EXHIBIT 1.1
S&S DRAFT
JUNE 12, 2006
GMARKET INC.
[ ] AMERICAN DEPOSITARY SHARES
REPRESENTING
[ ] COMMON SHARES
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UNDERWRITING AGREEMENT
[____________], 2006
▇▇▇▇▇▇▇ ▇▇▇▇▇ International
▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇,
▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇
▇▇▇▇▇ and Company, LLC
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇,
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
As representatives of the several Underwriters
named in Schedule I hereto,
Ladies and Gentlemen:
GMARKET Inc., a company incorporated in the Republic of Korea ("Korea")
(the "Company"), proposes, subject to the terms and conditions stated herein, to
issue and sell to the Underwriters named in Schedule I hereto (the
"Underwriters") for whom ▇▇▇▇▇▇▇ ▇▇▇▇▇ International and ▇▇▇▇▇ and Company, LLC
(the "Representatives") are acting as representatives, an aggregate of [_____]
American Depositary Shares ("ADSs") representing [_____] common shares, par
value KRW [_____] per share (the "Common Shares"), of the Company. The
shareholders of the Company named in Schedule II hereto and identified thereon
as the Principal Selling Shareholders (the "Principal Selling Shareholders")
propose, subject to the terms and conditions stated herein, to sell to the
Underwriters an aggregate of [_____] ADSs representing [_____] Common Shares.
The Company and ▇. ▇▇▇▇ Praktijk B.V. (the "DutchCo"), a shareholder of the
Company, propose, subject to the terms and conditions stated herein, to sell to
the Underwriters, at the election of the Underwriters, up to [_____] and [_____]
ADSs, respectively, representing [_____] and [_____] additional Common Shares,
respectively. The Principal Selling Shareholders and DutchCo are collectively
referred to herein as the "Selling Shareholders". The aggregate of [_____] ADSs
representing [_____] Common Shares to be sold by the Company and the Principal
Selling Shareholders is herein called the "Firm ADSs" and the aggregate of
[_____] ADSs representing [_____] additional Common Shares to be sold by the
Company and DutchCo is herein called the "Optional ADSs." The Firm ADSs and the
Optional ADSs that the Underwriters elect to purchase pursuant to Section 2
hereof are
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herein collectively called the "ADSs." The Common Shares represented by the Firm
ADSs are hereinafter called the "Firm Shares" and the Common Shares represented
by the Optional ADSs are hereinafter called the "Optional Shares" and the Firm
Shares and the Optional Shares are herein collectively called the "Shares."
The ADSs are to be issued pursuant to a deposit agreement (the "Deposit
Agreement"), dated as of [__________], 2006, among the Company, Citibank, N.A.,
as depositary (the "Depositary"), and holders from time to time of the American
Depositary Receipts (the "ADRs") issued by the Depositary and evidencing the
ADSs. Each ADS will initially represent the right to receive one Common Share
deposited pursuant to the Deposit Agreement.
1. (a) The Company represents and warrants to, and agrees with, each of
the Underwriters that:
(i) A registration statement on Form F-1 (File No. 333--134794)
(the "Initial Registration Statement") in respect of the Shares and the
ADSs has been filed with the Securities and Exchange Commission (the
"Commission"); the Initial Registration Statement and any
post-effective amendment thereto, each in the form heretofore delivered
to you, and, excluding exhibits thereto, to you for each of the other
Underwriters, have been declared effective by the Commission in such
form; other than a registration statement, if any, increasing the size
of the offering (a "Rule 462(b) Registration Statement"), filed
pursuant to Rule 462(b) under the Securities Act of 1933, as amended
(the "Act"), which became effective upon filing, no other document with
respect to the Initial Registration Statement has heretofore been filed
with the Commission; and no stop order suspending the effectiveness of
the Initial Registration Statement, any post-effective amendment
thereto or the Rule 462(b) Registration Statement, if any, has been
issued and no proceeding for that purpose has been initiated or, to the
best knowledge of the Company after due inquiry, threatened by the
Commission (any preliminary prospectus included in the Initial
Registration Statement or filed with the Commission pursuant to Rule
424(a) of the rules and regulations of the Commission under the Act, is
hereinafter called a "Preliminary Prospectus"; the various parts of the
Initial Registration Statement and the Rule 462(b) Registration
Statement, if any, including all exhibits thereto and including the
information contained in the form of final prospectus filed with the
Commission pursuant to Rule 424(b) under the Act in accordance with
Section 5(a) hereof and deemed by virtue of Rule 430A under the Act to
be part of the Initial Registration Statement at the time it was
declared effective, each as amended at the time such part of the
Initial Registration Statement became effective or such part of the
Rule 462(b) Registration Statement, if any, became or hereafter becomes
effective, are hereinafter collectively called the "Registration
Statement"; the Preliminary Prospectus relating to the ADSs that was
included in the Registration Statement immediately prior to the
Applicable Time (as defined in Section 1(a)(iii) hereof) is hereinafter
called the "Pricing Prospectus"; the final prospectus, in the form
first filed pursuant to Rule 424(b) under the Act, is hereinafter
called the "Prospectus"); and any "issuer free writing prospectus" as
defined in Rule 433 under the Act relating to the ADSs is hereinafter
called an "Issuer Free Writing Prospectus");
(ii) No order preventing or suspending the use of any Preliminary
Prospectus or any Issuer Free Writing Prospectus, if any, has been
issued by the Commission, and each Preliminary Prospectus, at the time
of filing thereof, conformed in all material respects to
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the requirements of the Act and the rules and regulations of the
Commission thereunder, and did not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein, in the light of
the circumstances under which they were made, not misleading; provided,
however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by an Underwriter
through the Representatives for use therein;
(iii) For the purposes of this Agreement, the "Applicable Time"(1)
is [___:_____] [a.m./p.m.] (PST time) on the date of this Agreement.
The Pricing Prospectus as supplemented by the Issuer Free Writing
Prospectuses and other documents listed in Schedule III hereto, taken
together (collectively, the "Pricing Disclosure Package") as of the
Applicable Time, did not include any untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading; and each Issuer Free Writing Prospectus
listed on Schedule III hereto does not conflict with the information
contained in the Registration Statement, the Pricing Disclosure Package
or the Prospectus and each such Issuer Free Writing Prospectus, as
supplemented by and taken together with the Pricing Prospectus as of
the Applicable Time, did not include any untrue statement of a material
fact or omit to state any material fact necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading; provided, however, that this representation
and warranty shall not apply to statements or omissions made in an
Issuer Free Writing Prospectus in reliance upon and in conformity with
information furnished in writing to the Company by an Underwriter
through the Representatives expressly for use therein;
(iv) The Registration Statement conforms, and the Prospectus and
any further amendments or supplements to the Registration Statement and
the Prospectus will conform, in all material respects to the
requirements of the Act and the rules and regulations of the Commission
thereunder and do not and will not, as of the applicable effective date
as to the Registration Statement and any amendment thereto and as of
the applicable filing date as to the Prospectus and any amendment or
supplement thereto, contain an untrue statement of a material fact or
omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; provided,
however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by an Underwriter
through the Representatives expressly for use therein;
(v) A registration statement on Form F-6 (File No. 33-[_____]) in
respect of the ADSs has been filed with the Commission; such
registration statement in the form heretofore delivered to you and,
excluding exhibits, to you for each of the other Underwriters, has been
declared effective by the Commission in such form; no other document
with respect to such registration statement has heretofore been filed
with the Commission; no stop order suspending the effectiveness of such
registration statement has been issued and no proceeding for that
purpose has been initiated or, to the best knowledge of the Company
after due inquiry, threatened by the Commission (the various
---------
(1) The time chosen should be the time at which, or a time immediately prior to
the time, the ADSs are priced.
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parts of such registration statement, including all exhibits thereto,
each as amended at the time such part of the registration statement
became effective, being hereinafter called the "ADS Registration
Statement"); and the ADS Registration Statement when it became
effective conformed, and any further amendments thereto will conform,
in all material respects to the requirements of the Act and the rules
and regulations of the Commission thereunder, and did not, as of the
applicable effective date, contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading;
(vi) A registration statement on Form 8-A (File No. 00-[_____]) in
respect of the registration of the Shares and the ADSs under the U.S.
Securities Exchange Act of 1934, as amended (the "Exchange Act"), has
been filed with the Commission; such registration statement in the form
heretofore delivered to you and, excluding exhibits, to you for each of
the other Underwriters, has been declared effective by the Commission
in such form; no other document with respect to such registration
statement has heretofore been filed with the Commission; no stop order
suspending the effectiveness of such registration statement has been
issued and no proceeding for that purpose has been initiated or
threatened by the Commission (the various parts of such registration
statement, including all exhibits thereto, each as amended at the time
such part of the registration statement became effective, being
hereinafter called the "Form 8-A Registration Statement"); and the Form
8-A Registration Statement when it became effective conformed, and any
further amendments thereto will conform, in all material respects to
the requirements of the Exchange Act and the rules and regulations of
the Commission thereunder, and did not and will not, as of the
applicable effective date, contain an untrue statement of a material
fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading;
(vii) The Company has not sustained since the date of the latest
audited financial statements included in the Pricing Prospectus any
material loss or interference with its business from fire, explosion,
flood or other calamity, whether or not covered by insurance, or from
any labor dispute or court or governmental action, order or decree,
otherwise than as set forth or contemplated in the Pricing Prospectus;
and, since the respective dates as of which information is given in the
Registration Statement and the Pricing Prospectus, there has not been
any change in the capital stock or long-term debt of the Company or any
material adverse change, or any development involving a prospective
material adverse change, in or affecting the general affairs,
management, financial position, shareholders' equity, results of
operations or prospects of the Company (a "Material Adverse Effect"),
otherwise than as set forth or contemplated in the Pricing Prospectus;
(viii) The Company does not own any real property; the Company has
good title to all personal property owned by the Company, in each case
free and clear of all liens, encumbrances and defects except such as
are described in the Pricing Prospectus or such as do not materially
affect the value of such property and do not interfere with the use
made and proposed to be made of such property by the Company; and any
real property and buildings held under lease by the Company are held by
the Company under valid, subsisting and enforceable leases with such
exceptions as are not material and do not
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interfere with the use made and proposed to be made of such property
and buildings by the Company;
(ix) The Company has been duly incorporated and is validly
existing as a corporation under the laws of Korea, with power and
authority (corporate and other) to own its properties and conduct its
business as described in the Pricing Prospectus, and has been duly
qualified as a foreign corporation for the transaction of business and
is in good standing under the laws of each other jurisdiction in which
it owns or leases properties or conducts any business so as to require
such qualification (if any), or is subject to no material liability or
disability by reason of the failure to be so qualified in any such
jurisdiction;
(x) The Company does not have any subsidiary;
(xi) The Company has all licenses, franchises, permits,
authorizations, approvals, orders and other concessions of and from all
governmental agencies that are necessary to own or lease its other
properties and conduct its business as described in the Pricing
Prospectus except for those licenses, franchises, permits,
authorizations, approvals, orders and other concessions, the lack of
which would not reasonably be excepted to have a Material Adverse
Effect; except as disclosed in the Pricing Prospectus, the Company does
not have any reasonable basis to believe that any regulatory body is
considering modifying, suspending or revoking any such licenses,
franchises, permits, authorizations, approvals, orders or concessions,
except for those modifications, suspensions or revocations which would
not reasonably be expected to have a Material Adverse Effect;
(xii) The Company's properties and assets are adequately insured
against all such risks as are normally insured by other companies
conducting similar businesses in Korea;
(xiii) Except as disclosed in the Pricing Prospectus, the Company
is not (A) in breach of or in default under any laws, regulations,
rules, orders, decrees, guidelines or notices of Korea, (B) in breach
of or in default under any approval, consent, waiver, authorization,
exemption, permission, endorsement or license granted by any court or
government agency or body (a "Government Agency") in Korea, (C) in
violation of its constituent documents, or (D) in default in the
performance or observance of any obligation, agreement, covenant or
condition contained in any indenture, mortgage, deed of trust, loan
agreement lease or other agreement or instrument to which it is a party
or by which it or any of its properties may be bound, except that, with
respect to (A) and (D), the existence of such breach or default would
not reasonably be expected to have a Material Adverse Effect;
(xiv) The Company has an authorized capitalization as set forth in
the Pricing Prospectus, and all of the issued shares of capital stock
of the Company have been duly and validly authorized and issued, are
fully paid and non-assessable and conform to the description of the
Common Shares contained in the Pricing Prospectus and the Prospectus;
the holders of outstanding shares of capital stock of the Company are
not entitled to preemptive or other rights to acquire the Shares or the
ADSs; there are no outstanding securities convertible into or
exchangeable for, or warrants, rights or options to purchase from the
Company, or obligations of the Company to issue, the Common Shares or
any other class of capital stock of the Company (except as set forth in
the Pricing Prospectus and the Prospectus under "Description of Capital
Stock" and
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"Management"); and the Shares may be freely deposited by the Company
and the Selling Shareholders with the Depositary against issuance of
ADRs evidencing ADSs; the ADSs, when issued and delivered against
payment therefor, will be freely transferable by the Company and the
Selling Shareholders to or for the account of the several Underwriters
and (to the extent described in the Pricing Prospectus and the
Prospectus) the initial purchasers thereof; and there are no
restrictions on subsequent transfers of the ADSs under the laws of
Korea and of the United States except as described in the Pricing
Prospectus and the Prospectus;
(xv) The Shares to be issued and sold by the Company to the
Underwriters hereunder have been duly and validly authorized and, when
issued and delivered against payment therefor as provided herein, will
be duly and validly issued and fully paid and non-assessable and will
conform to the description of the Common Shares contained in the
Pricing Prospectus and the Prospectus; and the issuance of such Shares
will not be subject to any preemptive or similar rights;
(xvi) Except as disclosed in the Pricing Prospectus, there are no
contracts, agreements or understandings between the Company and any
person which grants to such person the right to require the Company to
file a registration statement under the Act with respect to any
securities of the Company owned or to be owned by such person or to
require the Company to include such securities in the securities
registered pursuant to the Registration Statement, the ADS Registration
Statement or in any securities being registered pursuant to any other
registration statement filed by the Company under the Act;
(xvii) This Agreement has been duly authorized, executed and
delivered by the Company;
(xviii) The Deposit Agreement has been duly authorized, executed
and delivered by the Company, and constitutes a valid and legally
binding agreement of the Company, enforceable in accordance with its
terms, subject, as to enforceability, to bankruptcy, insolvency,
reorganization and similar laws of general applicability relating to or
affecting creditors' rights and to general equity principles; upon
