REG - Lotte Shopping CoLtd - 1st Quarter Results <Origin Href="QuoteRef">023530.KS</Origin> - Part 4
01/07/2016 07:45
- Part 4: For the preceding part double click ID:nRSA9296Cc
period At the end of the period
Number of Shares Shareholding Ratio Number of Shares Shareholding Ratio
Dongbin Shin Himself Common shares 4,237,627 13.46 4,237,627 13.46 -
Dongju Shin Relative Common shares 4,235,883 13.45 4,235,883 13.45 -
Kyukho Shin Relative Common shares 293,877 0.93 293,877 0.93 -
Youngja Shin Relative Common shares 232,818 0.74 232,818 0.74 -
Wonjun lee Director Common shares 300 0.00 300 0.00 -
Hotel Lotte Co., Ltd. Related company Common shares 2,781,947 8.83 2,781,947 8.83 -
Korea Fuji Film Co., Ltd. Related company Common shares 2,474,543 7.86 2,474,543 7.86 -
Lotte Confectionary Co., Ltd. Related company Common shares 2,474,543 7.86 2,474,543 7.86 -
Lotte Data Communication Company Related company Common shares 1,515,653 4.81 1,515,653 4.81 -
Lotte Chilsung Co., Ltd. Related company Common shares 1,237,272 3.93 1,237,272 3.93 -
Lotte Construction Co., Ltd. Related company Common shares 300,019 0.95 300,019 0.95 -
Busan Lotte Hotel, Co., Ltd. Related company Common shares 246,720 0.78 246,720 0.78 -
Seonyun Jang Relative Common shares 700 0.00 700 0.00 -
Yumi Shin Relative Common shares 28,903 0.09 28,903 0.09 -
Lotte Samdong Welfare Foundation Foundation Common shares 47,888 0.15 47,888 0.15 -
Yuwon Industry Co., Ltd. Other Common shares 3,000 0.01 3,000 0.01 -
Mikyeong Seo Other Common shares 30,531 0.10 30,531 0.10 -
Jaeyoung Jang Other Common shares 950 0.00 950 0.00 -
Juyoung Yu Other Common shares 499 0.00 499 0.00 -
Treasury stock Other Common shares 1,938,688 6.16 1,938,688 6.16 -
Total Common shares 22,082,361 70.12 22,082,361 70.12 -
Preferred shares 0 0 0 0
※ The number of specially related parties: 18
※ The largest shareholder: Dongbin Shin
B. Change in the largest shareholder
There has not been any change in the largest shareholder during the reporting period (for the recent three business
years).
C. Distribution of Shares
Shareholders owning more than 5% of the Company's shares
(As of 31 March 2016) (Unit: shares, %)
Name Number of shares Equity interest
Dongbin Shin 4,237,627 13.46%
Dongju Shin 4,235,883 13.45%
Hotel Lotte Co., Ltd. 2,781,947 8.83%
Korea Fuji Film Co., Ltd. 2,474,543 7.86%
Lotte Confectionary Co., Ltd. 2,474,543 7.86%
※ The employee stock ownership association has 39,759 shares, which is equal to a 0.13% interest in the Company.
