Internal management provisions
- Internal management provisions
Internal Rules Management
Chapter I. General Provisions
Article 1. Purpose
These Rules set forth the requirements for the overall management and appropriate disclosures of the Company’s internal information to ensure prompt and accurate disclosures and the prevention of inside trading by executive officers and employees in accordance with applicable laws including the Capital Market and Financial Investment Business Act.
Article 2. Definitions
- ① “Internal Information” as referred to in these Rules mean the disclosure obligations set forth in Part 1 of the KOSDAQ Market Disclosure Rules (hereafter the “Disclosure Rules”) and all other matters that may affect the Company’s operations and financial position and investors’ investment decisions.
- ② “Disclosure Officer” as referred to herein means a person appointed to reporting duties on behalf of the Company in accordance with paragraph 4 of Article 2 of the Disclosure Rules.
- ③ “Executive officers” as referred to herein mean directors (including any person who meets any of the requirements set forth in subparagraph 1 of paragraph 2 of Article 401 of the Commercial Code and auditors.
- ④ Terms other than those defined in paragraphs ① to ③ shall have the meanings used in applicable laws and regulations.
Article 3. Scope
These Rules apply to all cases concerning disclosures, insider trading, and internal information management except otherwise specified in applicable laws or the Company’s charter (articles of incorporation).
Chapter II. Management of Internal Information
Article 4. Management of Internal Information
- ① Executive officers and employees must keep strictly confidential the Company’s internal information disclosed or made available to them in the course of their employment and must not share such internal information in or outside the company unless it is absolutely necessary.
- ② The Chief Executive Officer (hereafter the “CEO”) shall take the necessary steps to manage the aforementioned internal information, such as developing specific criteria for the retention, delivery, and destruction of internal information and all related documents.
Article 5. Chief Disclosure Officer
- ① The CEO shall appoint a Chief Disclosing Officer and report it to the KRX. Replacement of the Disclosure Officer shall be also reported.
- ② The Chief Disclosure Officer oversees the establishment and operation of the internal information management system and performs the following duties:
- 1. Implementation of disclosures;
- 2. Monitoring and evaluation of the operation of the internal information management system;
- 3. Reviewing internal information and determining whether or not to disclose;
- 4. Measures necessary to operate the internal information management system such as training of executive officers and employees;
- 5. Supervision and oversight of the department, executive officer or employee responsible for the management or disclosure of internal information; and
- 6. Other activities deemed necessary by the CEO to operate the internal information management system.
- ③ The Chief Disclosure Officer has the following rights in performing the above-described duties:
- 1. Right to demand the submission of and access to all sorts of documents and records related to internal information;
- 2. Right to receive feedback or input from an executive officer or employee in the department responsible for accounting or auditing, or other departments responsible for generating internal information.
- ④ The Chief Disclosure Officer may consult an executive officer responsible for related duties if such consultation is necessary to perform the CDO’s duties and may at the Company’s expense seek expert assistance.
- ⑤ The Chief Disclosure Officer must report to the CEO or the board of directors the operating status of the internal information management on a regular basis.
Article 6. Disclosure Officer
- ① The CEO shall appoint a Disclosure Officer and report it to the KRX. Replacement of the Disclosure Officer shall be also reported.
- ② The Disclosure Officer shall perform the following duties under the direction of the Chief Disclosure Officer in connection with internal information management:
- 1. Collecting, reviewing, and reporting internal information to the Chief Disclosure Officer
- 2. Activities necessary to implement disclosures
- 3. Confirming the details necessary to manage internal information such as changes in applicable laws and reporting the details to the Chief Disclosure Officer
- 4. Other duties deemed necessary by the CEO or the Chief Disclosure Officer.
Article 7. Concentration of Internal Information
An executive officer and the head of each team/department must provide the Chief Disclosure Officer with relevant information in a timely manner when:
- 1. Internal information is generated;
- 2. the need arises to cancel or change the internal information already made publicly available; or
- 3. other request made by the Chief Disclosure Officer.
Article 8. Making Available Internal Information outside Organization
An executive officer and the head of each team/department must provide the Chief Disclosure Officer with relevant information in a timely manner in the following cases:
- ① An executive officer or employee who is required to provide internal information to a business partner, external auditor or agent of the Company, or any person or entity that entered into a consultation agreement with the Company for legal or management advice must report it to the Chief Disclosure Officer.
- ② In the case described above, the Chief Disclosure Officer must take such steps as may be necessary such as entering into a confidentiality agreement for relevant internal information.