issuance by the Depositary of ADRs evidencing ADSs and the deposit of
Shares in respect thereof in accordance with the provisions of the
Deposit Agreement, such ADRs will be duly and validly issued and the
persons in whose names the ADRs are registered will be entitled to the
rights specified therein and in the Deposit Agreement; and the Deposit
Agreement and the ADRs conform in all material respects to the
descriptions thereof contained in the Pricing Prospectus and the
Prospectus;
(xix) Other than as set forth in the Pricing Prospectus, all
dividends and other distributions declared and payable on the shares of
capital stock of the Company may under the current laws and regulations
of Korea be paid to the Depositary in Korean Won that may be converted
into foreign currency that may be freely transferred out of Korea, and
all such dividends and other distributions will not be subject to
withholding or other taxes under the laws and regulations of Korea and
are otherwise free and clear of any other tax, withholding or deduction
in Korea and without the necessity of obtaining any consents,
approvals, authorizations, permissions, orders, registrations, filings,
exemptions, waivers, endorsements, licenses, annual inspections,
clearances and
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qualifications of or with any Governmental Agency having jurisdiction
over the Company or any of its properties (hereinafter referred to as
"Governmental Authorizations") in Korea;
(xx) The execution and delivery of this Agreement and the Deposit
Agreement by the Company and issuance and sale of the Shares to be sold
by the Company hereunder and the deposit of the Shares being deposited
with the Depositary against issuance of the ADRs evidencing the ADSs
and the performance by the Company of all of the obligations under this
Agreement and the Deposit Agreement and the consummation of the
transactions herein and therein contemplated will not (A) conflict with
or result in a breach or violation of any of the terms or provisions
of, or constitute a default under, any indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument to which the
Company is a party or by which the Company is bound or to which any of
the property or assets of the Company is subject, (B) result in any
violation of the provisions of the Articles of Incorporation of the
Company or (C) result in any violation of any statute or any order,
rule or regulation of any Governmental Agency having jurisdiction over
the Company or any of its properties; and no consent, approval,
authorization, order, registration or qualification of or with any such
Governmental Agency is required for the execution, delivery and
performance by the Company of this Agreement and the Deposit Agreement,
the issue and sale of the Shares or the ADSs, the deposit of the Shares
being deposited with the Depositary against issuance of ADRs evidencing
the ADSs to be delivered or the consummation by the Company of the
transactions contemplated by this Agreement, except (i) the
registration under the Act of the Shares and the ADSs and the approval
of the ADSs for quotation on the National Association of Securities
Dealers Automated Quotations National Market System ("NASDAQ"), (ii)
the filing of a report with the Ministry of Finance and Economy of
Korea in connection with the issuance of the ADSs, which has been made
and is in full force and effect, (iii) such Governmental Authorizations
as have been duly obtained and are in full force and effect and copies
of which have been furnished to you and (iv) such Governmental
Authorizations as may be required under state securities or Blue Sky
laws or any laws of jurisdictions outside Korea and the United States
in connection with the purchase and distribution of the Shares and ADSs
by or for the account of the Underwriters;
(xxi) ADSs have been approved for quotation on NASDAQ, subject to
notice of issuance;
(xxii) Except as disclosed in the Pricing Prospectus, no stamp or
other issuance or transfer taxes or duties and no capital gains,
income, withholding or other taxes are payable by or on behalf of the
Underwriters to the government of Korea or any political subdivision or
taxing authority thereof or therein in connection with (A) the deposit
with the Depositary of Shares by the Company and the Selling
Shareholders against the issuance of ADRs evidencing ADSs, (B) the sale
and delivery by the Company and the Selling Shareholders of the ADSs to
or for the respective accounts of the Underwriters or (C) the sale and
delivery outside Korea by the Underwriters of the Shares and ADSs to
the initial purchasers thereof in the manner contemplated by this
Agreement;
(xxiii) The Company has not taken, directly or indirectly, any
action which was designed to or which has constituted or which might
reasonably be expected to cause or
7
result in stabilization or manipulation of the price of any security of
the Company to facilitate the sale or resale of the Shares and ADSs;
(xxiv) The statements set forth in the Pricing Prospectus and the
Prospectus under the captions "Description of Capital Stock" and
"Description of American Depositary Shares", insofar as they purport to
constitute a summary of the terms of the Common Shares and the ADSs,
respectively, and under the captions "Taxation" and "Underwriting",
insofar as they purport to describe the provisions of the laws and
documents referred to therein, are accurate, complete and fair in all
material respects;
(xxv) Other than as set forth in the Pricing Prospectus, there are
no legal or governmental proceedings pending to which the Company is a
party or of which any property of the Company is the subject which, if
determined adversely to the Company, would individually or in the
aggregate have a Material Adverse Effect; and, to the best of the
Company's knowledge, no such proceedings are threatened or contemplated
by any Governmental Agency or others;
(xxvi) The Company is not and, after giving effect to the offering
and sale of the ADSs and the application of the proceeds thereof, will
not be, an "investment company", as such term is defined in the
Investment Company Act of 1940, as amended (the "Investment Company
Act");
(xxvii) At the time of filing of the Initial Registration
Statement the Company was not and is not an "ineligible issuer," as
defined under Rule 405 under the Act;
(xxviii) The Company has not delivered an Issuer Free Writing
Prospectus to any prospective investor unless (a) such Issuer Free
Writing Prospectus was accompanied by the Preliminary Prospectus or (b)
the Company had previously delivered to such prospective investor the
Preliminary Prospectus;
(xxix) Except as disclosed in the Pricing Prospectus, the Company
owns, possesses, licenses or has other rights to use all material
patents, patent applications, copyrights, trademarks, service marks,
trade names, Internet domain names, technology, know-how (including
trade secrets and other unpatented and/or unpatentable proprietary or
confidential information, systems or procedures) and other intellectual
property necessary or used in any material respect to conduct its
business in the manner in which it is being conducted and in the manner
in which it is contemplated as set forth in the Pricing Prospectus
(collectively, the "Intellectual Property"); and except as disclosed in
the Pricing Prospectus, the conduct of the Company's business will not
conflict in any material respect with any such rights of others, and
the Company has not received any notice of any claim of infringement or
conflict with any such rights of others with respect to any
Intellectual Property or of any facts or circumstances which would
render any Intellectual Property invalid or inadequate to protect the
interest of the Company therein except those that (i) do not materially
interfere with the use made and proposed to be made of such
Intellectual Property by the Company or (ii) could not reasonably be
expected, individually or in the aggregate, to have a Material Adverse
Effect;
(xxx) The Company was not a Passive Foreign Investment Company
("PFIC") within the meaning of Section 1297 of the United States
Internal Revenue Code of 1986, as amended, for its taxable year ending
December 31, 2005 and has no plan or intention
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to conduct its business in a manner that would reasonably be expected
to result in the Company becoming a PFIC in the future;
(xxxi) Samil PricewaterhouseCoopers, who have certified certain
financial statements of the Company, are independent public accountants
as required by the Act and the rules and regulations of the Commission
thereunder;
(xxxii) Except as disclosed in the Pricing Prospectus, no
relationship, direct or indirect, exists between or among the Company,
on the one hand, and the directors, officers, stockholders, customers
or suppliers of the Company, on the other, that is required by the Act
to be described in the Registration Statement, the Pricing Prospectus
and the Prospectus that is not so described;
(xxxiii) The Company maintains a system of internal accounting
controls sufficient to provide reasonable assurance that: (A)
transactions are executed in accordance with management's general or
specific authorizations; (B) transactions are recorded as necessary to
permit preparation of financial statements in conformity with generally
accepted accounting principles in the United States ("US GAAP"), (C)
access to assets is permitted only in accordance with management's
general or specific authorization; and (D) the recorded accountability
for assets is compared with existing assets at reasonable intervals and
appropriate actions are taken with respect to any differences. Except
as disclosed in the Pricing Prospectus, the Company's internal control
over financial reporting is effective and the Company is not aware of
any material weaknesses in its internal control over financial
reporting;
(xxxiv) Since the date of the latest audited financial statements
included in the Pricing Prospectus, there has been no change in the
Company's internal control over financial reporting that has materially
adversely affected, or is reasonably likely to materially adversely
affect, the Company's internal control over financial reporting;
(xxxv) No material labor dispute work stoppage, slow down or other
conflict with the employees of the Company exists or, to the Company's
knowledge after due inquiry, is threatened;
(xxxvi) The section entitled "Management's Discussion and Analysis
of Financial Condition and Results of Operations--Critical Accounting
Policies" in the Pricing Prospectus and the Prospectus truly,
accurately and completely in all material respects describes: (A)
accounting policies which the Company believes are the most important
in the portrayal of the Company's financial condition and results of
operations and which require management's most difficult, subjective or
complex judgments ("Critical Accounting Policies"); (B) judgments and
uncertainties affecting the application of Critical Accounting
Policies; and (C) the likelihood that materially different amounts
would be reported under different conditions or using different
assumptions; and the Company's board of directors and management have
reviewed and agreed with the selection, application and disclosure of
Critical Accounting Policies and have consulted with its legal advisers
and independent accountants with regard to such disclosure;
(xxxvii) Since the date of the latest audited financial statements
included in the Pricing Prospectus, the Company has not, other than in
the ordinary course of business, (A) entered into or assumed any
contract, (B) incurred or agreed to incur any liability
9
(including any contingent liability) or other obligation, (C) acquired
or disposed of or agreed to acquire or dispose of any business or any
other asset or (D) assumed or acquired or agreed to assume or acquire
any liabilities (including contingent liabilities) that would be
material to the Company, and that are not otherwise described in the
Pricing Prospectus;
(xxxviii) The section entitled "Management's Discussion and
Analysis of Financial Condition and Results of Operations--Liquidity
and Capital Resources" in the Pricing Prospectus and the Prospectus
accurately and fully describes: (A) all material trends, demands,
commitments, events, uncertainties and risks, and the potential effects
thereof, that the Company believes would materially affect liquidity,
financial condition or results of operations of the Company and are
reasonably likely to occur and (B) the Company is not engaged in any
transactions with, or has any obligations to, its unconsolidated
entities (if any) that are contractually limited to narrow activities
that facilitate the transfer of or access to assets by the Company,
including, without limitation, structured finance entities and special
purpose entities, or otherwise engaged in, or has any obligations
under, any off-balance sheet transactions or arrangements.
(xxxix) Except as disclosed in the Pricing Prospectus, the Company
is not engaged in any material transactions with its directors,
officers, management, shareholders, or any other affiliate, including
any person who formerly held a position as directors, officers,
managers and/or shareholders, on terms that are not available from
unrelated third parties on an arm's length basis;
(xl) The audited annual financial statements and the notes thereto
included in the Registration Statement, the Pricing Prospectus and the
Prospectus comply in all material respects with the applicable
requirements of the Act and the Exchange Act, and present fairly in all
material respects the financial position of the Company as of the dates
indicated and the results of operations and the changes in cash flows
of the Company for the periods specified; such financial statements
have been prepared in conformity with the US GAAP applied on a
consistent basis throughout the periods covered thereby;
(xli) The unaudited interim financial statements as of and for the
quarter ended March 31, 2005 and 2006, respectively, and the related
note thereto included in the Registration Statement, the Pricing
Prospectus and the Prospectus comply in all material respects with the
applicable requirements of the Act and the Exchange Act, and present
fairly in all material respects the financial position of the Company
as of the dates indicated and the results of operations and the changes
in cash flow of the Company for the periods specified; such financial
statements have been prepared in conformity with the US GAAP applied on
a consistent basis throughout the periods covered thereby; the
unaudited interim financial statements as of and for the period ended
March 31, 2005 and 2006, respectively, have been reviewed by the
Company's independent accountants in accordance with Statement of
Auditing Standards No. 100;
(xlii) All amounts payable by the Company under this Agreement
shall be made free and clear of and without deduction for or on account
of any taxes imposed, assessed or levied by Korea on the Company or any
authority thereof or therein, nor are any taxes imposed in Korea on, or
by virtue of the execution or delivery of, this Agreement;
10
(xliii) The Company has paid all taxes and filed all tax returns
required to be paid or filed through the date hereof and is not the
subject of any dispute with the relevant tax or other appropriate
authorities except as may be being contested in good faith and by
appropriate proceedings;
(xliv) Any statistical, industry-related and market-related data
included in the Pricing Prospectus and the Prospectus are based on or
derived from sources that the Company reasonably and in good faith
believes to be reliable and accurate, and such data agree with the
sources from which they are derived, and the Company has obtained the
written consent for the use of such data from such sources to the
extent required;
(xlv) Except as may be provided herein and as disclosed in the
Registration Statement, the Pricing Prospectus and the Prospectus,
there are no contracts, agreements or understandings between the
Company and any person that would give rise to a valid claim against
the Company or any Underwriter for a brokerage commission, finder's fee
or other like payment in connection with the issuance and sale of the
ADSs;
(xlvi) Neither the Company nor, to the Company's best knowledge,
any director, officer, agent or employee, has used any corporate funds
for any unlawful contribution, gift, entertainment or other unlawful
expenses relating to a political activity, made any direct or indirect
unlawful payment to any foreign or domestic government official or
employee from corporate funds or taken any other action which violated
or is in violation of any provision of the Foreign Corrupt Practices
Act of 1977;
(xlvii) Neither the Company nor, to the Company's best knowledge,
any of its directors, officers, agents, employees or affiliates is
currently subject to any U.S. sanctions administered by the Office of
Foreign Assets Control of the U.S. Treasury Department ("OFAC"); and
the Company will not directly or indirectly use the proceeds of the
offering, or lend, contribute or otherwise make available such proceeds
to any subsidiary, joint venture partner or other person or entity, for
the purpose of financing the activities of any person currently subject
to any U.S. sanctions administered by OFAC;
(xlviii) The Company has not entered into any memorandum of
understanding, letter of intent, definitive agreement or any similar
agreements with respect to a merger or consolidation or a material
acquisition or disposition of assets, technologies, business units or
businesses; and
(xlix) The Company has entered into a side letter agreement (the
"Depositary Letter") with the Depositary instructing the Depositary,
for a period beginning from the date hereof and continuing to and
including the date 180 days after the date of the Prospectus covering
the public offering of the ADSs (the "Lock-Up Period"), not to accept
any shareholder's deposit of any Common Shares in the Company's ADR
facility or issue any new ADRs evidencing the ADSs to any existing
shareholder subject to the exceptions stated in the Depositary Letter
or further instructions by the Company; the Company agrees that it will
not release the Depositary from the obligations set forth in, or
otherwise amend, terminate or fail to enforce, the Depositary Letter
during the Lock-Up Period.
