 UEPS Technologies, Inc.: Exhibit 23.1 - Filed by newsfilecorp.com</TITLE>
   <META name="HandheldFriendly" content="true">
</HEAD>

<BODY style="font-size:10pt;">

<HR noshade align="center" width=100% size=3 color="black">
<A name=page_1></A>
<P align=center><U>CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM</U>
</P>
<P align=justify>We consent to the incorporation by reference in the following
Registration Statements of Net 1 UEPS Technologies, Inc.: </P>
<UL style="TEXT-ALIGN: justify">
  <LI>
  <P>Form S-3 No. 333-138521 </P>
  <LI>
  <P>Form S-8 No. 333-126958 </P>
  <LI>
  <P>Form S-8 No. 333-140042 </P>
  <LI>
  <P>Form S-8 No. 333-170395 </P></LI></UL>
<P align=justify>of our report dated January 10, 2011, with respect to the
financial statements of KSNET, Inc. included in this Current Report on Form
8-K/A of Net 1 UEPS Technologies, Inc. dated January 12, 2011. </P>
<P align=justify>/s/ Ernst &amp; Young Han Young <BR>Seoul, Republic of Korea
<BR>
  January 12, 2011 </P>
<HR align=center width="100%" color=black noShade SIZE=5>

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</DOCUMENT>
</SEC-DOCUMENT>
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