Chapter III. Disclosure of Internal Information
Article 9. Types of Disclosure
Disclosures made by the Company are classified as follows:
- 1. Reports on and disclosures of key business information pursuant to section 1 of chapter 2 of part 1 of the Disclosure Rules;
- 2. Inquired disclosure pursuant to section 2 of chapter 2 of part 1 of the Disclosure Rules;
- 3. Fair disclosure pursuant to section 3 of chapter 2 of part 1 of the Disclosure Rules;
- 4. Voluntary disclosure pursuant to chapter 3 of part 1 of the Disclosure Rules;
- 5. Submission of a securities registration statement, etc. pursuant to chapter 1 of part 3 of the Act;
- 6. Submission of a business report, etc. pursuant to Articles 159, 160, and 165 of the Act and to section 4 of chapter 2 of part 1 of the Disclosure Rules;
- 7. Submission of key reports pursuant to Article 161 of the Act; and
- 8. Other disclosure as required by law
Article 10. Implementation of Disclosure
- ① The Disclosure Officer must prepare a report on any disclosure that needs to be made as described in Article 9 and submit it to the Chief Disclosure Officer along with the necessary documents.
- ② The Chief Disclosure Officer must make the disclosure with the CEO’s approval after determining whether or not any of the details or documents referred to above violates applicable law.
Article 11. Follow-up after Disclosure
The Chief Disclosure Officer and the Disclosure Officer must take the steps necessary to correct any error or omission in the disclosed information immediately upon discovery.
Article 12. Media Relations
- ① In case of any media request to report on the Company, the Chief Disclosure Officer is responsible for responding to such a request. If necessary, an executive officer or an employee in the relevant team or department may be allowed to speak with the media.
- ② If the Company wishes to distribute its press releases to the media such as newspapers, the Company should discuss with the Chief Disclosure Officer.
- ③ Any executive officer or employee who becomes aware of any false or misleading information published by the media must report it to the Chief Disclosure Officer and the Chief Disclosure Officer must take necessary steps.
Article 13. Business Presentations
Business presentations shall be held to discuss the business performance, plans, and prospects of the Company following discussion with the Chief Disclosure Officer.
Chapter IV. Regulations on Insider Trading, etc.
Article 14. Return of Short-term Gains
- ① Executive officers and those employees who are subject to paragraph 1 of Article 172 of the Act and Article 194 of the Enforcement Decree of the same act must return to the Company any capital gains on the sale of such securities as specified in paragraph 1 of Article 172 of the same act (hereafter “Securities”) within six (6) months of purchasing them, or any capital gains on the purchase of Securities within six (6) months of selling them (such gains are collectively referred to as “Short-term Gains”).
- ② If any one of the shareholders of the Company, including those who hold equity securities or depository securities other than stock certificates, requests that the Company demand a person who has earned Short-term Gains as is described in ① to return such gains, the Company shall take all necessary steps within two (2) months of the request.
- ③ Upon receipt by the Company of notice of the realization of Short-Term Gains as described in ① from the Securities and Futures Commission, the Chief Disclosure Officer shall immediately make available the following on the website of the Company:
- 1. The status (position) of the person who is required to return Short-term Gains;
- 2. The amount of such Short-term Gains;
- 3. The date the notice of the occurrence of Short-term Gains is received from the Securities and Futures Commission;
- 4. A plan to demand the return of Short-term Gain
- 5. Shareholders of the Company may cause the Company to demand those who have earned Short-term Gains to return such gain and in case of failure by the Company to make such a demand within two (2) months of the shareholder request, shareholders may make the demand on behalf of the Company.
- ④ The disclosure due date referred to in ③ shall be the earlier of i) two (2) years from the date of notice of Short-term Gains from the Securities and Futures Commission, and ii) the date such Short-term Gains are returned.
Article 15. Notification of the Sale or Purchase of Securities
Executive officers and those employees who are subject to paragraph 1 of Article 172 of the Act and Article 194 of the Enforcement Decree of the same act must notify the Chief Disclosure Officer when conducting the sale or purchase of securities or other transactions.
Article 16. Prohibition on the Use of Undisclosed Important Information
Executive officers and employees shall not use, or allow a third party to use, the undisclosed important information specified in paragraph 1 of Article 174 of the Act, including the undisclosed important information of affiliates, for the sale or purchase of securities or other transactions.
Chapter V. By-laws
Article 17. Training
The Chief Disclosure Officer and the Disclosure Officer shall complete the training requirements for the disclosure obligations set forth in Article 36 and paragraph 5 of Article 44 of the Disclosure Rules and the Chief Disclosure Officer shall make training materials and details available to relevant executive officers and employees.
Article 18. Amendment and Abolition
Decisions to amend or abolish any of these Rules will be made by the CEO.
Article 19. Announcement of Rules
These Rules and amendments thereto shall be publicly available on the Company’s website.