(b) Each of the Selling Shareholders, severally and not jointly,
represents and warrants to, and agrees with, each of the Underwriters and the
Company that:
11
(i) Such Selling Shareholder, if a natural person, has legal
capacity, and if not a natural person, has been duly organized and is
validly existing as a company or a limited partnership, as the case may
be, in good standing in its jurisdiction of formation (to the extent
such qualification applies in such jurisdiction).
(ii) Except as disclosed in the Pricing Prospectus, all
Governmental Authorizations required for the deposit of the Shares
being deposited with the Depositary against issuance of the ADRs
evidencing the ADSs to be delivered at such Time of Delivery (as
defined in Section 4 hereof) for the sale and delivery of the Shares
represented by ADSs to be sold by such Selling Shareholder hereunder
and for the execution and delivery by such Selling Shareholder of this
Agreement and the Power of Attorney hereinafter referred to, and for
the sale and delivery of the Shares represented by ADSs to be sold by
such Selling Shareholder hereunder, have been obtained; and such
Selling Shareholder has full right, power and authority to enter into
this Agreement and the Power of Attorney and to sell, assign, transfer
and deliver the Shares represented by ADSs to be sold by such Selling
Shareholder hereunder;
(iii) The sale of the Shares represented by ADSs to be sold by
such Selling Shareholder hereunder, the deposit of the Shares with the
Depositary against issuance of the ADRs against issuance of the ADSs
evidencing the ADSs to be delivered at such Time of Delivery and the
compliance by such Selling Shareholder with all of the provisions of
this Agreement and the Power of Attorney and the consummation of the
transactions herein and therein contemplated, will not conflict with or
result in a breach or violation of any of the terms or provisions of,
or constitute a default under, any indenture, mortgage, deed of trust,
loan agreement or other agreement or instrument to which such Selling
Shareholder is a party or by which such Selling Shareholder is bound,
or to which any of the property or assets of such Selling Shareholder
is subject, nor will such action result in any violation of the
provisions of the constituent documents of such Selling Shareholder if
such Selling Shareholder is a corporation, the partnership agreement of
such Selling Shareholder if such Selling Shareholder is a partnership
or any statute or any order, rule or regulation of any Governmental
Agency having jurisdiction over such Selling Shareholder or the
property of such Selling Shareholder;
(iv) Immediately prior to such Time of Delivery such Selling
Shareholder will have, good and valid title to, and will be the record
and beneficial owner of, the Shares represented by ADSs to be sold by
such Selling Shareholder hereunder, free and clear of all liens,
encumbrances, equities or claims; and, upon delivery of the ADSs
representing such Shares and payment therefor pursuant hereto, good and
valid title to such ADSs, free and clear of all liens, encumbrances,
equities or claims, will pass to the several Underwriters;
(v) Neither such Selling Shareholder nor any of its affiliates,
nor any person acting on its or their behalf has taken, directly or
indirectly, any action which is designed to or which has constituted or
which might reasonably be expected to cause or result in stabilization
or manipulation of the price of any security of the Company to
facilitate the sale or resale of the Shares or the ADSs;
(vi) All information in respect of such Selling Shareholder or
provided by such Selling Shareholder for inclusion in the Registration
Statement, the Preliminary
12
Prospectus, the Pricing Prospectus including but not limited to the
information in the section entitled "Principal and Selling
Shareholders" therein does not include any untrue statement of a
material fact or omits to state a material fact necessary in order to
make the statements made therein, in the light of the circumstances
under which they were made, not misleading;
(vii) Such Selling Shareholder has duly executed and delivered a
Power of Attorney (the "Power of Attorney"), in the form heretofore
furnished to you, appointing the persons indicated in such Power of
Attorney, and each of them, as such Selling Shareholder's
attorneys-in-fact (the "Attorneys-in-Fact") with authority to execute
and deliver this Agreement on behalf of such Selling Shareholder, to
determine the purchase price to be paid by the Underwriters to the
Selling Shareholders as provided in Section 2 hereof, to authorize the
delivery of the Shares to be sold by such Selling Shareholder hereunder
and otherwise to act on behalf of such Selling Shareholder in
connection with the transactions contemplated by this Agreement;
(viii)The appointment by such Selling Shareholder of the
Attorneys-in-Fact by the Power of Attorney is to that extent
irrevocable; the obligations of such Selling Shareholder hereunder
shall not be terminated by operation of law, whether, in the case of
Selling Shareholders who are natural persons, by the death or
incapacity of such Selling Shareholder or, in the case of an estate or
trust, by the death or incapacity of any executor or trustee or the
termination of such estate or trust, or in the case of a partnership or
corporation, by the dissolution of such partnership or corporation, or
by the occurrence of any other event; if such Selling Shareholder or
any such executor or trustee should die or become incapacitated, or if
any such estate or trust should be terminated, or if any such
partnership or corporation should be dissolved, or if any other such
event should occur, before the delivery of the Shares hereunder, the
Shares shall be delivered by or on behalf of such Selling Shareholder
in accordance with the terms and conditions of this Agreement; and
actions taken by the Attorneys-in-Fact pursuant to the Powers of
Attorney shall be as valid as if such death, incapacity, termination,
dissolution or other event had not occurred, regardless of whether or
not the Attorneys-in-Fact, or any of them, shall have received notice
of such death, incapacity, termination, dissolution or other event;
(ix) No stamp or other issuance or transfer taxes or duties and
no capital gains, income, withholding or other taxes are payable by or
on behalf of the Underwriters to the government of Korea, the
Netherlands, Luxembourg, the British Virgin Islands or the United
States of America, or any political subdivision or taxing authority
thereof or therein, in connection with (A) the deposit with the
Depositary of the Shares against the issuance of ADRs evidencing the
ADSs to be sold by such Selling Shareholder, (B) the sale and delivery
by such Selling Shareholder of the Shares to be sold by such Selling
Shareholder to or for the respective accounts of the Underwriters or
(C) the sale and delivery by the Underwriters of the Shares to the
initial purchasers thereof in the manner contemplated by this
Agreement;
(x) All amounts payable by such Selling Shareholder under this
Agreement shall be made free and clear of and without deduction for or
on account of any taxes imposed, assessed or levied by Korea, the
Netherlands, Luxembourg, the British Virgin Islands or the United
States of America (except such income taxes as may be imposed by Korea,
the
13
Netherlands, Luxembourg, the British Virgin Islands or the United
States of America on payments hereunder to the Underwriter whose net
income is subject to tax by Korea, the Netherlands, Luxembourg, the
British Virgin Islands or the United States of America or withholding,
if any, with respect to any such income tax) or any authority thereof
or therein except as described in the Pricing Prospectus nor are any
taxes imposed in Korea, Netherlands, Luxembourg, the British Virgin
Islands or the United States of America on, or by virtue of the
execution or delivery of, such documents;
(xi) This Agreement has been duly authorized, executed and
delivered by such Selling Shareholder;
(xii) Neither such Selling Shareholder nor any of its affiliates
directly, or indirectly through one or more intermediaries, controls,
or is controlled by, or is under common control with, or is a person
associated with (within the meaning of Article I (dd) of the By-laws of
the National Association of Securities Dealers, Inc.), any member firm
of the National Association of Securities Dealers, Inc.; and
(xiii)Other than this Agreement, there are no contracts,
agreements or understandings between such Selling Shareholder and any
person that would give rise to a valid claim against such Selling
Shareholder or any Underwriter for a brokerage commission, finder's fee
or other like payment in connection with the offer and sale of the
Shares and the ADSs.
2. Subject to the terms and conditions herein set forth, (a) the
Company and each of the Principal Selling Shareholders agree, severally and not
jointly, to sell to each of the Underwriters, and each of the Underwriters
agrees, severally and not jointly, to purchase from the Company and each of the
Principal Selling Shareholders, at a purchase price per ADS of $[_____], the
number of Firm ADSs (to be adjusted by you so as to eliminate fractional shares)
determined by multiplying the aggregate number of Firm ADSs to be sold by the
Company and each of the Principal Selling Shareholders as set forth opposite
their respective names in Schedule II hereto by a fraction, the numerator of
which is the aggregate number of Firm ADSs to be purchased by such Underwriter
as set forth opposite the name of such Underwriter in Schedule I hereto and the
denominator of which is the aggregate number of Firm ADSs to be purchased by all
of the Underwriters from the Company and all of the Principal Selling
Shareholders hereunder and (b) in the event and to the extent that the
Underwriters shall exercise the election to purchase Optional ADSs as provided
below, the Company and DutchCo agree, severally and not jointly, to sell to each
of the Underwriters, and each of the Underwriters agrees, severally and not
jointly, to purchase from the Company and DutchCo, at the purchase price per ADS
set forth in clause (a) of this Section 2, that portion of the number of
Optional ADSs as to which such election shall have been exercised (to be
adjusted by you so as to eliminate fractional shares) determined by multiplying
such number of Optional ADSs by a fraction the numerator of which is the maximum
number of Optional ADSs which such Underwriter is entitled to purchase as set
forth opposite the name of such Underwriter in Schedule I hereto and the
denominator of which is the maximum number of Optional ADSs that all of the
Underwriters are entitled to purchase hereunder.
The Company and DutchCo, as and to the extent indicated in Schedule II
hereto, hereby grant, severally and not jointly, to the Underwriters the right
to purchase at their election up to [_____] Optional ADSs, at the purchase price
per ADS set forth in the paragraph above, for the
14
sole purpose of covering sales of shares in excess of the number of Firm ADSs.
Any such election to purchase Optional ADSs shall be made [IN PROPORTION TO THE
MAXIMUM NUMBER OF OPTIONAL ADSS TO BE SOLD BY THE COMPANY AND DUTCHCO AS SET
FORTH IN SCHEDULE II HERETO][INITIALLY WITH RESPECT TO THE OPTIONAL ADSS TO BE
SOLD BY THE COMPANY AND THEN DUTCHCO]. Any such election to purchase Optional
ADSs may be exercised only by written notice from you to the Company and
DutchCo, given within a period of 30 calendar days after the date of this
Agreement and setting forth the aggregate number of Optional ADSs to be
purchased and the date on which such Optional ADSs are to be delivered, as
determined by you but in no event earlier than the First Time of Delivery (as
defined in Section 4 hereof) or, unless you and the Company and DutchCo
otherwise agree in writing, earlier than two or later than ten business days
after the date of such notice.
3. Upon the authorization by you of the release of the Firm ADSs, the
several Underwriters propose to offer the Firm ADSs for sale upon the terms and
conditions set forth in the Prospectus.
4. (a) The ADSs to be purchased by each Underwriter hereunder, in
definitive form, and in such authorized denominations and registered in
such names as the Representatives may request upon at least forty-eight
hours' notice to the Company prior to a Time of Delivery (as defined
below) (the "Notification Time"), shall be delivered by or on behalf of
the Company and the Selling Shareholders to the Representatives,
through the facilities of The Depository Trust Company ("DTC") for the
account of such Underwriter, against payment by or on behalf of such
Underwriter of the purchase price therefor by wire transfer of Federal
(same-day) funds to the account specified by the Company and the
Selling Shareholders to the Representatives at least forty-eight hours
in advance of such Time of Delivery. The Company and the Selling
Shareholders will cause the certificates representing the ADSs to be
made available for checking at least twenty-four hours prior to the
Time of Delivery (as defined below) with respect thereto at the office
of DTC or its designated custodian (the "Designated Office").
The time and date of such delivery and payment shall be, with
respect to the Firm ADSs, 9:30 a.m., New York City time, on
[_________], 2006 or such other time and date as the Representatives
and the Company may agree upon in writing, and, with respect to the
Optional ADSs, 9:30 a.m., New York City time, on the date specified by
the Representatives in the written notice given by the Representatives
of the Underwriters' election to purchase such Optional ADSs, or such
other time and date as the Representatives and the Company may agree
upon in writing. Such time and date for delivery of the Firm ADSs is
herein called the "First Time of Delivery", such time and date for
delivery of the Optional ADSs, if not the First Time of Delivery, is
herein called the "Second Time of Delivery", and each such time and
date for delivery is herein called a "Time of Delivery".
(b) The documents to be delivered each Time of Delivery by or on
behalf of the parties hereto pursuant to Section 8 hereof, including
the cross-receipt for the ADSs and any additional documents requested
by the Underwriters pursuant to Section 8 hereof, will be delivered at
the offices of Shearman & Sterling LLP, 12th Floor, Gloucester Tower,
The Landmark, ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇ (the "Closing
Location"), and the ADSs will be delivered as specified in Section (a)
above, all at such Time of Delivery. A meeting will be held at the
Closing Location at [3:00] p.m., Hong Kong
15
time, on [the New York Business Day next preceding such Time of
Delivery][Monday ____________, 2006], at which meeting the final drafts
of the documents to be delivered pursuant to the preceding sentence
will be available for review by the parties hereto. For the purposes of
this Section 4, "New York Business Day" shall mean each Monday,
Tuesday, Wednesday, Thursday and Friday which is not a day on which
banking institutions in New York City are generally authorized or
obligated by law or executive order to close.