1. Stock Price and Transaction Record
a. Domestic Stock Market
(Unit: Won, shares)
Category October2015 November2015 December2015 January2016 February2016 March2016
Common stock price Maximum 274,000 238,500 244,000 237,500 250,000 277,500
Minimum 232,000 217,000 224,000 217,500 226,000 249,500
Average 255,571 228,119 232,619 229,625 235,139 264,659
Transaction volume Daily maximum 116,540 241,609 79,076 60,782 111,774 147,033
Daily minimum 38,773 38,008 23,880 22,169 13,941 15,234
Monthly total 1,521,432 1,966,708 934,536 764,456 731,928 1,281,259
b. Overseas Stock Market
Exchange: London Stock Exchange (Unit: USD)
Category October2015 November2015 December2015 January2016 February2016 March2016
Common stock price(US $) Maximum 12.05 10.35 10.35 9.50 9.71 11.45
Minimum 10.05 9.15 9.33 9.25 9.18 9.78
Average 11.15 9.73 9.72 9.36 9.43 10.87
Common stock price(won) Maximum 13,900 11,939 11,939 10,958 11,200 13,208
Minimum 11,593 10,555 10,762 10,670 10,589 11,281
Average 12,862 11,224 11,212 10,797 10,879 12,534
Transaction volume Daily maximum 28,025 4,000 22,805 5,860 1,600 1,400
Daily minimum 200 200 350 200 100 100
Monthly total 52,199 26,049 99,978 6,760 7,800 3,000
※ As of 31 March 2016 (exchange rate of USD 1.00 = KRW 1,153.50)
※ GDS (global depositary share) per share 20 issued with a ratio per 1GDS was issued to the 20.67
(exchange rate of USD 1.00 = KRW 967.8)
VII. Executives and Employees
A. Status of Executives and Employees
1. Executives
Registered Executives
(As of 31 March 2016 )
(Unit: shares)
Kyukho Shin 1922.10 Executive Chairman Representative Director 293,877 - 2015.3.20 2017.03.19
~2017.3.19
Dongbin Shin 1955.02 Chairman Inside Director 4,237,627 - 2016.3.22~2018.3.21 2018.03.21
Inwon Lee 1947.08 Vice-Chairman Representative Director - - 2016.3.22~2018.3.21 2018.03.21
Wonjoon Lee 1956.11 President Representative Director 300 - 2016.3.22~2018.3.21 2018.03.21
Youngja Shin 1942.10 Inside Director Inside Director 232,818 - 2016.3.22~2018.3.21 2018.03.21
Soogeun Kwak 1953.08 Outside Director Outside Director - - 2016.3.22~2018.3.21 2018.03.21
Jeongsuk Moon 1955.03 Outside Director Outside Director - - 2015.3.20~2017.3.19 2017.03.19
Hyeryeon Kang 1957.07 Outside Director Outside Director - - 2015.3.20~2017.3.19 2017.03.19
JaeWon Lee 1958.02 Outside Director Outside Director - - 2016.3.22~2018.3.21 2018.03.21
JaeWan Bahk 1955.01 Outside Director Outside Director - - 2016.3.22~2018.3.21 2018.03.21
SeokYoung Choi 1955.10 Executive Chairman Representative Director - - 2016.3.22~2018.3.21 2018.03.21
2016.3.22~2018.3.21
2018.03.21
SeokYoung Choi
1955.10
Executive Chairman
Representative Director
-
-
2016.3.22~2018.3.21
2018.03.21
※ Outside directors Taehyeon Kim and Byungkee Ko resigned on 18 March 2016.
※ Dongbin Shin, Youngja Shin, Inwon Lee, Wonjoon Lee were reappointed as representative and inside director on 18 March
2016, and Soogeun Kwak was reappointed as outside director, JaeWon Lee, JaeWan Bahk, SeokYoung Choi were appointed as
outside directors on the same date.
2.03 Director Future Strategy Center
Myeongseob Shim 1970.01 Director Future Strategy Center
Sangseon Yoon 1969.11 Director China
Hyungsik Jeon 1963.08 Director Department Store Product 2 164
Younsung Jung 1965.03 Director Department Store Jamsil branch 119
Gyuwan Hwang 1965.02 Director Department Store main branch 121
Choulwon Jang 1963.08 Director Department Store GF business 41
Hoseol Lee 1970.07 Director Department Store Youngdeungpo branch 94
Taeheung Nam 1964.12 Director Department Store Cheongnyangni 90
Daesu Kim 1967.09 Director Department Store Nowon branch 50
Jungho Song 1966.03 Director Department Store Busan main branch 752
Wansu Park 1968.11 Director Department Store Management support 123
Jaeok Lee 1970.01 Director Department Store women's fashion 35
Seondae Lee 1970.01 Director Department Store Public relations
Gidae Nam 1967.02 Director Department Store Food products 132
Yeongsu Ha 1970.06 Director Department Store Home appliances 53
Yeongtaek Yu 1969.06 Director Department Store Gwangbok 40
Hyungkyu Lee 1967.01 Director Department Store Pyeongchon branch 50
