Former ADOR CEO Min Hee-jin won the first trial in litigation over termination of the shareholders' agreement and the put option with HYBE.
At 10 a.m. on the 12th, the Seoul Central District Court Civil Division 31 (Nam In-su, Director General) opened the sentencing hearing for HYBE's lawsuit seeking confirmation of termination of the shareholders' agreement against former CEO Min and Min's lawsuit seeking payment for the share purchase price against HYBE.
The court ruled against the plaintiff in the shareholders' agreement termination confirmation lawsuit, and ruled for the plaintiff in the claim for the share purchase price, saying, "HYBE shall pay former CEO Min an amount equivalent to 25.5 billion won, former Deputy CEO Shin an amount equivalent to 1.7 billion won, and former director Kim an amount equivalent to 1.4 billion won."
The court said, "It is acknowledged that former CEO Min sought ways for ADOR to be independent," but added, "those appear to have been plans that assumed HYBE's consent," and judged that it is difficult to view them as a material breach of the shareholders' agreement.
Earlier, former CEO Min resigned from ADOR's inside director position in November 2024 and then notified HYBE of her exercise of the put option under the shareholders' agreement. According to the contract, ADOR's put option amount is calculated by applying a 13 multiple to the average operating profit of the previous two years and then applying 75% of the equity percentage held by the transacting party.
According to ADOR's audit report, Min Hee-jin could receive about 26 billion won from HYBE by exercising the put option to buy 18% of ADOR's shares (573,160 shares) based on the calculation period. However, HYBE had disclosed in July 2024 that the shareholders' agreement with Min had been terminated, and the legal battle between the two sides escalated.
HYBE argued that it had already notified termination of the contract in July 2024 because former CEO Min attempted to "take NewJeans away," causing damage to the company, and that the put option rights had therefore expired. HYBE said that because Min substantially breached the shareholders' agreement and HYBE notified termination for that reason, the contract was not valid even if the put option was exercised afterward.
However, former CEO Min's side argues that the shareholders' agreement was valid at the time of the put option exercise and that HYBE had no right to terminate the shareholders' agreement. They also said that NewJeans members' notices of termination of exclusive contracts to ADOR came at the end of November 2024, so the put option exercise that took place before that was lawful.
[Photo] OSEN DB
[OSEN]