5. (a) The Company agrees with each of the Underwriters:
(i) To prepare the Prospectus in a form approved by you,
which approval shall not be unreasonably withheld, and to file
such Prospectus pursuant to Rule 424(b) under the Act not later
than the Commission's close of business on the second business
day following the execution and delivery of this Agreement, or,
if applicable, such earlier time as may be required by Rule
430A(a)(3) under the Act; to make no further amendment or any
supplement to the Registration Statement or the Prospectus prior
to the last Time of Delivery if you shall have reasonably
objected to such amendment; to advise you, promptly after it
receives notice thereof, of the time when any amendment to the
Registration Statement has been filed or becomes effective or
any supplement to the Prospectus or any amended Prospectus has
been filed and to furnish you copies thereof; to file promptly
all material required to be filed by the Company with the
Commission pursuant to Rule 433(d) under the Act; to file
promptly all reports required to be filed by the Company with
the Commission pursuant to Section 13(a), 13(c) or 15(d) of the
Exchange Act subsequent to the date of the Prospectus and for so
long as the delivery of a prospectus (or in lieu thereof, the
notice referred to in Rule 173(a) under the Act) is required in
connection with the offering or sale of the ADSs; to advise you,
promptly after it receives notice thereof, of the issuance by
the Commission of any stop order or of any order preventing or
suspending the use of any Preliminary Prospectus or other
prospectus in respect of the ADSs, of the suspension of the
qualification of the ADSs for offering or sale in any
jurisdiction, of the initiation or threatening of any proceeding
for any such purpose, or of any request by the Commission for
the amending or supplementing of the Registration Statement or
the Prospectus or for additional information; and, in the event
of the issuance of any stop order or of any order preventing or
suspending the use of any Preliminary Prospectus or other
prospectus or suspending any such qualification, to promptly use
its best efforts to obtain the withdrawal of such order;
(ii) Promptly from time to time to take such action as
you may reasonably request to qualify the ADSs for offering and
sale under the securities laws of such jurisdictions as you may
request and to comply with such laws so as to permit the
continuance of sales and dealings therein in such jurisdictions
for as long as may be necessary to complete the distribution of
the ADSs, which period shall in no event extend for more than
two years from the later of the effective date of the
Registration Statement and any Registration Statement filed
pursuant to Rule 462(b); provided that in connection therewith
the Company shall not be required to qualify as a foreign
corporation or to file a general consent to service of process
in any jurisdiction;
16
(iii) Prior to 10:00 a.m., New York City time, on the New
York Business Day next succeeding the date of this Agreement and
from time to time, to furnish the Underwriters with written and
electronic copies of the Prospectus in New York City in such
quantities as you may reasonably request, and, if the delivery
of a prospectus (or in lieu thereof, the notice referred to in
Rule 173(a) under the Act) is required at any time prior to the
expiration of nine months after the time of issue of the
Prospectus in connection with the offering or sale of the ADSs
and if at such time any events shall have occurred as a result
of which the Prospectus as then amended or supplemented would
include an untrue statement of a material fact or omit to state
any material fact necessary in order to make the statements
therein, in the light of the circumstances under which they were
made when such Prospectus (or in lieu thereof, the notice
referred to in Rule 173(a) under the Act) is delivered, not
misleading, or, if for any other reason it shall be necessary
during such same period to amend or supplement the Prospectus in
order to comply with the Act, to notify you and upon your
request to prepare and furnish without charge to each
Underwriter and to any dealer in securities as many written and
electronic copies as you may from time to time reasonably
request of an amended Prospectus or a supplement to the
Prospectus which will correct such statement or omission or
effect such compliance, and in case any Underwriter is required
to deliver a prospectus (or in lieu thereof, the notice referred
to in Rule 173(a) under the Act) in connection with sales of any
of the ADSs at any time nine months or more after the time of
issue of the Prospectus, upon your request but at the expense of
such Underwriter, to prepare and deliver to such Underwriter as
many written and electronic copies as you may request of an
amended or supplemented Prospectus complying with Section
10(a)(3) of the Act;
(iv) To make generally available to its securityholders
as soon as practicable, but in any event not later than sixteen
months after the effective date of the Registration Statement
(as defined in Rule 158(c) under the Act), an earnings statement
of the Company (which need not be audited) complying with
Section 11(a) of the Act and the rules and regulations of the
Commission thereunder (including, at the option of the Company,
Rule 158);
(v) During the Lock-Up Period, not to (A) offer, sell,
contract to sell, pledge, grant any option to purchase, make any
short sale or otherwise dispose of, directly or indirectly,
other than pursuant to the employee stock option plan existing
on the date of this Agreement or options outstanding as of the
date hereof, or file with the Commission a registration
statement under the Act relating to, any Common Shares or ADSs,
or any securities of the Company that are substantially similar
to the Common Shares or ADSs, including but not limited to any
securities that are convertible into or exchangeable or
exercisable for, or that represent the right to receive, any
Common Shares or ADSs (collectively, the "Locked Securities"),
(B) enter into a transaction that would have the same effect, or
enter into any swap, hedge or other arrangement that transfers,
in whole or in part, any of the economic consequences of
ownership of such Locked Securities, whether any of these
transactions are to be settled by delivery of such Lock
Securities or other securities, in cash or otherwise, or (C)
publicly disclose the intention to make any
17
offer, sale, pledge, disposition or filing, without the prior
written consent of the Representatives;
(vi) Notwithstanding the restrictions contained in the
preceding paragraph (v), if (A) during the last [17] days of the
Lock-Up Period, the Company releases earnings results or
announces material news or a material event or (B) prior to the
expiration of the Lock-Up Period, the Company announces that it
will release earnings results during the [15]-day period
following the last day of the Lock-Up Period, then in each case
the Lock-Up Period will be automatically extended until the
expiration of the [18]-day period beginning on the date of the
release of the earnings results or the announcement of the
material news or material event, as applicable, unless the
Representatives waive, in writing, such an extension; the
Company will provide the Representatives and each shareholder
subject to the Lock-Up Period pursuant to the Lock-Up Agreement
(as defined in Section 8(l) hereof) with prior notice of any
such announcement that gives rise to an extension of the Lock-Up
Period;
(vii) To furnish to its shareholders as soon as
practicable after the end of each fiscal year an annual report
(in English) (including a balance sheet and statements of
income, shareholders' equity and cash flows of the Company and
certified by independent public accountants and prepared in
conformity with generally accepted accounting principles in the
U.S. ("U.S. GAAP")) and, as soon as practicable after the end of
each of the first three quarters of each fiscal year prepared in
accordance with US GAAP (beginning with the fiscal quarter
ending after the effective date of the Registration Statement),
to make available to its shareholders consolidated summary
financial information of the Company and its subsidiaries for
such quarter in reasonable detail;
(viii)During a period of three years from the effective
date of the Registration Statement, to furnish to you copies of
all reports or other communications (financial or other)
furnished to shareholders, and to deliver to you (i) as soon as
they are available, copies of any reports and financial
statements furnished to or filed with the Commission or any
securities exchange on which any class of securities of the
Company is listed; and (ii) such additional information
concerning the business and financial condition of the Company
as you may from time to time reasonably request (such financial
statements to be on a consolidated basis to the extent the
accounts of the Company and its subsidiaries are consolidated in
reports furnished to its shareholders generally or to the
Commission);
(ix) To file all documents required to be filed with the
Commission pursuant to the Exchange Act within the time periods
required by the Exchange Act and the rules and regulations of
the Commission thereunder;
(x) To use the net proceeds received by it from the sale
of the ADSs pursuant to this Agreement in all material respects
in the manner specified in the Pricing Prospectus under the
caption "Use of Proceeds";
(xi) Prior to each Time of Delivery to deposit the Shares
with the Depositary in accordance with the provisions of the
Deposit Agreement and otherwise to comply with the Deposit
Agreement so that ADRs evidencing ADSs may be
18
executed (and, if applicable, countersigned) and issued by the
Depositary against receipt of such Shares and delivered to the
Underwriters at such Time of Delivery;
(xii) Not to take, directly or indirectly, any action
which is designed to or which constitutes or which might
reasonably be expected to cause or result in stabilization or
manipulation of the price of any security of the Company or
facilitate the sale or resale or the Shares and the ADSs;
(xiii) To use its best efforts to list for quotation the
ADSs on NASDAQ;
(xiv) If the Company elects to rely upon Rule 462(b), the
Company shall file a Rule 462(b) Registration Statement with the
Commission in compliance with Rule 462(b) by 10:00 p.m.,
Washington, D.C. time, on the date of this Agreement, and the
Company shall at the time of filing either pay to the Commission
the filing fee for the Rule 462(b) Registration Statement or
give irrevocable instructions for the payment of such fee
pursuant to Rule 111(b) under the Act;
(xv) To indemnify and hold each Underwriter harmless
against any documentary, stamp or similar issuance or transfer
taxes, duties or fees and any transaction levies, commissions or
brokerage charges, including any interest and penalties, which
are or may be required to be paid in connection with the
creation, allotment, issuance, [offer and distribution] of the
Shares and ADSs to be sold by the Company and the execution and
delivery of this Agreement and the Deposit Agreement; and
(xvi) To register the issuance of the Shares with the
registry offices of the competent Korean courts having
jurisdiction over the Company within two weeks from the issuance
of the Shares.
(b) Each of the Selling Shareholders, severally and not
jointly, agrees with each of the Underwriters:
(i) Prior to each Time of Delivery, to deposit, or cause
to be deposited the Shares with the Depositary in accordance
with the provisions of the Deposit Agreement and otherwise to
comply with the Deposit Agreement so that ADRs evidencing ADSs
may be executed (and, if applicable, countersigned) and issued
by the Depositary against receipt of such Shares and delivered
to the Underwriters at such Time of Delivery;
(ii) Not to take, and not permit any of its affiliates or
any person acting on its behalf, to take, directly or
indirectly, any action which is designed to or which constitutes
or which might reasonably be expected to cause or result in
stabilization or manipulation of the price of any security of
the Company or facilitate the sale or resale of the Shares or
the ADSs;
(iii) To indemnify and hold each Underwriter harmless
against any documentary, stamp or similar issuance or transfer
taxes, duties or fees and any transaction levies, commissions or
brokerage charges, including any interest and penalties, which
are or may be required to be paid in connection with the
creation, allotment, issuance, offer and distribution of the
Shares and ADSs to be sold by such Selling Shareholder and the
execution and delivery of this Agreement and the Deposit
Agreement; provided, however, that such Selling Shareholder
shall not be
19
responsible for any such taxes, duties, fees, levies or
charges that arise as a result of the distribution of the
Shares or ADSs by any Underwriters in a manner other than that
as is customary in such transactions; and
(iv) In order to document the Underwriters' compliance
with the reporting and withholding provisions of the Tax Equity
and Fiscal Responsibility Act of 1982 with respect to the
transactions herein contemplated, such Selling Shareholder will
deliver to you prior to or at the First Time of Delivery (as
hereinafter defined) a properly completed and executed United
States Treasury Department Form W-8 or W-9 (or other applicable
form or statement specified by Treasury Department regulations
in lieu thereof).
6. (a) The Company represents and agrees that, without the prior
consent of the Representatives, it has not made and will not make any offer
relating to the ADSs that would constitute a "free writing prospectus" as
defined in Rule 405 under the Act; each Underwriter represents and agrees that,
without the prior consent of the Company and the Representatives, it has not
made and will not make any offer relating to the ADSs that would constitute a
free writing prospectus; any such free writing prospectus the use of which has
been consented to by the Company and the Representatives is listed on Schedule
III(a) hereto;
(b) The Company has complied and will comply with the requirements of
Rule 433 under the Act applicable to any Issuer Free Writing Prospectus,
including timely filing with the Commission or retention where required and
legending and including delivery of any Issuer Free Writing Prospectus only to
such prospective investors who have already received or are contemporaneously
receiving (by hyperlink or otherwise) the Preliminary Prospectus; the Company
represents that it has satisfied and agrees that it will satisfy the conditions
under Rule 433 under the Act, including without limitation making at least one
version of a "bona fide electronic road show" (as such term is defined in Rule
433(h) of the Act) available without restriction by means of graphic
communication to any person, to avoid a requirement to file with the Commission
any electronic road show that is a written communication;
(c) The Company agrees that if at any time following issuance of an
Issuer Free Writing Prospectus any event occurred or occurs as a result of which
such Issuer Free Writing Prospectus would conflict with the information in the
Registration Statement, the Pricing Prospectus or the Prospectus or would
include an untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements therein, in the light of the
circumstances then prevailing, not misleading, the Company will give prompt
notice thereof to the Representatives and, if requested by the Representatives,
will prepare and furnish without charge to each Underwriter an Issuer Free
Writing Prospectus or other document which will correct such conflict, statement
or omission; provided, however, that this representation and warranty shall not
apply to any statements or omissions in an Issuer Free Writing Prospectus made
in reliance upon and in conformity with information furnished in writing to the
Company by an Underwriter through the Representatives expressly for use therein.
7. The Company covenants and agrees with the several Underwriters that
(a) the Company will pay or cause to be paid the following: (i) the fees,
disbursements and expenses of the Company's counsel and accountants in
connection with the registration of the Shares and ADSs under the Act and all
other expenses in connection with the preparation, printing, reproduction and
filing of the Registration Statement the ADR Registration Statement, the Form
20
8-A Registration Statement, any Preliminary Prospectus, any Issuer Free Writing
Prospectus and the Prospectus and amendments and supplements thereto and the
mailing and delivering of copies thereof to the Underwriters and dealers; (ii)
the cost of printing or producing any Agreement among Underwriters, this
Agreement, the Deposit Agreement, the Blue Sky memorandum, closing documents
(including compilations thereof) and any other documents in connection with the
offering, purchase, sale and delivery of the Shares and ADSs; (iii) all expenses
in connection with the qualification of the ADSs for offering and sale under
state securities laws as provided in Section 5(b) hereof, including the fees and
disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the Blue Sky survey; (iv) all fees and
expenses in connection with applying to include the ADSs for quotation on
NASDAQ; (v) all roadshow expenses including travel, accommodation and meal
expenses; (vi) all fees and expenses (including fees, disbursements and expenses
of counsel to the Underwriters) incurred by the Underwriters in connection with
the transactions contemplated by this Agreement; (vii) the filing fees incident
to, and the fees and disbursements of counsel for the Underwriters in connection
with, securing any required review by the National Association of Securities
Dealers, Inc. of the terms of the sale of the ADSs; and (b) the Company will pay
or cause to be paid: (i) all expenses and taxes arising as a result of the
deposit by the Company and each of the Selling Shareholders of the Shares with
the Depositary and the issuance and delivery of the ADRs evidencing ADSs in
exchange therefor by the Depositary to the Company, of the sale and delivery of
the ADS and the Shares by the Company to or for the account of the Underwriters,
of the sale and delivery of the ADSs and the Shares by the Underwriters to each
other, and of the initial purchasers thereof in the manner contemplated under
this Agreement, including, in any such case, any Korean income, capital gains,
withholding, transfer or other tax asserted against an Underwriter by reason of
the purchase and sale of an ADS or a Share pursuant to this Underwriting
Agreement; (ii) the fees and expenses (including fees and disbursements of
counsel), if any, of the Depositary and any custodian appointed under the
Deposit Agreement, other than the fees and expenses to be paid by holders of
ADRs (other than the Underwriters, in connection with the initial purchase of
ADSs and the Shares); (iii) the fees and expenses of the Authorized Agent (as
defined in Section 15 hereof); (iv) the cost of preparing the ADRs; (v) the cost
and charges of any transfer agent or registrar; and (vi) all other costs and
expenses incident to the performance of its obligations hereunder which are not
otherwise specifically provided for in this Section; [and (c) such Selling
Shareholders will pay or cause to be paid all costs and expenses incident to the
performance of such Selling Shareholder's obligations hereunder which are not
otherwise specifically provided for in this Section, including (i) any fees and
expenses of counsel for such Selling Shareholder, (ii) such Selling
Shareholder's pro rata share of the fees and expenses of the Attorneys-in-Fact
and the Custodian and (iii) all expenses and taxes incident to the sale and
delivery of the ADSs to be sold by such Selling Shareholder to the Underwriters
hereunder; provided, however, that the foregoing agreement is subject to a
letter agreement entered into between the Company and the Representatives.