Younghwan Lee 1967.1 Director Department Store Suwon branch 112
Jonghyeok Hyeon 1969.10 Director Department Store Ulsan branch 40
Jieun Kim 1969.08 Director Department StoreOverseas fashion 50
Joohyuk Park 1968.01 Director Department Store gangnam branch 60
Younghwan Park 1968.11 Director Department Store Marketing 55
Jaiwook Kang 1968.01 Director Department Store Daejeon branch 40
Jinyup Kim 1970.04 Director Department Store merchandise 65
Junseok Cho 1970.03 Director Department Store Premium Outlets Paju branch 174
Deoghyung E 1970.06 Director Department Store Premium Outlets Gimhae branch 100
Kyoung Choi 1970.04 Director Department Store Centum City branch 10
Sangsoo Kim 1971.08 Director Department Store Planning 80
Hyun Park 1971.09 Director Department Store overseas business 77
Chimin Shin 1967.11 Director Department Store Ethical management 40
Sangyoung Park 1968.02 Director Department Store Men's sports
Junghyun Kim 1966.03 Director Department Store Gwangju branch 100
Dongho Jang 1967.06 Director Department Store Chengdu World Center branch 85
Yeon Na 1967.05 Director Department Store Shopping mall East Busan branch
Eulgyoung Son 1970.02 Director Department Store MD strategy
Woojin Bae 1971.04 Director Department Store independence MD 50
Younghee Kim 1970.1 Director Department Store Bundang branch 41
Gwani Lee 1969.01 Director Mar Mobile business
Pyungkyu Hong 1962.11 Director Mart Seoul customer 80
Wonsik Hong 1966.06 Director Mart Vietnam 32
Seungsun Song 1971.06 Director Mart Babies&Kids
Minho Kang 1968.11 Director Mart business strategy 10
Changyong Kim 1967.03 Director Mart management support
Jihyun Han 1967.11 Director Mart home furnishing
Joohee Woo 1967.03 Director Mart fresh foods 32
Hakjae Lee 1966.04 Director Mart overseas cooperation 32
Kyeongwoo Ryu 1966.10 Director Mart Cooperation
Jaewoo Jeong 1971.08 Director Mart processed foods
Heekyung Kim 1962.05 Director Mart gyeonggi Southern customer 166
Eunmo Yang 1967.06 Director Mart Incheon customer 31
Seungmu Heo 1965.02 Director Mart china Finance 32
Yeongbae Ham 1962.02 Director Mart Indonesia/Vietnam Finance
Yeongjun Cho 1971.01 Director Mart China Hwa-dong
Gwonhee Cho 1965.01 Director Mart yeongnam easten part customer 20
Sungmin Im 1968.03 Director Mart Gwangju Honam Customer
Jaechul Lim 1972.11 Director Mart Finance 10
Sanghae Kim 1968.10 Director Mart yeongnam westen part customer
Seonmee Jeong 1966.02 Director Mart global education 50
Hyunsun Suh 1971.09 Director Mar MD innovation
Yoonkyung Kim 1970.03 Director Mart marketing
Byeongjoon Choi 1971.03 Director Mart SCM
Jeonghan Kim 1968.02 Director Mart gyeonggi northern customer
Wonheon Jeong 1972.06 Director Mart MobileMD
Heonseo Kang 1972.01 Director Mart Daejeon Chungcheong customer
Kuneung Kim 1972.04 Director Mart Product
Jaehyung Seo 1964.10 Director Supermarket marketing
Eunggeol Kim 1967.03 Director Supermarket Planning
Youseok Jeon 1964.09 Director Supermarket honam
Yoojin Kim 1965.06 Director Supermarket development
Jongyoon An 1967.07 Director Supermarket management support
Jong Un Kim 1970.09 Director Supermarket development 1 15
Dong Ha Kim 1970.07 Director Supermarket fresh foods 8
Jae Guk Lee 1971.12 Director Supermarket development 2 15
Sangmoo Lee 1968.09 Director Cinema movie 50
Hyeongsu Ji 1965.10 Director Cinema management support
Eungyo Lee 1967.08 Director Cinema management strategy 20
Heeseong Oh 1970.12 Director Cinema new business
Kiwook Lee 1969.10 Director Lohb's management support
Kiwook Lee
1969.10
Director
Lohb's management support
2. Employees
(As of 31 March 2016) (Unit: persons, year, thousand Won)
Department Store Male 2,065 - 2 - 2,067 12.5 37,430,547 18,109
Female 3,091 - 316 - 3,407 10.0 29,662,462 8,852
Discount Store Male 3,912 421 - - 3,912 8.4 47,266,197 12,107
Female 9,735 8,630 - - 9,735 5.0 53,370,818 6,444
Others Male 2,102 1 222 - 2,324 5.4 20,410,243 8,814
Female 3,370 - 1,288 - 4,659 4.0 32,751,485 7,016
Total 24,275 9,052 1,828 - 26,104 6.6 220,891,752 8,984
-
4,659
4.0
32,751,485
7,016
Total
24,275
9,052
1,828
-
26,104
6.6
220,891,752
8,984
Notes:
(1) Based on eight hour work days and an average total of 24,588 employees.
