CREDIT TRANSACTION AGREEMENT

To : Youngnam Merchant Banking Corp.

In connection with discount of notes and other credit  transactions with you, we
agree to comply with the following provisions :

Article 1 (Applicability)
-------------------------

(1) We agree to  comply  with  this  Agreement  in  performing  our  obligations
incurred or to be incurred by us in  connection  with  discount of our notes and
other credit transactions.

(2) We agree to perform our  obligations  in  compliance  with the terms of this
agreement  in the event you obtain from third  parties  notes or checks  issued,
endorsed, accepted or guaranteed by us.

Article 2 (Limit of Credit)
---------------------------

(1) The total  amount of credit to be provided by you in the form of discount of
notes and other credit facility shall not exceed Won. We understand that you may
reduce this amount when your circumstances require you to do so.

(2) You may cancel  this  Agreement  without  any notice  when we fall under the
provisions of Article 7(1) or (2) of the standard Credit transaction Rules.

Article 3 (Cumulative Obligations)
----------------------------------

           In the event we provide  you with notes or checks  issued,  endorsed,
accepted  or  guaranteed  by us in  order  to  secure  our  performance  of  our
obligations  under this Agreement,  you may exercise your rights based on either
the notes or checks or the underlying obligations.

Article 4 (Interest : Discount Fee : Penalty)
---------------------------------------------

(1) We agree to pay interest,  discount  fees and penalties at the rate,  period
and calculation method as established by you.

(2) In the event of our default, we agree to pay penalties at the rate of 19.0 %
per year. (3) In the event collection of interest is needed at a different place
than your office,  we agree to pay in advance  interest  for the period  between
maturity date and the actual payment. We also agree to pay penalties at the rate
of  19.0 % per  year  for  late  payments  due to  mail  accident  or  delay  or
intentional or negligent delays caused by the payer or payer's bank.

Article 5 (Ancillary Obligations)
---------------------------------

(1) We agree to make advance  payments for fees  necessary  for note discount or
other credit transactions upon your demand.

(2) If you pay the  fees on our  behalf,  we agree  to pay you  interest  on the
amount of money paid by you.

Article 6 (Collateral)
----------------------

(1) To secure our payment hereunder, we agree to deliver to you promissory notes
or checks  with blank  amount,  issue  date and due date with power of  attorney
granting you the authority to fill out the blanks.

(2) In the event of our  default,  you may fill out the blanks not to exceed Won
and enforce your rights therein.

(3) If it is necessary to preserve your security  interest,  we agree to provide
or replace guarantor(s) or provide other collateral approved by you.

Article 7 (Acceleration)
------------------------

(1) The maturity of my debt will be accelerated without any notice in the event:

1.       We fail to pay you the whole or part of our debt on time, or

2.       The clearing house suspends this transaction, or

3.       We make a stop payment, or

4.       An  application  for  writ  of  execution,  preliminary  injunction  or
         sheriff's sale is made against us, or

5.       Bankruptcy  or  reorganization  if filed or  dissolution  proceeding is
         instituted, or

6.       We receive  notice of failure to pay taxes or other  assessments or tax
         warrant is issued against us.

(2) Further,  the following  will also  accelerate  the maturity of our debt, in
which event we agree to repay the entire debt immediately :

1.       Failure to perform all or any part of other obligations.

2.       Guarantor's default as provided in Article 7 (1) above.

Article 8 (Repurchase of discounted Notes)
------------------------------------------

(1) In the  event of  default  by us or by the payor of the  discounted  note as
provided in article 7 (1) above,  we shall be obligated to  repurchase  the mote
for its face amount and we agree to immediately pay the said amount.

(2) Until our  payment as set forth in  Article 8 (1) above,  you shall have the
right exercise all rights as the holder of the note.

Article 9 (Setoff)
------------------

(1) In the  event  we are  obligated  to  perform  our  obligations  or  reasons
enumerated  in articles 8 and 9 above,  you have the right to offset any of your
credits with our debts regardless of the maturity thereof.

(2) In the  event of  setoff,  we agree to pay you  interest,  discount  fee and
penalty until the day of setoff at the rate established by you.

Article 10 (presentment : Delivery)
-----------------------------------

(1) In the event of setoff, you are not obligated to return the note or check to
us. Rather, we agree to pick up the note or check at you office.

(2) In the event of setoff,  you do not need to  present or deliver  the note or
check if ;

1.       you cannot locate us, or

2.       the place of payment if your office, or

3.       it is difficult to deliver the note or check, or

4.       it is not  practical  to present  the note or check for the  purpose of
         collection of otherwise.