8. The obligations of the Underwriters hereunder, as to the ADSs to be
delivered at each Time of Delivery, shall be subject, in their discretion, to
the condition that all representations and warranties and other statements of
the Company and of the Selling Shareholders herein are, at and as of such Time
of Delivery, true and correct, the condition that the Company and the Selling
Shareholders shall have performed all of its and their obligations hereunder
theretofore to be performed, and the following additional conditions:
21
(a) The Prospectus shall have been filed with the Commission pursuant to
Rule 424(b) under the Act within the applicable time period prescribed for such
filing by the rules and regulations under the Act and in accordance with Section
5(a) hereof; all material required to be filed by the Company pursuant to Rule
433(d) under the Act shall have been filed with the Commission within the
applicable time period prescribed for such filing by Rule 433; if the Company
has elected to rely upon Rule 462(b) under the Act, the Rule 462(b) Registration
Statement shall have become effective by 10:00 p.m., Washington, D.C. time, on
the date of this Agreement; no stop order suspending the effectiveness of the
Registration Statement or any part thereof shall have been issued and no
proceeding for that purpose shall have been initiated or, to the Company's best
knowledge, threatened by the Commission; no stop order suspending or preventing
the use of the Prospectus or any Issuer Free Writing Prospectus shall have been
initiated or, to the Company's best knowledge, threatened by the Commission; and
all requests for additional information on the part of the Commission shall have
been complied with to your reasonable satisfaction;
(b) Shearman & Sterling LLP, United States counsel for the Underwriters,
shall have furnished to you such written opinion or opinions, dated such Time of
Delivery, in form and substance satisfactory to the Underwriters;
(c) ▇▇▇ ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ & Han, Korean counsel for the Underwriters, shall
have furnished to you such written opinion or opinions, dated such Time of
Delivery, in form and substance satisfactory to the Underwriters;
(d) Debevoise & ▇▇▇▇▇▇▇▇ LLP, United States counsel for the Company, shall
have furnished to you their written opinion, dated such Time of Delivery, in
form and substance satisfactory to you, to the effect that:
(i) This Agreement has been duly executed and delivered by the
Company;
(ii) The Deposit Agreement has been duly executed and delivered by the
Company and, assuming due authorization, execution and delivery of the
Deposit Agreement by the Depositary and that each of the Depositary and the
Company has full power, authority and legal right to enter into and perform
its obligations thereunder, constitutes a valid and legally binding
agreement of the Company, enforceable in accordance with its terms, subject
to bankruptcy, insolvency, reorganization and similar laws of general
applicability relating or affecting creditors' rights generally and to
general principles of equity;
(iii) Upon due issuance by the Depositary of the ADRs evidencing ADSs
being delivered at such Time of Delivery against the deposit of Shares to
be deposited by the Company in respect thereof in accordance with the
provisions of the Deposit Agreement, such ADRs will be duly and validly
issued and will entitle the holders thereof to the rights specified therein
and in the Deposit Agreement;
(iv) Under the laws of the State of New York relating to personal
jurisdiction, the Company has, pursuant to Section 15 of this Agreement,
validly and irrevocably submitted to the personal jurisdiction of any state
or federal court located in the Borough of Manhattan, The City of New York,
New York (each a "New York Court") in any action arising out of or relating
to this Agreement or the transactions contemplated hereby, has validly and
irrevocably waived any objection to the venue of a
22
proceeding in any such court, and has validly and irrevocably appointed the
Authorized Agent (as defined herein) as its authorized agent for the
purpose described in Section 15 hereof; and service of process effected on
such agent in the manner set forth in Section 15 hereof will be effective
to confer valid personal jurisdiction over the Company;
(v) The issue and sale of the Shares being delivered at such Time of
Delivery to be sold by the Company and the deposit of the Shares being
deposited by the Company with the Depositary against issuance of the ADRs
with respect to such Shares to be delivered at such Time of Delivery and
the compliance by the Company with all of the provisions of this Agreement
and the consummation of the transactions herein and therein contemplated
will not conflict with or result in a breach or violation of any of the
terms or provisions of, or constitute a default under, any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument
known to such counsel to which the Company is a party or by which the
Company is bound or to which any of the property or assets of the Company
is subject, nor will such action result in any violation of the provisions
of the Articles of Incorporation of the Company or any statute or any
order, rule or regulation known to such counsel of any United States
Federal or New York Governmental Agency having jurisdiction over the
Company or any of its properties;
(vi) No Governmental Authorization of the United States or the State
of New York is required for the issue and sale of the Shares and the ADSs
or the consummation by the Company of the transactions contemplated by this
Agreement, except the registration under the Act of the Shares and the
ADSs, and such consents, approvals, authorizations, registrations or
qualifications as may be required under state securities or Blue Sky laws
in connection with the purchase and distribution of the Shares and the ADSs
by the Underwriters;
(vii) The statements set forth in the Prospectus under the caption
"Description of American Depositary Shares", insofar as they purport to
constitute a summary of the terms of the Deposit Agreement and the ADSs,
and under the captions "Shares Eligible for Future Sale", "Taxation" and
"Underwriting", insofar as they purport to describe the provisions of the
laws and documents referred to therein, are accurate, complete and fair;
(viii) The Company is not an "investment company", as such term is
defined in the Investment Company Act;
(ix) The Registration Statement and the ADS Registration Statement
have become effective under the Act and, to the best of such counsel's
knowledge after due inquiries, no stop order suspending the effectiveness
of the Registration Statement or the ADS Registration Statement has been
issued under the Act and no proceeding has been initiated or threatened by
the Commission; and any required filing of the Prospectus pursuant to Rule
424(a) under the Act has been made in accordance with Rule 424(b) under the
Act;
(x) The Registration Statement, the ADS Registration Statement and the
Prospectus and any further amendments and supplements thereto made by the
Company prior to such Time of Delivery (other than the financial statements
and related schedules therein, as to which such counsel need express no
opinion) comply as to form in all
23
material respects with the requirements of the Act and the rules and
regulations thereunder; and
(xi) Although they do not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the Registration
Statement, the Pricing Prospectus or the Prospectus, except for those
referred to in the opinion in subsection (viii) of this Section 8(d), they
have no reason to believe (A) that, any part of the Registration Statement
or any further amendment thereto made by the Company prior to such Time of
Delivery (other than the financial statements and related schedules
therein, as to which such counsel need express no opinion), when such part
or amendment became effective, contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; (B) that the
Pricing Disclosure Package, as of the Applicable Time, contained any untrue
statement of a material fact or omitted to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading or (C) that, as of
its date and as of such Time of Delivery, the Prospectus or any further
amendment or supplement thereto made by the Company prior to such Time of
Delivery (other than the financial statements and related schedules
therein, as to which such counsel need express no opinion) contained or
contains an untrue statement of a material fact or omitted or omits to
state a material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading; and
they do not know of any amendment to the Registration Statement required to
be filed or of any contracts or other documents of a character required to
be filed as an exhibit to the Registration Statement or required to be
described in the Registration Statement or the Prospectus which are not
filed or described as required.
In rendering such opinion, such counsel may state that they express no
opinion as to the laws other than the law of the State of New York (its internal
laws) and the federal laws of the United States and may contain such assumptions
and qualifications as are customary for transactions of this nature;
(e) ▇▇▇, ▇▇▇ & ▇▇▇, Korean counsel for the Company, shall have furnished to
you such written opinion or opinions, dated such Time of Delivery, in form and
substance satisfactory to you, to the effect that:
(i) The Company has been duly incorporated and is validly existing as
a corporation in good standing under the laws of the Korea, with power and
authority (corporate and other) to own its properties and conduct its
business as described in the Prospectus;
(ii) The Company has been duly qualified as a foreign corporation for
the transaction of business and is in good standing under the laws of each
other jurisdiction in which it owns or leases properties or conducts any
business so as to require such qualification, or is subject to no material
liability or disability by reason of failure to be so qualified in any such
jurisdiction (such counsel being entitled to rely in respect of the opinion
in this clause upon opinions of local counsel and in respect of matters of
fact upon certificates of officers of the Company, provided that such
counsel shall state that
24
they believe that both you and they are justified in relying upon such
opinions and certificates);
(iii) The Company has an authorized capitalization as set forth in the
Prospectus, and all of the issued shares of capital stock of the Company
(including the Shares being delivered at such Time of Delivery) have been
duly and validly authorized and issued and are fully paid and
non-assessable; the holders of outstanding shares of capital stock of the
Company are not entitled to preemptive or other rights to acquire the
Shares to be deposited by the Company and the Selling Shareholders or the
ADSs to be purchased from the Company under this Agreement which have not
been complied with; the Shares to be deposited by the Company and the
Selling Shareholders may be freely deposited by the Company with the
Depositary against issuance of ADRs evidencing ADSs; the ADSs and the
Shares to be deposited by the Company and the Selling Shareholders are
freely transferable by the Company to or for the account of the several
Underwriters in the manner contemplated herein and the initial purchasers
thereof; and there are no restrictions on subsequent transfers of the ADSs
or the Shares except as described in the Prospectus under "Shares Eligible
for Future Sale" and "Underwriting"; and the Shares conform to the
description of the Common Shares contained in the Prospectus;
(iv) The Shares to be issued and sold by the Company have been duly
and validly authorized and, when issued and delivered by the Company in
accordance with the terms of this Agreement and the Deposit Agreement
against payment in full of consideration, will have been validly issued as
fully paid and non-assessable (meaning that no further sums are payable to
the Company on such Shares), and such Shares will not be subject to any
pre-emptive or similar rights under Korean law or the Company's Articles of
Incorporation;
(v) All of the outstanding shares of Preferred Stock conform in all
material respects to the description thereof contained in the Registration
Statement, the Pricing Prospectus and the Prospectus; and prior to or
concurrently with the First Time of Delivery, all of the shares of
Preferred Stock will be converted into Common Shares and such Common Shares
will be duly authorized, validly issued and fully paid and non-assessable;
(vi) This Agreement has been duly authorized, executed and delivered
by the Company;
(vii) The Deposit Agreement has been duly authorized, executed and
delivered by the Company and constitutes a valid and legally binding
agreement of the Company, enforceable in accordance with its terms,
subject, as to enforcement, to bankruptcy, insolvency, reorganization and
similar laws of general applicability relating to or affecting creditors'
rights and to general equity principles;
(viii) Each of this Agreement and the Deposit Agreement is in proper
form to be enforceable against the Company in Korea in accordance with its
terms; to ensure the legality, validity, enforceability or admissibility
into evidence in Korea of this Agreement or the Deposit Agreement, it is
not necessary that this Agreement or the Deposit Agreement or any other
documents be filed or recorded with any court or other authority
25
in Korea or that any stamp or similar tax in Korea be paid on or in respect
of this Agreement, the Deposit Agreement or any other documents to be
furnished hereunder;
(ix) Insofar as matters of Korean law are concerned, the Registration
Statement and the filing of the Registration Statement with the Commission
have been duly authorized by and on behalf of the Company; and the
Registration Statement has been duly executed pursuant to such
authorization by and on behalf of the Company;
(x) The execution and delivery of this Agreement and the Deposit
Agreement by the Company, the issuance and sale of the Shares and the ADSs
being delivered at such Time of Delivery to be sold by the Company and the
deposit of the Shares being deposited by the Company with the Depositary
against issuance of the ADSs evidencing the ADRs to be delivered at such
Time of Delivery by the Company and the performance by the Company with all
of the obligations under this Agreement and the Deposit Agreement and the
consummation of the transactions herein and therein contemplated will not
conflict with or result in a breach or violation of any of the terms or
provisions of, or constitute a default under, any indenture, mortgage, deed
of trust, loan agreement or other agreement or instrument known to such
counsel to which the Company is a party or by which the Company is bound or
to which any of the property or assets of the Company is subject, nor will
such action result in any violation of the provisions of the Articles of
Incorporation of the Company or any statute or any order, rule or
regulation known to such counsel of any Governmental Agency having
jurisdiction over the Company or any of its properties;
(xi) To the best of such counsel's knowledge, the Company does not own
any real property; and any real property and buildings held under lease by
the Company are held by the Company under valid, subsisting and enforceable
leases with such exceptions as are not material and do not interfere with
the use made and proposed to be made of such property and buildings by the
Company (in giving the opinion in this clause, such counsel may state that
no examination of record titles for the purpose of such opinion has been
made, and that they are relying upon a general review of the titles of the
Company, upon opinions of local counsel and abstracts, reports and policies
of title companies rendered or issued at or subsequent to the time of
acquisition of such property by the Company, upon opinions of counsel to
the lessors of such property and, in respect of matters of fact, upon
certificates of officers of the Company, provided that such counsel shall
state that they believe that both you and they are justified in relying
upon such opinions, abstracts, reports, policies and certificates);
(xii) To the best of such counsel's knowledge and other than as set
forth in the Prospectus, there are no legal or governmental proceedings
pending to which the Company is a party or of which any property of the
Company is the subject which would individually or in the aggregate have a
Material Adverse Effect; and, to the best of such counsel's knowledge, no
such proceedings are threatened or contemplated by any Governmental Agency
or threatened by others;
(xiii) No Governmental Authorization of or with any Governmental
Agency is required in Korea for the execution and delivery of this
Agreement and the Deposit Agreement by the Company, the issuance and sale
of the Shares and the ADSs by the Company, the deposit of the Shares being
deposited by the Company with the Depositary
26
against issuance of the ADSs evidencing the ADRs to be delivered at such
Time of Delivery by the Company or the consummation by the Company of the
transactions contemplated by this Agreement;
(xiv) The statements in the Prospectus under "Enforcement of Civil
Liability Provision of the Federal Securities Laws," "Laws and
Regulations," "Korean Foreign Exchange Controls and Securities Regulations"
and "Taxation" to the extent such statements relate to matters of law or
regulation or to the provisions of documents therein described, are true
and accurate in all material respects, and nothing has been omitted from
such statements which would make the same misleading in any material
respect; the statements set forth in the Prospectus under the captions
"Description of Capital Stock", insofar as they purport to constitute a
summary of the terms of the Common Shares and ADSs, and under the captions
"Taxation" and "Underwriting", insofar as they purport to describe the
provisions of the laws and documents referred to therein, are accurate,
complete and fair;
(xv) No stamp or other issuance or transfer taxes or duties and no
capital gains, income, withholding or other taxes are payable by or on
behalf of the Underwriters to the government of Korea or to any political
subdivision or taxing authority thereof or therein in connection with (A)
the deposit with the Depositary of Shares by the Company and the Selling
Shareholders against the issuance of ADRs evidencing the ADSs (B) the sale
and delivery by the Company of the ADSs and the Shares to or for the
respective accounts of the Underwriters or (C) the sale and delivery
outside Korea by the Underwriters of the ADSs and the Shares to the initial
purchasers thereof in the manner contemplated herein;
(xvi) The Company's agreement to the choice of law provisions set
forth in Section 19 hereof will be recognized by the courts of Korea; the
Company can ▇▇▇ and be sued in its own name under the laws of Korea; the
irrevocable submission of the Company to the exclusive jurisdiction of a
New York Court, the waiver by the Company of any objection to the venue of
a proceeding of a New York Court and the agreement of the Company that this
Agreement shall be governed by and construed in accordance with the laws of
the State of New York are legal, valid and binding; service of process
effected in the manner set forth in Section 15 hereof will be effective,
insofar as the law of Korea is concerned, to confer valid personal
jurisdiction over the Company; and judgment obtained in a New York Court
arising out of or in relation to the obligations of the Company under this
Agreement would be enforceable against the Company in the courts of Korea.