※ The above table excludes temporary workers.
※ Up until the third quarter of 2014 with respect to the Company's discount mart business, employees who had worked less
than two years were classified as contract employees according to the Company's internal standards. Since the third quarter
of 2014, those workers are now classified as employees without fixed terms as they are essentially under an indefinite term
contract.
※ Other businesses include the supermarket business, cinema business and H&B business.
※ Payment amounts in this report were prepared in accordance with accounting standards.
B. Compensation
Compensation of Directors
(Unit: million Won)
Category Number of directors Amount paid Average per person
Registered Director 5 1,218 244
Outside Director 3 50 17
Audit Committee Member 3 30 10
Total 11 1,298 118
Compensation of Individual Directors
(Unit: million Won)
Name Position Amount paid Note
- - - -
VIII. Transactions with Interested Parties
A. Transactions with the Largest Shareholder and its Affiliates
Not applicable.
B. Collateral
(Unit : 1 million Won)
IGIS Ⅰ CORPORATION Affiliates Stock Mizuho Bank Ltd. 5,477 - - - 5,477
Evaluation
End of term
IGIS Ⅰ CORPORATION
Affiliates
Stock
Mizuho Bank Ltd.
5,477
-
-
-
5,477
※ The entire cost of stocks of IGIS I CORPORATION that Lotte Shopping Co., Ltd. retains (book value: 5,476,603,000 KRW) is
provided as security to Mizuho Bank Ltd. regarding the loan of IGIS I CORPORATION.
C. Guarantee of Obligations
(Unit : local currency)
Lotte Shopping RUS Ltd. KEB USD 5,000,000 2014.05.02. ~ 2017.05.02.
Shandong Longzhile Shinhan Bank CNY 24,000,000 2014.06.23. ~ 2017.06.23.
Cinema Co., Ltd.
International BusinessCenter Company limited KEXIM USD 18,500,000 2015. 4.06. ~ 2016. 04.06.
KEXIM (Vietnam) USD 1,500,000
Lotte Properties(Shenyang) KEXIM USD 30,500,000 2016. 03.30. ~ 2019. 03.30.
Limited
LOTTE PROPERTIES KEB USD 140,000,000 2014. 03. 20. ~
(CHENGDU)HK LIMITED 2017. 03. 20.
Shinhan Bank USD 50,000,000
Lotte Shopping Holdings Standard Chartered Bank Korea USD 38,135,750 2014. 06. 03. ~
(Hong Kong) Co., Limited 2017. 06. 02.
BNP Paribas USD 38,135,000
Citibank, N.A. , USD 38,135,000
Hong Kong Branch
SMBC USD 38,135,000
ING USD 120,213,804 2015. 01. 20. ~
2018. 01. 19.
Shinhan Bank HKD 8,000,000 2015. 11. 10. ~
2017. 11. 10.
HSBC USD 95,297,610 2015. 11. 30. ~
2018. 11. 30.
PT. LOTTE Shopping Avenue DBS USD 20,000,000 2014. 09. 23. ~
Indonesia 2017. 09. 23.
JP Morgan IDR 200,000,000,000 2015. 12. 21. ~
2018. 12. 21.
Lotte Business Management (Tianjin) Co., Ltd. DBS CNY 200,000,000 2015. 06. 15. ~
2016. 06. 15.
LOTTE DEPARTMENT STORE (TIANJIN) CO., LTD. DBS CNY 110,000,000 2015. 07. 10. ~
2016. 07. 10.
Lucky Pai (Shanghai) Trading Co., Ltd. KEB Hana Bank CNY 58,000,000 2015. 11. 26. ~
2017. 11. 26.
KEB Hana Bank CNY 39,900,000
CNY 58,000,000
2015. 11. 26. ~
2017. 11. 26.
KEB Hana Bank
CNY 39,900,000
※ Besides the above guarantee of payment, the Company has guaranteed on the execution of contract of THE CINEMA OF KOREA
with CJ CGV by 50% each during the VPF contract signing with THE CINEMA OF KOREA and the Twentieth Century Fox Film
Corporation in October 2008.
