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Entered 2024.05.02 15:25 Modified 2024.05.02 15:31
While the battle between Hive and Adore CEO Min Hee-jin continues, it has been revealed that CEO Min has requested ‘authority to terminate the artist’s exclusive contract’ on his own without going through a board of directors Adore early this year.
According to the music industry on the 2nd, CEO Min’s law firm sent an amendment to the shareholder agreement that includes this content to Hive in February. Afterwards, Hive reportedly decided CEO Min’s offer was unreasonable and sent a reply rejecting it. An exclusive contract for a singer is a common type of contract for entertainment companies. Entertainment companies need board approval when terminating an exclusive contract. It is said that according to the shareholders’ contract concluded between Hive and CEO Min, the board of directors, like other general entertainment companies, must approve the termination of an artist’s exclusive contract.
Currently, Adore’s board of directors consists of three people, including CEO Min himself and his close associates, Deputy CEO Shin and Director Kim, who all have voting rights, so CEO Min is in charge. Under the current structure, Hive, which owns 80% of Adore’s shares, can call an extraordinary general meeting of shareholders to replace Adore’s board of directors and prevent the departure of its singers.
However, if CEO Min’s request is accepted, New Genes will be able to terminate the exclusive contract in accordance with CEO Min’s wishes without the involvement of Adore or Hive’s board of directors. Hive will have no way to stop its singer (New Genes) from leaving. Hive has claimed that CEO Min prepared a three-step scenario: ‘Secure cash by exercising put options → Trigger a decline in Adore’s corporate value by terminating the exclusive contract with New Genes → CEO Min acquires control rights to Adore.’ It is Hive’s view that the request for the CEO’s sole authority to terminate the exclusive contract was made with this situation in mind. Regarding this, CEO Min said, “It was only a request to resolve the unreasonable interference that occurred during the first process of New Genes and to operate an independent label,” and added, “It is not related to the ‘suspicion of steal management rights’ that’s debatable at the moment.” I removed it. An Adore official explained, “It was not a request to change the form of the New Genes contract, but the intention was to apply it to the renewal of the New Genes Newydd contract in the future and to the next rookie group (Adore).”
Representative Min’s side said, “Recently, Hive released a KakaoTalk message from the vice president claiming to occupy management rights.” He added, “The KakaoTalk message in question is from April 4th, and even according to Hive’s claims, it is untimely and unrelated. “It’s a matter,” he observed.
Correspondent Choi Da-eun max@hankyung.com
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