(xvii) The indemnification and contribution provisions set forth in
Section 9 hereof do not contravene the public policy or laws of Korea;
(xviii) All dividends and other distributions declared and payable on
the shares of capital stock of the Company, under the current laws and
regulations of Korea to be paid in Korean Won (including any such dividends
or distributions to be paid to the Depositary), may be converted into
foreign currency that may be freely transferred out of Korea, and all such
dividends and other distributions will not be subject to withholding or
other taxes under the laws and regulations of Korea and are otherwise free
and clear of
27
any other tax, withholding or deduction in Korea and without the necessity
of obtaining any Governmental Authorization in Korea;
(xix) The Company has all licenses and concessions of and from all
Governmental Agencies that are necessary to own or lease its properties and
conduct its businesses as described in the Prospectus; and the Company has
all franchises, permits, authorizations, approvals and orders and other
licenses and concessions of and from all Governmental Agencies that are
necessary to own or lease its other properties and conduct its businesses
as described in the Prospectus except for such licenses, franchises,
permits, authorizations, approvals and orders the failure to obtain which
will not have a Material Adverse Effect;
(xx) The Company is neither in violation of its constituent documents
nor in default in the performance or observance of any material obligation,
agreement, covenant or condition contained in any indenture, mortgage, deed
of trust, loan agreement, lease or other agreement or instrument to which
it is a party or by which it or any of its properties may be bound;
(xxi) Although they do not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the Registration
Statement, the Pricing Prospectus or the Prospectus, except for those
referred to in the opinion in subsection (xvii) of this Section 8(d), they
have no reason to believe (A) that, any part of the Registration Statement
or any further amendment thereto made by the Company prior to such Time of
Delivery (other than the financial statements and related schedules
therein, as to which such counsel need express no opinion), when such part
or amendment became effective, contained an untrue statement of a material
fact or omitted to state a material fact required to be stated therein or
necessary to make the statements therein not misleading; (B) that the
Pricing Disclosure Package, as of the Applicable Time, contained any untrue
statement of a material fact or omitted to state any material fact
necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading or (C) that, as of
its date and as of such Time of Delivery, the Prospectus or any further
amendment or supplement thereto made by the Company prior to such Time of
Delivery (other than the financial statements and related schedules
therein, as to which such counsel need express no opinion) contained or
contains an untrue statement of a material fact or omitted or omits to
state a material fact necessary to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
In giving such opinion, such counsel may state that with respect to all
matters of United States federal and New York law they have relied upon the
opinions of United States counsel for the Company delivered pursuant to
paragraph (c) of this Section 8;
(f) Patterson, Belknap, ▇▇▇▇ & ▇▇▇▇▇ LLP, counsel for the Depositary shall
have furnished to you their written opinion, dated such Time of Delivery, in
form and substance satisfactory to you, to the effect that:
(i) The Deposit Agreement has been duly authorized, executed and
delivered by the Depositary and constitutes a valid and legally binding
obligation of the Depositary, enforceable in accordance with its terms,
subject as to enforcement to bankruptcy,
28
insolvency, reorganization and similar laws of general applicability
relating to or affecting creditors' rights and to general equity
principles;
(ii) Upon execution and delivery by the Depositary of ADRs evidencing
the ADSs against the deposit of Shares in accordance with the provisions of
the Deposit Agreement, the ADSs will be validly issued and will entitle the
holders of the ADSs to the rights specified in those ADRs and in the
Deposit Agreement; and
(iii) The legal entity for the issuance of ADRs filed a registration
statement for the ADSs on Form F-6 under the Act and the staff of the
Commission has informed such counsel that the Commission declared hat
registration statement effective and, to the best of such counsel's
knowledge after due inquiries, no stop order suspending the effectiveness
of the ADS Registration Statement or any part thereof has been issued and
no proceedings for that purpose have been instituted or are pending or
contemplated under the Act, and the ADS Registration Statement, and each
amendment as of their respective effective dates, complied as to form in
all material respects with the requirements of the Act and the rules and
regulations thereunder;
(g) The respective counsel for each of the Selling Shareholders, as
indicated in Schedule II hereto, each shall have furnished to you their written
opinion with respect to each of the Selling Shareholders for whom they are
acting as counsel, dated [such] [First] Time of Delivery, in form and substance
satisfactory to you, to the effect that:
(i) A Power of Attorney has been duly executed and delivered by such
Selling Shareholder and constitute valid and binding agreements of such
Selling Shareholder in accordance with their terms;
(ii) This Agreement has been duly authorized, executed and delivered
by or on behalf of such Selling Shareholder; and the sale of the Shares or
ADSs to be sold by such Selling Shareholder hereunder and thereunder and
the compliance by such Selling Shareholder with all of the provisions of
this Agreement, the Power of Attorney and the consummation of the
transactions herein and therein contemplated will not conflict with or
result in a breach or violation of any terms or provisions of, or
constitute a default under, any statute, indenture, mortgage, deed of
trust, loan agreement or other agreement or instrument known to such
counsel to which such Selling Shareholder is a party or by which such
Selling Shareholder is bound, or to which any of the property or assets of
such Selling Shareholder is subject, nor will such action result in any
violation of the provisions of the constituent documents of such Selling
Shareholder if such Selling Shareholder is a corporation[,] [the
Partnership Agreement of such Selling Shareholder if such Selling
Shareholder is a partnership] or any order, rule or regulation known to
such counsel of any court or governmental agency or body having
jurisdiction over such Selling Shareholder or the property of such Selling
Shareholder;
(iii) No Governmental Authorization of or with any Governmental Agency
in [jurisdiction of incorporation] is required for the consummation of the
transactions contemplated by this Agreement and the Deposit Agreement,
except [name any such consent, approval, authorization or order] which
[has] [have] been duly obtained and [is] [are] in full force and effect,
such as have been obtained under the Act and such as may be required under
state or foreign securities or Blue Sky laws in connection with the
purchase and distribution of such Shares or ADSs by the Underwriters;
29
(iv) Immediately prior to such [the First] Time of Delivery, such
Selling Shareholder had good and valid title to, and was the record and
beneficial owner of, the Shares or ADSs to be sold at [such] [the First]
Time of Delivery by such Selling Shareholder under this Agreement and the
Deposit Agreement, free and clear of all liens, encumbrances, equities or
claims, and had full right, power and authority to sell, assign, transfer
and deliver the Shares or ADSs to be sold by such Selling Shareholder
hereunder and thereunder;
(v) Assuming that neither the Underwriters, nor the agents acquiring
possession of such Shares or ADSs on their behalf, has notice of any
adverse claim to such Shares or ADSs (or the agent's acquiring possession
of such certificate or certificates for such Shares or ADSs on the
Underwriters' behalf) and paying the purchase price therefor pursuant to
the Underwriting Agreement, each of the several Underwriters will be a
"protected purchaser" of such Shares or ADSs to be purchased by it (within
the meaning of Section 8-303 of the New York UCC) and will acquire its
interest in such Shares or ADSs (including, without limitation, all rights
that such Selling Shareholder had or has the power to transfer in such
Shares or ADSs) with good and valid title and free and clear of any
security interest, mortgage, pledge, lien, encumbrance or any adverse or
other claims;
(vi) Such Selling Shareholder's agreement to the choice of law
provisions set forth in Section 19 hereof will be recognized by the courts
of [__________]; such Selling Shareholder can ▇▇▇ and be sued in its own
name under the laws of [__________]; the irrevocable submission of such
Selling Shareholder to the exclusive jurisdiction of a New York Court, the
waiver by such Selling Shareholder of any objection to the venue of a
proceeding of a New York court and the agreement of such Selling
Shareholder that this agreement of such Selling Shareholder shall be
governed by and construed in accordance with the laws of the State of New
York are legal, valid and binding; service of process effected in the
manner set forth in Section 15 hereof will be effective, insofar as the law
of [__________] is concerned, to confer valid personal jurisdiction over
such Selling Shareholder; and judgment obtained in a New York court arising
out of or in relation to the obligations of such Selling Shareholder under
this Agreement would be enforceable against such Selling Shareholder in the
courts of [__________].
In rendering such opinion, such counsel may state that they express no
opinion as to the laws of any jurisdiction outside [__________];
(h) On the date of the Prospectus at a time prior to the execution of this
Agreement, at 9:30 a.m., New York City time, on the effective date of any
post-effective amendment to the Registration Statement filed subsequent to the
date of this Agreement and also at each Time of Delivery, Samil
PricewaterhouseCoopers shall have furnished to you a letter or letters, dated
the respective dates of delivery thereof, in form and substance satisfactory to
you, to the effect set forth in Annex I hereto (the executed copy of the letter
delivered prior to the execution of this Agreement is attached as Annex I(a)
hereto and a draft of the form of letter to be delivered on the effective date
of any post-effective amendment to the Registration Statement and as of each
Time of Delivery is attached as Annex I(b) hereto);
(i) (i) The Company shall have not sustained since the date of the latest
audited financial statements included in the Pricing Prospectus any loss or
interference with its business
30
from fire, explosion, flood or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental action, order
or decree, otherwise than as set forth or contemplated in the Pricing
Prospectus, and (ii) since the respective dates as of which information is
given in the Pricing Prospectus there shall not have been any change in the
capital stock or long-term debt of the Company or any change, or any
development involving a prospective change, in or affecting the general
affairs, management, financial position, shareholders' equity or results of
operations or prospects of the Company, otherwise than as set forth or
contemplated in the Pricing Prospectus, the effect of which, in any such
case described in clause (i) or (ii), is in the judgment of the
Representatives so material and adverse as to make it impracticable or
inadvisable to proceed with the public offering or the delivery of the ADSs
being delivered at such Time of Delivery on the terms and in the manner
contemplated in the Prospectus;
(j) On or after the Applicable Time there shall not have occurred any of
the following: (i) a suspension or material limitation in trading in securities
generally on the Nasdaq National Market, the New York Stock Exchange or the
London Stock Exchange; (ii) a suspension or material limitation in trading in
the Company's securities on the Nasdaq National Market; (iii) a general
moratorium on commercial banking activities in New York, London or Korea
declared by the relevant authorities, or a material disruption in commercial
banking or securities settlement or clearance services in the United States, the
United Kingdom or Korea; (iv) a change or development involving a prospective
change in taxation affecting the Company, the Shares or the ADSs or the transfer
thereof; (v) the outbreak or escalation of hostilities involving the United
States, the United Kingdom or Korea or the declaration by the United States, the
United Kingdom or Korea of a national emergency or war or (vi) the occurrence of
any other calamity or crisis or any change in financial, political or economic
conditions or currency exchange rates or controls in the United States, the
United Kingdom, Korea or elsewhere, if the effect of any such event specified in
clause (v) or (vi) in the judgment of the Representatives makes it impracticable
or inadvisable to proceed with the public offering or the delivery of the ADSs
being delivered at such Time of Delivery on the terms and in the manner
contemplated in the Prospectus;
(k) The ADSs to be sold by the Company and the Selling Shareholders at such
Time of Delivery shall have been duly included, subject to notice of issuance,
for quotation on NASDAQ;
(l) The Company has obtained and delivered to the Underwriters executed
copies of an agreement from each of the Selling Shareholders and the other
persons listed in Schedule IV hereto, to the effect set forth in Exhibit A (each
a "Lock-Up Agreement") in form and substance satisfactory to you;
(m) The Depositary shall have furnished or caused to be furnished to you at
such Time of Delivery certificates satisfactory to you evidencing the deposit
with it of the Shares being so deposited against issuance of ADRs evidencing the
ADSs to be delivered by the Company and the Selling Shareholders at such Time of
Delivery, and the execution, countersignature (if applicable), issuance and
delivery of ADRs evidencing such ADSs pursuant to the Deposit Agreement;
31
(n) The Company shall have complied with the provisions of Section
5(a)(iii) hereof with respect to the furnishing of prospectuses on the New York
Business Day next succeeding the date of this Agreement;
(o) The Company and such Selling Shareholder shall have furnished or caused
to be furnished to you at such Time of Delivery certificates of officers of the
Company and of such Selling Shareholder (it being understood that in the case of
the Selling Shareholders, such certificates may be provided by Attorneys-in-Fact
on behalf of the Selling Shareholders), respectively, satisfactory to you as to
the accuracy of the representations and warranties of the Company and such
Selling Shareholder, respectively, herein at and as of such Time of Delivery, as
to the performance by the Company and such Selling Shareholder of all of their
respective obligations hereunder to be performed at or prior to such Time of
Delivery, and as to such other matters as you may reasonably request, and the
Company shall have furnished or caused to be furnished certificates as to the
matters set forth in subsections (a) and (i) of this Section, and as to such
other matters as you may reasonably request; and
(p) The Company has entered into the Depositary Letter with the Depositary
instructing the Depositary not to accept any shareholder's deposit of any Common
Shares in the Company's ADR facility or issue any new ADRs evidencing the ADSs
during the Lock-Up Period.