※ The Company has guaranteed the execution of the contract of Burger King Japan Co., Ltd. regarding the loyalty contract
(3.0% of the net sales, 25,000 USD per an opening of a new store) between Burger King Japan Co., Ltd. and BK ASIAPAC, PTE.
Ltd.
※ As of the end of the current quarter, the Company has a contract of supplementing capital in case of difficulty of
returning the original principal and interest by the issuing companies of H&D Able 2nd Corporation, Suwon Landmark 2nd
Corporation, and Invest Farmland Corporation, regarding the asset-backed corporate paper of Lotte Incheon Development Co.,
Ltd (face value of 700 billion KRW, due to expire on 23 February 2018), corporate bill securities of Lotte Suwon Stn.
Shopping Town (face value of 250 billion KRW, due to expire on 28 May 2018), and electronic short-term private loan of
Lotte Incheon Town (face value of 34 billion KRW, due to expire on 29 Dec 2016).
※ The Company has collected the performance bond of 30.6 billion KRW, which the Company has previously paid the city of
Incheon from Lotte Incheon Town in accordance with the sales contract between the city of Incheon and Lotte Incheon Town
in 2015.
※ The Company has been providing a payment guarantee from 2014 on the rent that the Lotte Suwon Stn. Shopping Town has to
pay to the landlord during the lending peiord (20 years).
※ The Company has issued new capital stock in 2013, 20 billion of which has been purchased and retained by Lotte
Insurance.
d. Transaction of tangible assets
(Unit : 1 million Won)
Name (Corporation Name) Relationship Purpose of trade Trade period Object of trade Trade amount
Lotte Engineering & Construction Co., Ltd. Affiliate Capital purchase 2016.01.01~2016.03.31 Tangible assets 45,915
Lotte Logistics Corporation Affiliate Capital purchase 2016.01.01~2016.03.31 Tangible assets 518
Lotte Aluminium Co., Ltd. Affiliate Capital purchase 2016.01.01~2016.03.31 Tangible assets 2,978
Lotte Data Communications Company Affiliate Capital purchase 2016.01.01~2016.03.31 Tangible assets 12,128
※ Transactions under 100 million Won have been omitted. (Writing guide VII 10-1-2)
e. Sales of stocks and bonds
(Unit : 1 million Won)
Name (Corporation Name) Relationship Type of trade Trade date Object of trade No. of stocks (*1) Trade amount
Lotte Shopping Holdings Consolidated subsidiary Recapitalization 29 Jan 2016 Lotte Shopping Holdings - 41,025
(Hong Kong) Co., Limited (Hong Kong) Co., Limited common stock
Lotte Accelerator Equity method applicable company Recapitalization 31 Jan 2016 Lotte Accelerator common stock 500,000 2,500
Lotte Ulsan Development Consolidated subsidiary Recapitalization 25 Feb 2016 Lotte Ulsan Development common stock 2,000,000 10,000
Coralis S.A. Equity method applicable company Recapitalization 29 Feb 2016 Coralis S.A. common stock - 4,474
Lotte Giants Equity method applicable company Recapitalization 7 Mar 2016 Lotte Giants common stock 1,800,000 9,000
LOTTE CINEMA VIETNAM Consolidated subsidiary Recapitalization 2016.03.31 LOTTE CINEMA VIETNAM - 10,299
CO., LTD. CO., LTD. common stock
※Transactions under 100 million Won have been omitted. (Writing guide VII 10-1-2)
※ (*1) Foreign corporations do not issue stocks due to the local regulations.
※ There is no exchange, donation, and reception of the above trades.
f. Operational trades with the major stockholder
- N/A.
g. Trades with concerned parties besides the major stockholder
- N/A.
IX. Other Relevant Matters
A. Summary of the Minutes from the General Meeting of Shareholders
Date Matters Decision
46hGeneral Meeting of Shareholders(18March 2016) Agenda No. 1: Approval of the Company's 46hfiscal year financial statementsAgenda No. 2 Appointment of directors -No. 2-1: Appointment of standing directors Approved
-No. 2-2: Appointment of outside directors-No. 2-3: Appointment of audit committee members
Agenda No. 3: Approval of compensation limit for directors
B. Contingent Liabilities
1. Major legal proceedings
The Company's management does not believe that the final outcome of the lawsuits that it is currently involved in would
significantly affect the Company's financial condition.
a. Major lawsuits where the Company is the plaintiff
(1) Lotte Shopping Co., Ltd.