(3) In the event of setoff,  we agree to immediately  return to you notes issued
by you or other instruments evidencing you debt.

(4) If there is a co-debtor  on the note,  you may continue to hold the note and
collect the balance of the debt remaining after the setoff.

Article 11 (Order of Satisfaction)
----------------------------------

           In the event our payment or the setoff as provided in Article 9 above
is not  sufficient to satisfy our debt,  you have the right to apply our payment
in any order or method convenient for you.

Article 12 (Risk of Loss; Indemnity)
-------------------------------------

(1) In the event the note or check issued,  endorsed,  accepted or guaranteed by
us or other  instrument  delivered  to you is lost,  destroyed or damaged due to
unavoidable reasons like calamity,  disaster or accident during  transportation,
we nevertheless  agree to make the necessary  payments in reliance on your books
or other records and to deliver to your replacement note or instrument. We waive
claims against you for any damages that we may incur as a result thereof..

(2) Even if your rights on the note or check  should  lapse  because the note or
check issued,  endorsed,  accepted or guaranteed by us is determined void due to
lack of  necessary  requisites  or  invalidating  entries  or due to  procedural
defects in preserving your rights, we agree that we are still indebted to you in
the face amount of the note or check as our loan from you.

(3) To the extent that you have exercised reasonable care in comparing the seals
on the note,  check or other  instrument  with the seal registered with you, you
will not be liable for any loss  caused by forgery,  alteration  or theft and we
agree to take full  responsibility  as is  written  on the note,  check or other
instrument.

(4) Any and all fees and  expenses  expended to enforce or preserve  your rights
against us or to collect form or otherwise  dispose of the  collateral  shall be
borne by us.

Article 13 (Notice of Changes)
------------------------------

(1) We agree to  immediately  notify  you in  writing of any change of our seal,
name, trade name, representative, address,

(2) We will be  solely  responsible  for any  losses  or  damages  caused by our
neglect of notice and we agree to  indemnify  you from and against any claims in
this regard.

Article 14 (Report and Inspection)
----------------------------------

(1) We agree to file a report on our assets,  management  and status of business
upon  your  demand  and to  provide  you with  access to our  records,  factory,
business premises, etc. for your inspection.

(2) We agree to immediately notify you of any important changes,  whether actual
or possible changes, in our assets,  management or status of business regardless
of your demand.

Article 15 (Jurisdiction)
-------------------------

           Any legal proceedings  arising out of this transaction shall be filed
to the court having jurisdiction over your place of business.

Article 18 (Rights Cumulative)
------------------------------

           Your failure to exercise your rights under this  Agreement  shall not
be construed as waiver of other rights you may have under this Agreement.

Article 19 (Liabilities of Guarantor)
-------------------------------------

(1)  Guarantor  agrees to  comply  with all the  terms  and  conditions  of this
Agreement and agrees to be liable,  jointly and severally with us, for principal
debt in the  amount  of Won  together  with  interest,  penalty  and  all  other
ancillary fees.

(2) Guarantor  agrees to provide or replace  collateral  or other  security upon
your demand.

(3)  Guarantor  agrees  not to  exercise  his  right of  subrogation  while  the
transaction between you and the borrower is in effect.  Guarantor further agrees
to  subordinate  his  rights to your  rights  and to  transfer  his right to you
without compensation when requested by you.

(4) Guarantor's  obligations  herein shall not be affected even if the guarantor
has  previously  provided you or will provide you with  another  guarantee  with
respect to the same borrower

Article 18 (Term)
-----------------

(1) This  Agreement  shall  remain in effect  until the day of January 18, 2001.
This Agreement shall be automatically extended for an additional year unless you
notify us otherwise one(1) month prior to its expiration.

(2)  Notwithstanding  the  provision  of Article 18 (1) above.  Any  outstanding
obligations of us shall survive the termination of this Agreement.

Dated : January 18, 2000

Borrower : NewState Capital Co., Ltd.
           826-24 Yoksam-Dong
           Kangnam-Gu, Seoul
      By : Byung Ki Kim, President
           (Corporate sea; affixed)

Guarantor : Byung Ki Kim
            Kangnam-Gu, Seoul
       By : Byung Ki Kim, President
            (Signed)

(1) This  Agreement  shall remain in effect until the day of July 12,  2000.This
Agreement  shall be  automatically  extended for an  additional  year unless you
notify us otherwise one(1) month prior to its expiration.