[(q) The Company shall have deposited with the Korean Share Depositary
certificates in negotiable form representing all of the Shares to be sold by
each of the Selling Shareholders hereunder, against issuance by the Korean Share
Depositary of a Master Share Certificate evidencing the Shares to be sold by
each of the Selling Shareholders to be delivered by book-entry to the Depositary
by such Time of Delivery.]
9. (a) The Company will indemnify and hold harmless each Underwriter
against any losses, claims, damages or liabilities, joint or several, to which
such Underwriter may become subject, under the Act or otherwise, insofar as such
losses, claims, damages or liabilities (or actions in respect thereof) arise out
of or are based upon an untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, the Registration
Statement, the ADR Registration Statement, the Pricing Prospectus or the
Prospectus, or any amendment or supplement thereto, any Issuer Free Writing
Prospectus or any "issuer information" filed or required to be filed pursuant to
Rule 433(d) under the Act, or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, and will reimburse
each Underwriter for any legal or other expenses reasonably incurred by such
Underwriter in connection with investigating or defending any such action or
claim as such expenses are incurred; provided, however, that the Company shall
not be liable in any such case to the extent that any such loss, claim, damage
or liability arises out of or is based upon an untrue statement or alleged
untrue statement or omission or alleged omission made in any Preliminary
Prospectus, the Registration Statement, the ADR Registration Statement, the
Pricing Prospectus or the Prospectus or any amendment or supplement thereto, or
any Issuer Free Writing Prospectuses, in reliance upon and in conformity with
written information furnished to the Company by any Underwriter through the
Representatives expressly for use therein.
(b) Each of the Selling Shareholders will indemnify and hold harmless each
Underwriter against any losses, claims, damages or liabilities, joint or
several, to which such Underwriter may become subject, under the Act or
otherwise, insofar as such losses, claims,
32
damages or liabilities (or actions in respect thereof) arise out of or are based
upon an untrue statement or alleged untrue statement of a material fact
contained in any Preliminary Prospectus, the Registration Statement, the ADR
Registration Statement, the Pricing Prospectus or the Prospectus, or any
amendment or supplement thereto, or arise out of or are based upon the omission
or alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, in each case
to the extent, but only to the extent, that such untrue statement or alleged
untrue statement or omission or alleged omission was made in any Preliminary
Prospectus, the Registration Statement, the ADR Registration Statement, the
Pricing Prospectus or the Prospectus or any such amendment or supplement in
reliance upon and in conformity with written information furnished to the
Company by such Selling Shareholder expressly for use therein; and will
reimburse each Underwriter for any legal or other expenses reasonably incurred
by such Underwriter in connection with investigating or defending any such
action or claim as such expenses are incurred; provided, however, that the
liability of each Selling Shareholder pursuant to this subsection 9(b) shall not
exceed the product of the number of ADSs sold by such Selling Shareholder and
the initial public offering price of the ADSs as set forth in the Prospectus.
(c) Each Underwriter will indemnify and hold harmless the Company and each
Selling Shareholder against any losses, claims, damages or liabilities to which
the Company or such Selling Shareholder may become subject, under the Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions in
respect thereof) arise out of or are based upon an untrue statement or alleged
untrue statement of a material fact contained in any Preliminary Prospectus, the
Registration Statement, the ADR Registration Statement, the Pricing Prospectus
or the Prospectus, or any amendment or supplement thereto, or arise out of or
are based upon the omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not
misleading, in each case to the extent, but only to the extent, that such untrue
statement or alleged untrue statement or omission or alleged omission was made
in any Preliminary Prospectus, the Registration Statement, the ADR Registration
Statement, the Pricing Prospectus or the Prospectus or any such amendment or
supplement in reliance upon and in conformity with written information furnished
to the Company by such Underwriter through the Representatives expressly for use
therein; and will reimburse the Company and each Selling Shareholder for any
legal or other expenses reasonably incurred by the Company or such Selling
Shareholder in connection with investigating or defending any such action or
claim as such expenses are incurred.
(d) Promptly after receipt by an indemnified party under subsection (a),
(b) or (c) above of notice of the commencement of any action, such indemnified
party shall, if a claim in respect thereof is to be made against an indemnifying
party under such subsection, notify the indemnifying party in writing of the
commencement thereof; but the omission so to notify the indemnifying party shall
not relieve it from any liability which it may have to any indemnified party
otherwise than under such subsection. In case any such action shall be brought
against any indemnified party and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
therein and, to the extent that it shall wish, jointly with any other
indemnifying party similarly notified, to assume the defense thereof, with
counsel satisfactory to such indemnified party (which shall not, except with the
consent of the indemnified party, be counsel to the indemnifying party), and,
after notice from the indemnifying party to such indemnified party of its
election so to assume the defense thereof, the indemnifying party shall not be
liable to such indemnified party under such subsection for any legal expenses
33
of other counsel or any other expenses, in each case subsequently incurred by
such indemnified party, in connection with the defense thereof other than
reasonable costs of investigation. No indemnifying party shall, without the
written consent of the indemnified party, effect the settlement or compromise
of, or consent to the entry of any judgment with respect to, any pending or
threatened action or claim in respect of which indemnification or contribution
may be sought hereunder (whether or not the indemnified party is an actual or
potential party to such action or claim) unless such settlement, compromise or
judgment (i) includes an unconditional release of the indemnified party from all
liability arising out of such action or claim and (ii) does not include a
statement as to or an admission of fault, culpability or a failure to act, by or
on behalf of any indemnified party.
(e) If the indemnification provided for in this Section 9 is unavailable to
or insufficient to hold harmless an indemnified party under subsection (a), (b)
or (c) above in respect of any losses, claims, damages or liabilities (or
actions in respect thereof) referred to therein, then each indemnifying party
shall contribute to the amount paid or payable by such indemnified party as a
result of such losses, claims, damages or liabilities (or actions in respect
thereof) in such proportion as is appropriate to reflect the relative benefits
received by the Company and the Selling Shareholders on the one hand and the
Underwriters on the other from the offering of the ADSs. If, however, the
allocation provided by the immediately preceding sentence is not permitted by
applicable law or if the indemnified party failed to give the notice required
under subsection (d) above, then each indemnifying party shall contribute to
such amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
fault of the Company and the Selling Shareholders on the one hand and the
Underwriters on the other in connection with the statements or omissions which
resulted in such losses, claims, damages or liabilities (or actions in respect
thereof), as well as any other relevant equitable considerations. The relative
benefits received by the Company and the Selling Shareholders on the one hand
and the Underwriters on the other shall be deemed to be in the same proportion
as the total net proceeds from the offering of the ADSs purchased under this
Agreement (before deducting expenses) received by the Company and the Selling
Shareholders bear to the total underwriting discounts and commissions received
by the Underwriters with respect to the ADSs purchased under this Agreement, in
each case as set forth in the table on the cover page of the Prospectus. The
relative fault shall be determined by reference to, among other things, whether
the untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by the
Company or the Selling Shareholders on the one hand or the Underwriters on the
other and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission. The Company, each
of the Selling Shareholders and the Underwriters agree that it would not be just
and equitable if contributions pursuant to this subsection (e) were determined
by pro rata allocation (even if the Underwriters were treated as one entity for
such purpose) or by any other method of allocation which does not take account
of the equitable considerations referred to above in this subsection (e). The
amount paid or payable by an indemnified party as a result of the losses,
claims, damages or liabilities (or actions in respect thereof) referred to above
in this subsection (e) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
subsection (e), no Underwriter shall be required to contribute any amount in
excess of the amount by which the total price at which the ADSs underwritten by
it and distributed to the public were offered to the
34
public exceeds the amount of any damages which such Underwriter has otherwise
been required to pay by reason of such untrue or alleged untrue statement or
omission or alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations in this subsection (e) to
contribute are several in proportion to their respective underwriting
obligations and not joint.
(f) The obligations of the Company and the Selling Shareholders under this
Section 9 shall be in addition to any liability which the Company and the
respective Selling Shareholders may otherwise have and shall extend, upon the
same terms and conditions, to each person, if any, who controls any Underwriter
within the meaning of the Act; and the obligations of the Underwriters under
this Section 9 shall be in addition to any liability which the respective
Underwriters may otherwise have and shall extend, upon the same terms and
conditions, to each officer and director of the Company and to each person, if
any, who controls the Company or any Selling Shareholder within the meaning of
the Act.
10. (a) If any Underwriter shall default in its obligation to purchase the
ADSs which it has agreed to purchase hereunder at a Time of Delivery, you may in
your discretion arrange for you or another party or other parties to purchase
such ADSs on the terms contained herein. If within thirty-six hours after such
default by any Underwriter you do not arrange for the purchase of such ADSs,
then the Company and the Selling Shareholders shall be entitled to a further
period of thirty-six hours within which to procure another party or other
parties satisfactory to you to purchase such ADSs on such terms. In the event
that, within the respective prescribed periods, you notify the Company and the
Selling Shareholders that you have so arranged for the purchase of such ADSs, or
the Company and the Selling Shareholders notify you that they have so arranged
for the purchase of such ADSs, you or the Company and the Selling Shareholders
shall have the right to postpone such Time of Delivery for a period of not more
than seven days, in order to effect whatever changes may thereby be made
necessary in the Registration Statement or the Prospectus, or in any other
documents or arrangements, and the Company agrees to file promptly any
amendments to the Registration Statement or the Prospectus which in your opinion
may thereby be made necessary. The term "Underwriter" as used in this Agreement
shall include any person substituted under this Section with like effect as if
such person had originally been a party to this Agreement with respect to such
ADSs.
(b) If, after giving effect to any arrangements for the purchase of the
ADSs of a defaulting Underwriter or Underwriters by you and the Company and the
Selling Shareholders as provided in subsection (a) above, the aggregate number
of such ADSs which remains unpurchased does not exceed one-eleventh of the
aggregate number of all of the ADSs to be purchased at such Time of Delivery,
then the Company and the Selling Shareholders shall have the right to require
each non-defaulting Underwriter to purchase the number of ADSs which such
Underwriter agreed to purchase hereunder at such Time of Delivery and, in
addition, to require each non-defaulting Underwriter to purchase its pro rata
share (based on the number of ADSs which such Underwriter agreed to purchase
hereunder) of the ADSs of such defaulting Underwriter or Underwriters for which
such arrangements have not been made; but nothing herein shall relieve a
defaulting Underwriter from liability for its default.
(c) If, after giving effect to any arrangements for the purchase of the
ADSs of a defaulting Underwriter or Underwriters by you and the Company and the
Selling Shareholders as provided in subsection (a) above, the aggregate number
of such ADSs which remains
35
unpurchased exceeds one-eleventh of the aggregate number of all of the Shares to
be purchased at such Time of Delivery, or if the Company and the Selling
Shareholders shall not exercise the right described in subsection (b) above to
require non-defaulting Underwriters to purchase ADSs of a defaulting Underwriter
or Underwriters, then this Agreement (or, with respect to the Second Time of
Delivery, the obligations of the Underwriters to purchase and of the Company and
DutchCo to sell the Optional ADSs shall thereupon terminate, without liability
on the part of any non-defaulting Underwriter or the Company or the Selling
Shareholders, except for the expenses to be borne by the Company and the Selling
Shareholders and the Underwriters as provided in Section 7 hereof and the
indemnity and contribution agreements in Section 9 hereof; but nothing herein
shall relieve a defaulting Underwriter from liability for its default.
11. The respective indemnities, agreements, representations, warranties and
other statements of the Company, the Selling Shareholders and the several
Underwriters, as set forth in this Agreement or made by or on behalf of them,
respectively, pursuant to this Agreement, shall remain in full force and effect,
regardless of any investigation (or any statement as to the results thereof)
made by or on behalf of any Underwriter or any controlling person of any
Underwriter, or the Company, or any of the Selling Shareholders, or any officer
or director or controlling person of the Company, or any controlling person of
any Selling Shareholder, and shall survive delivery of and payment for the ADSs.
12. If this Agreement shall be terminated pursuant to Section 10 hereof,
neither the Company nor the Selling Shareholders shall then be under any
liability to any Underwriter except as provided in Sections 7 and 9 hereof; but,
if for any other reason any ADSs are not delivered by or on behalf of the
Company and the Selling Shareholders as provided herein, the Company and each of
the Selling Shareholders pro rata (based on the number of ADSs to be sold by the
Company and such Selling Shareholder hereunder) will reimburse the Underwriters
through you for all out-of-pocket expenses approved in writing by you, including
fees and disbursements of counsel, reasonably incurred by the Underwriters in
making preparations for the purchase, sale and delivery of the ADSs not so
delivered, but the Company and the Selling Shareholders shall then be under no
further liability to any Underwriter in respect of the ADSs not so delivered
except as provided in Sections 7 and 9 hereof.