1) Cancellation of denial of rectification of VAT (Supreme Court 2015Du58959)
Classification Content
Litigation date - 09 Dec 2015
Litigants - Plaintiff : Lotte Shopping Co., Ltd. and 1 other, Defendants : Head of Namdaemun Tax Office and 91 others.
Content of litigation - Claim of rectification of VAT regarding transactions made with mileage and presented gift certificates, as they are considered as discounted transactions
Amount of litigation - 10.7 billion won
Proceedings - 1st trial on 24 Oct 2014 (2013GuHap57389): Lost
- 2nd trial on 29 Oct 2015 (2014Nu71704): Lost - 3rd trial on 09 Dec 2015 (2015Du58959): in progress
Further schedule and plan of litigation - The case has been proposed to the full member at the Supreme Court, 3rd trial in progress.
Impact of outcome on the Company - As it is a litigation regarding a claim of rectification after the relevant VAT had already been paid, no additional loss is expected in case of a defeat.
2) Cancellation of denial of rectification of VAT (Seoul Administrative Court, 2015GuHap74999)
Classification Content
Litigation date - 24 Sep 2015
Litigants - Plaintiff : Lotte Shopping Co., Ltd. and 1 other, Defendants : Head of Gangnam Tax Office and 107 others.
Content of litigation - Claim of rectification of VAT regarding transactions made with mileage and presented gift certificates, as they are considered as discounted transactions
Amount of litigation - 20.7 billion won
Proceedings - 1st trial (Seoul Administrative Court 2015GuHap74999): In progress
Further schedule and plan of litigation - A similar case of our Company is in progress (Supreme Court, 2015Du58959). We will respond based on the outcome.
Impact of outcome on the Company - As it is a litigation regarding a claim of rectification after the relevant VAT had already been paid, no additional loss is expected in case of a defeat.
3) Claim for damages (Seoul Central District Court, 2014GaHap532526)
Classification Content
Litigation date - 14 May 2014
Litigants - Plaintiff: Choongang Industrial Development Co., Ltd. Defendants: Rits Industrial Co., Ltd., Kyungdong Civil Engineering and Construction Co., Ltd., Lotte Shopping Co., Ltd., City of Cheongju
Content of litigation - Claim for damage from violation of contract during exchange of implementation rights among implementing companies and implementation of project
Amount of litigation - 24.1 billion won
Proceedings - 1st trial (Seoul Central District Court, 2014GaHap532526) In progress
Further schedule and plan of litigation - 31 May 2016 was the date of pleading (judgment pronouncement date not decided). Planning to lodge an appeal in case of defeat.
Impact of outcome on the Company - Due to the low probability of defeat, a loss is not expected; will reasonably gauge the possibility of defeat and appropriate provisions.
(2) Lotte Card Co., Ltd.
1) Claim for damages (Seoul Central District Court, 2014GaHap11067 and 82 other cases)
Classification Content
Litigation date - 28 Feb 2014 and other dates
Litigants - Eunyoung Kim and 40,928 others
Content of litigation - Claim for psychological damage due to personal information leakage
Amount of litigation - 26.7 billion won
Proceedings - Seoul Central District Court, 2014GaHap11067 and 82 other cases in progress
Further schedule and plan of litigation - 01 Jul 2016 was the date of pleading. Planning to respond based on the final outcome.
Impact of outcome on the Company - The Company cannot reasonably predict the outcome of the 83 cases regarding personal information leakage, and 4.1 billion won has been appropriated for provision.
※ Standard for important litigations of the Company: Litigations that significantly affect the finance of the Company, or
litigations with a litigation amount over 10 billion won.
※ Further information can be found in note 36 (on contingent liabilities and contract details) of 3. Group Accounts and
note 35 (on contingent liabilities and contract details) of 5. Financial Statements of III. Finance-related contents.
