Min Hee-jin notifies Hive of a 26 billion put option exercise… ‘Contract battle between shareholders’

Notification of put option exercise pursuant to shareholder agreement early this month
New Jeans sends proof of contents for ‘Min Hee-jin’s return request’

It has been reported that Min Hee-jin, former CEO of Adore, exercised a put option (stock purchase right) on the shares held by Adore with parent company Hive earlier this month.

According to the music industry on the 14th, former CEO Min notified Hive of his intention to exercise a put option on the Adore stocks he owned early this month. According to the court’s decision to limit former CEO Min’s voting rights on the dismissal proposal in May, if former CEO Min exercises the put option, the exercise price is ‘the average of Adore’s operating profit for the past two years multiplied by 13 times and the total issued amount. With the ‘amount divided by the number of shares’, you can receive 75% of former CEO Min’s 18% stake.

Since former CEO Min exercised the put option earlier this month, the calculation year is 2022-2023. In 2022, when New Jeans debuted, Adore’s operating profit was a loss of 4 billion won. The following year, 2023, operating profit increased significantly to 33.5 billion won, but since the base year is 2022-2023, the amount that former CEO Min could receive is estimated at around 26 billion won.

Industry officials predicted that if CEO Min had exercised the put option in 2025, two months later, he would receive at least twice the amount he can currently receive because this year’s operating profit is reflected. Therefore, attention is focused on the background to former CEO Min’s loss of tens of billions of won in two months.

However, just because former CEO Min claimed the put option does not mean he can receive the entire amount right away. Former CEO Min was previously notified of his dismissal from the Adore board of directors. Hive said about former CEO Min, who is currently an executive director. It is claimed that the contract between shareholders has been terminated. Hive has filed a lawsuit to confirm the validity of the contract between former CEO Min and shareholders, and the outcome of former CEO Min’s put option exercise is expected to depend on the outcome of this lawsuit.

In addition, it is known that former Vice President Adore, a close associate of former Representative Min, also exercised the put option.

On the 13th, New Jeans members sent a proof of contents to their agency Adore regarding a ‘request for correction of violations of the exclusive contract’, and various speculations are being raised about former CEO Min’s exercise of the put option. In the proof of contents, the New Genes members added, “If the matters we requested are not corrected within 14 days, we will terminate the exclusive contract.” The 14 days presented here is the grace period for contract termination under the standard exclusive contract for pop culture artists.

Requests for corrective action include civil and criminal action against those who ordered the misconduct and breach of trust mentioned in Hive’s internal report revealed through recent government inspections and media reports, as well as an official apology for the ‘ignoring’ comment to New Genes member Hani. included in It also included a demand for former Representative Min to return as representative.

Regarding the content certification, Adore responded, “We will do our best to resolve it wisely so that we can continue to work with the artist.”

Regarding the claims raised by some regarding the listed company, former CEO Min dismissed the claim as “unfounded (some claims that he was related to a certain listed company).” Adore asked several questions, including ‘(about the content) whether relatives of New Genes members were involved and whether director Min Hee-jin met with the company,’ to which former CEO Min responded that it was “unfounded.”

Previously, former CEO Min, who appeared on popular music critic Kim Young-dae’s YouTube channel last month, said, “I never tried to leave (the company) as Hive claimed,” and “I keep being harassed by strange frames and being falsely accused,” and expressed his opposition to independence. He explained that the rumor was not true.

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