13. In all dealings hereunder, you shall act on behalf of each of the
Underwriters, and the parties hereto shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of any Underwriter made or
given by you jointly or by the Representatives as the representatives of the
several Underwriters; and in all dealings with any Selling Shareholder
hereunder, you and the Company shall be entitled to act and rely upon any
statement, request, notice or agreement on behalf of such Selling Shareholder
made or given by any or all of the Attorneys-in-Fact for such Selling
Shareholder.
All statements, requests, notices and agreements hereunder shall be in
writing, and if to the Underwriters shall be delivered or sent by mail, telex or
facsimile transmission to you as the Representatives in care of (A) ▇▇▇▇▇▇▇
▇▇▇▇▇ International, [Peterborough Court, ▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇]
[68th Floor, ▇▇▇▇▇▇ Kong Center, ▇ ▇▇▇▇▇'▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇ Kong], Attention:
[_____] and (B) ▇▇▇▇▇ and Company, LLC, ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇, Attention: [_____]; if to any Selling Shareholder shall be
delivered or sent by mail, telex or facsimile transmission to counsel for such
Selling Shareholder at its address set forth in Schedule II hereto; if to the
Company shall be delivered or sent by mail, telex or facsimile transmission to
the address of the Company set forth in the ▇▇▇▇▇▇▇▇▇▇▇▇
▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇: General Counsel; and if to any shareholder of the Company
that is a signatory to the Lock-Up Agreement by mail, telex or facsimile
transmission to [_____]; provided, however, that any notice to an Underwriter
pursuant to Section 9 (d) hereof shall be delivered or sent by mail, telex or
facsimile transmission to such Underwriter at its address set forth in its
Underwriters' Questionnaire or telex constituting such Questionnaire, which
address will be supplied to the Company or the Selling Shareholders by you upon
request. Any such statements, requests, notices or agreements shall take effect
upon receipt thereof.
14. This Agreement shall be binding upon, and inure solely to the benefit
of, the Underwriters, the Company and any Selling Shareholders and, to the
extent provided in Sections 9 and 11 hereof, the officers and directors of the
Company and each person who controls the Company, any Selling Shareholder or any
Underwriter, and their respective heirs, executors, administrators, successors
and assigns, and no other person shall acquire or have any right under or by
virtue of this Agreement. No purchaser of any of the ADSs from any Underwriter
shall be deemed a successor or assign by reason merely of such purchase.
15. Each of the parties hereto irrevocably (i) agrees that any legal suit,
action or proceeding against the Company or any Selling Shareholder brought by
any Underwriter or by any person who controls any Underwriter arising out of or
based upon this Agreement or the transactions contemplated hereby may be
instituted in any state or federal court located in the Borough of Manhattan,
The City of New York, New York (a "New York Court"), (ii) waives, to the fullest
extent it may effectively do so, any objection which it may now or hereafter
have to the laying of venue of any such proceeding and (iii) submits to the
exclusive jurisdiction of such courts in any such suit, action or proceeding.
Each of the Company and the Selling Shareholders has appointed CT Corporation
System, New York, New York, as its authorized agent (the "Authorized Agent")
upon whom process may be served in any such action arising out of or based on
this Agreement or the transactions contemplated hereby which may be instituted
in any New York Court by any Underwriter or by any person who controls any
Underwriter, expressly consents to the jurisdiction of any such court in respect
of any such action, and waives any other requirements of or objections to
personal jurisdiction with respect thereto. Such appointment shall be
irrevocable. Each of the Company and the Selling Shareholders represents and
warrants that the Authorized Agent has agreed to act as such agent for service
of process and agrees to take any and all action, including the filing of any
and all documents and instruments, that may be necessary to continue such
appointment in full force and effect as aforesaid; provided that if for any
reason the Authorized Agent named above ceases to act as Authorized Agent
hereunder for the Company or any Selling Shareholder, the Company or such
Selling Shareholder will appoint another person acceptable to the
Representatives in the Borough of Manhattan, The City of New York, New York, as
Authorized Agent. Service of process upon the Authorized Agent and written
notice of such service to the Company shall be deemed, in every respect,
effective service of process upon the Company and the Selling Shareholders, as
the case may be.
16. In respect of any judgment or order given or made for any amount due
hereunder that is expressed and paid in a currency (the "judgment currency")
other than United States dollars, the Company and the Selling Shareholders, as
the case may be, will severally indemnify each Underwriter against any loss
incurred by such Underwriter as a result of any variation as between (i) the
rate of exchange at which the United States dollar amount is converted into the
judgment currency for the purpose of such judgment or order and (ii) the rate of
exchange at which an Underwriter is able to purchase United States dollars with
the amount of the judgment
37
currency actually received by such Underwriter. The foregoing indemnity shall
constitute a separate and independent obligation of the Company and the Selling
Shareholders and shall continue in full force and effect notwithstanding any
such judgment or order as aforesaid. The term "rate of exchange" shall include
any premiums and costs of exchange payable in connection with the purchase of or
conversion into United States dollars.
17. Time shall be of the essence of this Agreement. As used herein, the
term "business day" shall mean any day when the Commission's office in
Washington, D.C. is open for business.
18. Each of the Company and the Selling Shareholders acknowledges and
agrees that (i) the purchase and sale of the Shares pursuant to this Agreement
is an arm's-length commercial transaction between the Company and the Selling
Shareholders, on the one hand, and the several Underwriters, on the other, (ii)
in connection therewith and with the process leading to such transaction each
Underwriter is acting solely as a principal and not the agent or fiduciary of
the Company or any Selling Shareholder, (iii) no Underwriter has assumed an
advisory or fiduciary responsibility in favor of the Company or any Selling
Shareholder with respect to the offering contemplated hereby or the process
leading thereto (irrespective of whether such Underwriter has advised or is
currently advising the Company or any Selling Shareholder on other matters) or
any other obligation to the Company or any Selling Shareholder except the
obligations expressly set forth in this Agreement and (iv) each of the Company
and the Selling Shareholders has consulted its own legal and financial advisors
to the extent it deemed appropriate. Each of the Company and the Selling
Shareholders agrees that it will not claim that the Underwriters, or any of
them, has rendered advisory services of any nature or respect, or owes a
fiduciary or similar duty to the Company or such Selling Shareholder, in
connection with such transaction or the process leading thereto.
19. This Agreement shall be governed by and construed in accordance with
the laws of the State of New York.
20. This Agreement supersedes all prior agreements and understandings
(whether written or oral) between the Company and the Underwriters, or any of
them, with respect to the subject matter hereof.
21. The Company and each of the Underwriters hereby irrevocably waives, to
the fullest extent permitted by applicable law, any and all right to trial by
jury in any legal proceeding arising out of or relating to this Agreement or the
transactions contemplated hereby.
22. This Agreement may be executed by any one or more of the parties hereto
in any number of counterparts, each of which shall be deemed to be an original,
but all such counterparts shall together constitute one and the same instrument.
23. The Company and the Selling Shareholders are authorized, subject to
applicable law, to disclose any and all aspects of this potential transaction
that are necessary to support any U.S. federal income tax benefits expected to
be claimed with respect to such transaction, and all materials of any kind
(including tax opinions and other tax analyses) related to those benefits,
without the Underwriters imposing any limitation of any kind.
If the foregoing is in accordance with your understanding, please sign and
return to us (one for the Company and for each of the Representatives plus one
for each counsel and the Custodian) counterparts hereof, and upon the acceptance
hereof by you, on behalf of each of the
38
Underwriters, this letter and such acceptance hereof shall constitute a binding
agreement among each of the Underwriters, the Company and each of the Selling
Shareholders. It is understood that your acceptance of this letter on behalf of
each of the Underwriters is pursuant to the authority set forth in a form of
Agreement among Underwriters, the form of which shall be submitted to the
Company and the Selling Shareholders for examination upon request, but without
warranty on your part as to the authority of the signers thereof.
39
Any person executing and delivering this Agreement as Attorney-in-Fact for
each Selling Shareholder represents by so doing that he has been duly appointed
as Attorney-in-Fact by such Selling Shareholder pursuant to a validly existing
and binding Power of Attorney which authorizes such Attorney-in-Fact to take
such action.
Very truly yours,
GMARKET INC.
By: .........................................
Name:
Title:
THE SELLING SHAREHOLDERS
NAMED IN SCHEDULE II HERETO, ACTING SEVERALLY
By: .........................................
Name:
Title:
As Attorney-in-Fact acting on behalf of
each of the Selling Shareholders named in
Schedule II to this Agreement.
Accepted as of the date hereof:
▇▇▇▇▇▇▇ SACHS INTERNATIONAL
▇▇▇▇▇ AND COMPANY, LLC
By:....................................................................
(▇▇▇▇▇▇▇ Sachs International)
By:....................................................................
(▇▇▇▇▇ and Company, LLC)
On behalf of each of the Underwriters
40
SCHEDULE I
NUMBER OF
OPTIONAL
ADSS
TOTAL NUMBER OF TO BE
FIRM PURCHASED IF
ADSS MAXIMUM
OPTION
UNDERWRITER TO BE PURCHASED EXERCISED
----------- --------------- ------------------
▇▇▇▇▇▇▇ Sachs International.....................................
▇▇▇▇▇ and Company, LLC..........................................
▇▇▇▇▇▇ ▇▇▇▇▇▇ Partners LLC......................................
[NAMES OF OTHER UNDERWRITERS]...................................
--------------- ------------------
Total............................................. =============== ==================
41
SCHEDULE II
NUMBER OF
OPTIONAL
TOTAL NUMBER OF ADSS
FIRM TO BE
ADSS SOLD IF
MAXIMUM
TO BE SOLD OPTION EXERCISED
--------------- ------------------
The Company........................................................ 6,079,710
The Principal Selling Shareholders (a):
Ki ▇▇▇▇▇ ▇▇▇.............................................. 1,180,000
▇▇▇▇▇ Sun Jo.............................................. 200,000
Dae ▇▇▇ ▇▇▇▇.............................................. 265,000
Sang ▇▇▇ ▇▇▇.............................................. 275,400
▇▇▇▇▇ ▇▇▇ Ryu............................................. 47,735
Young Duck ▇▇▇............................................ 150,000
▇▇▇▇▇ ▇▇ ▇▇▇▇▇............................................ 150,000
Dae ▇▇▇▇ ▇▇▇▇............................................. 100,000
Bok Soon ▇▇▇.............................................. 73,000
▇▇▇ ▇▇ ▇▇▇................................................ 100,000
▇▇▇▇▇ Soon Chun........................................... 100,000
Sun Min Hong.............................................. 45,000
Techno Pacific Assets Limited............................. [ ]
▇▇▇▇▇ ▇▇▇ ▇▇▇............................................. 50,000
▇▇▇▇ ▇▇▇ ▇▇▇.............................................. 15,000
Jae ▇▇▇ ▇▇▇............................................... 30,000
Young Sun ▇▇▇............................................. 50,000
Chung Hoon Han............................................ 30,000
Song Uk ▇▇▇............................................... 20,000
Ki ▇▇▇▇ ▇▇▇............................................... 50,000
Young Soo Seo............................................. 50,000
Young Il ▇▇▇▇............................................. 11,250
Sang Man ▇▇▇.............................................. 20,000
Si ▇▇▇▇▇ ▇▇▇.............................................. 50,000
Yoon ▇▇▇▇▇ ▇▇▇............................................ 50,000
Doo ▇▇▇▇▇ ▇▇▇............................................. 50,000
Sook ▇▇▇▇ ▇▇▇............................................. 50,000
▇▇▇▇▇ ▇▇ ▇▇▇.............................................. 50,000
Hyun ▇▇▇▇ ▇▇▇............................................. 50,000
Moon ▇▇▇ ▇▇▇.............................................. 50,000
Il ▇▇▇▇ ▇▇▇▇▇............................................. 14,900
Doo ▇▇▇▇▇ ▇▇▇............................................. 14,900
Sae ▇▇▇▇ ▇▇▇▇▇............................................ 2,600
Yoo Ri ▇▇▇................................................ 6,300
42
NUMBER OF
OPTIONAL ADSS
TOTAL NUMBER OF TO BE SOLD
FIRM ADSS IF MAXIMUM
TO BE SOLD OPTION EXERCISED
--------------- ------------------
▇▇▇▇▇ ▇▇▇ ▇▇▇............................................. 2,520
▇▇▇▇▇ ▇▇▇▇ ▇▇▇............................................ 6,300
Dae ▇▇▇▇ ▇▇▇▇............................................. 5,000
Jae ▇▇▇▇ ▇▇▇.............................................. 2,400
▇▇▇▇▇ ▇▇▇ Park............................................ 1,300
Won Bum ▇▇▇............................................... 1,250
DutchCo (b):
▇. ▇▇▇▇ Praktijk B.V. .................................... -
--------------- ------------------
Total..................................................... 3,039,855
=============== ==================
(a) The Principal Selling Shareholders are represented by Debevoise &
▇▇▇▇▇▇▇▇ LLP of 13/F, Entertainment Building, 30 Queen's Road Central, Hong
Kong, as the United States counsel and ▇▇▇, ▇▇▇ & ▇▇▇ of Hankook Tire ▇▇▇▇,
▇▇▇-▇▇ ▇▇▇▇▇▇-▇▇▇▇, ▇▇▇▇▇▇▇-▇▇, ▇▇▇▇▇ ▇▇▇-▇▇▇, Korea, as the Korean counsel] and
has appointed [▇▇. ▇▇▇▇▇ Bae Ku] as the Attorneys-in-Fact for each such
Principal Selling Shareholder. Techno Pacific Assets Limited is also represented
by [ ] of ______________________ as the BVI counsel.
(b) DutchCo is represented by [▇▇▇▇ ▇▇▇▇▇ & ▇▇▇▇▇▇▇ LLP OF ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇ AS THE UNITED STATES COUNSEL, ▇▇▇▇▇▇
P.C., AS THE DUTCH COUNSEL AND ▇▇▇, ▇▇▇ & ▇▇▇ AS THE KOREAN counsel] and has
appointed [NAMES OF ATTORNEYS-IN-FACT], and each of them, as the
Attorneys-in-Fact for DutchCo.
43
SCHEDULE III
Materials other than the Pricing Prospectus that comprise the Pricing Disclosure
Package:
[To come]
44
SCHEDULE IV
List of Persons subject to the Lock-Up Agreement
[To come]
45