2. Bills or checks provided as collateral
(1) Lotte Card, which is a subordinate company, bears the warranty responsibility in the event of failure of
asset backed card debenture to equip itself with appropriate requisites or in the event of occurrence of causes such as
overdue. In the case of trust format of liquidation, the trust company can request Lotte Card to put assets in excess of a
prescribed amount into trust additionally if the assets being assigned fail to be maintained at or above a prescribed
level. In addition, in the event of asset liquidation, if prescribed causes such as when the average portfolio profit rate
over the 3 continuous settlement terms falls below the average basic cost rate over the same period or when the revised
balance of the principal of liquefied assets as of the date of the termination date of each of the settlement terms falls
below the minimum balance of the principal of liquefied assets, etc. agreed upon under the relevant contract materialize,
then, the limited company specializing in asset liquidation shall bear the responsibility for early redemption of the asset
backed securities.
(2) Lotte Shopping has the right to purchase 5.1% of the entire stocks of Hyundai Logistics Co., Ltd. that Aegis First
owns. Aegis First, unless the Lotte Shopping does not exercise call option for the said equity, has the right to sell it to
Lotte Shopping. On the other hand, the entire amount of the stocks of Aegis First (with book value of 5,476,603,000 Won)
that Lotte Shopping owns has been offered as collateral to the Mizuho Bank in relations to the loan by Aegis First
3. Use of proceeds from private placements
- N/A
4. Other Contingent Liabilities
a. Detail of paymentguarantees on behalf of specially related parties
Details of guarantee or payment guarantees provided by the Company in favour of its specially related parties are as
follows. There are no guarantee or payment guarantees provided by such specially related parties in favour of the
Company.
(Unit : local currency)
Lotte Shopping RUS Ltd. KEB USD 5,000,000 02 May 2014 - 02 May 2017 Guarantee of payment for financing
Shandong Longzhile Shinhan Bank CNY 24,000,000 23 Jun 2014 - 23 Jun 2017
Cinema Co., Ltd.
International BusinessCenter Company limited KEXIM USD 18,500,000 06 Apr 2015 - 06 Apr 2016
KEXIM (Vietnam) USD 1,500,000
Lotte Properties(Shenyang) KEXIM USD 30,500,000 30 Mar 2016 - 30 Mar 2019
Limited
LOTTE PROPERTIES KEB USD 140,000,000 20 Mar 2014 - 20 Mar 2017
(CHENGDU)HK LIMITED
Shinhan Bank USD 50,000,000
Lotte Shopping Holdings Standard Chartered Bank Korea USD 38,135,750 03 Jun 2014 - 02 Jun 2017
(Hong Kong) Co., Limited
BNP Paribas USD 38,135,000
Citibank, N.A. , USD 38,135,000
Hong Kong Branch
SMBC USD 38,135,000
ING USD 120,213,804 20 Jan 2015 - 19 Jan 2018
Shinhan Bank HKD 8,000,000 10 Nov 2015 - 10 Nov 2017
HSBC USD 95,297,610 30 Nov 2015 - 30 Nov 2018
PT. LOTTE Shopping Avenue DBS USD 20,000,000 23 Sep 2014 - 23 Sep 2017
Indonesia
JP Morgan IDR 200,000,000,000 21 Dec 2015 - 21 Dec 2018
Lotte Business Management (Tianjin) Co., Ltd. DBS CNY 200,000,000 15 Jun 2015 - 15 Jun 2016
LOTTE DEPARTMENT STORE (TIANJIN) CO., LTD. DBS CNY 110,000,000 10 Jul 2015 - 10 Jul 2016
Lucky Pai (Shanghai) Trading Co., Ltd. KEB Hana Bank CNY 58,000,000 26 Nov 2015 - 26 Nov 2017
KEB Hana Bank CNY 39,900,000
KEB Hana Bank
CNY 58,000,000
26 Nov 2015 - 26 Nov 2017
KEB Hana Bank
CNY 39,900,000
※ Besides the above guarantee of payment, the Company has guaranteed the execution of contract of THE CINEMA OF KOREA with
CJ CGV by 50% each during the VPF contract signing with THE CINEMA OF KOREA and the Twentieth Century Fox Film Corporation
in October 2008.
※ The Company has guaranteed the execution of the contract of Burger King Japan Co., Ltd. regarding the loyalty contract
(3.0% of the net sales, 25,000 USD per an opening of a new store) between Burger King Japan Co., Ltd. and BK ASIAPAC, PTE.
Ltd.
※ As of the end of the current quarter, the Company has a contract of supplementing capital in case of difficulty of
returning the original principal and interest by the issuing companies of H&D Able 2nd Corporation, Suwon Landmark 2nd
Corporation, and Invest Farmland Corporation, regarding the asset-backed corporate paper of Lotte Incheon Development Co.,
Ltd (face value of 700 billion KRW, due to expire on 23 February 2018), corporate bill securities of Lotte Suwon Stn.
Shopping Town (face value of 250 billion KRW, due to expire on 28 May 2018), and electronic short-term private loan of
Lotte Incheon Town (face value of 34 billion KRW, due to expire on 29 Dec 2016).
※ The Company has collected the performance bond of 30.6 billion KRW, which the Company has previously paid the city of
Incheon from Lotte Incheon Town in accordance with the sales contract between the city of Incheon and Lotte Incheon Town
in 2015.
※ The Company has been providing a payment guarantee from 2014 on the rent that the Lotte Suwon Stn. Shopping Town has to
pay to the landlord during the lending peiord (20 years).
※ The Company has issued new capital stock in 2013, 20 billion of which has been purchased and retained by Lotte
Insurance.
Issuance of hybrid securities recognized as equity
(As of 31 March 2016) (Unit: million Won)
Issuance number Issue No. 1-1, 2 of Lotte Shopping subordinated hybrid securities
Issuance date 15 November 2013
Issued amount Won 270 billion (No. 1-1: Won 240 billion, No. 1-2: Won 30 billion)
Purpose of issuance Repayment of borrowings and general corporate purposes
Type of offering Private placement
Listed/Unlisted Unlisted
Outstanding balance Won 270 billion (No. 1-1: Won 240 billion, No. 1-2: Won 30 billion)
Equity recognition Recognition for accounting purposes Issued securities were recognized as equity shares as they are not considered as part of assets that may be collected for money owed to creditors. However, no dividend may be paid until all interest has been paid.
Credit rating agencies' equity recognition ratios Moody's: 50%, Fitch: 50%
Unpaid accumulated interest None
Maturity and early redemption Maturity: 30 years (but may be extended)
Call options are exercisable five years after issuance date.
Interest rate (with conditions for rate adjustment) 4.723% (the rate will be recalculated every five years after issuance date as 5-year government bond yield＋1.5%, with an additional 1% at 10 years after issuance)
Seniority Issued securities will be considered pari passu with the lowest ranked preferred stock of the Company and are senior to common stock of the Company. Subordinated to all
other obligations of the Company other than existing preferred shares and other obligations specified to be pari passu with the securities.
Impact on financial structure after debt classification Debt ratio increase (An increase to 68.8% from 65.9% as of 31 March 2016)
Impact on financial structure after debt classification
Debt ratio increase (An increase to 68.8% from 65.9% as of 31 March 2016)
5. Sanctions and Fines
a. Lotte Shopping
In July 2013, the Seoul Regional Tax Office commenced a regular tax investigation into the Company and assessed additional
taxes, which were paid in full by the Company in February 2014.
Business segment Company Date Sanction / fine Reason Measures taken to prevent reoccurrence
Retail Lotte Shopping 2015.03.05 Imposition of fine (3.2 million Won) and warning Omission in entering of some of the details for the public announcement (annual public announcement) of the collective status of the company in 2013 (Article 11-4 of the Law on Monopoly Regulation and Fair Trading (Public announcement on the collective current status of company)) Reinforcement of review on public announcement works
b. Lotte Card
Business segment Company Date Sanction / fine Reason Measures taken to prevent reoccurrence
- More to follow, for following part double click ID:nRSA9296CeRecent news on Lotte Shopping Co
See all newsREG - Lotte Shopping CoLtd - Annual Financial Report <Origin Href="QuoteRef">023530.KS</Origin>
AnnouncementREG - Lotte Shopping CoLtd - Official List Notice (UKLA) <Origin Href="QuoteRef">023530.KS</Origin>
AnnouncementREG - Lotte Shopping CoLtd - 3rd Quarter Results <Origin Href="QuoteRef">023530.KS</Origin> - Part 6
AnnouncementREG - Lotte Shopping CoLtd - 3rd Quarter Results <Origin Href="QuoteRef">023530.KS</Origin> - Part 5
AnnouncementREG - Lotte Shopping CoLtd - 3rd Quarter Results <Origin Href="QuoteRef">023530.KS</Origin> - Part 4
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